American Eagle Energy Files for Chapter 11 Bankruptcy

American Eagle Energy Corp filed for Chapter 11 bankruptcy, the latest energy company forced to restructure because of depressed oil and gas prices.

 

Listing about $215 million in debts, American Eagle Energy filed its petition in U.S. Bankruptcy Court in Denver on Friday, about two months after missing an interest payment on $175 million of notes.

 

The Littleton, Colo.-based company, which drills mainly in the so-called "Spyglass Area" in North Dakota, had raised the debt just last August, shortly before a sharp drop in oil prices would threaten profit margins.

 

It joins a list of recently bankrupt energy companies including Quicksilver Resources and Dune Energy .

 

Fitch Ratings last week said default rates in the energy sector are expected to keep rising after a missed interest payment by RAAM Global Energy and Venoco Inc's distressed debt exchange.

 

Investors in the energy space, which accounts for nearly one-fifth of all high-yield debt, are growing increasingly wary of the risk, Fitch said, making it harder for struggling such companies to raise capital.

 

American Eagle was downgraded by Moody's (MCO) on April 10, despite having reached a forbearance agreement with some creditors protecting it from foreclosure actions. The agreement was set to expire on May 15.

 

American Eagle, which in court papers reported about $212 million in assets, last week appointed Marty Beskow its new chief financial officer after incumbent Kirk Stingley resigned.

 

The company has a plethora of unsecured creditor claims, court papers show, mostly from suppliers. Among the largest is a $3.4 million claim for high pressure pumping services from Halliburton.

 

American Eagle is represented in bankruptcy by lawyers at BakerHostetler. The case is In re American Eagle Energy Corp, U.S. Bankruptcy Court, District of Colorado, No. 15-15073.