Perpetual Energy took to posting an advertisement in a Alberta community newspaper to announce their selling of assets at a severe discount.
“After decades of operating as your neighbor, we are sadly bidding community members farewell. The reason, we simply couldn’t afford to operate in the municipality any longer.”
As was reported in the Calgary Herald, the transaction involves more than 2,200 shallow gas wells and other facilities across eastern Alberta with production capacity of 35.5 million cubic feet equivalent per day and annual operating costs of $35 million to $45 million.
Sue Riddell Rose, Perpetual’s CEO said the assets had been cash flow negative because all of the cash they generate was swallowed up by municipal taxes.
“The municipal tax charged to our properties placed our operations into a major loss situation. The reason, regulated valuations used to calculate taxes massively exceed the true value of our assets,” reads the press release.
“We asked officials to consider changes but they said no. As a result, on October 1, 2016 we sold our assets in your community for a nominal dollar.”
The release closed by thanking suppliers, employees, contractors, and the residents of the community for their support over the years.
So this was posted in my local county paper. Oil company sold assets for a $1.00. #ableg pic.twitter.com/hCeJhSNqeg
— GrainCura (@xpmike) November 9, 2016