North Sea Oil and Gas Firm Xcite Energy Heading for Liquidation
An energy company headquartered in Surrey but whose operations are focussed on activities in the North Sea off the coast of Scotland looks to be heading towards liquidation.
Xcite Energy’s managers have been trying to engineer a deal that would allow the business to continue operating but those efforts have so far been thwarted by a lack of agreement among relevant stakeholders.
A restructuring plan was put to the oil and gas company’s bondholders in recent days with the firm, which is listed on London’s Alternative Investment Market (AIM), aiming to implement a debt to equity swap to improve its financial position.
However, bondholders have reportedly rejected the idea on the basis that they are not convinced that the plan could be properly implemented.
“The principal bondholders have informed the company that they are not satisfied that the transaction is capable of being implemented in a manner acceptable to them,” a statement given on behalf of Xcite explained.
Xcite owns and operates one of the largest currently undeveloped energy fields in the North Sea but has faced significant pressures on its finances in recent years as a result of a sharp fall in the price of oil on international markets.
What the future might hold for its undeveloped energy fields is now unclear but expectations are that Xcite’s bond trustees will soon petition the relevant authorities to appoint a liquidator to manage the company’s affairs going forward.
The company’s shares as listed on the AIM stock exchange have been suspended with reports suggesting that liquidators will be appointed to Xcite within around six weeks of a request from bond trustees being made.
Xcite is based primarily in the city of Aberdeen in north-east Scotland, where the past few years have been tough for the oil and gas industry and the hundreds of businesses whose operations rely on it.
Thousands of jobs have been lost in recent years across the UK’s energy sector, with the Unite union having warned earlier this year that Scotland might soon struggle to maintain any form of viable oil and gas industry if current trends continue.