Castex Energy Partners third amended plan effective as of March 14

By Caroline Salls

Pittsburgh, March 15 – Castex Energy Partners, LP’s third amended plan of reorganization took effect on Wednesday, according to a notice filed with the U.S. Bankruptcy Court for the Southern District of Texas.

The plan was confirmed on Feb. 27.

As previously reported, Castex entered into a restructuring support agreement with some of its pre-bankruptcy lenders.

Key components of the company’s Chapter 11 plan include conversion of a substantial portion of the lenders’ debt to equity, an agreement related to a shared services agreement and assumption, payment of undisputed vendor claims, assumption of joint operating agreements, oil and gas leases and various contracts and modification of the exit capital structure to allow for repayment of exit facility debt and maintenance of development potential with respect to the assets of the reorganized companies.

Under the plan, third-party vendor trade claims will be paid in full as they come due.

Administrative expense, priority non-tax claims and priority tax claims, as well as debtor-in-possession lender claims will be paid in full.

Other secured claims will either be paid in full in cash or reinstated or holders will receive the collateral securing the claims.

Holders of RBL secured claims will receive a share of equity interests. In addition, these creditors will receive a share of $90 million in loans and $105 million in commitments under the reserve-based facility portion of the company’s exit financing and $55 million of exit credit agreement term loans.

Holders of general unsecured claims will receive cash and warrants.

Holders of equity interests will receive no distribution.

Houston-based Castex is engaged in the exploration, development, production and acquisition of oil and natural gas properties. The company filed for bankruptcy on Oct. 16 under Chapter 11 case number 17-35835.

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