Blast Energy oil drilling rig auction, sale hearing postponed to March 29

By Caroline Salls

Pittsburgh, March 19 - Blast Energy Services, Inc.'s auction and hearing to approve the sale of five oil drilling rigs was continued to March 29, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

The auction and sale hearing were originally scheduled for March 19, but are being postponed to allow the bid procedures to be amended to resolve an objection.

The bid procedures will be amended to resolve issues related to adequate protection, and the total adequate protection amount to be reserved will be determined at a hearing scheduled for March 28.

As previously reported, Laurus Master Fund Ltd. is the stalking horse bidder for the rigs, and it intends to credit bid the entire $40.6 million in secured debt that is secured by all assets owned by Blast Energy and subsidiary Eagle Domestic Drilling Operations LLC, which owns the rigs.

If Laurus is not the high bidder, Blast Energy will pay it $100,000 for expense reimbursement.

Bidders must pay a $2 million deposit, and the minimum initial overbid must be for at least $150,000 more than Laurus' bid.

Subsequent bids must be for at least $100,000 more than the previous bid.

Blast Energy, a Houston-based provider of fabricated mobile drilling rigs to the oil and natural gas sector, filed for bankruptcy on Jan. 19. Its Chapter 11 case number is 07-30424.

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