Louisiana-based Green Field Energy Services Inc filed for a Chapter 11 bankruptcy protection yesterday. In its filing in a Wilmington, Delaware Bankruptcy Court, the oil field service provider declared assets of USD 500 million. It also had liabilities of the same amount.
Last month, Green Field was unable to pay its principal payment on a loan it owed to a Royal Dutch Shell affiliate. In its September 9 report, Moody's Investors Services said that credit facility default also brought about a cross default of senior secured notes amounting to USD 250 million.
Moody further reduced Green Field Energy's rating to Ca from Caa2 on its USD 200 million secured debt. A Ca rating showed that a company was said to be highly speculative and that it was close to a default. However, it still had the potential to recover principal and interest. A Caa2 rating, meanwhile, would be given to a firm that was judged to be a very high credit risk.
Moody's said Green Field did not have sufficient cash or cash flow to make payments. These payments included Green Field's mandatory debt amortization, interest expenses and capital spending.
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