© Reuters. FILE PHOTO: A process tower flies through the air after exploding at the TPC Group Petrochemical Plant, after an earlier massive explosion sparked a blaze at the plant in Port Neches, Texas, U.S., November 27, 2019. REUTERS/Erwin Seba/File Photo
(Corrects name of company to TPC from TCP in headline and first paragraph)
HOUSTON (Reuters) -Texas petrochemical producer TPC Group filed for bankruptcy protection on Wednesday with a plan to hand over control to its lenders, after struggling under costs and legal claims from a 2019 fire.
The Houston-based firm filed for Chapter 11 in U.S. Bankruptcy Court for the District of Delaware with plans to eliminate $950 million of $1.3 billion in secured debt and shed liabilities from an explosion and fire at its plant in Port Neches, Texas. The company had negotiated and agreed the deal with debt-holders.
The largest North American processor of the petrochemicals butane and butadiene, plans to continue operations while it restructures, said Chief Executive Edward J. Dineen in a statement. The chemicals are used in manufacturing of plastics, tires and gasoline.
The company faces federal and state investigations over the Port Neches fire, and is in negotiations with a committee representing some 7,000 claims for property damage, business interruption and personal injury, according to court filings.
The fire was “a critical event leading to” the bankruptcy, according to a court filing. The pandemic later cut into its business, cutting 2020 revenue nearly in half compared to 2019, and a winter storm in 2021 also hit sales, it said.
The case is U.S. Bankruptcy Court, District of Delaware, No. 22-10493.