Arena Energy Successfully Completes Financial Restructuring10/1/2020
THE WOODLANDS, Texas – October 1, 2020 – Arena Energy, LP (“Arena Energy”) announced today that it has successfully completed its financial restructuring and has emerged from bankruptcy under the ownership of San Juan Offshore LLC (“San Juan Offshore”). Arena received support from 100% of its secured lenders for its prepackaged plan of reorganization. San Juan Offshore was formed by members of the Arena Energy management team, in partnership with Lime Rock Partners, to sponsor Arena Energy’s prepackaged plan of reorganization.
The company will continue to operate as Arena Energy with the continuation of its long-tenured management team and employees led by Mike Minarovic. Operations over its portfolio of 120 platforms across 71 blocks in the Gulf of Mexico remains unchanged, and all ordinary course trade and lienholder claims will be paid in full in cash.
Arena Energy emerges from the restructuring with a substantially strengthened balance sheet and no debt apart from a contingent payment obligation due its former secured lenders contemplated by the prepackaged plan, subject to certain future market conditions.
Arena Energy achieved record production of over 40,000 barrels of oil equivalent per day just prior to the sharp reduction in oil prices brought on by the current recession. The company intends to employ its reconstituted financial position to recapture those production levels by restarting its drilling program in the fourth quarter of 2020.
Mike Minarovic, founder of San Juan Offshore and Chief Executive Officer of Arena Energy noted, “We named San Juan Offshore after one of the most challenging moments in the life of Theodore Roosevelt, a hero to many of us. This has been the most challenging year in our careers, given the impacts of COVID-19 on Arena Energy and the global oil and gas industry. We are thankful to have faced this challenge, with our employees and and our partners at Lime Rock, and have a business that now has the capital structure necessary to execute our development program going forward.”
J McLane, Managing Director and Chief Investment Officer at Lime Rock Partners, added “We want to thank everyone involved in the restructuring of Arena Energy for a constructive and swift process that allows Arena Energy to get back to the business of creating value. We look forward to working with Mike and the entire Arena Energy team to restart what has been the most active drilling effort in the shallow water Gulf.”
Arena Energy was advised in connection with the plan of reorganization by Kirkland & Ellis LLP as legal counsel, Evercore as financial advisor, and Alvarez & Marsal as restructuring advisor.
San Juan Offshore was advised by Davis Polk & Wardwell LLP as legal counsel and Lime Rock Partners was advised by Willkie Farr & Gallagher LLP as legal counsel, and Perella Weinberg Partners and Tudor, Pickering, Holt & Co. as financial advisors.
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