38.6c New Delhi, India, Friday, April 19, 2024
International

Singapore Oil Trader ZenRock Owes More Than $600 Million to banks and creditors; Company confirms economic problems in an application to the Court

By Ghazal Bhootra      13 May, 2020 10:18 AM      0 Comments
Singapore Oil Trader ZenRock

Hit by falling market rates and the COVID-19 pandemic - ZenRock Commodities Trading Pte. Ltd, a Singapore based Oil Trader, confirmed to be in a debt of more than $600 million to creditors, as confirmed by it in a court filing on 11th May 2020.

The company stated in its application to the court that it ran into economic problems due to the falling of oil prices and that the Coronavirus disturbed its trading graph right after it increased its sales and back-office operations in 2019.

In the appeal for "moratorium relief" filed on 6th May 2020, the company mentioned that it owed over 5 banks a sum of $166.1 million and possessed outstanding balances of about $449 million along with at least 10 unsecured claimants.

"ZenRock is now in financial difficulties for the following broad reasons," it highlighted in the appeal while mentioning that "severe disruption" to trade caused by the pandemic, a "steep and sustained decline in crude oil prices" and a tightening credit market "exacerbated" by banks' as the main reasons.

"Partly in consequence of the above, ZenRock is facing difficulties in collecting accounts receivable of approximately $120.5 million," it further mentioned in the application.

ZenRock's appeal for insolvency protection was apparently made after HSBC Holdings PLC asked the oil trading company to function under judicial management, a process whereby the court designates an independent manager to run the administration of a financially distressed company.

On 8th May 2020, Singapore's High Court nominated an interim manager after a hearing on virtual conferencing platforms, two sources claimed.

ZenRock's "moratorium relief" was dissipated during the hearing. Such assistance automatically takes consequence with an appeal and lasts for 30 days or until a court hearing, whichever case happens to occur earlier.

In late April, ZenRock published a statement to its clients and said that it was not under financial stress after global oil and fuel prices collapsed.

HSBC has purported that ZenRock took part in many "highly dishonest transactions" which also comprised of utilizing the same oil cargo to acquire loans from no less than two different lenders, as alleged by a separate affidavit, per Reuters.

Singapore police had raided ZenRock's office on 8th March 2020 after HSBC filed a report, a source mentioned.

With the exception of HSBC, ZenRock has five other secured creditors including Natixis Bank, ING Bank, Credit Agricole, and Bank of China, as claimed in the court filing by ZenRock.

Banque de Commerce et de Placements (BCP), a Swiss bank, is the sixth creditor, the document said.

The document also comprised of a list of ZenRock's top 10 unsecured creditors as on February 29, 2020, for a total sum close to $449 million.

These creditors include French oil major Total's Totsa Total Oil Trading SA, Malaysian state energy firm Petronas' Petco Trading Labuan Co Ltd, oil major Royal Dutch Shell's Shell International Eastern Trading Company, Thai energy major PTT PCL's trading companies in Singapore and London, Angola's Sonangol Finance Ltd, and oil major BP's BP Singapore Pte. Ltd

Four sources who had awareness on the matter stated that Sonangol, China Aviation Oil, and PTT International no longer had any outstanding amounts with ZenRock.

PetroChina International Singapore Pte Ltd, a unit of PetroChina, South Korea's Daelim Corp, Singapore, and China Aviation Oil (Singapore) Corp are also included in the list of unsecured creditors.

"These trade creditors are unsecured, but the obligations are mostly matched against incoming receivables," ZenRock said in the court filing.



Share this article:



Leave a feedback about this
TRENDING NEWS

pil-filed-by-ashwini-kumar-upadhyay-in-sc-for-yr-bachelor-of-law-degree-after-class
Trending Judiciary
PIL filed by Ashwini Kumar Upadhyay in SC for 3-yr Bachelor of Law degree after Class XII

PIL by Ashwini Kumar in SC seeks to shorten law degree to 3 years post-Class XII, citing current 5-year span as irrational.

18 April, 2024 11:21 AM
we-all-know-what-happened-when-there-were-ballot-papers-sc-on-return-of-ballot-papers-or-100-vvpats-count
Trending Judiciary
'We all know what happened when there were ballot papers,' SC on return of ballot papers or 100% VVPATs count

SC questions EVM process, debates ballot paper return and 100% VVPAT count verification, citing past issues.

18 April, 2024 01:53 PM

TOP STORIES

lsj-exclusive-interview-how-bjp-govt-will-free-chhattisgarh-from-naxal-menace
Trending Interview
LSJ Exclusive Interview: How BJP govt will free Chhattisgarh from “Naxal menace”? [Watch Video]

What is Chhattisgarh govt's plan for solving the Maoist/Naxalite problem in the state? Will there be a surgical strike against the Naxals or solution will be found via diplomatic channels? Read the Exclusive Interview with the Deputy Chief Minister Vijay Sharma.

13 April, 2024 12:33 PM
sc-rejects-review-of-order-to-pay-rs-154-cr-compensation-to-ex-air-force-staff-for-transfusion-of-hiv-infected-blood
Trending Judiciary
SC rejects review of order to pay Rs 1.54 Cr compensation to ex Air Force staff for transfusion of HIV infected blood [Read Order]

SC denies review of Rs 1.54 Cr HIV compensation order to ex-Air Force staff for medical negligence.

13 April, 2024 03:13 PM
cji-cautions-against-overlooking-ethical-legal-consideration-on-use-of-ai-in-court-adjudication
Trending Legal Insiders
CJI cautions against overlooking ethical legal consideration on use of AI in court adjudication

CJI D Y Chandrachud warns about ethical, legal challenges in AI use in courts, stressing need for thorough review.

13 April, 2024 07:08 PM
need-to-safeguard-judiciary-from-unwarranted-pressures-21-ex-judges-write-letter-to-cji
Trending Legal Insiders
Need to safeguard judiciary from unwarranted pressures: 21 ex-judges write letter to CJI

21 ex-judges write to CJI Chandrachud urging protection of judiciary from pressures undermining its integrity and autonomy.

15 April, 2024 12:17 PM

ADVERTISEMENT


Join Group

Signup for Our Newsletter

Get Exclusive access to members only content by email