Mammoth Energy Statement On Puerto Rico Bankruptcy Developments
OKLAHOMA CITY, March 14, 2022 /PRNewswire/ -- Mammoth Energy Services, Inc. (NASDAQ: TUSK) ("Mammoth" or the "Company") today issued the following statement in response to Puerto Rico's governor Gov. Pedro Pierluisi's attempt to terminate the $8.3 billion dollar bankruptcy agreement that would have allowed the Puerto Rico Electric Power Authority ("PREPA") to emerge from bankruptcy and pay its creditors:
"This is yet another example of Puerto Rico and PREPA continuing their resistance to pay their bills. I commend Judge Laura Taylor Swain for directing the Puerto Rico Fiscal Management and Oversight Board ("FOMB") to advance a new deal for PREPA immediately. While PREPA has begun addressing amounts owed to post-bankruptcy creditors, Mammoth's subsidiary Cobra Acquisitions LLC ("Cobra") is still owed more than $340 million dollars for work completed nearly three years ago. PREPA is running out of excuses, and it is well past time for them to make their creditors whole," said Arty Straehla, Chief Executive Officer of Mammoth.
During a recent meeting of the FOMB in Puerto Rico, board member Justin Peterson made the following comments on the need to hold PREPA accountable: https://www.youtube.com/watch?v=0p3iRwyOfs8
JUSTIN PETERSON: "As some of you know, who follow me on Twitter, I have called attention to this matter because I think it is important that PREPA be held accountable. Just so everybody understands that I had the opportunity to have lunch with Arty Straehla, who is the CEO of Mammoth in DC one day he came to see me. So, after the hurricane when Puerto Rico needed help, they called these guys, and they you know on a moment's notice deployed people to help bring emergency restoration to the grid and they were paid some and but not all and PREPA continued to run the meter and ask a lot of this company who swung into action and did what it was contracted to do, and they haven't been paid. And so I agree with everything our chairman said that you know we want to work with FEMA and work with the process and make sure that everything that deserves to be paid is paid but I just I just want to underscore for everybody what these guys did and I also want to underscore that something that you said which is that when Members of Congress have asked FEMA are you telling PREPA not to pay these guys and FEMA'S denied it and so again you know maybe more fake news that we have to deal with that we have to look into but thank you for your comments."
Following Hurricane Maria (September 2017) in Puerto Rico and its complete destruction of the island's power grid, Mammoth, through Cobra, was awarded an initial $200 million restoration contract in 2017. Through five separate amendments to the original contract, the aggregate contract amount was eventually increased to $945 million. PREPA awarded a second contract of up to $900 million to Cobra in response to a Request for Proposals ("RFP") process.
As of February 28, 2022, Mammoth, through Cobra, is owed $344 million including $117 million in interest charges, as specified in the contract, on remaining invoices for work Cobra completed nearly three years ago.