(NEW ORLEANS) — Harvey Gulf International Marine has filed for Chapter 11 bankruptcy protection, the latest sign of stress along the Gulf of Mexico amid a global slowdown in oil drilling and a prolonged slump in oil prices, The Acadiana Advocate reported.
The New Orleans-based offshore operator listed about $1.2 billion in debt. The filing, in the Southern District of Texas, includes a restructuring plan that would convert nearly $1 billion in secured debt into equity. The plan, which requires court approval, is intended to help the company clear up its balance sheet ahead of when CEO Shane Guidry expects the drilling industry to begin to rebound — possibly by 2020.
Harvey Gulf lists 200 to 999 creditors and assets worth $100 million to $500 million. HGIM Holdings' filing includes dozens of affiliates that are also seeking bankruptcy protection together. Harvey Gulf has about 580 employees, including about 504 crewmembers, and 60 vessels.
An emergency hearing on the company's plan is scheduled for Friday in federal bankruptcy court in Houston.
"Beginning in 2014, as a result of severely depressed oil prices, exploration and production companies drastically cut the number of offshore exploration and drilling projects in the Gulf of Mexico, causing substantial drops in both vessel utilization and day rates," the filing says.
Through early last year, Harvey Gulf took measures to weather the downturn, such as cutting $87 million in costs and idling unprofitable vessels.
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