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Forbes Energy to file for bankruptcy as early as this month -sources
December 16, 2016 / 3:50 PM / 9 months ago

Forbes Energy to file for bankruptcy as early as this month -sources

Dec 16 (Reuters) - U.S. oilfield services firm Forbes Energy Services Ltd is preparing to file for bankruptcy as soon as this month, as it struggles with approximately $300 million in debt, people familiar with the matter said on Friday.

The company’s plans to seek protection from its creditors underscore the stress facing the U.S. oilfield services sector amid low energy prices, as oil and gas exploration and production companies have scaled back drilling.

The sources noted that the schedule of a bankruptcy filing by Forbes Energy could slip and asked not to be identified because the preparations are confidential. A Forbes spokesman declined to comment.

The company, headquartered in Alice, Texas, said in its latest quarterly financial statement in November that it may have to file for bankruptcy. It has also been in talks with its creditors about a potential debt restructuring.

More than 200 energy-related firms have filed for bankruptcy since oil prices crashed about two years ago.

Competing oilfield services firms Key Energy Service Inc , C&J Energy Services Ltd and Basic Energy Services Inc have all filed for bankruptcy in recent months.

Another competitor, Seventy Seven Energy Inc, emerged from bankruptcy in August, and this week announced an approximately $1.76 billion deal to be acquired by Patterson-UTI Energy Inc.

Forbes Energy operates around 173 well servicing rigs in Texas, Louisiana and Pennsylvania. It also transports and disposes of fluids used in drilling.

Forbes Energy also competes with Stallion Oilfield Services Ltd, Superior Energy Services Inc and Heckman Corp.

After it missed an interest payment on its bonds earlier this year, Forbes Energy’s creditors granted it a series of forbearance agreements, allowing the company to avoid financial penalties.

Forbes Energy lost $23.2 million in the three months ended Sept. 30. Its bonds due in 2019 were trading at 27.5 cents on the dollar on Friday, according to Thomson Reuters data, indicating investor concerns about full repayment. (Reporting by Jessica DiNapoli in New York and Tom Hals in Wilmington, Delaware; Editing by Dan Grebler)

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