A Texas oilfield services company filed for bankruptcy protection, leaving small-business truckers that haul oilfield equipment in the lurch.
Eagle Pressure Controls LLC and its wholly owned subsidiary, Eagle PCO LLC of Navasota, Texas, recently filed for Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.
The company filed its petition three months after the Occupational Safety and Health Administration (OSHA) slapped it with a hefty fine following a fatal oil well fire that killed three workers in January.
Eagle PCO is also facing mounting lawsuits stemming from the oil well fire.
Chapter 11 filing hurts heavy haulers
In its filing, Eagle PCO lists both its assets and liabilities as between $1 million and $10 million. The oilfield services company states that it has up to 199 creditors. The company maintains that no funds will be available for unsecured creditors once it pays administrative fees.
Among the company’s unsecured creditors — which are last in line for payment in Chapter 11 cases — are three Odessa, Texas-based equipment haulers, collectively owed nearly $16,000. The three companies named in the petition are Nobster’s Hot Shot & Crane, Permian Machinery Movers Inc. and Pradon Construction & Trucking Co., a heavy equipment hauler.
According to Eagle PCO’s financials, its gross revenues were $5.7 million as of its bankruptcy petition in November. This is a significant drop from nearly $28 million the oilfield services company reported in 2019.
The company’s largest unsecured creditors include American Express, which is owed more than $439,000, Bestway Oilfield of Channelview, Texas, owed nearly $271,000 and Meyer Service Co. of Corpus Christi, Texas, owed more than $198,400. The OSHA office in Austin, Texas, is also listed as an unsecured creditor — owed $55,300.
A creditor’s meeting is scheduled for 10:30 a.m. on Dec. 8
Legal woes plague Eagle PCO
In late August, OSHA fined three oil and gas companies following a six-month investigation into a deadly rig explosion that killed three workers in January.
One worker died immediately when natural gas in the well sparked a fire, according to initial reports. Two later died of their injuries in the hospital.
Eagle Pressure Control, along with Forbes Energy Service of Alice, Texas, and Chesapeake Energy Corp., which owned the well, were fined more than $387,000 for alleged safety violations.
Chesapeake Energy, headquartered in Oklahoma City, filed for Chapter 11 protection in June.
The families of the three men killed in the well explosion in late January in Burleson, Texas, filed suit against Chesapeake. Also named in the suits are subcontractors Eagle Pressure Control and Forbes Energy, among other companies, hired by Chesapeake to change out a section of the wellhead.
Double whammy
An oil glut and slumping sales amid the COVID-19 pandemic have forced several oil and gas companies to file for bankruptcy protection since March.
A price war between OPEC and Russia, which caused oil prices to tank, forced several oil and gas companies into bankruptcy as well. The lack of business and nonpayment from debtors have forced oilfield equipment haulers in the oil patch also to file bankruptcy.
Read more articles by FreightWaves Senior Editor Clarissa Hawes.
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