For the second day in a row, another Houston-based small independent producer has announced plans to file for bankruptcy. Panaco Inc. said Tuesday it would file a voluntary petition for relief under Chapter 11 in the U.S. Bankruptcy Court, on the heels of Contour Energy Co., which announced similar plans on Monday (see Daily GPI, July 16).

Panaco CEO Ted Stautberg said, “This action will be taken to offer Panaco the most efficient way to restructure its balance sheet and access new working capital, while continuing to operate in the ordinary course of business. This action will also enable Panaco to pursue its previously announced strategic alternatives, including a possible sale or merger.”

The company, which acquires producing properties and then recovers reserves that have been bypassed or previously overlooked, has struggled with a heavy debt load, and earlier this year it defaulted on a loan agreement. It also canceled its annual shareholders meeting, and in June fired CEO Robert Wonish. Investment firm Energy Capital Solutions was hired in April to explore ways to keep the company viable, which could include a sale or merger.

Panaco’s operations are focused primarily offshore in the Gulf of Mexico and onshore in the Gulf Coast region. It operates approximately 75% of its offshore and onshore wells and operates 12 offshore platforms. It also owns interests in 109 miles of offshore oil and natural gas pipelines, all at least 10-inches diameter. Daily production is averaging 32 MMcfe, the company said.

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