Banks demanded Buttes make payments on loans.

The Oakland-based company said that it is trying to restructure its debts but that “avoidance of the bankruptcy courts is not assured.” Buttes Oil received notice from its major lending banks that it was in default on interest payments of $150.6 million in secured debt. The oil and gas company said it may have to sell some or all of its drilling rigs, taking write-downs that “could be very substantial” on the rigs and, possibly, on its mineral and agricultural assets.