Permian Shale Producer Approach Resources Enters Bankruptcy

After being battered by weak Permian gas prices, Approach Resources filed for Chapter 11 bankruptcy to explore strategic alternatives that include either a restructuring or the sale of its business.

Permian Shale Producer Approach Resources Enters Bankruptcy

Approach Resources began exploring deleveraging alternatives earlier this year following the breach of certain financial covenants under its revolving credit facility. (Source: Hart Energy/Shutterstock.com)

Approach Resources Inc. entered bankruptcy on Nov. 18 after over a year of being battered by weak natural gas prices in the Permian Basin, where the Fort Worth, Texas-based independent’s operations are focused.

As part of the voluntary Chapter 11 filing in the United States Bankruptcy Court for the Southern District of Texas (Houston Division), Approach said it will begin to explore strategic alternatives that include either a restructuring of its balance sheet or the sale of its business as a going concern.

In the meantime, the company has received a commitment from its pre-petition lenders for $16.5 million as part of a “debtor-in-possession” (DIP) financing, subject to court approval and customary closing conditions.

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Emily Patsy

Emily Patsy is the senior managing editor for Hart Energy’s Digital News Group. She's responsible for the daily news flow and also manages the A&D Watch and Energy Pulse weekly newsletters.