Case Overview

Barrow Shaver Resources, LLC, a large oil and gas operator, filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of Texas. In connection with the bankruptcy, a dispute arose between Barrow Shaver and a group of non-operating working interest owners who hold interests in numerous Barrow Shaver oil and gas leases on valuable property located in Morris, Cass, Upshur, and Camp Counties, Texas. The current dispute centers on whether Barrow Shaver may avoid the working interests previously assigned to the group. To protect their interests, the non-operating working interest owners commenced an adversary proceeding in the Southern District. In that action, they seek a declaration that the disputed working interests are either not property of the bankruptcy estate or, alternatively, not subject to avoidance by Barrow Shaver. The proceeding also involves related issues concerning expense allocations to the working interest owners. The matter remains in its early stages and is still pending before the court.