Fort Worth-based Basic Energy Services warns of nearly 500 layoffs following bankruptcy
Fort Worth-based Basic Energy Services is warning nearly 500 Texas employees they could be made redundant following an announcement in mid-August that the company files for bankruptcy and is looking for buyers for its assets.
Employees at six state facilities could be affected by the sale of the company, according to a letter the company submitted to the Texas Workforce Commission under a law requiring notice of mass layoffs. If layoffs do occur, they will take place on or within two weeks of October 19.
The Texas sites include two facilities in Andrews and one in Big Spring, Denver City, Fort Worth and Kenedy. Hundreds of employees at Basic Energy’s California sites and one site in New Mexico have also been notified of potential layoffs.
“The business has faced extraordinary challenges in the wake of the COVID-19 pandemic, and we thank the Basic team for their continued hard work and dedication as we continue to provide our customers with exceptional service,” experienced crews and a wide range of safe and efficient solutions. production services, ”said Keith Schilling, CEO of Basic Energy, in the company’s bankruptcy announcement.
The company, which specializes in well maintenance, water logistics and remediation services for oil and gas companies, voluntarily filed for Chapter 11 bankruptcy protection on August 17 and has initial agreements with major bidders Axis Energy Services Holdings LLC, Berry Corp. and Select Energy Services Inc.
If the bankruptcy court permits, Axis, based in Longview, will obtain the assets of Basic Energy’s well maintenance and completion and repair segment outside of California; Houston-Based Select Energy to Acquire All of the Company’s Water Logistics Assets Outside of California; and Dallas-based Berry will acquire all of the company’s assets in California.
An auction for the assets of Basic Energy will take place with the Axis, Berry and Select Energy bids setting the bar low if further qualified bids are submitted.
It is not known whether the sale of the business will be completed or whether a company that takes over Basic Energy’s operations will offer some or all of its employees, according to the letter from the company.
“If the company does not enter into such sales transactions, the company currently expects it to be forced to cease operations and make staff reductions,” wrote Eric Lannen, director of operations. Human Resources of Basic Energy, in the notice.
In the meantime, Basic Energy has filed motions seeking court approval to continue its normal business operations, which includes paying employees, vendors and suppliers.
Guggenheim Credit Services has committed $ 35 million in debtor-in-owner financing to Basic Energy, which the company plans to use to support it through the bankruptcy and acquisition process.
This is Basic Energy’s second bankruptcy filing in the past decade. The company emerged from bankruptcy in 2016, but has struggled in recent years, posting first quarter revenue of $ 94.3 million, down more than $ 34 million from the same quarter of the previous year.