Holding an oil and gas licence: a privilege, not a right

Say you are about to buy, sell, or invest in an Alberta oil and gas company. You are conducting your due diligence, negotiating the transaction documents, pursuing any necessary approvals and are looking forward to closing. Before you can proceed, get ready to add another item to your closing checklist. The Alberta Energy Regulator (AER) has recently made some changes concerning oil and gas licences and approvals that you will need to consider. In December 2017, the AER re-issued Directive 067: Eligibility Requirements for Acquiring and Holding Energy Licences and Approvals. The revised directive tightens the eligibility requirements for individuals and companies to hold oil and gas licences and approvals in Alberta and gives the AER greater scrutiny regarding such licences and approvals. These new requirements could delay, increase the cost of or halt oil and gas related M&A transactions. Parties should consider the following steps at an early stage of a transaction…

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