MESSAGE TO OUR SHAREHOLDERS
Our consistent message for the past year has been alerting shareholders to the difficulties facing the junior oil sands sector and the steps the Corporation has taken to address these challenges. It has now been a little over a year since we initiated a strategic review process and at this point we have nothing concrete to report. A number of companies have viewed the data and assessed our assets but no offers to partner with SilverWillow, acquire assets or the Company have been forthcoming. We now face a difficult situation with declining cash reserves, limited ability to obtain financing and a challenging oil price environment which undermines the economic viability of new projects in the near term.
The combination of headwinds which includes political and regulatory uncertainty, pipeline delays, investment restrictions, global over-supply and now low oil prices has seen a number of oil companies seeking bankruptcy protection or consider significant re-structuring plans to accommodate high debt loads. Fortunately, SilverWillow has no debt and few liabilities but we must be realistic as we proceed into 2015. As you will recall, in July 2014, we drastically reduced staff and other costs and in August curtailed management compensation and work hours. These steps were taken to allow the Company time to seek a positive outcome for shareholders through the strategic process. That time is rapidly diminishing and our Board will have to consider what alternatives remain.
In the coming weeks our advisors from RBC Capital Markets will be going back to the companies that have in the past demonstrated an interest in the Company’s assets to update them on our situation. In the absence of renewed interest from such counter-parties, our Board will have no choice but to consider all options including wind-up of the company.
We are extremely disappointed to be at this juncture and will continue to work on behalf of shareholders to seek the best outcome. We will keep you informed of progress as information becomes available.
President and Chief Executive Officer
Calgary, Alberta, Canada
April 16, 2015