August 13, 2021
Abbey Resources Corp., a Calgary, Alberta-based owner and operator of over 2,000 shallow gas wells in Swift Current, Saskatchewan, obtained protection under the CCAA on August 13, listing approximately $15.3 million in liabilities, including $5.2 million for municipal taxes, $6.5 million owed to surface rights holders, and $1.6 million owed under leases with mineral rights holders. Since the company acquired the wells via three transactions in 2016 and 2017, the price the company has been able to sell its production from those wells has not been sufficient to pay its debts. While the company has been able to cover its day-to-day operating costs, it cannot consistently pay land taxes to the municipalities and one First Nation where the wells are located. Opponents to the CCAA application alleged, among other things, that the company was not acting in good faith. In particular, they suggested that the company knew from the outset that the operations it established in the three asset acquisitions would not generate sufficient cash flow to pay its debts as they become due. Moreover, the opponents stated that they have lost confidence in the company's management. Despite strong opposition by the regulator, the Saskatchewan Minister of Energy (the "Minister"), the court also approved the inclusion of a provision in the initial order staying administrative action by the Minister for the company's failure to pay certain funds. MNP was appointed monitor. Counsel is DLA Piper for the company, McDougall Gauley for the monitor, Robertson Stromberg for the Minister, Miller Thomson for the Rural Municipality of Lacadena No. 28, Kanuka Thuringer for the Rural Municipality of Miry Creek No. 229 and MLT Aikins for Carry the Kettle Nakoda Nation Band No. 76.