Persist Oil and Gas acquires core assets of Manitok Energy

15 April 2019

On April 15, 2019, Alvarez & Marshal Canada Inc., the receiver and manager and trustee in bankruptcy of Manitok Energy Inc. ("Manitok") and its wholly owned subsidiaries Raimont Energy Corp. and Corinthian Oil Corp., sold the majority of the core assets of Manitok to Tantalus Energy Corp., now Persist Oil and Gas Inc. ("Persist"). A highly skilled management team was able to deploy Canadian capital and private equity financing to re-create a business that had been destroyed by a number of factors including constraints on market access, increasingly expensive drilling and production costs, regulatory uncertainty at the federal and provincial levels and the flight of debt and equity from the energy industry in Western Canada.

The Court of Queen's Bench of Alberta initially approved the transaction on January 18, 2019, but the parties had to renegotiate the deal following the January 29, 2019 decision of the Supreme Court in Orphan Well Association v. Grant Thronton Ltd. (Redwater) which fundamentally changed the legal landscape for transactions with receivers of oil and gas assets.

Over a period of almost 14 months following the appointment of the receiver, a team of Gowling WLG securities and insolvency lawyers worked with former management of and equity and debt investors in Manitok to create and fund Persist Oil and Gas to purchase Manitok's core assets. The team was lead by Tom Cumming, Greg Peterson and Frank Sur and included Zafar Jaffer and Simanpreet Panaych (corporate and transactional); Jay Lalach (energy); Sunil Joneja (banking); Paul Edwards (litigation support); and Caireen Hanert (insolvency).


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