July 07, 2020
Canadian Mining Magazine ran “What’s next for Canadian oil and gas as COVID-19 adds to existing challenges”, which explores how COVID-19 has amplified many problems that the sector was already facing, details the reaction to the pandemic and discusses what the outlook for the industry could look like as it moves toward a recovery. A small excerpt of the piece is below:
To preserve shareholder value and protect balance sheets, boards have been forced to very quickly make decisions designed to address liquidity and solvency concerns, including storing and shutting-in production (rather than giving it away for nothing or, shockingly, having to pay for it to be taken away), slashing capital budgets and dividends, suspending buybacks, cutting executive compensation, laying off employees, and ensuring their companies have access to cash via lines of credit and otherwise. There has been a new wave of layoffs and terminations in recent weeks as losses deepen in Q2, with continued uncertainty regarding the timing and extent of demand recovery.
A version of the authors’ analysis was published in the Q2 Torys Quarterly. This issue of the Quarterly examines how companies, including companies in the oil and gas industry, can approach recovery from COVID-19.