Business Restructuring & Insolvency 2021 Annual Review

We continued to represent Mesquite Energy Inc. (f/k/a Sanchez Energy Corporation) in connection with efforts to right-size its midstream and marketing cost structure following a chapter 11 bankruptcy process that saw our former clients, as prepetition lenders to Sanchez, receive equity interests in the reorganized Mesquite. Sanchez was a publicly traded, independent oil and gas exploration and production company with 2018 revenues exceeding $1 billion and one of the largest E&P reserve positions in the Eagle Ford Shale. It emerged from chapter 11 protection in June 2020 with substantial unresolved litigation regarding, among other things, efforts to reject certain uneconomic contracts with service providers and others with working interests in leases operated by Mesquite. During 2021, a cross-practice team of Morrison & Foerster restructuring and litigation attorneys led the charge for Mesquite in litigation that resulted in successful settlements of two key remaining litigation matters. The first settlement involved amendments to agreements with one of Mesquite’s working interest partners and led to reduced cost subsidies previously borne by Sanchez. The second settlement followed novel litigation and successful rejection of an in-field gathering agreement, ultimately leading to materially improved economic terms provided by existing service providers. Mesquite Energy MORRISON & FOERSTER | BRIG 2021 ANNUAL REVIEW 29 28 MORRISON & FOERSTER | BRIG 2021 ANNUAL REVIEW