MLCJR LLC is on a Chapter 7 liquidation path following conversion on February 28, 2024, with trustee wind-down and budgeted cash-collateral use authorized by the March 8, 2024 wind-down order Dkt. 1738. The next material work is completing estate administration and resolving statutory-lien priority disputes, with creditors seeking reconsideration of the lien procedures in their April 12, 2024 motion Dkt. 1822.

MLCJR LLC moved into Chapter 7 liquidation on February 28, 2024, under the conversion order Dkt. 20, which required turnover of estate property to a Chapter 7 trustee and dissolved the unsecured creditors’ committee. On March 8, 2024, the court’s wind-down order Dkt. 1738 authorized trustee Randy W. Williams to wind down the debtors and use cash collateral consistently with the governing stipulation and budget.

MLCJR LLC and its subsidiaries had filed Chapter 11 petitions on May 14, 2023. The court entered the final DIP financing order Dkt. 434 on June 13, 2023. The trustee’s later wind-down motion Dkt. 1733 recounted that the DIP facility matured on November 30, 2023; Amarillo National Bank, as DIP agent, then filed a January 17, 2024 notice terminating consensual cash-collateral use Dkt. 1384. This financing history preceded the conversion and the subsequent arrangement to fund limited estate administration.

The Chapter 11 asset-sale process produced several court approvals. The January 25, 2024 A-Port sale order Dkt. 1456 authorized the sale of the Grand Isle shore base and related assets for $2,720,000.00, subject to adjustments. The February 10, 2024 Natural Resources Worldwide sale order Dkt. 1626 authorized an oil and gas asset sale for $20,250,000 in cash, also subject to adjustments, with liens attaching to proceeds and lease transfers requiring applicable regulatory approvals.

The trustee’s March 6, 2024 wind-down motion Dkt. 1733 described approximately $4.715 million in cash collateral for estate administration, including a $400,000 litigation reserve and up to $2.865 million in operating reserves. It also identified obligations of purchasers W&T Offshore and Natural Resources Worldwide to pay $250,000 each monthly under separate 90-day transition-services agreements. The trustee proposed retaining limited staff for asset maintenance, monitoring, and transition work, and projected limited cash availability after March 15, 2024. The March 8 order granted wind-down and cash-collateral authority.

By April 12, 2024, statutory-lien treatment was a contested issue in the liquidation. In their reconsideration motion Dkt. 1822, service creditors challenged procedures entered on April 10 for determining the validity, priority, and extent of their liens, alleging insufficient notice and due process. Their filing also reported that $47,494,240 of net W&T sale proceeds had been distributed to DIP lenders in partial satisfaction of DIP obligations. Resolving lien priority and administering the remaining estate assets were the material tasks identified at that stage.

MLCJR LLC is on a Chapter 7 liquidation path following conversion on February 28, 2024, with trustee wind-down and budgeted cash-collateral use authorized by the March 8, 2024 wind-down order Dkt. 1738. The next material work is completing estate administration and resolving statutory-lien priority disputes, with creditors seeking reconsideration of the lien procedures in their April 12, 2024 motion Dkt. 1822.

MLCJR LLC moved into Chapter 7 liquidation on February 28, 2024, under the conversion order Dkt. 20, which required turnover of estate property to a Chapter 7 trustee and dissolved the unsecured creditors’ committee. On March 8, 2024, the court’s wind-down order Dkt. 1738 authorized trustee Randy W. Williams to wind down the debtors and use cash collateral consistently with the governing stipulation and budget.

MLCJR LLC and its subsidiaries had filed Chapter 11 petitions on May 14, 2023. The court entered the final DIP financing order Dkt. 434 on June 13, 2023. The trustee’s later wind-down motion Dkt. 1733 recounted that the DIP facility matured on November 30, 2023; Amarillo National Bank, as DIP agent, then filed a January 17, 2024 notice terminating consensual cash-collateral use Dkt. 1384. This financing history preceded the conversion and the subsequent arrangement to fund limited estate administration.

The Chapter 11 asset-sale process produced several court approvals. The January 25, 2024 A-Port sale order Dkt. 1456 authorized the sale of the Grand Isle shore base and related assets for $2,720,000.00, subject to adjustments. The February 10, 2024 Natural Resources Worldwide sale order Dkt. 1626 authorized an oil and gas asset sale for $20,250,000 in cash, also subject to adjustments, with liens attaching to proceeds and lease transfers requiring applicable regulatory approvals.

The trustee’s March 6, 2024 wind-down motion Dkt. 1733 described approximately $4.715 million in cash collateral for estate administration, including a $400,000 litigation reserve and up to $2.865 million in operating reserves. It also identified obligations of purchasers W&T Offshore and Natural Resources Worldwide to pay $250,000 each monthly under separate 90-day transition-services agreements. The trustee proposed retaining limited staff for asset maintenance, monitoring, and transition work, and projected limited cash availability after March 15, 2024. The March 8 order granted wind-down and cash-collateral authority.

By April 12, 2024, statutory-lien treatment was a contested issue in the liquidation. In their reconsideration motion Dkt. 1822, service creditors challenged procedures entered on April 10 for determining the validity, priority, and extent of their liens, alleging insufficient notice and due process. Their filing also reported that $47,494,240 of net W&T sale proceeds had been distributed to DIP lenders in partial satisfaction of DIP obligations. Resolving lien priority and administering the remaining estate assets were the material tasks identified at that stage.