Enerkem Inc. et al., CCAA

Enerkem Inc. et al., a group of cleantech companies headquartered in Québec, obtained CCAA protection on May 12.

Founded in 2000, Enerkem specializes in converting heterogeneous waste and biomass materials into a diverse range of clean fuels and circular chemicals, using proprietary patented technology. In 2014, Enerkem launched the world’s first full-scale waste-to-biofuels and chemicals facility in Edmonton, Alberta.

In January 2024, in order to manage its limited liquidity, Enerkem announced the closure of the plant and implemented various workforce reductions and other cost-cutting measures.

Enerkem is also involved in a new recycling facility project in Varennes, Québec, which is being built by Varennes Cellulosic Ethanol LP (“VCE”), with which Enerkem has agreements to license its proprietary patented technology. As a result of significant cost overruns and insufficient financing, VCE itself entered CCAA protection in March 2025.

Enerkem was also involved in a similar project in Spain, but sold its interest to its partner in the project, Repsol Quimica, in 2023.

Given the significant capital required to operate its business, as well as its significant debt-load and cash burn rate, Enerkem has been unable to be profitable as a business thus far and has sustained operating losses over the last three years.

Enerkem currently lists approximately $432.2 million in liabilities, including $220.4 million to its noteholders — Repsol, ESC Sustainable Solutions Fund and certain funds managed by Monarch Alternate Capital — and $16.3 million to Fiera Private Debt Fund IV and Federation of Canadian Municipalities.

The purpose of the CCAA proceedings is to run a stalking horse SISP to implement a credit bid restructuring transaction with the noteholders, unless a superior offer is received. Repsol is providing a DIP loan.

Deloitte is the monitor.

Counsel is Stikeman Elliott for Enerkem, Osler for the monitor, Bennett Jones for Repsol, Goodmans for the Ad Hoc Committee of Noteholders and BLG for Fiera.