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October 29, 2016

 

The oil wells are pumping, the loans are slowly being paid off and there is money in the bank.

That was the news from Collins Barrow Auditor Peter Falice during the Petrolia Discovery Foundations Annual General meeting.

In the last few years the foundation which runs and preserves the historic site has struggled. In 2014, it took out a $150,000 loan for the Sarnia Lambton Business Development Bank to consolidate its loans. Then, the long-time general manager and only employee of the site passed away. When the volunteer board recognized the financial difficulties, it asked the Town of Petrolia to take over management of the site. That lasted a few months. The town stepped away from the site after a building inspection showed a number of buildings and walkways needed to be demolished.

But Falice says the volunteer board put their heads down and got to work and now what was a tough financial picture is improving.

Falice told about 30 people at the meeting, the foundation generated enough money last year through bingos, donations and oil revenues to operate with a slight yearly surplus. Discovery’s deficit has shrunk from $205,000 in 2014 to $186,000 in 2015. “The foundation stopped making loan payments for a year but they began again this August,” says Falice. “This is a good financial statement….the value of the property is high and your debt is relatively low. What you’re struggling with is cash flow and hopefully that will get better.”

Dawn Sperling, the foundation chair, says that will happen as the price of oil climbs. Sperling says 10 wells are now pumping well compared to five in 2015. Oil production climbed from 362 barrels in 2014 to 684 in 2015 and so far in 2016, 864 barrels have been sold.

But that hasn’t translated into a lot of cash. The price of oil is hovering around $50 per barrel compared to $90 a couple of years ago.

 

“The price is starting to come up,” says Sperling, but it is now where we want it to be.”

The foundation plans to bring more wells up as soon as possible to increase the site’s cash flow. It also wants to rebuild the failing wood walkways as soon as possible. “Once we get the walkway done, at lest we will be able to snow the field and Fitzgerald Rig and that is what draws the universities.”

The foundation is also actively looking for grants to renew some of the historic buildings on the site. The county building inspection showed major deficiencies in the Blue House which serves as an administration building, and the old church.

And Sperling says to move some of that work forward, the foundation needs a full-time employee. “Most of these goals can be achieved but without a dedicated volunteers, we would not have be able to move things forward…Another thing we do need is a manager, someone who is here to deal with the ins and outs of the site.”

That too will depend on revenue, she says.

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