Obsidian Energy, A Learner, More Capable Oil And Gas Producer
Obsidian Energy, formerly Penn West Petroleum Ltd, is a mid-sized oil and gas producer in Canada. Penn West was one of the largest oil and gas producers in Canada, with a market capitalization of US $9.5 Billion in 2008, and formerly a part of the S&P/TSX 60 stock market index, an index made up of the largest 60 publicly traded companies in Canada.
After a series of financial and operational difficulties due falling oil prices in 2014, it sold billions of dollars of assets to reduce its debt from $3 billion in 2013 to $384 million as of March 2017; in addition to selling assets, it significantly decreased its workforce from 2,350 employees to about 300 in 2017. In June of 2017, Penn West shareholders voted overwhelmingly in favor to change Penn West’s name to Obsidian Energy. David French, who came in as the new CEO of the Calgary oil and gas company in October of 2016, remarked that the company chose the name because obsidian is a naturally occurring volcanic glass that can be “sharpened and honed”.
Obsidian Energy is now more efficient, though smaller and leaner in operation after these changes. Obsidian Energy holds three major assets in Alberta, along the Western Canadian Sedimentary Basin: Alberta Viking, Cardium, and Peace River, for a total production of approximately 31,000 barrels of oil equivalent per day. In November 2017, Obsidian Energy settled a lawsuit filed by the SEC without admitting or denying any of the allegations in the complaint, and agreed to pay a $8.5 Million penalty. Find Additional Information Here.
David French, Obsidian Energy’s President and CEO remarked on the settlement: “Our settlement resolves this legacy Penn West issue, and we are focused on looking forward as a new company. We appreciate the open dialogue with the SEC Staff, which led to this conclusion.”
These changes from Penn West to Obsidian Energy have allowed Obsidian to move forward as a lean and efficient operation in spite of the difficulties many oil, and gas producers have faced in recent years.