Sabine Oil & Gas Corporation
In 2016, a trial began to determine the future of Sabine Oil & Gas Corporation's $3 billion chapter 11 reorganization plan. The plan called for first and second lien secured creditors to receive new claims representing approximately 98% of the reorganized company's enterprise value, leaving unsecured creditors, owed $1.4 billion, to recover less than two cents on the dollar. The plan had the support of the secured creditors, but unsecured creditors were strongly opposed. At the heart of the unsecured creditors' objections to the plan was a dramatically different view on valuation. How much were Sabine's oil and gas reserves worth today? How much were they worth at the time Sabine filed for chapter 11? And, based on these valuations, what was a fair recovery for Sabine's creditors?