Canadian Overseas Petroleum Limited (LSE:COPL, CSE:XOP, OTC:VELXF) believes there is little prospect for a return to shareholders or bondholders as it announced it has applied for an initial order under the ‘Companies' Creditors Arrangement Act’ in Canada.
Effectively entering administration, the company said it has applied to Alberta Court of King's Bench for the CCAA, which the company noted would provide ‘stay of proceedings in favour of the COPL Group, approval of debtor-in-possession financing and the appointment of KSV Restructuring Inc. to serve as monitor of the COPL Group’.
The company said it will continue its day-to-day operations as usual and intends to continue paying its critical suppliers in the ordinary course during the CCAA proceedings.
COPL’s previously announced forbearance agreement with the company's senior lenders has now expired.
The company requested its shares to be suspended on both the London Stock Exchange and the Canadian Securities Exchange with immediate effect.