UPDATE 2-Ultra Petroleum flags going concern risk, warns of bankruptcy

Mon Feb 29, 2016 6:41pm EST
 
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(Adds information on debt payment due tomorrow)

By Amrutha Gayathri

Feb 29 (Reuters) - Natural gas producer Ultra Petroleum Corp said its auditors have raised doubts about its ability to stay in business and that it may have to seek bankruptcy protection in the United States or Canada.

Ultra Petroleum said in a regulatory filing on Monday that it expects to default on a credit agreement on March 15, and would file for bankruptcy protection if it failed to make debt payments, restructure debt or secure additional capital.

The company also has a looming $62 million payment due March 1 and a $40 million interest payment due the same day on its senior notes. As of Sept. 30, Ultra had $25.6 million in cash, according to public filings.

A call to a spokesperson for Ultra was not immediately returned.

The company, reeling from a prolonged slump in commodity prices, said on Feb. 18 it was considering strategic alternatives and that it had engaged Kirkland & Ellis LLP as legal adviser and Rothschild and Petrie Partners as financial advisers.

At the time, Ultra said it was booking a chunk of its proved undeveloped reserves as probable reserves "due to uncertainty around financing (their) development."

The company's fortunes have declined sharply since 2008, when its market capitalization was $15 billion. Now it is worth about $53 million.   Continued...