In mid-August, Sanchez Energy Corp. joined the still small but now-growing list of upstream independents for whom the shale boom has gone bust. With the Chapter 11 bankruptcy filing, Sanchez joins a list of 2019 E&P bankruptcies that includes Legacy Reserves LP, Vanguard Natural Resources LLC, Arsenal Energy Holdings LLC and several others.

E&P companies have been under pressure by shareholders to focus on returns instead of growth. But the volatile nature of the oil business, which has seen oil prices rise post-downturn but nowhere near pre-downturn levels, has left some companies—most of which are saddled with debt— struggling to stay afloat.

Investors, investment bankers and lenders have been down on the upstream for quite some time. In April, Hart Energy reported the somber mood at the usually convivial annual Oil & Gas Investment Symposium (OGIS) sponsored by the Independent Petroleum Association of America in New York. Investors did not seem eager to move. Of the overall conference one said, “I’m not really looking for anything in particular. I’m just trying to understand where the sector is now. I have not been paying it much attention for the past few years.” Another investor said simply, “I have not been wowed.”

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