Current GDPP Stock Info

Goodrich Petroleum announces $40 million capex plan targeting the Haynesville for 2017

Houston-based Goodrich Petroleum Corp. (ticker: GDPP) announced that the company’s board of directors has approved a preliminary capital expenditure budget for next year. The company plans to spend $40 million in 2017, Goodrich said in a press release Tuesday.

The company said it plans to drill 12-16 gross (3-4 net) wells during the course of next year. The company’s operations will focus on its assets in the Haynesville Shale play in North Louisiana. Goodrich also has assets in the Eagle Ford and the Tuscaloosa Marine Shale (TMS).

Goodrich also announced Tuesday that the company entered into a private placement for shares of its common stock. The placement covers 2.3 million shares of the company’s common stock sold at a price of $11.00 per share for gross proceeds of $25 million (approximately $23.5 million net), according to the company.

Pro forma for the offering, Goodrich will have in excess of $40 million of cash, $16.7 million of first lien debt and $40 million of second lien payment in kind debt, the company said. Proceeds from the private placement will be used to fund the company’s 2017 drilling program and for general corporate purposes, including working capital.

Goodrich Petroleum asset map

From bankruptcy to drilling in less than a year

On April 15, 2016, Goodrich announced that it filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The company worked with bondholders to forgive $175 million in debt in exchange for ownership in the company, and wiped out $224 million in unsecured debt. In eight months, the company has gone from announcing bankruptcy to releasing capex guidance and a drilling program as oil prices begin to recover.

The bankruptcy process has been quick for many oil and gas companies forced to turn to Chapter 11 during the downturn. Stakeholders on all sides of the process have “an intense desire to minimize the friction of the process,” Haynes and Boone Partner Patrick Hughes told Oil & Gas 360®. “The longer you’re in the process, the more likely you are to have friction and additional expense, and potentially litigation,” he explained.

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