A major natural gas developer operating in Wyoming's Green River Basin has filed for bankruptcy as demand for natural gas decreases during the COVID-19 pandemic.

Ultra Petroleum filed a petition for Chapter 11 bankruptcy on Thursday in Southern Texas U.S. District Court.

In a written statement, the company said the Chapter 11 restructuring will help eliminated roughly $2 billion in debt. The company says it has secured a commitment for financing of up to $25 million on hand.

Ultra Petroleum officials say the company is expected to continue normal operations under the restructuring agreement.

“After several months of liability management efforts and careful consideration of how best to navigate a challenging low commodity price environment and our debt levels, Ultra’s Board of Directors determined that a voluntarily filling for Chapter 11 reorganization provides the best outcome for the entity," Ultra CEO Brad Johnson said in a written statement. "This financial restructuring will result in an enterprise with very little debt, good liquidity, and significant free cash flow that is underpinned by a large-scale, low-cost base of natural gas and condensate production.”

Last fall, Ultra announced that it was suspending its drilling program. At the time, the company said it was too difficult to support new well development in the Pinedale area, Johnson said.

Court filings show that Ultra filed for bankruptcy once before in 2016.

According to the most recent court filings, Ultra has $1.45 billion in total assets and owes lenders $2.5 billion. The company owes unpaid debts to several oil and gas field services companies in Wyoming.

Last month, the company issued a statement to shareholders explaining concern over Ultra's ability to continue.

"At this time, we do not expect to obtain a waiver of this requirement and we do not currently have sufficient liquidity to repay such indebtedness were it to be accelerated," the company said.

This developing story will be updated.

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