Chesapeake Energy Inc., a highly indebted pioneer of the U.S. shale energy industry, has hired restructuring advisers as the company has been crippled by persistently weak natural gas prices coupled with the recent collapse of oil prices and the repercussions of the coronavirus pandemic.

The Oklahoma City-based company has hired law firm Kirkland & Ellis and financial advisers Rothschild & Co. to help manage its $9 billion debt pile while navigating the crisis, people familiar with the matter said.

One of the early movers of the U.S. shale revolution, Chesapeake warned late last year that it was struggling to operate in a low commodities prices environment. Its difficulties were exacerbated by the oil price war sparked in recent days by the confrontation between Saudi Arabia and Russia.

Chesapeake was co-founded by the late Aubrey McClendon in 1989 and rose from obscurity to become for a time the second-largest gas producer in the U.S. after Exxon Mobil Corp. Its shares closed down almost 33% on March 16 to $0.20.

In after-market trading hours, the company’s share price dropped a further 10% after Reuters first reported that it had hired restructuring advisers. Chesapeake declined to comment.

Bankers and lawyers advising oil and gas companies warned there could be many more forced to consider going bankrupt to manage their ballooning debt pile.

“It’s a complete meltdown,” said an adviser working with multiple upstream companies considering filing for Chapter 11 bankruptcy protection. “Any company that is an E&P [exploration and production] company, other than the very big ones, is in danger . . . unless the government offers them a bailout package it’s going to be a disaster.”

The near-collapse of several energy companies comes in the wake of the failure of OPEC and Russia earlier this month to agree a deal on cutting production to prop up crude prices. Saudi Arabia wanted to make further cuts to production, but when Russia refused, it decided to raise output.

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