Bad actor oil company leaves taxpayers to absorb nearly $300K in tax write-offs

Posted on July 24, 2025 by Taber Times

By Jared Vas
Taber Times
Local Journalism Initiative Reporter

Razor Energy Corporation, once a publicly traded junior oil and gas company, collapsed under a mountain of debt accumulated under the watch of experienced leadership.

The company operated in the MD of Taber, and through regulatory loophole abuses amassed substantial liabilities, partly due to its failure to file audited financial statements, management’s analysis, and related certifications – leading to a cease trade order.

Showing little capacity or intent to repay its creditors, Razor filed for protection under the Companies’ Creditors Arrangement Act (CCAA), a legal process that halts creditor actions temporarily and allows strategic debt restructuring under court supervision.

This process also enabled Razor to transfer operating licenses and profitable assets to another company while isolating unwanted liabilities.

In December 2024, Texcal Energy Canada Inc. acquired Razor Energy and took control of Razor’s profitable assets but left behind the messy, unwanted liabilities – including orphan wells and nearly $300,000 in outstanding municipal tax debt. By transferring those to a shell company designed to absorb the burdens, it effectively shifted the costs onto taxpayers. Those burdens were shoved into a shell company called ResidualCo, created specifically to fail.

Now, ResidualCo is stuck in court proceedings designed to erase the debt, leaving taxpayers responsible for the cost. At a recent MD of Taber council meeting, the administration asked council to approve a write-off of $289,595 in outstanding property taxes and penalties following the sale of an oil and gas company. The current outstanding amount for the company is $577,000. The motion would write-off a portion of that, leaving approximately 287,000 to be paid. The write off would apply to the 2024 taxes which are in arrears.

Administration has received $216,000, which satisfied the outstanding balance for 2023. However, MD council was not pleased with the proposed resolution, as it’s not the first time something like this has happened.

Coun. John Turcato expressed frustration with the Alberta Energy Regulator for allowing oil and gas companies to avoid accountability and leave municipalities to absorb monetary loss.

“Someone has to be held responsible,” he urged. “This is getting old – it really is, and I’m not in favour of writing this stuff off … but what is our alternative?”

Administration expressed the importance of writing off taxes deemed unpayable when a company goes bankrupt. Write-offs in this manner are necessary and routine for accounting practices.

Coun. Merrill Harris noted the same thing has been happening consistently since his first term in 2013 and shared concern for the taxpayer burden that extends beyond unpaid taxes to the significant costs of cleaning up abandoned orphan wells.

“So, the taxpayer is yet again stuck with paying the bill,” he said with a sigh. He moved to send a letter addressing the taxpayer burden from unpaid taxes and orphan well management. Administration informed him that a letter had been sent in the last two weeks – a fact Harris was unaware of.

Reeve Miyanaga took responsibility for the lack of council involvement in this letter. The letter was sent to provincial stakeholders including the premier’s office and Alberta Energy Regulator. Miyanaga also moved to have the letter available to the public via the next MD council meeting. She then voiced sharp frustration with the regulatory gaps in the province, questioning how oil and gas companies are able to transfer licenses without settling municipal tax debts.

“The province continues to say they’re doing something about it  –  but what?” the reeve challenged. “My question to AER and Premier Smith is: [companies] are not allowed to operate unless their royalties are paid, how can they be permitted to operate and transfer licenses without paying their municipal taxes?”

Miyanaga was irritated that while the MD is working to fund recreation – recently approving $300,000 for major projects – it is simultaneously facing this significant tax write-off.

“That is just annoying,” she said.

Coun. Hildebrandt agreed, noting that this also “rubs salt” into the wounds of anyone who owns property. He also expressed how municipalities build infrastructure to support the oil industry, mainly roads, “… and this is the thanks we get from that industry,” he said.

Miyanaga emphasized that not all industry members are egregious, noting that the same companies and board members are repeatedly involved. Recognizing the importance of sound accounting practices, six of seven councillors voted to approve the motion – adding the word “regrettably” to the resolution.

Turcato urged a vote against the motion, arguing that keeping the process “messy” would keep the issue in circulation. In addition, council moved to gather information about outstanding property taxes and penalties that have been written off as far back as manageable. Council noted that 99 per cent of their issues are with the oil industry.