In June 2017, Penn West Petroleum changed its name to Obsidian Energy. Obsidian Energy now aims at being accountable to its stakeholders including the shareholders, partners and the public based in the areas they operate in. The oil and gas production company commit to attaining growth in the coming years by being keen interest in their budgeting needs especially concerning the cost of oil and gas.
The change of name comes as no surprise following the scandal that rocked Penn West in 2014. At the time, David Dyck, the company’s newly appointed chief financial officer, discovered irregularities at the institution and reported them. The error had $300 million in expenses miss-classified, which forced the company to restate its 2012, 2013 and part of 2014 financial reports. This resulted in lawsuits based on accounting irregularities in Canada and class-action lawsuits in the United States.
Other than surviving this scandal, the company also survived a commodity price crash and four years of high debts, which saw it go through both financial and operational difficulties. To sail through the turbulent times, Penn West made asset sales. The disposal of its assets helped to bring down the net debt to just $384 million down from three $3 billion.
The company also reduced its workforce starting in 2012. This undertaking saw the number of employees decline from 1,415 to around 400 by the end of 2016. There was a halt in the payment of dividends, and members of the board of directors went without compensation. Click Here for more information.
The 26th June change of name came into effect after 92 percent of the shareholders voted for a change of name. With Obsidian undergoing these massive changes, it was imminent for the company to distance itself from the four years strain and mishaps to give it a facelift.
Obsidian Energy is now an oil and natural gas production company based in Calgary, Alberta. Its gas and oil fields are found in one of the world’s largest petroleum reserves in Alberta. In a day, it has an estimated production of 30, 000 barrels of oil.