A large local oil producer has won a deadline extension from its creditors that allows it to avoid filing for bankruptcy protection after it was unable twice recently to make scheduled interest payments totaling tens of millions of dollars.
Santa Clarita-based California Resources Corp., a major employer and payer of property taxes in Kern County, announced Monday it now has until 8:59 p.m local time on June 30 to pay lenders money that was due May 29 but which had been delayed until Sunday night.
Its failure to make the payments or otherwise reach a new deal by 8:59 p.m. Sunday could have forced the company to seek bankruptcy protection. But the extension agreement gives CRC about two weeks to work out a new arrangement that could put the company on firmer financial ground.
CRC still owes several billion dollars left from its 2014 spinoff from Occidental Petroleum Corp. It's been trying to restructure its debt after the cancellation of a March deal that would have let it rework the debt.
Facing low oil prices during the pandemic, CRC has already shut in oil production, cut paid hours for its local workforce and slashed capital investments.
The extension agreements posted Monday were between CRC and lenders including JPMorgan Chase Bank N.A. and the Bank of New York Mellon Trust Co. N.A.