By Dan Bewley and Scott Thompson, The News On 6
TULSA, OK -- Oklahoma's independent oil producers may be left out in the cold, one year after SemGroup filed bankruptcy.
The Tulsa energy company was one of the state's largest buyers of oil and now those producers are learning they may not ever be paid.
The oil and gas industry is the lifeblood of Oklahoma. Thousands of state residents rely on black gold to pay the bills.
A major player for the last eight years has been Tulsa based SemGroup. But a year ago Wednesday, SemGroup filed for bankruptcy protection, leaving oil producers like Stan Earnhardt, holding the bill, waiting for their money
"Nothing has changed for the small producer. We haven't gotten any money and it doesn't look like we'll get very much," said Stan Earnhardt, an independent oil producer.
Earnhardt had hoped the bankruptcy court in Delaware would honor an Oklahoma statute that says the state's oil producers should be paid first, before other creditors.
But the judge in charge of SemGroup's bankruptcy ruled the statute doesn't apply in this case, forcing Earnhardt to file his own suit against SemGroup.
"What's frustrating to me is that this whole situation is being controlled by lawyers in Delaware," said Stan Earnhardt.
"It's just like going into the grocery store and walking out and being robbed, because that's exactly what happened," said Lee Levinson, an oil and gas attorney.
Lee Levinson says SemGroup owes $143 million to Oklahoma's oil producers and royalty owners.
The judge in Delaware ruled that SemGroup should only pay 5% of that debt, leaving many without a big chunk of their income.
"Imagine running a business and having no gross revenue for 3 or 4 months," said Lee Levinson.
Stan Earnhardt says SemGroup's collapse has cost him nearly $200,000 and forced him to change the way he gets paid for what his pumps produce -- no more credit, instead he'll want cash.
"I will not be extending six weeks worth of credit to the people that buy my oil in the future and I don't see how any other operator can do that either," said Stan Earnhardt.
Lee Levinson has filed four lawsuits on behalf of Oklahoma's oil producers to get their money from SemGroup. But those suits were recently moved out of Oklahoma and will be heard in Delaware, making it even more difficult for the producers to get paid.
7/20/2009 Related Story: Catsimatidis Out At SemGroup