(Reuters) - Chesapeake Energy, the No. 2 U.S. natural gas producer, said on Monday it had no plans to file for bankruptcy, after sources told Reuters the company had asked its longtime counsel to look at restructuring options.

Chesapeake Energy Corporation's 50 acre campus is seen in Oklahoma City, Oklahoma, on April 17, 2012. REUTERS/Steve Sisney

Chesapeake’s shares were halted after plunging more than 50 percent but later pared some losses, as it said advisers Kirkland & Ellis had been providing counsel since 2010 and will continue to help the company strengthen its balance sheet.

Trade publication Debtwire had reported the engagement of Kirkland & Ellis on Friday evening, prompting Chesapeake’s shares to drop early on Monday to $1.50 on fears it might soon make one of the biggest bankruptcy filings of the current crash in oil and natural gas prices.

The company, seeking to downplay those worries, said it “currently has no plans to pursue bankruptcy and is aggressively seeking to maximize value for all shareholders.”

With more than $10 billion in bonds, the oil and gas producer’s balance sheet is under pressure and its equity market capitalization is around just $1.2 billion.

In addition to its debt, filings show Chesapeake has commitments to pay about $2 billion a year for space on pipelines run by several companies, including Williams Companies Inc, whose shares fell 35 percent on Monday, in part on its exposure to Chesapeake.

Chesapeake had cash on hand of about $1.8 billion on Sept. 30, according to public filings. That is plenty to pay $500 million in debt due in March, though at least another $1.3 billion will come due through 2018.

Once a Wall Street darling that in many ways symbolized the U.S. fracking revolution, Chesapeake has struggled since a governance crisis prompted the departure of its founder and former Chief Executive Aubrey McClendon in 2013. Prominent Chesapeake shareholders include Carl Icahn.

With oil and gas prices down 70 percent since 2014 and many new wells money losers, analysts say companies like Chesapeake are in “zombie mode” - slowly burning through cash and unable to invest in growth in a meaningful way.

Tim Rezvan, an energy analyst at Stern Agee, said in a note to clients about Chesapeake that it was “hard to justify any equity value until liquidity questions get answered.”

CNBC, citing sources, said Chesapeake hopes to sell assets or tender bonds.

The Oklahoma City-based company recently completed a debt exchange, converting $3.8 billion of unsecured debt into new second-lien notes, but the new bonds dropped on the secondary market. A limited number of holders of debt with near-term maturities participated in the exchange.

Chesapeake has suspended its dividend to preserve cash, cut about 15 percent of its workforce and written down the value of some oil and gas assets. Standard & Poor’s downgraded Chesapeake to CCC+ last month.

In the third quarter of 2015, it reported a loss of $4.69 billion, compared with a profit of $169 million the same quarter the year before.

About 40 energy companies entered bankruptcy in 2015 and more are expected in the next few months.