Site C contractor consents to receivership, raising more questions on project contract & bids
It was over a year ago that I first reported on the difficulties facing Site C contractor, Petrowest… and the oddity of the company being qualified to even be awarded a contractor. https://lailayuile.com/2016/03/02/site-c-consortium-member-petrowest-has-waiver-extended-by-lenders-until-march-31-2016/
In November 2015, the BC Government and BC Hydro awarded a $1.5 Billion contract to the Peace River Hydro Partners, of which Petrowest Corporation is included. http://www.alaskahighwaynews.ca/regional-news/site-c/1-5-billion-site-c-civil-works-contract-awarded-to-peace-river-hydro-partners-1.2119419
Yet curiously by December 2015– just a month after this Site C contract was awarded – the Financial Post was reporting that Petrowest was operating on borrowed time from its lenders: http://business.financialpost.com/news/energy/petrowest-corp-is-operating-on-borrowed-time-from-its-lenders-as-ebitda-cut-in-half?__lsa=42f4-b32f
After unsuccessfully finding a resolution to their financial woes, last week the Site C consortium – Peace River Hydro Partners – handed them a termination notice. Long story short, Petrowest could not come up with their portion of the money required for their contract. http://www.newswire.ca/news-releases/petrowest-announces-receipt-of-prhp-termination-notice-639835123.html
Late Sunday, Petrowest released this: http://www.newswire.ca/news-releases/petrowest-announces-demand-notice-and-consent-to-receivership-640219933.html
CALGARY, Aug. 13, 2017 /CNW/ – Petrowest Corporation (“Petrowest” or the “Company”) (TSX:PRW) announces that the Company’s banking syndicate have provided a notice demanding immediate repayment of all amounts owing under the credit facilities. The Bridge Loan from subordinated lenders arranged on May 19, 2017 is fully drawn and no additional sources of credit or funding are available. Accordingly, the Company’s Board of Directors have consented to the appointment of a receiver and intend on resigning immediately upon such appointment.
The banking syndicate intends to file an application with the Court of Queen’s Bench of Alberta to place the Company into receivership and appoint Ernst & Young as receiver (the “Receiver”). The application is scheduled to be heard on Tuesday August 15, 2017 and court approval is expected. The Receiver will be charged with managing the day to day affairs of the Company during the period of appointment and should be contacted with respect to any questions concerning the assets and liabilities of Petrowest.
It’s one thing for a company like Petrowest to get tossed a lifeline… which in essence this contract should have been. But their participation in the consortium raised a number of questions over the weekend, including how it was they were considered ‘qualified’ in the first place.
Further questions brought forward over the weekend were raised by a reader in the legal field:
Great questions… and ones perhaps Rich Coleman, Mike Bernier, Pat Pimm, former premier Christy Clark, former Energy minister Bill Bennett and former BC Hydro ceo Jessica McDonald might have insight to?
Rick Quigley has strong ties in Fort St. John as a resident, which former Premier Clark touted loudly when the contract was awarded. He was also involved in another failed venture here on Van Isle, via Mariners Village:
Of course, Bob Mackin tried to find out more about this contract… but couldn’t under FOI. ( So much for bringing back transparency to government Ms. Clark)
Quigley is also said to have hands in at least one or more numbered companies to fall back on, when Petrowest falls through.
The NDP minister so far has chosen not to say anything on all this, because of the BCUC review – frankly the two are separate issues in my opinion. And the news of Petrowest bolsters the concern over the complete lack of transparency and accountability when it comes to decisions made on Site C.
We know that on the eve of the election, an increase to the budget was rubber stamped by Brad Bennett, a BC Hydro director who went on to campaign with Clark on her campaign bus: http://thebreaker.news/news/site-c-boost/ The amount and why, are secret.
We know that BC Hydro censored the Site C budget and spending, from a report kept secret during the election: http://thebreaker.news/news/site-c-secrecy/
Oddly enough, on the day news came out that Peace River Hydro Partners had given notice of termination to Petrowest, Legislative reporter/ columnist Keith Baldrey tweeted this:
Followed by a RT from Mike Smyth:
And neither has since tweeted any mention or link to the news of Petrowest, despite Business in Vancouver and Energeticcity both doing stories on it. Even Vaughn Palmer has been silent on this development. ( as of the time of this post none had mentioned it on Twitter, or written of it)
Considering all three have regularly commented & tweeted on most Site C developments, the lack of comment in the days since, was glaring.
Thankfully Alaska Highway News to the rescue and they have a great report out today, with comments and more questions from another in the legal field as well:
One can only guess where this will all end up as we all wait for the BCUC review underway. The decision to halt the construction or not rests in the hands of the BC NDP cabinet. Details of the BCUC review and a link to the BCUC itself can be found here: https://energeticcity.ca/2017/08/bcuc-releases-details-on-site-c-inquiry-after-bc-ndp-government-asks-for-review/
What the BCUC can’t answer, are the questions asked above. And it is long past due for some transparency from BC Hydro on the project that continues to mimic one of the greatest boondoggles of all time, Muskrat Falls. https://lailayuile.com/2016/10/23/if-there-is-any-saving-grace-to-muskrat-falls-let-it-be-the-light-it-shines-on-premier-clarks-vow-to-get-site-c-past-the-point-of-no-return/
** pics I posted online, from earlier this summer when geotech concerns stopped work and resulted in lay offs. http://www.alaskahighwaynews.ca/site-c/trouble-at-old-landslide-forces-site-c-layoffs-72-let-go-last-week-1.21353527