Whiting Petroleum Corp filed for Chapter 11 bankruptcy, the U.S. shale producer said on Wednesday, the first publicly traded casualty of crashing crude oil prices that are expected to bite into record U.S. output.

Whiting was once the largest oil producer in North Dakota, now the second-biggest oil-producing state in the country. It has agreed with creditors to cut its debt by about $2.2 billion through an exchange of some of its notes for 97% of new equity. Existing shareholders will own 3% of the reorganized company.

Notably, Whiting said in a regulatory filing that on March 26, in response to the circumstances affecting the oil industry, it revised its compensation program to pay out more than $13 million bonuses to several executives, including $6.4 million to CEO Brad Holly.

Numerous shale oil and gas producers, faced with burdensome debt loads, have cut spending aggressively as oil prices have plunged by about two-thirds this year with the coronavirus pandemic slamming fuel demand and Russia and Saudi Arabia flooding markets with extra crude.

A U.S. drilling boom over the last three years lifted national oil production to a record of roughly 13 million barrels per day, but investors have grown frustrated with poor returns. Callon Petroleum and other companies have hired advisors to restructure debt.

Shares of Whiting fell 32 cents, or 47%, to 36 cents each on Tuesday.

The company's market valuation has shrunk to $32 million from as much as $15 billion at its peak in 2011, when investors were discovering the burgeoning shale sector. As of Dec. 31, Whiting had $2.8 billion in debt and more than $585 million in cash on its balance sheet.

Whiting is among the most shorted oil and gas stocks, with more than 60% of its outstanding shares borrowed for short selling, according to FIS Astec Analytics data.

Analysts believe the energy sector is primed for more defaults in coming months. Whiting's bankruptcy brings the trailing 12-month high-yield energy default rate to more than 11%, and the year-end figure could ultimately surpass the 19.7% level set in January 2017, according to Fitch Ratings.

Energy producers Chesapeake Energy Corp and Chaparral Energy Inc as well as natural gas producer Gulfport Energy Corp are working with debt restructuring advisers or investment banks to shore up cash reserves.

SunTrust Robinson Humphrey analyst Neal Dingmann said filing for bankruptcy "was more of a temporary solution than a long-term sustainable plan."

"We believe this financial demise was due to a combination of difficult macro conditions combined with sub-par operations for several quarters," Dingmann said.

The company was also hampered by debt after purchasing rival Kodiak Oil & gas in mid-2014, just before shale's 2015-2016 crash, for $6 billion, which included $2.2 billion in debt.

Whiting was expected to produce about 42 million barrels of oil equivalent in 2020. It said it would continue to operate without material disruption to vendors, partners or employees.

Moelis & Co is Whiting's financial adviser, while Alvarez & Marsal is its restructuring adviser. PJT Partners is acting as financial adviser for creditors.