Erin Energy creditor asks court to dismiss Chapter 11 bankruptcy case

By Caroline Salls

Pittsburgh, July 11 – Erin Energy Corp. senior secured creditor Zenith Bank plc asked the U.S. Bankruptcy Court for the Southern District of Texas to dismiss the company’s Chapter 11 case, according to a motion filed Wednesday.

Zenith said the Erin Energy debtors’ reorganization efforts “hinged on success at a hearing before the Nigeria Federal High Court on July 6,” but that hearing has been adjourned to Oct. 3.

“Before October 2018, the debtors will run out of cash and will lack funds to administer their Chapter 11 cases,” the motion said. “If they have not done so already, the debtors will deplete their DIP loan by the second week of July, and the debtors offer no evidence that they will be able to obtain additional post-petition financing.”

In addition, Zenith said Erin Energy has not generated any revenue since the fall of 2017, and substantially all of the debtors’ assets “are encumbered by liens far exceeding the value of those assets.”

In May, secured creditor Public Investment Corp. Soc. Ltd. (PIC) also asked the court to dismiss the Chapter 11 cases.

Both motions said if the court chooses not to dismiss the cases, it should abstain from further proceedings.

Based in Houston, Erin Energy is an explorer, developer and producer of oil and gas. The company filed bankruptcy on April 25 under Chapter 11 case number 18-32106.

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