By: Nigel Bankes
PDF Version: An Operator of Gas Processing Facilities Does Not Have a Possessory Lien Under the Possessory Liens Act
Case Commented On: Cansearch Resources Ltd v Regent Resources Ltd, 2017 ABQB 535 (CanLII)
Cansearch and Regent jointly owned the Joffre Facility under the term of an agreement for the construction, ownership and operation (CO & O) of that facility (2008). Cansearch was appointed as operator. The CO & O agreement afforded Cansearch as operator an operator’s lien (cl 602(a)) in the following terms:
Effective from the Effective Date, Operator shall have a lien and charge, which is first and prior to any other lien, charge, mortgage or other security interest, with respect to the Function Unit Participations of each Owner in the Facility and such Owner’s share of Facility Products, to secure payment of such Owner’s proportionate share of the costs and expenses incurred by Operator for the Joint Account.
Cansearch never registered its Operator’s Lien pursuant to the Personal Property Security Act, RSA 2000, c P-7 (PPSA).
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