Dear Valued Partner,
We have taken a meaningful step forward in making EP Energy a stronger and more competitive company. Our industry continues to experience challenging dynamics as a result of depressed commodity prices. To that end, we have been very transparent about our efforts to actively manage our capital to control spending and preserve liquidity, and we have made progress on that front already. In addition, during the second quarter, our Board of Directors appointed a special committee to evaluate options to address our debt and capital structure.
Following a comprehensive review as well as extensive, ongoing discussions with our creditors, EP Energy voluntarily filed petitions for chapter 11 reorganization in the U.S. Bankruptcy Court. This process will allow us to pursue a significant reduction of our debt in order to enhance EP Energy’s long-term competitive position. I want to emphasize that EP Energy is continuing to operate as normal throughout this process.
There are a few specific points we want you to keep in mind:
- EP Energy has sufficient liquidity to run our business throughout the restructuring process. We have received Court approval to use our current cash balance, combined with cash flow generated by our ongoing operations, to support the business throughout the court-supervised process.
- Vendors will be paid in full for goods and services provided on or after October 4, 2019. Invoices for goods and services provided on or after October 4, 2019 should be submitted through the typical accounts payable channels, and payments will be processed in accordance with contract terms, if applicable.
- Bankruptcy law mandates that unpaid debts for goods and services provided prior to October 4, 2019, also known as “pre-petition claims,” cannot be paid without specific court approval. If you provided goods or services before October 4, 2019 and have not been paid, you can file a proof of claim with the Bankruptcy Court.
- We value our relationship and will continue to work with you as we move forward.
The Company has reached an agreement in principle on a comprehensive restructuring with a number of its key creditors. Over the coming days and weeks, we will continue working with our creditors and stakeholders to propose a plan of reorganization that will considerably strengthen our balance sheet and provide the financial flexibility to continue building our business through the current market environment. We remain laser focused on improving our operational execution, capital efficiency and driving value for our stakeholders.
Below is a link to a set of FAQs that will help address some initial questions.
As you have other questions, please don’t hesitate to reach out to your normal EP Energy contact or call the Company’s information hotline toll-free at 877-502-9869 or +1-917-947-2373 (for calls originating outside the U.S.). Additional information such as court filings and information about the claims process is available at https://cases.primeclerk.com/EPEnergy or by sending an email to EPEnergyinfo@primeclerk.com. While we may not have all the answers today, we are committed to keeping you informed throughout this process as there are updates to share.
Thank you for your continued support. We are confident in the future of our company and look forward to building on our relationship and getting even stronger for the future.
President and Chief Executive Officer