Gastar Exploration U.S. Trustee opposes reorganization plan releases

By Caroline Salls

Pittsburgh, Dec. 17 – The acting U.S. Trustee overseeing Gastar Exploration Inc.’s Chapter 11 case objected to confirmation of the company’s proposed plan of reorganization, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

Acting Region 7 U.S. trustee Henry G. Hobbs Jr. said the releases included in the plan “are not supported by independent consideration, agreement or specific action” by the releasing parties.

In addition, Hobbs said the third-party releases, exculpations and injunctions provided in the plan are overly broad, in violation of the Bankruptcy Code.

If the release provisions are not amended, Hobbs said the court should deny confirmation.

The plan confirmation hearing is scheduled for Dec. 20.

Gastar Exploration is Houston-based oil and natural gas company. The company filed for bankruptcy on Oct. 31 under Chapter 11 case number 18-36057.

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