Obsidian Energy is a highly ranked Canadian based company that produces natural gas and oil. Being located along western Canadian sedimentary basin one of the world’s largest petroleum reserves, the high end equipped company produces an average of 30000 BOE per day. Before it rebranded to obsidian energy on 26 June 2017, the company was initially known as Penn West Petroleum Company.
The Company was stricken by crude oil prices fall in 2014, which significantly led to re-establishment and selling of majority of its assets for the following years to reduce its debts. These changes led to a restructuring of the company, based on some new pillars that were meant to make sure it is back to its best. It majored on a constant pursuit of progress, liability, and transparency to the shareholders’ efforts and any other parties they were in business. The company also focused on safeguarding its enterprise value by discipline and decision-making.
In 2017, the new CEO David French suggested a new name for the company that would no longer sound like the old one and which would relate to a naturally occurring volcanic glass and hence they suggested the word Obsidian.
Currently, the company operates in three places around Canada; Alberta Viking, Cardium and Peace River, where its vital development assets are situated.
Obsidian Energy has some responsibilities, which include health and safety community and environment and corporate governance. These responsibilities help the company to mitigate that impacts resulting from the production of oil and gas.it ensures the community around its operation and its employees are far from far-reaching effects like accidents.
Some of the programs that help Obsidian Energyto reduce the risk of funds is hedging. Hedging concentrates in crude oil and natural gas, which the company regularly updates the prices on their website as they fluctuate. Learn More Here.
In summary, Obsidian Energy has found to maintain a positive result after restructuring to a small-scale intermediate size company of oil and natural gas production. Their principles have held them well towards achieving their goals in the evolving world maintaining them top at top 100 companies in the Canadian energy industry.
See Also: http://calgaryherald.com/business/energy/restructured-penn-west-proposes-name-change-to-obsidian-energy
Obsidian Energy Ltd is an energy company that specializes in petroleum products, oil, and gas. The term “obsidian” tells of its willingness to grow and transform with the changes in the fast-paced industry. With its high-quality assets and an entrepreneurial spirit, OBE promises investors a value for their money. However, it enters the market not as a new company but as a reformed Penn West Petroleum Limited.
Reason for Reforms
Formerly as Penn west Petroleum Limited, Obsidian Energy was one of the largest mid-size enterprises in the petroleum sector. It produced over 135,000 barrels per day, employed more than 1400 people, and had nearly 180 million shareholders. For the past four years, however, accounting scandals and high debt levels almost led to the company’s closure.
Surviving a crisis
In 2014, the firm’s debt was $3 billion. Through assets sales, Obsidian Energy reduced the debt by nearly 90% to only $384, million. In 2016, the firm settled the accounting scandals that had led to costly investors lawsuits. As a permanent solution to its woes, the shareholders decided on an entire overhaul in the organization’s leadership and operations. Get More Info Here.
From the beginning of 2017, Obsidian has undergone several target-specific changes. The production level was cut down to 30,000 barrels per day. As a result, the number of employees was reduced to only 300. Even more, it narrowed its focus from 30 production areas to just four.
Shareholders take a stand
For a complete transformation, the management of Penn West Petroleum put together a 6-point resolutions proposal. The six resolutions were geared towards avoiding the previous crisis and most importantly, redesigning the company’s course of action. On the 26th of June 2017, the shareholders took their stand on the proposed changes. Over 92% voted in favor of each resolution.
Change of Name
Changing the company’s name from Penn West to Obsidian Energy was the fifth resolution on the proposal. Just as Obsidian, the firm was taking a dynamic entrepreneurial approach in its organization and operations. Other decisions included the appointment of Ernst & Young as the firm’s financial editor and election of 8 new directors.