Triangle Petroleum receives $153.84 million payment demand from NGP

By Caroline Salls

Pittsburgh, May 3 – Triangle Petroleum Corp. received a letter from NGP Triangle Holdings, LLC requiring Triangle to repurchase its 5% convertible promissory note payable to NGP in connection with a “fundamental change” under the note, according to an 8-K filed Wednesday with the Securities and Exchange Commission.

Triangle said the letter specified May 17 as the repurchase date and demanded payment of $153.84 million of immediately available funds on that date.

In addition, Triangle said Peter Hill and Roy Aneed resigned from its board of directors on May 1.

According to the 8-K, the company decided not to file its 10-K annual report for the fiscal year ended Jan. 31 and to “focus its limited resources on its restructuring efforts.”

As previously reported, in March 2016 the company launched a process to explore and evaluate strategic alternatives for its individual business units and the company as a whole.

Since that time, Triangle said the depressed oil and gas pricing environment has persisted, and its two principal operating subsidiaries have been deconsolidated.

In June 2016, Triangle USA Petroleum Corp., the company’s former exploration and production subsidiary, filed for Chapter 11 bankruptcy protection. That subsidiary emerged from bankruptcy in March, at which time Triangle Petroleum’s equity in the unit was cancelled.

In September 2016, RockPile Energy Services, LLC, the company’s former oilfield services subsidiary, was sold to a third party in satisfaction of RockPile’s obligations under its credit facility.

Triangle Petroleum said an audit opinion related to its consolidated financial statements for the fiscal year ended Jan. 31, 2016 included an explanatory paragraph indicating substantial doubt about its ability to continue as a going concern.

Because of continued uncertainty regarding its current liquidity, the company said it expects that any audit report relating to its consolidated financial statements for the fiscal year ended Jan. 31, 2017 would also contain an explanatory paragraph regarding substantial doubt about its ability to continue as a going concern.

To date, Triangle Petroleum said discussions with some of its stakeholders regarding a potential consensual restructuring or recapitalization have not resulted in any definitive agreements.

Triangle Petroleum said it has limited financial resources and personnel, its chief accounting officer recently resigned, some financial information required from an unconsolidated subsidiary to complete the fiscal year 2017 audit remains outstanding, and NGP has demanded payment of the note on May 17.

If it is unable to restructure or recapitalize, Triangle Capital said it may be forced to reorganize through bankruptcy.

Triangle is an energy company based in Denver.

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