Site C consortium member Petrowest has waiver extended

by lenders until March 31 2016

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By Laila
**UPDATED BELOW
Heres a little something interesting to gnaw on while Im working this other story.
In November 2015, the BC Government and BC Hydro
awarded a $1.5 Billion contract to the Peace River Hydro
Partners, of which Petrowest Corporation is
included. http://www.alaskahighwaynews.ca/regionalnews/site-c/1-5-billion-site-c-civil-works-contract-awarded-topeace-river-hydro-partners-1.2119419
Yet curiously by December 2015 just a month after this Site
C contract was awarded the Financial Post was reporting
that Petrowest was operating on borrowed time from its

lenders: http://business.financialpost.com/news/energy/petrowest-corp-is-operating-on-borrowed-time-from-itslenders-as-ebitda-cut-in-half?__lsa=42f4-b32f

CALGARY Petrowest Corp. is operating on borrowed time from its lenders.

The oilfield and forestry services company says it has until Jan. 18 to provide a 2016 budget to get
temporary relief from some of its debt commitments.
Most of the commitments relate to Petrowests adjusted EBITDA, a measure of earnings that has
fallen dramatically.
As of Sept. 30, the Calgary-based company had generated $10.62 million of adjusted EBITDA for the
first nine months of 2015, down from $27.6 million in the comparable period of 2014.
One of Petrowests covenants is to maintain a minimum of $20.7 million adjusted EBITDA for four
consecutive quarters.
Petrowests lenders have granted waivers on its debt covenants until Feb. 29, subject to the budget
condition.

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Yesterday, Stockhouse reported that lenders have now extended the debt waiver to March 31st, giving Petrowest
some breathing room while they work with lenders: http://www.stockhouse.com/news/pressreleases/2016/03/01/petrowest-provides-update-on-credit-facilities
Which begs the question: What kind of due diligence does the BC Government and BC Hydro perform when it
comes to potential bidders? Because for me, a company that has lenders making noise would be a big red flag

This out today from BIV: https://www.biv.com/article/2016/3/bc-government-withholds-competing-bids-site-c-cont/

One email from BC Hydro CEO Jessica McDonald on November 16, 2015, suggests there was a bit
of a rush to finalize and announce the awarding of the contract.
There is a very tight timeframe for an announcement of this award, McDonald writes in an email.
That urgency is not explained as the following sentences are redacted.

Question: Would the above situation regarding Petrowest, have been a mitigating factor in the rush to award and
finalize this contract? Because a contract in the hand certainly soothes lenders.

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