Independent oil and gas company Delta Petroleum Corp, in which billionaire investor Kirk Kerkorian holds a 33% stake, said it was looking to sell itself as it grapples with ballooning debt.

"Delta (is) conducting a strategic alternatives process that will be aimed at ... dealing with 2012 debt maturities," the company said in a statement.
According to a regulatory filing, a $25 million term loan taken from Macquarie Bank Ltd is due in January 2012 and holders of $115 senior convertible notes have the option to require the company to repurchase the notes on May 1, 2012.

Delta has been divesting its non-core assets, mainly in Texas and the DJ Basin, and now operates mainly in the Piceance Basin in northwestern Colorado, which contains reserves of coal, natural gas, and oil.

The Williams Fork formation in the Piceance Basin is rich in natural gas and is the center of activity in the basin with companies such as Williams Companies, Bill Barrett Corp , Berry Petroleum and Canada's biggest natural gas producer, Encana Corp operating in the area.

Delta's shares have lost about 44% of its value since it started hiving off its non-core assets about a year ago.

The company, which in the past has indicated that it was looking to put itself on the market, has a market value of $131.6 million and long-term debt of $259.5 million as of the quarter ended March 31, according to Thomson Reuters data.

The strategic alternative process was to explore the value of about 22,000 net acres in the Williams Fork other shale resources, Chief Executive Carl Lakey said.

Delta's board has engaged Macquarie Capital (USA) Inc and Evercore Group LLC to act as advisers.

Tracinda Corp, through which Kerkorian owns the stake in Delta, declined to comment on the company's announcement.