Oklahoma oil and gas producer Chaparral Energy Inc. on May 11 warned of its ability to continue as a going concern amid a historic plunge in commodity prices and said it has hired legal and financial advisers.

A fall in economic activity due to the COVID-19 pandemic and a price war between top oil producers Russia and Saudi Arabia has hurt oil prices, with U.S. crude falling about 60% this year and dropping below $0 for the first time in history last month.

Reuters reported in March the company was working with debt restructuring advisers as it looks to shore up its cash position.

Oklahoma City-based Chaparral had around $421 million of debt outstanding at the end of 2019. It had about $22.6 million in cash and cash equivalents and $130 million drawn under its $325 million borrowing base, with no significant debt maturities due until 2022.

Last month, Chapparal Energy said it would award $2.15 million in retention bonuses to five senior executives including CEO Charles Duginski, instead of long-term stock awards.

The company had said Duginski would receive $725,000, the most among the group, if he stays with the firm for the next 12 months.

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Retention awards are incentives offered to executives by the company during crucial times and are seen as a red flag in the beleaguered energy industry.

If Chaparral files for bankruptcy protection, it would be the second time for the company, which went through the process during the last oil price slump in 2014-16 and emerged out of it in March 2017.

Earlier in the day, shale pioneer Chesapeake Energy Corp. said it was unable to access financing and was considering a bankruptcy court restructuring of its over $9 billion debt if oil prices don’t recover.

Chesapeake last week decided to prepay $25 million in incentives to top executives. Peers Whiting Petroleum Corp. and Diamond Offshore Drilling Inc. also gave cash awards to senior management just days before filing for Chapter 11 protection last month.

Chaparral said May 11 it has begun to shut-in non-essential oil production and posted a first-quarter profit of $4.91 million compared with a loss of $103.5 million a year earlier.

Shares of the company were up 28% at 50 cents in extended trading.