In the restructuring involving Dundee Energy Limited Partnership and its general partner, Dundee Oil and Gas Limited (“Dundee”) Fasken acted for National Bank of Canada (“National Bank”), the operating lender, DIP Lender and senior secured creditor to Dundee.
The insolvency proceedings, originally under the proposal provisions of the Bankruptcy and Insolvency Act (“BIA”) and subsequently under the Companies’ Creditors Arrangement Act (“CCAA”) are the first known insolvency proceedings involving oil and gas assets in Ontario. The oil and natural gas wells are located both on-shore and off shore of Lake Erie creating additional complications. The sale process within the CCAA was complicated and contentious. After the selection of Lagasco Inc. (“Lagasco”) as the purchaser of the assets, a motion to force the assignment of oil and natural gas leases was opposed, requiring the filing of additional financial information concerning the future ability of Lagasco to satisfy requirements of the Ministry of Natural Resources and Forestry. A “bitter bidder”, Canadian Overseas Petroleum Limited (“COPL”) brought injunctive proceedings to restrain a participant in the purchase transaction from participating in the transaction in alleged breach of a confidentiality agreement. Subsequently, a credit union that was financing a significant portion of the purchase price was placed into administration by a regulatory authority and could not proceed with the financing. Despite these challenges, the sale to Lagasco successfully closed on November 15, 2018.
Fasken advised National Bank of Canada with a team led by Aubrey Kauffman and Stuart Brotman.
