A common contractual lien found in the oil and gas industry is the "Operator’s Lien". Operator’s Liens are explicitly created pursuant to s. 505 of the 1990 CAPL Operating Procedure (the "Operating Procedure"). The "Operator’s Lien" created by the Operating Procedure provides that the operator will have "a lien and charge, which is first and prior to any other lien, charge, mortgage or other security interest, with respect to the interest of each Joint-Operator in the joint lands, the wells and equipment thereon, the petroleum substances produced therefrom and any production facilities".
Operator’s Liens Charging Personal Property
As was the case in our earlier discussion respecting Processing Liens, where an Operator’s Lien charges personal property, the Alberta Personal Property Security Act ("PPSA") will apply and, in order for the Operator’s Lien to trump other security interests, it will have to be perfected earlier than those other interests in accordance with the PPSA. This
