U.S. shale oil and gas producer Chesapeake Energy Corp. plans to cut 15% of its workforce, an email sent to employees revealed, as it closes on new financing that will allow it to emerge from bankruptcy court protection next week.

Once the second-largest U.S. natural gas producer, Chesapeake was felled by a long slide in gas prices. The company is “resetting our business to emerge a stronger and more competitive enterprise,” according to the email to employees by CEO Doug Lawler dated Feb. 2, and reviewed by Reuters.

Most of the 220 layoffs will happen at the Oklahoma City headquarters, the email said.

Chesapeake on Feb. 2 said it planned to raise $1 billion in notes to complete its bankruptcy exit.

The company’s bankruptcy plan was approved by a U.S. judge last month, giving lenders control of the firm and ending a contentious trial.

Chesapeake filed for court protection in June 2020, reeling from overspending on assets and from a sudden decline in demand and prices spurred by the coronavirus pandemic.

“As we prepare to conclude our restructuring, we continue to prudently manage our business and staffing levels to adapt to challenging market conditions and position Chesapeake for sustainable success,” company spokesman Gordon Pennoyer said by email, when asked about the planned layoffs.

People losing their jobs will be given severance packages and career assistance, according to Lawler's email. The company’s headquarters was closed on Feb. 3 and workers were notified by phone about layoffs “because of the current health concerns known to all,” the email said.

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