Ultra Petroleum Files For Bankruptcy... Again

Ultra Petroleum (NASDAQ: UPL) has voluntarily filed for Chapter 11 bankruptcy for the second time in four years. This time, the natural gas producer aims to eliminate about $2 billion in debt from its balance sheet.

Ultra Petroleum has already agreed to terms on a comprehensive balance sheet restructuring with most of its key creditors. They will also provide it with financing so that the business can maintain operations while the bankruptcy case is pending. That funding includes up to $25 million from first-lien term loan holders, which, when combined with operating cash flow, will enable the company to continue paying its employees and vendors. Upon exiting bankruptcy, which the company expects to do in as little as three months, it will have very little remaining debt. Meanwhile, its creditors will provide it with a credit facility carrying an initial borrowing base of $100 million and $60 million of total commitments, giving Ultra the liquidity it needs to operate after reemerging.

Image source: Getty Images.