Tomball oil field service company BJ Services filed for Chapter 11 bankruptcy in Houston early Monday morning.
BJ Services has two business lines — cementing and hydraulic fracturing. As part of the bankruptcy, the company plans to sell its cementing business and portions of its hydraulic fracturing business. With bidders already in play, the company hopes the sales will move quickly to avoid layoffs.
In a statement, BJ Services CEO Warren Zemlak said the company's board of directors and management worked diligently over the past several weeks to avoid this outcome but could not overcome volatile commodity markets and significantly reduced demand during the COVID-19 pandemic.
"Despite maintaining a leading market position and strong client support, the severe downturn in activity and subsequent lack of liquidity resulted in an unmanageable capital structure," Zemlak said. "After exhausting every possible alternative to address these issues and improve our liquidity, we have made the very difficult decision to proceed with a Chapter 11 process."
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BJ Services is developing a plan with investors to minimize disruption to customers, Zemlak said.
"I want to assure our business partners that our team is as focused as ever on working with our stakeholders to procure sufficient liquidity to complete all client activities safely and in accordance with all applicable laws and regulations," he said.
If the planned sales fail, BJ Services warned the Oklahoma Office of Workforce Development that the company will have to lay off 90 people at its facility in Yukon, Okla.
http://www.houstonchronicle.com/business/energy/article/BJ-Services-files-for-Chapter-11-bankruptcy-15420006.php
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