By: Drew Yewchuk
PDF Version: Abandonment and Reclamation Obligations, Builders Liens, and Municipal Taxes in Oil and Gas Bankruptcy Proceedings
Cases Commented On: Manitok Energy Inc (Re), 2022 ABCA 117 (CanLII)
Re Manitok Energy Inc, 2022 ABCA 117 (CanLII) (Manitok) was released March 30, 2022. It relates to the bankruptcy of an Alberta oil and gas corporation and interprets the Supreme Court of Canada’s decision in Orphan Well Association v Grant Thornton Ltd, 2019 SCC 5 (CanLII) (often referred to as Redwater, after the bankrupt company involved). The specific question before the Court of Appeal in Manitok was:
Whether end of life obligations associated with the abandonment and reclamation of unsold oil and gas properties must be satisfied by the Receiver from Manitok’s estate in preference to satisfying what may otherwise be first-ranking builders’ lien claims based on services provided by the lien claimants before the receivership date. (Manitok at para 1)