Cobra parent Mammoth: PREPA paid Whitefish, now it’s our turn
By The Star Staff
Mammoth Energy Services Inc., the parent company of Cobra Acquisitions, had words to say about the Puerto Rico Electric Power Authority (PREPA) settling its debt with Whitefish Energy Holdings LLC for services rendered in the aftermath of Hurricane Maria.
Mammoth CEO Arty Straehla commented in a written statement over the weekend that while it is encouraging that PREPA has begun addressing amounts owed to post-bankruptcy creditors, Mammoth’s subsidiary Cobra Acquisitions is owed more than three times the amount owed to Whitefish for work restoring electricity for Puerto Rico.
“It has been nearly five years since Hurricane Maria, and nearly three years since Cobra completed its work, which has stood the test of time during subsequent natural disasters,” Straehla said. “We are proud of our work, and fully expect to be compensated for our efforts. It is clear the time for talk is over, and the time for action is now. We have been fully cooperative throughout this process, providing every piece of requested documentation. PREPA is running out of excuses for its refusal to pay, and if they continue to drag their feet, we believe it will further impact their ability to exit from bankruptcy.”
After Hurricanes Irma and Maria destroyed 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 process.
As of Feb. 28, 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, Straehla said.
U.S. District Judge Laura Taylor Swain, who oversees PREPA’s bankruptcy in the Title III bankruptcy court, in August 2021 rejected a request by Cobra Acquisitions to reopen the court dispute over unpaid contract fees for work it performed for PREPA.
Swain said that indefinite delays of a criminal trial on fraud allegations against Keith Ellison, Cobra’s president, were not sufficient grounds to lift the stay on its dispute with PREPA.
PREPA paid Cobra more than $1 billion for repairs it performed on the power grid after the destruction caused by the hurricanes. But the utility stopped making payments to the contractor after allegations that Ellison secured the contracts by delivering kickbacks to Federal Emergency Management Agency officials.
PREPA at the time said it was waiting for the outcome of the trial.