McAfee & Taft attorneys win ‘extraordinary’ remedy for oil and gas producers
Judge approves appointment of committee in SemGroup bankruptcy October 6, 2008October 6, 2008
McAfee & Taft attorneys, led by shareholder Steven Bugg, won a “surprise victory” Friday for oil and gas producers who have not been paid in the SemGroup LP bankruptcy case. The Oklahoman and Tulsa World featured the story on the front page of their Saturday business sections and The Journal Record featured the story in their Monday edition.
A Delaware bankruptcy judge approved the appointment of a committee to represent producers, royalty owners and working-interest owners “who have not been adequately represented in the case,” Bugg told The Journal Record. According to court records, more than 1,000 producers are owed money; however, the total number of individual interests — producers, royalty owners and other interest owners — could total more than one million people.
The producers asked for the committee status, which may give them a singular, more interactive voice in court proceedings, Tulsa World reported. Tulsa-based SemGroup LP reportedly owes oil, gas and asphalt producers up to $1 billion for goods sold on credit in the weeks before the company’s filing for Chapter 11 bankruptcy protection on July 22.
“The judge said this was an extraordinary remedy,” Bugg told the Tulsa World. “He said it was very rare to allow that, but that producers had proved their case.”
Mike Terry, president of the Oklahoma Independent Petroleum Association, told The Oklahoman that the ruling was “certainly a step in the right direction — maybe a giant step.”
“It’s about time that someone stood up for the producers,” he said.