Tumbling energy prices over the past year and a lack of credit pushed two U.S. energy companies into Chapter 11 bankruptcy, the latest in a string of such filings.
Pacific Ethanol Inc, the largest West Coast-based producer and marketer of ethanol, put its production plants in California, Oregon and Idaho in Chapter 11 bankruptcy, the company said on Monday. The company's marketing arm, which buys and sells ethanol, did not file for bankruptcy.
Oil and gas exploration company TXCO Resources Inc said it also filed for Chapter 11 bankruptcy, along with seven subsidiaries.
Energy companies have suffered as the economic downturn sent prices for natural gas, crude oil and gasoline down sharply from their peaks in July, squeezing many of the smaller players.
Norwegian oilfield driller PetroMENA filed for bankruptcy on Sunday in the United States and exploration company Energy Partners Ltd of New Orleans filed for bankruptcy on May 1.
Pacific Ethanol, which reported 2008 revenue of $703.9 million, said it plans to continue marketing and selling ethanol under existing marketing agreements.
The five bankrupt subsidiaries have obtained bankruptcy financing of up to $20 million, which will allow them to continue operating while they reorganize, the company said.
The company said on May 12 it would likely need to file for bankruptcy if it was not able to restructure its debt.
Makers of the corn-based biofuel have struggled as weak U.S. demand for motor fuels has depressed prices and margins, and last year VeraSun Energy, once the largest publicly listed U.S. ethanol maker, filed for bankruptcy.
Pacific Ethanol, based in Sacramento, California, had said that the volume of ethanol sold fell 24 percent in the quarter, while the average sales price was down 28 percent. It said in court documents it had between $50 million and $100 million in assets and between $100 million and $500 million in liabilities.
TXCO Resources said in a court filing that it sharply increased capital expenditures last year just as prices for its oil and gas plummeted more than 50 percent, putting a severe strain on the company's cash.
The San Antonio-based company said in court documents it had $432 million in assets and $323 million in liabilities. It said it would seek court approval for $32 million in financing to get it through bankruptcy.
The company had 2008 operating revenue of $143.7 million and participated in 96 wells, mostly in Texas.
Shares of Pacific Ethanol and TXCO Resources were both down more than 40 percent in morning trade.
The cases are In re: Pacific Ethanol Holding Co LLC, U.S. Bankruptcy Court, Southern District of Texas, No. 09-11713 and In re: TXCO Resources Inc, U.S. Bankruptcy Court, Western District of Texas, No. 09-51807.
(Reporting by Thomas Hals, editing by Dave Zimmerman)