Creditors charge 'sham transaction' in Buccaneer bankruptcy

[unhappycamper]

http://www.adn.com/article/20140729/creditors-charge-sham-transaction-buccaneer-bankruptcy



Buccaneer Energy's jack-up rig Endeavor in Cook Inlet north of Anchor Point. August 23, 2013

Creditors charge 'sham transaction' in Buccaneer bankruptcy
Dermot Cole
July 29, 2014

FAIRBANKS -- Companies trying to collect millions from a failed oil and gas exploration company in Cook Inlet claim that the financial affairs of Buccaneer Energy are tied up in an elaborate shell game.

A month before Buccaneer Energy filed for protection under Chapter 11 of the federal bankruptcy laws May 31, its biggest lender entered a “sham transaction” to circumvent Australian law, according to a court filing in Texas by unsecured creditors of Buccaneer Energy, including oil and gas support firms.

Meridian Capital International, which owns 19.99 percent of Buccaneer, is the largest owner and was the largest secured creditor of Buccaneer as of January. The unsecured creditors charge that Meridian engineered a transfer of its secured debt of $58 million to another company that paid nothing for the debt.

Buccaneer, which has benefited from state subsidies through state tax credits and a state-backed investment in a jack-up rig, was insolvent by last December, the creditors said. In the months that followed, Meridian’s conduct allowed the company to run up more than $15 million in unsecured debt, the creditors said.