And you thought the days of corporate excess and money mismanagement were long gone with the dot-com crash in 2001!

Deepwater oil and exploration company ATP Oil & Gas (Nasdaq: ATPG) actually went public in 2001 and, through a series of project delays, an insurmountable pile of debt, and a few unfortunate events, now sits on the precipice of a bankruptcy filing, according to Bloomberg.

ATP, at one point, was flying high. In 2007, its share price topped out at $57, and then CEO and current chairman Paul Bulmahn gave each of his 52 employees the perk of a round-trip ticket to Sweden to go pick a new Volvo for themselves, or $25,000 in cash. At the moment, ATP sure could use those frivolous cash expenditures back.

However, when the credit crisis and subsequent recession hit, oil prices collapsed and demand dried up, essentially crippling the company. In the years that have followed, things have only gone from bad to worse.

The Deepwater Horizon oil spill in 2010, which was owned by Transocean (NYSE: RIG), but leased out by BP, resulted in a six-month deepwater drilling moratorium in the Gulf of Mexico, considerably more stringent deepwater drilling regulations, and very limited permit licensing once the ban was lifted. The repercussions of the spill are still being felt, with ATP having multiple project delays in the Gulf, where it operates the majority of its rigs. Yet, many drillers, including Ensco (NYSE: ESV), have returned to fully-operational status in the region.

There were a few glimmers of hope over the years, as ATP discovered natural gas reserves totaling up to 2.3 trillion cubic feet off the coast of Israel, in conjunction with drilling partner, Isramco (Nasdaq: ISRL). Between the Shimshon well discovery, and expected improvement in the Clipper field of the Gulf of Mexico, many investors figured the company would just refinance its debt, and increase productivity to boost cash flow.

Things just didn’t work out that way.

As of its most recently finished quarter, ATP boasted about $2 billion in debt, $1.5 billion of which was due in May 2015 and accrued interest a ridiculous 11.875% rate per year. ATP, facing the prospect of an $89 million interest payment in November, and with very little cash left in its coffers, appears to have turned (according to reports) to Credit Suisse (NYSE: CS) for a $600 million bridge loan to allow it to operate during possible bankruptcy proceedings. Again, these are unconfirmed rumors as of Friday evening, but they are enough to send the stock screaming lower by 73%.

What the ATP story came down to was, simply, a case of a company that expanded beyond its own means, imprudently utilized its cash on hand, and couldn’t generate positive cash flow. The year 2002 was the last time that ATP generated positive cash flow, while burning through more than $3 billion in cash between 2003 and 2011. Even if ATP survives the week without filing for bankruptcy, and this all turns out to be an elaborate rumor, it’s facing a nearly impossible uphill battle in refinancing and repaying its debt load, with the cash constraints needed to rectify its many production delays and developments. It’s also not going to be able to file its second-quarter results on time, and doesn’t have a clue when it will be able to.

ATP proves, once again, that it’s only a matter of time before imprudent spending catches up with unprofitable companies. C’est la vie, ATP … it was nice knowing you!

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