Vanguard Natural Resources (NASDAQ: VNR) shares dropped more than 60% in early trade after the company announced it has voluntarily filed petitions for Chapter 11 bankruptcy. In addition, the company has entered into a Restructuring Support Agreement with certain consenting holders of the company’s 7.875% Senior Notes due 2020, 8 3/8% Senior Notes due 2019 and 7.0% Senior Secured Second Lien Notes due 2023. Vanguard said it intends to use this agreement to eliminate approximately $708 million in debt under its reserve-based credit facility and senior unsecured debt. “We continue to believe in the quality of our asset base and the dedication and competence of our office and field employees. The depressed commodity price cycle which has persisted over the past two years, combined with a tightened regulatory environment for senior debt providers, has resulted in a situation where, despite reducing our total debt by over $500 million in 2016, we find ourselves unable to meet the obligations of our current credit facility. With a successful restructuring of our balance sheet, Vanguard will be better positioned to weather this new lower for longer commodity price environment, while also improving our long-term financial security and better position us for long-term success,” president and CEO Scott W. Smith stated in the news release.
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About Vanguard Natural Resources, LLC
Vanguard Natural Resources, LLC is a limited liability company focused on the acquisition, production and development of oil and natural gas properties. Vanguard’s assets consist primarily of producing and non-producing oil and natural gas reserves located in the Green River Basin in Wyoming, the Permian Basin in West Texas and New Mexico, the Piceance Basin in Colorado, the Gulf Coast Basin in Texas, Louisiana, Mississippi and Alabama, the Arkoma Basin in Arkansas and Oklahoma, the Big Horn Basin in Wyoming and Montana, the Williston Basin in North Dakota and Montana, the Anadarko Basin in Oklahoma and North Texas, the Wind River Basin in Wyoming, and the Powder River Basin in Wyoming. More information on Vanguard can be found at www.vnrllc.com.
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