WILMINGTON - Energy producers have asked a U.S. judge to appoint a trustee to run Semgroup, an oil and gas services company that has been in bankruptcy for more than a year, the producers' lawyer said on Tuesday.
We would like to see someone opearting the company for all creditors, not just the banks, said Hugh Ray, a partner with Andrews Kurth in Houston, who represents the producers committee. We hope that someone is appointed that doesn't show favoritism to anyone.
The Official Producers' Committee said in a court filing on Friday a trustee is needed because Semgroup's management have raised questions about their ability to perform their fiduciary duties.
Producers argue that their claims are among the highest priority because of their status as suppliers. That argument and the value of their claims have been at the center of several disputes in the case.
The producers also requested an investigation of intercompany dealings in the bankruptcy, particularly those involving the SemGroup subsidiary Eaglwing.
It appears that Eaglwing had substantial assets that have disappeared during the bankruptcy cases, the filing said.
SemGroup collapsed in July 2008 after suffering $3.2 billion in losses due to bad bets on oil prices. The court appointed an examiner, who said in April that the company's top executives lied about its liquidity problems and mismanaged a speculative oil trading strategy.
The company recently proposed its second amended reorganization plan, which has gone to creditors for confirmation.
Ray said the thousands of producers who supplied Semgroup are mystified as to why they have not been paid.
By not offering to pay producers' claims in full, Ray said a plan can not be confirmed.
The debtor continues to play shake and bake with them. Filing sequential plans that aren't confirmable adds to the confusion, said Ray. He said apppointing a trustee would help reach a consensus plan.
Now they have another plan. What I'm saying is pick a lane, any lane. Tell us what lane you want to drive is so we know what the deal is. It's an egregious deal of lane stradling.
A company spokesman and an attorney for the company could not be reached for comment.
The case is In re SemCrude LP, U.S. Bankruptcy Court, District of Delaware, No 08-11525. (Reporting by Tom Hals, editing by Leslie Gevirtz)