“That’s the ballgame,” Tulsa attorney Gary McDonald said Wednesday during the Mid-Con Expo Energy Conference at the Cox Convention Center in Oklahoma City.

“One hundred percent recovery: that’s what the statutes intended,” he added. “I think the prospects for full recovery are very good.”

SemCrude and Eaglwing, two SemGroup subsidiaries caught up in the Tulsa energy company’s July 22, 2008, bankruptcy, owe hundreds of producers for oil and gas bought in the 50 days before the Chapter 11 filing. The producers group also includes thousands more people as operators, working interests and royalty owners, according to reports.

A key battle in Delaware federal bankruptcy court pits the producers against a mammoth group of secured lenders led by Bank of America. Those creditors backed a $2.5 billion credit line and hold secured claims on SemGroup’s assets, according to reports.

Oil and gas producers, McDonald pointed out, also are a large group but tethered to a variety of state laws governing those liens for product sold prior to bankruptcy. Most of the oil and gas was sold to SemCrude and Eaglwing from Oklahoma, Texas, Kansas and New Mexico.

“It’s a difficult process to manage,” he said.

The Oklahoma statute guarding producers’ interest is clear, McDonald added. The revenues for “all sale of product shall be regarded as separate

Legal precedent, however, is slim on these types of trust cases, a concern apparently raised by Delaware Federal Judge Brendan L. Shannon earlier in the proceedings. The reason for the low volume of case law, McDonald replied, is that system has worked in protecting producers.

McDonald and other producer counselors will make their final arguments beginning next Wednesday in the Wilmington, Del., courtroom. The Tulsa lawyer believes he will get a fair hearing.

“You should know that we have a fine judge,” he said of Shannon, whom he credited with noting the producers’ rights when he approved SemGroup’s debtor-in-possession financing last year.

“He takes his time,” McDonald added. “I am confident that the decision he reaches is a decision he believes is right as a matter of law.”

Some officials have estimated the producers’ claims to be as high as $1 billion. SemGroup filed for Chapter 11 bankruptcy protection after its traders, led by company CEO and co-founder Tom Kivisto, ran up $2.4 billion in margin losses on failed oil futures positions, according to reports.

SemGroup traders were taking a mostly short position, based on the assumption that prices would return to historic levels on the New York Mercantile Exchange. Oil, meanwhile, rose to a historic high of $147 per barrel in the same month that SemGroup collapsed financially.

The Tulsa company now is pursuing a reorganization plan that could be focused on its SemCrude unit. The deadline for delivering that plan to Shannon’s court is May 15.