On June 22, 2020, FERC issued a declaratory order confirming its view that it shares jurisdiction with the United States Bankruptcy Court (“Bankruptcy Court”) over transportation agreements between ETC Tiger Pipeline, LLC (“ETC Tiger”) and Chesapeake Energy Marketing L.L.C. (“Chesapeake”). As a result, aside from obtaining approval from the Bankruptcy Court to reject its contracts with ETC Tiger, Chesapeake must seek a determination from FERC as to whether a filed rate may be modified or abrogated under the Natural Gas Act (“NGA”).

Summary

On June 22, 2020, the Federal Energy Regulatory Commission (“FERC” or “Commission”) issued an order concluding that the Commission and the United States Bankruptcy Courts have concurrent jurisdiction to review and address the disposition of natural gas transportation agreements (“FERC-jurisdictional agreement”) sought to be rejected through bankruptcy.

Hogan Lovells Publications | 15 June 2020

Navigating distress and insolvency in the oil and gas industry

Following the success of our three-part webinar series produced together with Houlihan Lokey in Spring 2020, we have developed reports summarizing how companies and investors can better navigate distress and insolvency in the oil and gas industry.

The transaction involved the restructuring of certain loan facilities via creditors' schemes of arrangement (Schemes). Prior to implementation, the Schemes terminated automatically by their terms as certain required payments had not been made by the relevant condition precedent satisfaction date.

McKool Smith principal John Sparacino shared his expertise in bankruptcies filings with Business Insider’s article, “Some Cash-Strapped US Oil Companies Can't Even Afford Chapter 11 Bankruptcies. That Means They Have to Wait Things Out or Liquidate” In May, the oil price surged almost 90%; however, many upstream producers and oilfield-service companies are already in bad shape that they might not be able to afford Chapter 11 bankruptcy process.

Hogan Lovells Publications | 29 May 2020

Implications of COVID-19 on the Australian Mining Industry

1. Which financial (not tax or labour) short-term compensation schemes for immediate losses due to social distancing measures have been implemented? For which industries/sizes of business?

Deferred Loan Repayment

Over the past four years, midstream firms have struggled to adapt their long-standing practices and adjust their long-held expectations, which were fundamentally disrupted by the outcome of the landmark bankruptcy case, In re Sabine Oil & Gas. Midstream providers have since developed and relied on certain mechanisms and carefully drafted contract language in order to bind upstream companies and their successors in interest to obligations and restrictions contained of midstream agreements.

2020 has seen a significant increase in chapter 11 filings by oil and gas producers. Critical to the operations of these companies, and to the transportation and processing of the producer’s gas, are gathering agreements entered into between the producers and midstream companies. A pivotal question posed at the start of these chapter 11 proceedings is whether the gathering agreements are executory contracts subject to rejection or whether they create real property interests that cannot be rejected in chapter 11 proceedings. The answer depends on who you ask.