CORRECTED-Oil firms battle banks for shot at Semgroup's cash

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NEW YORK, May 14 (Reuters) - Former oil suppliers to bankrupt energy-trader SemGroup asked Thursday for priority to be paid back ahead of SemGroup lenders, including Bank of America (BAC.N: Quote, Profile, Research), which hold more than $3 billion in claims.

Oil producers from Oklahoma, Texas and Kansas -- who claim Semgroup owes them more than $400 million for oil they supplied before the company's Chapter 11 filing last July -- argued before a Delaware bankruptcy judge for the right to collect.

The producers told U.S. Bankruptcy Judge Brendan Shannon that state laws protecting oil vendors give them priority ahead of SemGroup's secured lenders, led by Bank of America. Banks hold $3 billion in claims against Semgroup, including $2.5 billion in loans.

Shannon didn't rule on the claims Thursday, but producers expected him to rule soon.

"We believe that Judge Shannon will give the priority to the producers in all three of the states at issue now," said Phil Tholen, chief financial officer of Oklahoma driller Samson Resources, one of several producers with Semgroup claims.

"I would assume that the producers' priority claims will then be dealt with and paid."

Tulsa-based Semgroup, once a giant oil storage and logistics company with $14 billion in sales, filed for protection from its creditors after incurring billions in trading losses as oil prices rose to $147 a barrel last July.

Disputes over Semgroup's remaining cash are heating up as Semgroup seeks to emerge from bankruptcy in the third quarter. Company executives plan to file a reorganization plan Friday.