Creditors seek to wind up zombie US energy firms

Wilmington, Delaware

RISING financial stress in the US energy sector has prompted some suppliers and vendors to take unusual legal action to collect unpaid debts: forcing struggling companies with billions of dollars in debt into bankruptcy.

Since August, creditors have filed petitions for involuntary bankruptcy against three energy producers with nearly US$2 billion in combined debt: Miller Energy Resources Inc, Black Elk Energy Offshore Operations and Energy & Exploration Partners Inc. During that period, there have been a total of seven bankruptcies involving energy companies with at least US$200 million in debt.

Involuntary bankruptcies signal deepening pessimism about the crude market…