Offshore drilling contractor Diamond Offshore has started voluntary Chapter 11 proceedings to restructure and strengthen its balance sheet.
According to its statement on Monday, Diamond and select subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas.
Diamond explained that it intends to use the proceedings to restructure and strengthen its balance sheet and achieve a more sustainable debt profile.
The company and its advisors are pursuing negotiations with its key stakeholders regarding a comprehensive restructuring plan to address the capital structure.
Diamond noted it has sufficient capital to fund its global operations in the ordinary course and to make continued investments in safety and reliability during the reorganization proceedings and does not require additional post-petition financing at this time.
Marc Edwards , President and Chief Executive Officer, said: “After a careful and diligent review of our financial alternatives, the Board of Directors and management, along with our advisors, concluded that the best path forward for Diamond and its stakeholders is to seek Chapter 11 protection.
“ Through this process, we intend to restructure our balance sheet to achieve a more sustainable debt level to reposition the business for long-term success”.
In recent company news, Diamond Offshore got a contract cancellation from Beach Energy for the Ocean Onyx drilling rig.
The rig was supposed to be used for the development of Beach’s undeveloped Otway Basin gas reserves.