Breitburn Energy Partners Investment Losses

Did you lose money investing in Breitburn Energy Partners, LP at the recommendation of your broker?  If so, The White Law Group may be able to help you recover your losses by filing a FINRA Arbitration Claim against the brokerage firm that sold you the investment.

Breitburn Energy Partners LP (NASDAQ: BBEP) is an independent oil and gas master limited partnership (MLP) focused on the acquisition, exploitation, development and production of oil and gas properties in the United States.

Breitburn Energy Partners LP’s battle continues in bankruptcy court. On May 8, nearly a year after its initial filing,  the company filed a motion to extend the exclusive period during which the Company can file a Chapter 11 plan and solicit acceptances thereof through and including July 11, 2017 and September 9, 2017, respectively with the U.S. Bankruptcy court.

According to the motion, “The Debtors have been administering these cases economically and efficiently and managing a coordinated plan negotiation process consistent with the priorities of their capital structure. The Debtors believe that this process will result in a Proposed Plan premised on a substantial equity infusion and an approximate $1.9 billion deleveraging of the Debtors’ balance sheet.”

In addition, “The modest extensions of the Exclusive Periods requested herein will allow this process to be finalized in a rational manner, consistent with the intent and purpose of chapter 11, maximize value for the Debtors’ economic stakeholders, and assure the Debtors’ successful emergence from chapter 11 and, most importantly, their long-term viability.” The Court scheduled a June 1, 2017 hearing to consider the motion.

Last May Breitburn Energy Partners LP, along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York.

As we told you, the bankruptcy comes on the heels of a dramatic decline in the price of the shares, having dropped more than 97% in the last year alone.  Since then, an equity committee to advocate for Breitburn’s common shareholders was formed as the reorganization plan was put together.

One of the most important issues for shareholders was much ammo the equity committee would have to work with in negotiations based on valuing reserves. The company’s 239.3 million barrels of oil equivalent are the key asset right now, meaning the price of oil will be important to the equation.

Investigating Potential Claims

Unfortunately for many investors they did not fully understand the risks of oil and gas MLPs like Breitburn Energy Partners.  The investment’s performance is directly tied to the price of oil which dropped dramatically beginning in 2014. In addition, the investment’s structure requires that 90% of revenue be paid out as income causes further erosion to the investments in a time of a decline.

Also, many investors were also told that price fluctuations may occur but that the benefit of MLPs is that the distributions were consistent and therefore appealing to retired income seeking investors.

The White Law Group continues to investigate the liability that brokerage firms may have for recommending Breitburn Energy Partners.

Brokerage firms are required to perform adequate due diligence to evaluate whether the investments they recommend are suitable in light of the client’s age, net worth, risk tolerance, investment experience, and investment objectives.

Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.  The White Law Group believes certain financial advisors have been recommending MLPs improperly to income seeking retired investors – focusing on the income potential of the investments while downplaying or ignoring the risks.

Free Consultation

If you suffered losses investing in Breitburn Energy Partners at the recommendation of your financial advisor and would like a free consultation with a securities attorney, please call The White Law Group at 888-637-5510.

The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.

For more information on The White Law Group, please visit https://whitesecuritieslaw.com.

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