Oil and Gas Operators’ Liens: Protecting the Operator’s Interests

Operators’ Liens typically provide that the operator, processor or transporter, as applicable, is granted a first priority lien and charge over the subject matter of the agreement (i.e., the joint lands, the production and/or the joint equipment). However, the situation often becomes more complicated once that joint owner or producer files for creditor protection under the Companies’ Creditors Arrangement Act. These further complications often arise because operators typically do not register or otherwise perfect their Operators’ Liens, and courts in Alberta have held that such liens, unless perfected, are subordinate to secured interests. Read more
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