Sunshine Oilsands: the appeal and the fight over a corrigendum

On October 30, 2026, Sunshine Oilsands Ltd. filed a Civil Notice of Appeal in the Court of Appeal of Alberta, Appeal No. 2601-0340AC, against the whole of the order appointing PricewaterhouseCoopers Inc., LIT receiver and manager of its Alberta property on the Orphan Well Association's application. Its first ground is that the chambers judge, as the notice puts it, "set out and construed a text of section 3(1)(b)(ii) of the Regulation that is not the enacted text of that provision (Reasons, paras 45 and 48), and set out section 106.1 of the OGCA without the words 'subject to the regulations' and then found that section 106.1 contains 'no limit' (Reasons, paras 42 and 43)," per the Civil Notice of Appeal, Oct. 30, 2026, item 5, ground 1(a).

The day before, the court had written to counsel about one of those two provisions. At 9:30 am on October 29, the court's commercial duty coordinator relayed an email from Justice B.B. Johnston: "Justice Johnston is in receipt of the correspondence from counsel. She is aware of the error in the transcription of section 3(1)(b)(ii) and intended to issue a corrigendum. Having received the parties' correspondence this morning, she is prepared to hear submissions prior to issuing a corrigendum," per Sunshine's affidavit, Nov. 2, 2026, Ex. "A", p. 18. The OWA had applied on October 28 to correct the reasons. Sunshine's answer, filed November 2, proposes a corrigendum that would leave paragraphs 43 and 46 to 53 unamended.

The reasons, Orphan Well Association v Sunshine Oilsands Ltd, 2026 ABKB 751, reported here on October 30, held that "only in relation to" in s. 3(1)(b)(ii) of the Orphan Fund Delegated Administration Regulation "does not require a prior orphan designation" (Reasons, Oct. 27, 2026, para. 48).

Five grounds, and a narrower order in the alternative

The first ground has three more limbs. The regulation's first limb does require that the sites be orphans, the notice says, and none of Sunshine's has been designated one under s. 70(2)(a) of the OGCA. The receivership is not "in relation to" reasonable care and measures, it says, when on the judge's own findings the OWA had provided them under the Alberta Energy Regulator's order of February 24, 2025, continuously and without a receiver. And "the realization or transfer of property," the notice says, is not a purpose for which the power was delegated (Notice of Appeal, item 5, grounds 1(b)–(d)).

The notice also says the judge erred in holding that the OWA could obtain the order under s. 13(2) of the Judicature Act and s. 99(a) of the Business Corporations Act "notwithstanding the limits on its delegated authority"; in treating the OWA as an "interested person," including by relying on s. 206.1(d) of the ABCA, "a definition that applies only for the purposes of Part 17"; and, among its complaints on whether a receiver was just and convenient, in finding a risk of irreparable harm "in the absence of evidence of any current risk to public safety or the environment" (Notice of Appeal, item 5, grounds 2–4).

Failing an order setting the receivership aside, the notice asks for three terms to be varied: the order would reach only Sunshine's AER-licensed wells, facilities and pipelines "and the assets used in connection with them," not all its Alberta property; any sale out of the ordinary course of business would need the court's approval; and the Receiver's Borrowings Charge of up to $2,000,000, which ranks ahead of existing security interests, would be limited in amount and rank behind them. Sunshine also claims "an order staying operation of the Receivership Order, or parts thereof, pending the determination of the within appeal," and the form answers yes to an application to expedite (Notice of Appeal, item 5, ground 5; items 6, 9). No stay application, and no ruling on a stay, is in the record.

In an October 28 email to Sunshine's counsel, the OWA's counsel had said any appeal of the application of s. 3(1)(b)(ii) to s. 106.1 "would be meritless, moot, and have no practical effect," because the receiver was also appointed under s. 13(2) of the Judicature Act and s. 99 of the ABCA, "so that appointment would continue notwithstanding any appeal of the Court's application of section 3(1)(b)(ii)." The OWA did not believe Sunshine "would satisfy the stringent requirements for a stay," and expected instructions to seek security for costs if Sunshine pursued an appeal (Sunshine's affidavit, Ex. "A", p. 8).

Two versions of one subparagraph

Paragraph 45 of the reasons sets out the subparagraph as: "(ii) the Association shall act under sections 41, 102(1), 104(1)(b) and (2)(b) and 106.1 of the Act only in relation to the suspension, abandonment, remediation and reclamation of orphan sites and to providing reasonable care and measures to prevent impairment or damage in respect of orphan sites" (Reasons, para. 45).

The regulation the OWA attached at Tab 1 of its own May 12, 2025 brief says that the Regulator's powers under those sections "and, for the purposes of the enforcement of an order made by the Regulator, section 105(1)(a), (c), (d) and (e) and (3) of the Act may be exercised and carried out only in relation to suspension, abandonment, remediation and reclamation in respect of orphan wells, facilities, well sites and facility sites, and only in relation to providing reasonable care and measures to prevent impairment or damage in respect of wells, facilities, well sites and facility sites" (OWA Brief of Argument, May 12, 2025, Tab 1, p. 24). The OWA's October 28 letter to the judge sets out the regulation in the same words (Sunshine's affidavit, Ex. "A", pp. 13–14), as do Sunshine's November 2 submissions.

Sunshine counts five differences. The reasons' version says the Association "shall act under" the sections where the regulation says the powers "may be exercised and carried out"; it omits the enforcement clause; it says "orphan sites" where the first limb says "orphan wells, facilities, well sites and facility sites"; it joins the two purposes with "and to" where the regulation repeats "and only in relation to"; and it says "orphan sites" again where the second limb says "wells, facilities, well sites and facility sites" (Sunshine's Written Submissions, Nov. 2, 2026, paras. 6, 8–9).

In Sunshine's reading, the regulation confines the delegated power to two separately limited purposes: suspension, abandonment, remediation and reclamation, "available only for orphan wells, facilities and sites," and reasonable care and measures, "available for any well, facility or site." Sunshine's sites are not orphans, the submissions say, and reasonable care and measures were already being provided without a receiver: "Neither purpose describes this receivership." Paragraph 48 of the reasons says "the words 'and to' confirm that providing reasonable care and measures is in addition to the reference to orphan sites rather than limited by its mention" (Reasons, para. 48); those words, Sunshine says, "appear in the paragraph 45 text and not in the Regulation" (Submissions, paras. 10, 23).

Ground 1(a) also reaches s. 106.1 of the Oil and Gas Conservation Act, which paragraph 42 of the reasons sets out as: "The Regulator may apply to the Court of King's Bench for the appointment of a receiver, receiver-manager or trustee of the property of a licensee or approval holder." Paragraph 43 finds "no limit in section 106.1 of the OGCA regarding when or how an application for the appointment of a receiver is to occur" (Reasons, paras. 42–43). The OWA's May 2025 brief quotes the section as allowing the Regulator, "subject to the regulations," to apply for "a receiver, receiver-manager, trustee or liquidator of the property of a licensee" (OWA Brief of Argument, para. 39). Sunshine's submissions say paragraph 42 omits "subject to the regulations" and "or liquidator" and adds "or approval holder," and that its point at the hearing "was not when or how, but who and for what" (Submissions, paras. 14, 37). The court's October 29 direction refers only to s. 3(1)(b)(ii), as does the OWA's letter.