Canacol Energy Seeks Colombian Judicial Recognition of Canadian Insolvency to Halt Asset Executions

Canacol Energy Ltd. (TSX: CNE) (OTCID: CNNEQ) (BVC: CNEC), a Canadian natural gas exploration and production company with operations in Colombia, has formally requested that the Colombian Superintendencia de Sociedades (Superintendency of Corporations) recognize its ongoing Canadian insolvency proceedings. The objective of the petition is to suspend all execution processes and protective measures that could affect the continuity of its operations in Colombia.

The request, submitted by KPMG INC. in its capacity as the court-appointed monitor and foreign representative, aims to secure the company’s ability to maintain its ordinary course of business while the financial restructuring advances. The local subsidiaries included in the scope of the Colombian petition are Canacol Energy Colombia S.A.S., Cne Oil & Gas S.A.S., Cantana Energy Sucursal Colombia, and Cneog Colombia Sucursal Colombia.

Insolvency Under Canada’s CCAA Framework

The foundation of the process is an Initial Order issued by the Honorable Court of King’s Bench of Alberta, at the Calgary Judicial Centre, which initiated the insolvency proceedings for Canacol Energy Ltd. and several direct and indirect subsidiaries. The restructuring is advancing under the Canadian federal legislation, the Companies’ Creditors Arrangement Act (CCAA).

The subsidiaries involved in the primary proceeding include Alberta LTD, Canacol Energy ULC, Alberta ULC, Cantana Energy GMBH, Cne Oil & Gas S.R.L, Shona Holding GMBH, Cne Energy S.A.S., and Cne Oil & Gas S.A.S.

As the court-appointed monitor, KPMG INC. was authorized to act as the foreign representative. Through its counsel in Colombia, KPMG INC. presented six principal requests to the Superintendencia de Sociedades:

• Recognize the foreign insolvency process pursuant to Title III of Colombian Law 1116 of 2006.
• Recognize KPMG INC. as the monitor and foreign representative of the Canadian principal proceeding.
• Suspend any execution processes and measures that could affect the debtors’ operations in Colombia.
• Maintain the corporate control of bank accounts designated to cover operational and administrative expenses.
• Guarantee the validity and execution of contracts mentioned in the filing.
• Prevent the execution of real guarantees (liens or mortgages) to protect the pool of assets and ensure equitable treatment among creditors.

Separately, the Agencia Nacional de Hidrocarburos (ANH) is reviewing the implications of Canacol’s CCAA filing and has ordered vigilance over its Colombian operations.

Judicial Cooperation and US Chapter 15 Filing

The Superintendencia de Sociedades clarified that its role is to act as the competent authority for the homologation of foreign court decisions, coordinating international judicial cooperation and protecting the patrimony of companies operating in Colombia during cross-border insolvency processes. Superintendent Billy Escobar emphasized that the recognition mechanism does not initiate a local reorganization or liquidation process but rather adopts instruments of cooperation to preserve business continuity and organize the payment of obligations.

The recognition of the foreign proceeding, according to the Superintendent, “will allow decisions adopted by the Canadian authority to take effect in Colombia, ensuring coordination between jurisdictions and the protection of the debtor’s assets against potential individual executions.”

Furthermore, on November 24, 2025, Canacol Energy Ltd. and certain subsidiaries filed for relief under Chapter 15 of the US Bankruptcy Code before the Bankruptcy Court for the Southern District of New York. This action seeks recognition of the Canadian CCAA proceeding as the foreign principal proceeding, primarily to protect company assets located in the US and facilitate cooperation between US courts and the foreign judicial processes.

Stock Exchange Status Update

The financial distress resulted in the suspension of trading for Canacol‘s common shares across the exchanges where they were listed.

On December 1, 2025, the company announced that, following a review by the Toronto Stock Exchange (TSX), its common shares will be delisted effective at the close of trading on December 29, 2025. Trading of the shares (TSX: CNE) has been suspended since November 18, 2025, and will continue until the delisting takes effect, after which a Canadian trading market for the shares will cease to exist. Shareholders will retain their legal rights and equity participation in the company following the delisting.

While the company’s shares remain listed in the US on the OTCID (OTCID: CNNEQ) and on the Bolsa de Valores de Colombia (BVC) (BVC: CNEC), the company anticipates that the OTCID will also delist the common shares. The Superintendencia Financiera de Colombia is also expected to review the issuer’s registration in the National Registry of Securities and Issuers, which could impact its continued listing on the BVC.

Above photo: Canacol’s Capella Oil Field (courtesy Canacol)