Cequel Energy Inc. - MRRS Decision

MRRS Decision

Headnote

Mutual Reliance Review System for ExemptiveRelief Applications -- Relief granted to a reporting issuerfrom the requirement to send its annual audited financial statementsconcurrently with the filing of the statements, subject to certainconditions.

Applicable Ontario Statutory Provisions

Securities Act, R.S.O. 1990, c. S.5, as am.,s. 79, 80(b)(iii).

Rules & Policies Cited

National Policy Statement No. 51.

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

ALBERTA, ONTARIO, BRITISHCOLUMBIA, MANITOBA,

NOVA SCOTIA, SASKATCHEWANAND

NEWFOUNDLAND AND LABRADOR

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

CEQUEL ENERGY INC.

MRRS DECISION

WHEREAS the local securities regulatoryauthority or regulator (the Decision Maker) in each of Alberta,Ontario, British Columbia, Manitoba, Nova Scotia, Saskatchewanand Newfoundland and Labrador has received an application fromCequel Energy Inc. (Cequel) for a decision under the securitieslegislation of the Jurisdictions (the Legislation) that therequirement contained in the Legislation for Cequel to sendto its shareholders its audited annual consolidated financialstatements concurrently with the filing of such financial statementsas required by the Legislation (the Concurrent Mailing Requirement)shall not apply to Cequel on the basis below;

AND WHEREAS under the Mutual RelianceReview System for Exemptive Relief Applications (the System),the Alberta Securities Commission (the Commission) is the principalregulator for this application;

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 -- Definitions;

AND WHEREAS Cequel has represented tothe Decision Makers that:

1. Cequel is a corporation amalgamated underthe Business Corporations Act (Alberta) with its headoffice located in Calgary, Alberta.

2. Cequel is a publicly traded energy corporationengaged in the exploration, development and production ofcrude oil and natural gas in western Canada.

3. The common shares of Cequel are listedand posted for trading on the Toronto Stock Exchange.

4. Cequel is a reporting issuer in all provincesof Canada that incorporate such a concept in their legislation.

5. In accordance with National Policy StatementNo. 51 - Changes in the Ending Date of a Financial Year andin Reporting Status (NP 51), Cequel changed the ending dateof its financial year in July, 2002 and, as a result of thechange, Cequel's most recently completed financial year isfor the 17 month period ended December 31, 2002.

6. NP 51 requires Cequel to file both itsannual information form and annual financial statements forthe 17 month period ended December 31, 2002 (the 2002 FinancialStatements) on March 31, 2003.

7. Cequel filed its annual information formon March 31, 2003 on SEDAR in accordance with NP 51 but asof the date hereof has not filed its 2002 Financial Statementson SEDAR as a result of the Concurrent Mailing Requirement.

8. Other than the requirement to file its2002 Financial Statements by March 31, 2003 pursuant to NP51, Cequel is not in default of any requirements of the applicablesecurities legislation in any of the provinces in which itis a reporting issuer.

9. Cequel intends to file its 2002 FinancialStatements on SEDAR no later than two business days afterthe date of this decision document.

10. Cequel's annual general meeting of shareholdersis scheduled to be held on June 9, 2003 and Cequel proposesto deliver the 2002 Financial Statements to the shareholdersof Cequel entitled to receive them on May 9, 2003, concurrentlywith the Notice of Meeting and Management Proxy Circular forthe 2003 Annual Meeting of Shareholders.

11. Cequel substantially released its 2002Financial Statements, without an auditor's report thereon,by press release on March 13, 2003 and such financial statementsare therefore available currently for viewing by the publicon SEDAR.

AND WHEREAS under the System, this MRRSDecision Document evidences the decision of each Decision Maker(collectively, the Decision);

AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers underthe Legislation is that the requirement contained in the Legislationrequiring Cequel to concurrently send to its shareholders the2002 Financial Statements filed with the Decision Makers pursuantto the Legislation shall not apply to Cequel, provided thatCequel:

(a) concurrently with the filing of the2002 Financial Statements with the Jurisdictions, issuea press release indicating that Cequel proposes to deliverthe 2002 Financial Statements to the shareholders of Cequelentitled to receive them on May 9, 2003, concurrently withthe Notice of Meeting and Management Proxy Circular forthe 2003 Annual Meeting of Shareholders and that shareholdersof Cequel, wishing to view this information in advance ofMay 9, 2003, may obtain copies of the 2002 Financial Statementsand MD&A on request, or by accessing the 2002 FinancialStatements and MD&A on the SEDAR website; and

(b) delivers the 2002 Financial Statementsto the shareholders of Cequel entitled to receive them inaccordance with the procedures outlined in National Instrument54-101 -- Proxy Solicitation and in any event no later thanMay 10, 2003.

(c) files its 2002 financial statementson SEDAR no later than two business days after the dateof this decision document.

April 2, 2003.

"Agnes Lau"