Ivanhoe Energy bankrupt as restructuring bid fails
Ivanhoe Energy Inc., a company that proposed using a unique heavy oil technology to develop its Tamarack thermal oilsands project in northern Alberta, has been declared bankrupt after it failed to reach a restructuring proposal under the Bankruptcy and Insolvency Act.
In a news release Tuesday, the Vancouver- based company backed by mining promoter Robert Friedland said it worked “diligently” with major creditors and its courtappointed trustee, Ernst & Young, since filing a notice of its plan on Feb. 20 but no “viable restructuring proposal” resulted.
Its deadline to reach an agreement had earlier been extended from April 21 to May 29.
No company spokesman could be reached Tuesday. A spokesman for Ernst & Young did not return a request for comment.
Ivanhoe suspended work on the estimated $ 1.37- billion, 20,000- barrel- per- day Tamarack project last year after it was one of five projects affected by an Alberta Energy Regulator review of shallow thermal projects over worries about cap rock integrity.
It bought the property from Talisman Energy Inc. in 2008 for $ 105 million.
“Ivanhoe’s decision is based on the uncertainty that there is no timeline defined ... for a new regulatory framework for shallow SAGD projects, and that there is no clarity as to a path for approval for its Tamarack application,” the company said in a news release in March 2014.
Tamarack was to use the company’s proprietary heavy- to- light or HTL technology to partially upgrade the bitumen.
The same technology was touted for use at a heavy oil project in Ecuador, and in other fields around the world including the United States and Mongolia.
On Feb. 4, Ivanhoe announced its contract on the Ecuador block, struck in August 2014 with Petroamazonas EP, Ecuador’s state- run oil company, would be terminated.
Ivanhoe stock was halted from trading in February after it announced The Bank of New York Mellon had demanded immediate payment when it defaulted on an interest payment of $ 2.1 million on debentures with $ 73.3 million in outstanding principal.
Ivanhoe suspended work on the Tamarack project last year after it was one of five projects affected by an Alberta Energy Regulator review.