By Guillermo Parra-Bernal
SAO PAULO, Jan 24 Bankrupt oil producer Óleo e
Gás Participações SA will delay presenting its
restructuring plan to creditors, initially scheduled for Friday,
by about a week as the company attempts to secure more funding,
two sources familiar with the situation told Reuters.
Óleo e Gás, formerly known as OGX Petróleo e Gas
Participações SA, and creditors are discussing terms
of a potential $200 million debtor-in-possession loan, said the
sources, who declined to be identified because the talks are
private. The delay is unlikely to disrupt operations, and the
company has enough funds to stay afloat, both sources added.
Management wants to convince the maximum number of creditors
to back the recovery plan, which has to be filed with a
Brazilian bankruptcy court, the first source said. Óleo e Gás
owes about $5.1 billion to investors such as bond fund Pimco,
dozens of suppliers including Schlumberger NV, and
sister company and shipbuilder OSX Brasil SA.
Óleo e Gás and OSX are both controlled by Brazilian tycoon
Eike Batista, the former billionaire whose empire of commodities
and industrial companies collapsed last year in dramatic fashion
under a mountain of debt after disappointing output at the oil
company's wells sent investors running for the exits.
Calls to Óleo e Gás in Rio de Janeiro were not immediately
answered. Lawyers working on behalf of the company and creditors
declined to comment.
Once Óleo e Gás delivers the restructuring plan to the
bankruptcy court, creditors will then have between 30 days and
60 days to endorse or reject the plan. Bankers and creditors
have moved slowly with the DIP loan because they are uneasy with
the lack of precedent for such a structure in Brazil, the second
In the United States, DIP loans are the first debt that gets
repaid. As a result, such loans tend to be a regular feature of
bankruptcy cases and are credited with saving companies and
their employees from fire-sale liquidations.
In recent weeks, Óleo e Gás obtained a bridge loan to pay
for operations while it seeks the DIP loan.
The company, which filed for bankruptcy protection on Oct.
30, stands to lose offshore exploration rights in Brazil's
Espírito Santo state should it fail to meet capital spending
commitments by the end of this week, a source with direct
knowledge of the situation told Reuters on Thursday.