ECA Review - 2019-05-16

14 M ay 16'19 Ha NNa /CORONa TION/STETTLER, a B. ECa REVIEW
Junior natural gas company Trident folds
Terri Huxley
ECA Review
All 33 employees and 61 contractors
associated with Alberta
based natural gas producer
Trident have been laid off after
their announcement on Wed.
May 1.
On April 30, the company
ceased operations, leaving 4,700
wells into the hands of Alberta
Energy Regulator (AER).
Trident’s total estimated
abandonment and reclamation
obligations are approximately
$329 million.
The company was in talks
with the AER since February
when the AER ordered the
company to properly manage
its approximately 4,400
energy licenses by
addressing end-of-life obligations
through
decommissioning its sites,
posting financial security, or
transferring the sites to
responsible energy
companies.
Trident did not respond to
this order and informed the
AER on April 30 that it had
ceased operations entirely.
Trident blames the combination
of extremely low natural
gas prices and high surface
lease and property tax payments
which has exhausted the
liquidity of the company.
“Behind these obligations, we
do not anticipate any recovery
for shareholders and unsecured
creditors. Likewise, any
recovery for secured lenders is
highly uncertain. We had been
working openly and collaboratively
with our lenders and the
AER since February,” noted the
news release from Trident.
These challenges reached a
tipping point with persistent,
unaddressed capacity constraints
on TransCanada’s
NGTL system leading to April
Alberta gas prices averaging
$0.81 and summer prices currently
averaging $1.00.
“Although we had substantially
settled the terms on a
financing solution with our primary
creditors for an orderly
restructuring and sales process,
we were unable to secure
AER support for a restructuring
in a timely fashion.”
Trident is worrisome of the
future of Canadian energy jobs,
subsequently growing the
Orphaned Well
Association.
“We fear that
many other companies
may falter
without clear,
sound policy
making post-Redwater.
In the face
of this extended
uncertainty,
lenders and
investors may
flee Canada and
further job losses
will occur.
Without access to
financing, we
expect that the
Orphaned Well
Association may
grow
exponentially.”
As of its 2018
reserve audit,
Trident has
approximately
458 billion cubic
feet equivalent of proved
reserves.
The junior company had 64
leases located in Kneehill
County, 88 leases in Starland
County, and 22 in the County of
Stettler.
Local companies left unpaid
Roger Chapman of Roger
Chapman Oilfield Services
based out of Carbon, Ab. was
left with a $35,000 bill from
Trident after nine months of
contracted work completed.
“
The junior company
had 64 leases located in
Kneehill County, 88
leases in Starland County
and 22 in the County
of Stettler.
He claims out of his 40 years
of experience as a trucking company
in the oil and gas industry,
this has ‘been the worst I’ve
ever seen.’
For months, smoke screens in
the form of ‘confirmed’ or ‘misplaced’
cheques in the mail
were provided by Trident
administration yet none were
ever received.
Oil and gas companies do
have leeway as they can choose
to hold off on contractor payments
for up to 120 days due to
current provincial government
rule.
“That has to stop,” said
Chapman. “It should be 30 to 45
days at the max. 60 on the outside
because if you get two
months of work tied up with
these guys you got a lot of
money out and we are still owed
invoices from Trident since last
September.”
“There will be no freebies
and no forgiveness for anything
[from now on],” he continued.
This isn’t the first time the
truck company owner has been
on the hook for bills as a couple
other oil and gas companies
folded a few years ago.
They had smaller invoices to
pay at roughly $2,000 rather
than $35,000. “This Trident one
bites,” he said.
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also been to blame for contractor
profit as they tender for
the lowest price and find the
most efficient use of that company’s
revenue, causing prices for
work to drop.
“You hear of other companies
that are bidding so low there
[that] you’re probably going to
lose your work so either you
have got to bid low or you have
to shut it down so you get
hooked into doing shit like that
too so then you end up with
your profit at five, 10 per cent at
the most.
“When you’re held out for 160
days, your five or 10 per cent
profit just went out the
window,” said Chapman.
Chapman’s daughter, Jaena
Downe said in one invoice to
the company, “I hope you
realize the impact this has on
the smaller companies that
provided services to you,” she
said. “It is a shame that we
‘unsecured creditors’ are considered
the bottom of the barrel
when it comes to paying what
you owe.
“I am sure you realize but
care little that acts like this are
what end up taking the small
companies out of business and
starving the families that work
for them. But of course you
would know that after you
stopped paying your own contractors
at the end of March and
then subsequently fired
everyone with no notice on
April 30, 2019.”
Chapman has maintained his
operations through the help of
his farm finances although he
prefers to keep the two businesses
separate.
Despite the downturn in
income, Chapman has chosen to
stay in business for the sake of
his younger crew who have
started their own families and
his loyal customer base.
Picking up
where they left off
AER spokesperson Shawn
Roth, Senior Advisor of
External Communications mentioned
the AER is currently
pursuing all options available to
them to make sure that the
infrastructure left behind is
transferred to “responsible
operators, safely decommissioned,
or, as a last resort,
transferred to the Orphan Well
Association.”
May is Better Hearing month
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It all
starts with a
Hearing
Test
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413 Main Street
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(403) 443-2288
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“Many of Trident’s wells
were still operating and
once transferred to responsible
operators can still
contribute to royalties, keep
Albertans working, and
deliver value to our
economy,” said Roth.
As for landowners, any
with safety concerns are
directed to call the AER’s
24-hour response line at
1-855-474-6356.
Seven national titles
Cont’d from Pg 13
The stigma surrounding
pageants has been hard for
Ekelund but underneath the
superficial looking exterior,
the judges examine academic
marks, public
Ekelund
Blue Sky Fotography
speaking, charity and volunteer
hours and other criteria
which pushes competitors to
be the best they can be in all
aspects of public
appearance.
Currently, Ekelund holds
seven national titles with
the hopes of claiming an
international title when she
competes in London in
Any legal action can be
done by contacting the
Surface Rights Board with
concerns around outstanding
lease payments as
this is their jurisdiction.
The AER has no jurisdiction
regarding lease
payments.
Landowners may also
find information from the
Farmer’s Advocate Office
useful.
November 2019.
This includes titles like
Miss Pre-teen for Model
Miss, Miss Camrose, Miss
Daysland, Miss Perfectly,
Miss Teen Perfectly,
Canadian Final Miss which
she was crowned by Miss
Universe Canada.
“With this title, the biggest
honour is just being
chosen from such a small
town,” said Ekelund.
“Usually the girls are
chosen from Toronto or
Vancouver, somewhere with
a big population. So I’m from
a town of maybe 800 people
so I really get to represent
like local talents and I get to
go around and appear at
community events that I
normally wouldn’t get much
exposure [to] so I’m really
thankful for that. I’m hoping
to bring back an international
title to continue on
the support.”
The title of Miss Teen
Canada CWI has never previously
been won by a rural
residing contestant before.
She won it last September
and was hand picked to take
the title for a second year
after they looked at her pageant
and modelling
experience and charity
work, giving her another
opportunity to try and win
an international title.
Ladies from 23 other countries
will be in attendance
competing.
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