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Full title: Response/Objection Filed by Official Committee Of Unsecured Creditors. (Related document(s):307 Amended Chapter 11 Plan) (Stewart, Paul) (Entered: 06/04/2021)

Document posted on Jun 3, 2021 in the bankruptcy, 4 pages and 0 tables.

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The Official Committee of Unsecured Creditors (the “Committee”) of Castex Energy 2005 Holdco, LLC, et al (collectively, the “Debtors”) respectfully submits this Memorandum in Support of the Debtors’ Fourth Amended Joint Chapter 11 Plan [Dkt.The Debtors have now filed the Fourth Amended Plan which incorporates a term sheet setting forth a global resolution of claims and issues arising between the Debtors, its lenders, certain joint interest owners and operators of properties as well as with the Committee.The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, as applicable, are: Castex Energy 2005 Holdco, LLC (6832); Castex Energy 2005, LLC (6832); Castex Energy Partners, LLC (6832); and Castex Offshore, Inc. (8432) (collectively, the “Debtors”). The Fourth Amended Plan is a reasonable resolution to a complicated problem – how to best wind-down the affairs of the Debtors while balancing future environmental concerns and regulatory compliance with maximizing the value of the Debtors’ remaining assets such that creditors may receive a return on Allowed Claims.Local Counsel for the Official Committee of Unsecured Creditors of Castex Energy 2005 Holdco, L.L.C. CERTIFICATE OF SERVICE I hereby certify that on this 4th day of June 2021, a true and correct copy of the foregoing OFFICIAL COMMITTEE OF UNSECURED CREDITORS’ MEMORANDUM IN SUPPORT OF THE DEBTORS’ FOURTH AMENDED JOINT CHAPTER 11 PLAN was sent via ECF Noticing to all parties registered to receive CM/ECF Notices in this case.

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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION In re Chapter 11 CASTEX ENERGY 2005 HOLDCO, LLC, et al.1 Case No. 21-30710 (MI) (Jointly Administered) Relates to Dkt. 296 OFFICIAL COMMITTEE OF UNSECURED CREDITORS’ MEMORANDUM IN SUPPORT OF THE DEBTORS’ FOURTH AMENDED JOINT CHAPTER 11 PLAN   The Official Committee of Unsecured Creditors (the “Committee”) of Castex Energy 2005 Holdco, LLC, et al (collectively, the “Debtors”) respectfully submits this Memorandum in Support of the Debtors’ Fourth Amended Joint Chapter 11 Plan [Dkt. 294] (the “Fourth Amended Plan”). As noted by the Committee in its Limited Objection to Confirmation of the Debtors’ Third Amended Joint Chapter 11 Plan [Dkt. 296] (the “Committee Objection”), the certain issues had yet to be definitively resolved and were still being negotiated amongst parties-in-interest. The Committee further indicated that it believed consensus resolution was close and that the parties were continuing to work in good faith towards ultimate resolution. The Debtors have now filed the Fourth Amended Plan which incorporates a term sheet setting forth a global resolution of claims and issues arising between the Debtors, its lenders, certain joint interest owners and operators of properties as well as with the Committee. The   1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, as applicable, are: Castex Energy 2005 Holdco, LLC (6832); Castex Energy 2005, LLC (6832); Castex Energy Partners, LLC (6832); and Castex Offshore, Inc. (8432) (collectively, the “Debtors”). The Debtors’ mailing address is: One Memorial City Plaza, 800 Gessner Rd., Suite 925, Houston, TX 77024.

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Committee notes that the term sheet attached to and incorporated within the Fourth Amended Plan is the delicate product of extensive negotiations between the various stakeholders. The Fourth Amended Plan is a reasonable resolution to a complicated problem – how to best wind-down the affairs of the Debtors while balancing future environmental concerns and regulatory compliance with maximizing the value of the Debtors’ remaining assets such that creditors may receive a return on Allowed Claims. At the outset of the case, the Committee identified several issues with the proposed resolution of the Debtors’ chapter 11 cases. Chiefly, the Committee was concerned that, as originally envisaged, the Debtors’ wind-down plan would leave unsecured creditors with little hope of seeing any return on their claims. The Debtors’ being operators of numerous oil & gas properties, many of which were offshore, which have extensive plugging and abandonment liability associated therewith. The Debtors, and the proposed liquidating trust would be subject to continual health, safety and environmental oversight and expense pressures which likely would devour liquidating trust assets prior to distribution to creditors. Moreover, the significant asset being transferred to the liquidating trust (what was previously defined as the Escrowed Talos Shares) were subject to a lock-up arrangement and subject to restrictions on when and if such shares could be released. The Fourth Amended Plan, however, successfully resolves many of the issues concerning the Committee. The proposed global settlement set forth in the Term Sheet incorporated within the Fourth Amended Plan provides for operatorship of remaining offshore wells to be taken over by other working interest owners, and further, provides for a significant waiver of claims by such parties. The end result is that the Debtors’ offshore health, safety and environmental issues have been resolved, hopefully to the satisfaction of the United States, and a fund is being transferred to

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the liquidating trust providing creditors with a projected return on claims. Something not truly countenanced at the outset of this case. The Committee believes the results achieved under the Fourth Amended Plan present the best and most efficient method of concluding these Chapter 11 cases. For these reasons, and reasons which may be expressed at hearing, the Committee supports the Fourth Amended Plan as it incorporates the global settlement term sheet. The Committee continues to work through the Liquidating Trust Agreement and Confirmation Order with the Debtors, and reserves all rights thereunder. The Committee is supportive of the Debtors’ efforts to confirm the Fourth Amended Plan and believes that the Debtors will be able to show compliance with all applicable confirmation requirements, including but not limited to those under 11 U.S.C. §1129. To the extent the Committee Objection remains live despite the filing of the Fourth Amended Plan, the Committee hereby withdraws the Committee Objection. STEWART ROBBINS BROWN & ALTAZAN, LLC By: /s/ P. Douglas Stewart, Jr. Paul D. Stewart, Jr. (LA. Bar # 24661, admitted SDTX) William S. Robbins (TX Bar # 24100894) Brandon A. Brown (TX Bar # 24104237) Baton Rouge, LA 70801-0016 Telephone: (225) 231-9998 Facsimile: (225) 709-9467 Email: dstewart@stewartrobbins.com wrobbins@stewartrobbins.com bbrown@stewartrobbins.com Lead Counsel for the Official Committee of Unsecured Creditors of Castex Energy 2005 Holdco, L.L.C. Continued On Next Page

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-and- Tom A. Howley (TX Bar # 24010115) Eric Terry (TX Bar # 00794729) HOWLEY LAW PLLC Pennzoil Place – South Tower 711 Louisiana St., Suite 1850 Houston, Texas 77002 Telephone: 713-333-9125 Facsimile: 713-659-9601 Email: tom@howley-law.com Email: eric@howley-law.com Local Counsel for the Official Committee of Unsecured Creditors of Castex Energy 2005 Holdco, L.L.C. CERTIFICATE OF SERVICE I hereby certify that on this 4th day of June 2021, a true and correct copy of the foregoing OFFICIAL COMMITTEE OF UNSECURED CREDITORS’ MEMORANDUM IN SUPPORT OF THE DEBTORS’ FOURTH AMENDED JOINT CHAPTER 11 PLAN was sent via ECF Noticing to all parties registered to receive CM/ECF Notices in this case. /s/ P. Douglas Stewart, Jr. P. Douglas Stewart, Jr.  

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