Halcon slashes drilling budget, bonds weaken; oil, gas names end mixed; Caesars plan OK’d

By Stephanie N. Rotondo

Phoenix, Jan. 9 – Oil prices were in decline once more on Friday, but it didn’t necessarily drag down the entire distressed debt market with it.

In fact, the oil and gas space ended the day in mixed fashion.

A trader said SandRidge Energy Inc.’s 8 7/8% notes due 2022 were nearly a point higher at 65 5/8. Offshore oil driller Hercules Offshore Inc. saw its 10¼% notes due 2019 get almost 3 points better at 56¾.

California Resources Corp.’s 6% notes due 2024 were also a little higher, gaining a quarter-point to close around 82.

On the downside were Midstates Petroleum’s 9¼% notes due 2021, which fell half a point to 49¾, according to a trader.

W&T Offshore’s 8½% notes due 2019 were also softer, ending nearly 1 point weaker at 66½.

One name in particular – Halcon Resources Corp. – had news of its own that was pushing the company’s bonds around.

The Houston-based independent energy company announced late Thursday that it had cut its drilling and completion budget forecast for the year by about half.

Away from that space, Caesars Entertainment Corp. paper was weaker after the company said its restructuring support plan was officially effective, having secured more than 60% of the necessary noteholders’ approval.

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