Obsidian Energy, previously known as Penn West Petroleum Ltd., is an intermediate-sized Canadian oil and gas producer based in Calgary, Alberta. On June 26th, 2017, this company suffered a significant scandal. They went through significant changes, redefined their company and renamed it Obsidian Energy.
In July of 2014, David Dyck, the new appointed Chief Financial Officer announced a discovery of accounting practices that “misclassified nearly $300 million in expenses.” This scandal resulted in class action lawsuits by investors that were settled in 2016. This scandal led the company straight into a debt crisis and a commodity price crash for three years. The company made several asset sales to reduce their debt, the cut backs leaving the company with less than 50% of their former employees. Previously the company produced approximately 135,000 barrels of oil per day (boepd). Today they produce only 28,000 boepd. Though the company is much smaller, Obsidian Energy continues to provide oil and gas, and plans for modest growth.
Along with their name change, Obsidian strives to guide their company on three values: disciplined technical and commercial decision-making, relentless pursuit of innovation and progress as well as transparent efforts with shareholders, partners and communities the company operates in. Dave French, the new CEO of Obsidian Energy, explained that the company chose the name obsidian to reflect the nature of volcanic glass that can be “sharpened and honed.” Refer to This Article for more information.
Obsidian Energy’s oil and gas fields are located in Western Canada’s Sedimentary Basin, a region known to possess some of the largest petroleum reserves. Obsidian Energy is committed to making a positive impact in the communities where the company works. Their program Our Community Matters helps the company to keep open communications with area residents, proactively address concerns and mitigate the impacts that can be associated with gas and oil production. Obsidian Energy also incorporates environmental programs in place to adhere to and maintain proper environmental regulation, resource conservation, and proper site reclamation practices. Obsidian Energy has taken their name meaning literally, with new regulations and stricter operations, and transparency to shareholders.