While the oil boom continues falling apart in North Dakota, it has claimed the venture capital firm, Intervention Energy, which filed for Chapter 11 bankruptcy in recent days.
The firm, one of the largest companies focused on developing the Bakken and three forks areas in the Williston Basin, listed more than $140 million in debt in its filing made on Friday. Intervention Energy drills mostly in North Dakota but ventures at times into Montana and has more than 50,000 net acres of oil and gas leases. The company was formed in 2008 when its chief executive and founder, John Zimmerman left Wall street.
But Intervention Energy is also in the midst of a fight with lender EIG Global energy Partners. In the bankruptcy court papers, Zimmer described EIG as a cooperative partner for the majority of its time as the firm’s lender but charged its “position clearly changed once they decided to build up their competing platform.”
Zimmerman contends the financial relationship started to deteriorate last fall when Intervention defaulted on its debt with EIG. EIG has one share in the company and did not sign off on the bankruptcy petition.
Intervention’s revenue from oil and gas sales was more than $28 million in 2015 and daily production increased nearly 40% in the same year. The company still has $2.3 million in cash and expects to have $5.7 million by mid-August.
Intervention is not alone in Bakken bankruptcies. Emerald Oil Inc. has filed and operators of Halcon Resources Corp. say they plan to file soon for Chapter 11.