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Home > News > Valuable News > North American oil company bankruptcy debt hits record high   

North American oil company bankruptcy debt hits record high   

2020-11-02

According to Rigzone on October 23: Debt related to the bankruptcy of North American oil and gas companies in 2020 is already at an all-time high.

These debts will increase further this year as the wave of Chapter 11 filings continues, Rystad Energy said in a statement.

Rystad Energy noted that the total number of North American exploration and production (E&P) and oilfield services (OFS) companies filing for Chapter 11 bankruptcy protection so far this year has reached 84, down from an all-time high of 142 in 2016. However, the associated debt carried by these companies is much higher, now at $89 billion, reportedly $19 billion higher than in 2016.

In the current price environment, Rystad Energy expects more companies to go bankrupt this year and accumulate more than $100 billion in associated debt.Rystad Energy notes that 2016 is unlikely to be repeated in terms of the number of bankruptcies.Rystad Energy's data shows that currently, 40 North American E&P companies are in bankruptcy There were 44 OFS company bankruptcies.

Artem Abramov, head of shale research at Rystad Energy, said in a company statement: "While the fundamentals of the oil and gas market have improved significantly compared to April-May, we do not believe the wave of North American bankruptcies is over yet."

He added: "Many small and medium-sized public and private producers continue to face financial challenges in the current price environment and questions remain about their ability to service their debt in 2021-2022."

Disclaimer: ECHEMI reserves the right of final explanation and revision for all the information.

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