Adams County oil company files for Chapter 11, blaming SB 181

This story has been updated to include comments from PetroShare.

ENGLEWOOD  — PetroShare Corp. (OTCMKTS: PRHR), an oil drilling company that primarily operates in Adams County, has filed for Chapter 11 bankruptcy.

In filings with the U.S. Bankruptcy Court of Colorado, the Englewood-based company listed $36,927,856 in assets and $45,100,988 in debts in a voluntary reorganization.

In a statement, CEO Stephen Foley blamed Senate Bill 181 for the company’s bankruptcy, saying the sweeping oil and gas reform bill passed by state lawmakers earlier this year is warding off investors. The company also pointed to oil price volatility as driver of investor worries.

“The new Colorado regulatory environment governing oil and gas permitting in the state and the associated uncertainty on rule-making has made it very difficult to attract new capital investment in this sector,” he said.

The company said it plans to continue operating and “maintain most staffing and equipment” through the bankruptcy process.

PetroShare’s bankruptcy comes just a day after the Adams County Board of Commissioners unanimously approved doubling the setback requirements for new drilling operations and several other regulations on oil and gas companies, becoming the first local government to use Senate Bill 181’s so-called “1041 powers” to create stricter regulations than at the state level.

PetroShare produced 445,403 barrels of oil and 612,800 MCF of natural gas this year between its operations in Adams and Weld counties, according to Colorado Oil and Gas Conservation Commission Data. The vast majority of that production came from Adams County.

In an email, PetroShare president Fred Witsell said the company cut its staff to nine employees to manage the company as it restructures.

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