Growing bankruptcy crisis in global oil and gas industry

[raspberry-blower]

They will die anyway if they burn it through the gross overheating of atmosphere that burning it will cause and the subsequent rise in sea level and loss of prime agricultural land. As someone else said, "The human population is in overshoot."

The difference is that a lot more of the ecosystems upon which we rely will survive if we leave the stuff in the ground and so will a lot more of the people. Burn it and you will destroy most of the ecosystems which support us and even more people will die.

From the propaganda point of view, dig it up and burn it and a few very rich but incredibly stupid people will make a lot more money. Leave it in the ground and a few very rich but incredibly stupid people will make less money and might even go to the wall (we can only hope) and the rest of us might get to enjoy our lives a bit more.

Not a hard choice in my book.

The problem you will have is not with those very few at the top but with the two or three billion in the middle which will fight over which half dies and which half wins. My guess is that the western world which all has fertility rates at or below replacement will decide that their third of the seven billion are the winners and will seek ways to set the other two thirds against each other to mutually wipe each other out. That two thirds will use all the fossil fuel they can get their hands on in the war effort to be the victors. You can't tell them they have to fight it out with stone tipped spears because some of them already have working nukes.

Ultimately this all comes down to the economic system that we live in that has been designed by the 0.1% that benefits them the most. However the way it is set up and run, it gives the illusion that there is something for the masses. ICH has a timely link to Adam Curtis's Century of the Self

The bottom line is that warning signs - such as Limits to Growth and Peak Oil are direct challenges to this headless mindset. Instead of being tackled intelligently they have been decried to keep the illusion going.

The basis of the oxymoronic "Sustainable Development" is increasingly larger amounts of debt - which is becoming unrepayable (if it was ever repayable in the first place)

Which brings us back full circle:

Zero Hedge: Two More Energy Companies File for Chapter 11

[raspberry-blower]

A fair bit of cheery reading on Bloombergs recently about the state of health in the Oil & Gas sector. All of which show the true state of said sector

Moodys: E & P Debt Recovery Plunges to "Catastrophic" Levels

Creditors of energy exploration and production companies that went bankrupt last year recouped less than half the usual amount for their claims, and 2016 is shaping up just as bad, according to Moody’s Investors Service.

Recovery rates for 15 U.S. E&P bankruptcies averaged a “catastrophic” 21 percent last year, well below the historical average of 59 percent, Moody’s said in a report released Monday. Senior unsecured bondholders were hammered even more, averaging just 6 cents on the dollar. Collectively, the debacle could be worse than the telecom industry’s collapse in the early 2000s, measured by both the number of companies that go bust and the recoveries, Moody’s said.

If you hold Unsecured stock - well, more fool you. Caught trying to pick up Nickels in front of the steamroller

On the same theme:

Oil Bankruptcies leave lenders with catastrophic recovery rate

They like that word "catastrophic" don't they?

Defaults in the oil and natural gas industry have been rising through a market slump that has exceeded two years as companies lacked the cash to make interest payments on their debt. Bankruptcies among U.S. producers so far this year are about twice the number among companies rated by Moody’s in all of 2015, the report said. The oil and gas figures have helped propel U.S. corporate defaults to the highest since 2009.

Less than half of the companies that negotiated distressed-debt exchanges in 2015 to try to stave off bankruptcy succeeded, the analysts wrote. Among those that did such deals only to file for bankruptcy protection this year are Halcon Resources Corp., SandRidge Energy Inc. and Goodrich Petroleum Corp. Their debt will probably have very weak recoveries, they said.

Kicking the can down the road again - but how much road is left?

Then this: How Zombie Oil Companies Stay Alive in Life or Death Debt Markets

Moreover, the degree to which such exchanges actually help energy companies stave off bankruptcy is not entirely clear. More than half of the exchanges struck by energy companies last year failed to stop the firms from filing from bankruptcy protection in 2016, according to Moody's. In the meantime, the deals may add to pressures in the oil market by keeping 'zombie' drillers alive for longer than crude prices might suggest.

"The issuance of second-lien debt — and other secured debt variants such as third-lien debt or even 1.5-lien debt — led to significant leverage creep in the already highly levered capital structures, while funding capital expenditures and extending the financial viability of distressed companies," the analysts wrote. "It arguably sustained the U.S. oil and gas supply, while prices remained uneconomic for a significant swath of such oil and gas drilling."