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California Resources Discussing Bankruptcy Terms with Creditors

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   |    Friday,June 26,2020

California Resources may be headed toward bankruptcy, as it is currently discussing the possibility with its lenders, according to a 10Q statement filed on June 25th, 2020.

The company said: "As discussed further below, we are actively discussing the terms of a restructuring with our creditors and other stakeholders with the objective of enabling us to continue operations better positioned to capitalize on our asset base and operating capabilities."

A Look Back

  • May 29, 2020: Did not pay the approximately $51 million due on its $1.3 billion credit agreement
  • June 2, 2020: Entered into forbearance agreement with lenders of the 2014 revolving credit facility
  • June 15, 2020:  Did not make payment of $72.3 millon on the 8% Senior Secured lien notes due 2022

The company also blamed Occidental Petroleum: "Our spin–off from Occidental Petroleum Corporation (Occidental) in December 2014 burdened us with significant debt which was used to pay a $6 billion cash dividend to Occidental. Together with the activity level and payables that we assumed from Occidental and due to Occidental's retention of a vast majority of receivables, our debt peaked at approximately $6.8 billion in May 2015."

 


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