Restructuring of Greenfire Oil and Gas

McMillan acted for Alvarez & Marsal Canada Inc. (“A&M”) in its capacities as Trustee in Bankruptcy and Receiver of Greenfire Oil and Gas Ltd. and Greenfire Hangingstone Operating  Corporation (collectively, “Greenfire”).

Greenfire was engaged in the business of oil and natural gas development and extraction in Western Canada, namely operations conducted at its steam assisted gravity drainage bitumen production facility in the Northern Alberta oil sands. Greenfire underwent a restructuring under Division I of the Bankruptcy and Insolvency Act during which A&M acted as Proposal Trustee. Greenfire ultimately obtained court approval for a sale of its assets and A&M was appointed as Receiver to, among other things, facilitate a secured claims process in respect of the allocation and distribution of the proceeds of the sale.

The court approved over the objection of a number of key creditors a linked purchase offer and debtor in possession loan without a formal post-filing sale process. The approval was urgent because the plant was not properly winterized before being shut down. The court was presented with evidence of potentially catastrophic damage if an immediate source of funding could not be obtained to dry or restart the plant.  Appeals filed with respect to the sale approval and DIP approval were denied by the Alberta Court of Appeal. The case involved a novel argument that a marketing agreement between Greenfire and one of its creditors was an eligible financial contract and an interest in land that could not be disclaimed under Canadian insolvency laws. The receivership proceeding involved the adjudication of sixteen contested and complex secured claims by the Receiver with McMillan’s assistance.

The McMillan team was led by Adam Maerov and included Kourtney Rylands, Preet Saini, and Shahen Mirakian.

McMillan’s Restructuring & Insolvency Group is one of Canada’s leading business insolvency groups. Our highly skilled team includes top-ranked lawyers known for their expertise and creative problem-solving, allowing McMillan to deliver the highest standards of transactional and structuring leadership, and commercial advocacy. We have advised on the restructuring, purchase and sale of businesses in a variety of industries. We regularly work with financially challenged companies, boards of directors, Canadian and US financial institutions, lending syndicates, bondholders, investors, ad hoc and official creditors’ committees, court-appointed officers and major customers and suppliers of insolvent companies. We provide our clients with successful outcomes and comprehensive solutions to the most challenging problems.