The Supreme Court of Nova Scotia has granted one month of creditor protection to OpenHydro Technologies Canada, during which the company will try to find a way to get the broken 2MW tidal turbine out of the waters of the Bay of Fundy in Canada.
The stay of proceedings against the subsidiary of the Irish parent company OpenHydro, which went bankrupt this July, will expire in December 2018 and allow the creditors to pursue debtors for amounts owed.
During the period, OpenHydro Techologies Canada will perform feasibility assessment on whether a reasonable plan of arrangement might be developed for the company, and also – according to Chronicle Herald which quoted Peter Wedlake who is monitoring the case – to find a suitable option to retrieve the 2MW tidal turbine from the Minas Passage.
The turbine was installed in the same week OpenHydro announced bankruptcy, due to the decision of its owner – French-based Naval Energies – to stop further investments in tidal energy sector, and refocus its activities on other marine energy industries.
Two months later, in September 2018, the inspection revealed the turbine installed in the Minas Passage had been damaged beyond repair, therefore incapable of generating electricity, which was confirmed in the supreme court documents.
“There are a number of options and we are in the process of exploring each one of them. One of which may be, a third party may buy certain corporate assets and takes on the responsibility to remove the turbine itself. Another might be a company hired by a third party to remove the turbine,“ Wedlake was reported as saying by Chronicle Herald.
Furthermore, other assets of OpenHydro, like its Scotia Tide barge – a purpose-built vessel for the installation of tidal turbines – are being claimed by the companies that weren’t payed the agreed sums for providing services to OpenHydro to support the installation for the tidal turbine.
According to the supreme court filings, seven creditors have advanced against the vessel in Federal Court.
Also, another creditor of OpenHydro – BBC Chartering Carriers – began proceedings in the Federal Court asserting a claim against the Turbine Control Centre, which was associated with the submerged turbines.
On November 1, 2018, the Federal Court granted default judgement in favor of BBC Chartering and ordered the sale of the Turbine Control Centre.
According to Nova Scotia Supreme Court Justice Michael Wood, who granted the one-month stay for OpenHydro, the cases of Scotia Tide barge, and turbine control centre, are not within the jurisdiction of the Supreme court, and will remain in the administration of the Federal Court.
Operating since 2005, OpenHydro Technologies Canada specializes in the design, manufacture, installation, and maintenance of marine turbines generating renewable energy from tidal streams.
Naval Energies requested the liquidation of OpenHydro and its associated businesses, including the Canadian enterprise, as its Irish-based subsidiary was reported to have accumulated significant debts over the time, with the figures reaching up to €280 million.
Following the announcement of the OpenHydro’s liquidation request, a joint venture OpenHydro formed with Canadian energy company Emera under the name of Cape Sharp Tidal broke apart as the Canadian partner decided to withdraw from the joint enterprise.
Commenting, Emera said the joint company no longer represented ‘the value’ for its business.
Moreover, Canadian media have reported that the broken 2MW tidal turbine, stuck at the bottom of the Bay of Fundy, is not the ownership of OpenHydro, but seemingly of Cape Sharp Tidal.