Another Permian Oil Producer Files For Bankruptcy

Permian oil producer Rosehill Resources said on Monday that it had filed for bankruptcy protection, becoming the latest shale casualty of the collapse in oil prices. Rosehill Resources has started voluntary Chapter 11 cases under the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas, following a restructuring support agreement with some of its lenders announced early this month.  After the oil price crash in March, Rosehill Resources – which has assets in the Delaware Basin in the Permian – stopped all drilling and completion activity for 2020, “in light of deteriorating global markets and commodity prices.” At the time, Rosehill Resources fully drew all funds available to it under a revolving credit facility, as a result of which its debt rose to US$340 million, while total cash on hand was US$73 million. Rosehill Resources is this week’s first bankruptcy in the U.S. oil patch and the latest victim of the crash in oil prices and oil demand in March due to the pandemic and the brief spat between Saudi Arabia and Russia which resulted in the Saudis flooding the market with oil in April, when global demand was at its weakest...MORE