California Resources Said to Mull Bankruptcy as Debt Mounts (1)

California Resources Corp. is seriously considering bankruptcy after the troubled oil and gas company’s efforts to rework its debt out of court fell short amid a crash in energy prices, according to people with knowledge of the matter.

Management is exploring alternatives to address its nearly $5 billion of debt after the Los Angeles-based company pulled a proposed bond exchange due to poor market conditions, said the people, who weren’t authorized to comment publicly. California Resources’ debt starts maturing next year, and about $74 million of interest is due in June.

“We have significant operating flexibility and are focusing ...