December 23, 2016 / 2:17 PM / a year ago

Bonanza Creek Energy to file for bankruptcy

Dec 23 (Reuters) - Oil and gas producer Bonanza Creek Energy said it would file for bankruptcy on or before Jan. 5, joining a long list of energy companies that have succumbed to a drop in oil prices.

The Denver-based company said bondholders would eliminate $850 million in debt and that some would provide $200 million in new equity.

Bonanza Creek’s shares were down 47.5 percent at $1.01 before the opening bell on Friday.

Global oil prices have fallen more than 50 percent since mid-2014, eroding cash flows of oil producers and crimping their ability to meet debt and interest payments.

Earlier this month, Stone Energy Corp filed for Chapter 11 bankruptcy and said it would eliminate about $1.2 billion in debt by transferring control of the company to its noteholders. (Reporting by Ahmed Farhatha in Bengaluru; Editing by Ted Kerr)

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