A small energy producer with wells and facilities in Alberta and B.C. says it has shut down production, laid off all non-executive employees and its directors and officers have resigned after a bank called in a loan.
Calgary-based Terra Energy Corp. has long been struggling to turn a profit, first as low natural gas prices cut into earnings and then as the collapse in crude prices derailed its plans to switch focus from natural gas to oil.
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But the final blow came last week, when Terra said Canadian Western Bank was exercising its right under the federal Bankruptcy and Insolvency Act to call in its loan of $15.9 million plus interest, costs and fees.
The company has until next Monday to repay.
Terra said since it was losing money on its operations at current commodity prices and had no alternative financing options, the company had no choice but to halt production and lay off staff.
"The directors have determined that Terra's business is no longer viable," the company said Monday in a news release. It did not respond to requests for comment.