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Show Park City's Paiute Oil Corp. forced to file Chapter 11 Staylev Kenl;i Inc. and E-Z Rentals a combined sum t $j8.45o. Paiuie's combined debt equals about 2'j million. Pinder said. The company lists $11 million in assets with $5 million in liabilities. The oil and mining firm ran into cash-flow problems last spring. Pinder said, after it bought out Southern Pacific Railroad's share of a Uinta Basin oil field. At the time of that transaction, Paiute's other partner in the interest. Walker Energy, was expected to buy the Southern Pacific shares. Walker Energy, however, did not come forward, Pinder said, leaving Paiute short on cash. Walker is currently believed to be trying to sell its shares in the Uinta Basin field, Pinter said. Pinder maintains the company has 2'-. million barrels of "developed" oil, that is, crude oil ready to be pumped. The oil is valued at $50 million. Further. Pinder claims the company has proved reserves of by Christopher Smart Robert J. Pinder's Park City-based Paiute Oil and Mining Corp. has filed under Chapter 11 of the federal bankruptcy code. The move, wtiich will allow the firm to reorganize its debt structure, comes in the wake of a petition for involuntary bankruptcy which was filed Sept. 27 by four of Paiute's creditors. Pinder said Paiute filed the Chapter 11 petition Dec. 18, one day before the involuntary bankruptcy was to be heard by Judge Glen E. Clark's U.S. Bankruptcy Court. "It was the only way to ensure that our investors would be protected," he said. Paiute made an offer to the creditors, Pinder maintains, that would have the equivalent of paying the debt in full. The creditors rejected the offer. According to the petition for involuntary bankruptcy, Paiute owes LCLOil Company, Olympus Oil Inc., another 25 million barrels of oil. According to the Chapter 11 section of the bankruptcy code, Paiute has 120 days to file a reorganization plan that will satisfy debtors. Pinder said that a new plan may not pay debtors 100 cents on the dollar. Because of an apparent mix-up, Judge Clark had ordered Paiute into involuntary bankruptcy Oct. 23. But according to Pinder, the petition for the involuntary bankruptcy was answered in a timely manner on Oct. 22. the day it was due. That document, however, was misplaced ,' by the court clerk. W hen Judge Clark found the mistake he rescinded the bankruptcy order Nov. 5. If the court had ordered Paiute into involuntary bankruptcy at the scheduled Dec. 19 hearing, the company's assets could have been liquidated by a court appointed trustee who would distribute the proceeds to company creditors. |