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Oklahoma Oil Driller Chaparral Files for Bankruptcy Protection

(Bloomberg) — Chaparral Energy Inc. filed for bankruptcy protection for the second time in four years, another financial reckoning for one of the many cash-starved shale drillers punished by sluggish oil prices.

The company filed for Chapter 11 in U.S. Bankruptcy Court in Delaware. It listed estimated liabilities and assets both in the $500 million to $1 billion range.

The Covid-19 pandemic has led to a surge in energy industry bankruptcies, as lockdowns strangle demand and prompt lenders to cut credit lines. So far in 2020, the tally has included California Resources Corp., the state’s largest crude producer, and shale gas driller Chesapeake Energy Corp.

The Oklahoma City-based oil and gas producer operates in the Anadarko Basin. It previously filed for bankruptcy protection in 2016, following a plunge in crude prices that started in 2014.

In April, lenders cut Chaparral’s borrowing base to $175 million from $325 million. At the time, the company had borrowed $250 million on its credit facility, leaving it with a so-called borrowing base deficiency that the company subsequently agreed to pay down in installments. Also in April, Scott Pittman resigned as chief financial officer.

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