Page 13 - NorthAmOil Week 38

NorthAmOil PERFORMANCE NorthAmOil

FTS files for bankruptcy protection

US HYDRAULIC fracturing company FTS Interna- amounted to $161mn as of September 18, to con-
tional, along with two affiliated units, has filed tinue operating as normal during the Chapter 11
for Chapter 11 bankruptcy protection. The fil- restructuring process.
ing, lodged with the US Bankruptcy Court in the FTS’ bankruptcy filing is one of a growing
Southern District of Texas on September 22, esti- number by both upstream and oilfield service
mated the number of FTS creditors at 200-999, companies this year, as the US energy industry
with the company holding $100-500mn worth struggles to survive a downturn that was severely
of assets and between $500mn and $1bn worth exacerbated by the coronavirus (COVID-19)
of liabilities. pandemic. Energy sector bankruptcies have
As of June 30, the company had assets total- continued in relatively large numbers since the
ling $517.2mn and debts worth $535.3mn. As of last industry downturn, which began in 2014.
the date of the filing, the company’s funded debt Law firm Haynes and Boone has estimated that
obligations totalled roughly $446.7mn, accord- as of August 31, 244 North American producers
ing to a declaration to the bankruptcy court by and 233 oilfield services firms had filed for bank-
FTS’ chief financial officer, Lance Turner. ruptcy protection since the start of 2015.
A day before the bankruptcy filing, FTS The new bankruptcies are bringing various
said in a statement that it had reached a “sec- complications with them. For example, Bloomb-
ond amended and restated” restructuring sup- erg reported last week that the US Department of
port agreement with creditors holding around the Interior (DoI) was proposing strengthening
87.55% of the principal amount outstanding of the requirements on bonds issued by a growing
its secured debt. These creditors agreed to allow number of bankrupt oil producers to deal with
the company to use its existing cash, which abandoned offshore wells.™
POLICY

Alberta empties emissions reduction

fund with new investments

ALBERTA THE government of Alberta said this week that Carbon Capture Utilization and Storage grant
it was emptying its Technology Innovation and programme.
Emissions Reduction (TIER) fund by spending The TIER fund investment includes
CAD750mn ($560mn) on projects that help CAD9.5mn ($7.1mn) from Emissions Reduc-
industries reduce their carbon emissions. tion Alberta (ERA), which is also being directed
“We think it’s time to put all of the money towards furthering CCS initiatives. Around
inside the fund to work,” Alberta Minister of CAD5mn ($3.7mn) of this ERA funding will
Environment Jason Nixon said on September be used to generate calls for proposals through
The investment is set 22. “I can think of no better time to use it than Accelerating CCS Technologies, a global
to support projects when we are dealing with a significant economic CCS-focused investment partnership. The
across all industries, downturn like this.” remaining CAD4.5mn ($3.4mn) will support
but is expected to The provincial government will provide more two Alberta-based carbon capture technology
have a particular focus about how it intends to spend the TIER money companies – Carbon Corp. and Carbon Upcy-
on advancing carbon in the coming weeks, according to Nixon. It has cling Technologies.
capture and storage already been revealed that the money from the CBC News cited the ERA’s CEO, Steve Mac-
technology. fund will be supplemented with money from Donald, as saying CCS projects were key to
industry and other sectors, for a total investment achieving provincial environmental goals.
of CAD1.9bn ($1.4bn) in Alberta’s economy. The “They help us to increase the value of our
government’s investment is expected to support natural resources and decarbonise energy use
3,400 jobs on its own and up to 8,700 jobs when by capturing a waste stream and turning it into
the supplementary funds are included, Nixon valuable products,” MacDonald said.
said. The CCS push has been announced dur-
The investment is set to support projects ing the same week that the federal Canadian
across all industries, but is expected to have government completed carbon tax deals with
a particular focus on advancing carbon cap- the provinces of Ontario and New Brunswick.
ture and storage (CCS) technology. Around Alberta continues to resist a federal carbon tax,
CAD80mn ($60mn) of the funding will go to and is challenging its constitutionality through
Alberta’s new Industrial Energy Efficiency and the Supreme Court of Canada.™

Week 38 24•September•2020 www. NEWSBASE .com P13