Oilfield services firm BJ Services filed for Chapter 11 bankruptcy protection early on July 20, following a severe cut in demand and cash crunch due to the coronavirus pandemic.
The company, which offers hydraulic fracturing of shale wells, said it was in discussions with bidders for sale of its cementing business and portions of its fracking operations.
"Severe downturn in activity and subsequent lack of liquidity resulted in an unmanageable capital structure," CEO Warren Zemlak said, and added BJ Services was working with its lenders to get liquidity to fund the sale.
The fracking company, which filed for Chapter 11 in the bankruptcy court in Southern District of Texas, listed assets and liabilities in the range of $500 million to $1 billion.
BJ services, which operates in shale basins in Canada, said it would file seeking protection under the companies' creditors arrangement act for an orderly wind-down of operations in the country.
Oilfield service giant Baker Hughes Co. closed a $6.8 billion deal to buy the company in 2010. However, in 2017, BJ Services began operating as an independent joint venture after Baker Hughes sold a 53.3% stake in the hydraulic fracturing and cementing business to private equity firm CSL Capital Management and Goldman Sachs' West Street Energy Partners for $325 million.
BJ Services, which has crews in shale basins across the U.S. and Canada, withdrew its plans for a $100 million IPO in 2019, which it had initially filed in 2017.
Estimated volumes at the Dugong discovery are 40 to 120 million barrels of oil equivalent (MMboe), the company said.
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