Case Studies
Arena Energy
Energy

SITUATION
- Chiron advised our Client which provided surety bonds to insure plugging and abandonment (P&A) obligations for Arena Energy (the “Company”)
- Our Client had significant, contingent unsecured plugging and abandonment bonding exposure to Arena Energy (“Company”)
- Client engaged Chiron approximately a week prior to the Company seeking Chapter 11
- The Company had already negotiated pre-packaged Chapter 11 terms with existing secured creditors with senior secured creditors receiving $0.10-$0.20 per $1.00 of $600 MM of funded debt
- The Company had offered the Client insufficient credit enhancement terms, and Client was unable to improve position
- The Client Goal: enhance terms the Company was offering
- Chiron Transactional Advisory Scope
- Analyze the Company’s reserves, financial condition, and well-plugging liabilities and outlook upon exiting Chapter 11
- Negotiate with the Company, its Advisors and its Private Equity Backer to protect Client’s continuing contingent unsecured credit exposure
OUTCOME
- Using deep experience in both oil and finance, Chiron negotiated a doubling of the collateral protection for our Client, enabling the Company to file its pre-pack and continue its growth while Client was well protected
“In an offshore oil and gas restructuring, Chiron provided the industry knowledge and the financial insight needed to substantially improve our collateral protections while still giving the company plenty of room for growth. They helped to create a win-win.” — Bob Kirk, RLI

The Challenge
Our Client had significant, contingent unsecured plugging and abandonment bonding exposure to Arena Energy (“Company”).
The Chiron Solution
Negotiate with the Company, its Advisors and its Private Equity Backer to protect Client’s continuing contingent unsecured credit exposure.
The Result
Using deep experience in both oil and finance, Chiron negotiated a doubling of the collateral protection for our Client, enabling the Company to file its pre-pack and continue its growth while Client was well protected.