Kitikmeot Corp. offers no financial information at Inuit association’s annual meeting

Update on 2019 Kitnuna bankruptcies leaves creditor aghast

This sign posted last November on the Kitnuna Corp. building in Cambridge Bay provided official public notice that Kitnuna Petroleum Ltd. and Kitnuna Projects Inc. had declared bankruptcy. Little information on the bankruptcies came to light at the Kitikmeot Inuit Association’s annual general meeting this week in Cambridge Bay. (File photo)

By Jane George

Creditors in western Nunavut who are still smarting over money owed to them by two bankrupt companies, Kitnuna Projects and Kitnuna Petroleum, could not learn much from a recent Kitikmeot Corp. update on the bankruptcies.

The two companies, which declared bankruptcy last November, together owed more than $10 million to a long list of creditors, including local businesses, when they closed.

The update on the bankruptcies was included in a report presented on Tuesday, Oct. 6, by KC’s president David Omilgoitok and by John Stevenson, its chief operating officer, to the Kitikmeot Inuit Association’s annual general meeting in Cambridge Bay.

“As some delegates will recall from my report last year, we were having a serious look at restructuring the Kitnuna Group of Companies, which were all in financial trouble. As result of that work, two companies, Kitnuna Petroleum and Kitnuna Projects, have been put into bankruptcy,” the report said.

The two companies were subsidiaries of KC, the wholly owned business arm of the KIA.

And their bankruptcies last November left many in the Kitikmeot region with big unpaid bills.

One of those owed money, who spoke to Nunatsiaq News on the condition of anonymity, said they don’t understand how the KC management is still in place while all employees of the two subsidiaries lost their jobs.

“There need to be some serious repercussions, but none have occurred to date. Where … does this happen other than with these birthright entities? People are alarmed, but are afraid to speak up,” the creditor said.

No figures or information were provided at the AGM on the impact of these bankruptcies or what took place afterwards in terms of a settlement with the creditors.

KC has said it only discloses financial information to its sole shareholder, the KIA, at their first meeting of every calendar year.

The two KC companies made an assignment into bankruptcy on Nov. 4, 2019.

Online documents from Deloitte Restructuring Inc., the licensed insolvency trustee, show that Kitnuna Petroleum had assets of about $9 million, but owed about $8.7 million, mainly to the Government of Nunavut and the Qulliq Power Corp.

Kitnuna Projects had about $2.8 million in assets and owed about $2.7 million, including roughly $120,000 to Kitnuna Corp., $73,000 to Kitnuna Expediting, $783,000 to Kitnuna Petroleum and $614,000 to the Qulliq Energy Corp.

Many western Nunavut companies were also on the list of creditors owed money by Kitnuna Projects: Inukshuk Enterprises, JMS Supplies, Kalvik Enterprises and the Ikaluktutiak Co-op, to mention a few.

Deloitte has not responded to Nunatsiaq News’ requests for additional information on how or if the creditors were repaid.

By filing for bankruptcy, the two Kitnuna companies were also able to stop unsecured creditors from taking legal action against them and stop any actions already in place.

This protection, called a “stay of proceedings,” is provided by section 69 of the Bankruptcy and Insolvency Act.

KC provided no figures on how its active subsidiaries are now doing in its report to the annual meeting, and no $100,000-dividend cheques were handed out to the KIA, as was done in 2015.

The KC report did say, “Every one of our 25 or so companies has been impacted by COVID-19.”

Both Larga patient boarding homes in Yellowknife and Edmonton were “significantly impacted” by COVID-19, it said, due to the “immediate stoppage of non-emergency patients traveling for medical appointments.”

“Even though we managed to access some funding to offset loss of income for employees, both businesses have been deeply impacted by COVID-19 financially. All that said, both of our Larga homes continue to operate in a safe and efficient manner.”

The full report can be found on the KIA Facebook page.

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(14) Comments:

  1. Posted by Old trapper on

    I got no Facebook you guys need to think of people too who don’t have toxic Facebook

    • Posted by The Old Trapper on

      The above is not “The Old Trapper” that most of you will recognize as a frequent participant in the comment section.
      .
      Come on man think of your own nickname, don’t try to use mine, okay?
      .
      And the KIA needs to be held responsible. They need to be transparent financially and let the beneficiaries know what is going on.

  2. Posted by I live in the Arctic on

    incompetent and indifferent leadership.

  3. Posted by Transparency Now! on

    ALL Inuit Orgs, Associations and all of their Corporate arms have a duty to their members and constituents to ensure transparency. Make their financial statements publicly available !! It’s the only tool we have to ensure accountability!! QIA does it, Kiv IA does it, what else are you hiding Kit IA ??

    • Posted by Yup on

      NTI should also show their finances in detail. They seem to just throw money around like for example 2.4 million to a company that doesn’t have an office or staff to start TV channel. We need to know how the beneficiary money is being spent.

    • Posted by General Mills on

      When do Nunavut’s citizen’s get some Accountability?

      When have they ever?

  4. Posted by Darren Etibloena on

    For years they hired southern staff from the Atlantic provinces: in and out of Cambridge Bay every what, six weeks. So one hire would be on average 8 turn arounds? How much did these hires cost? 1 person- 8 return tickets, probably at least 2 nights hotel or transient stay, airport shuttles, and meals. I get that they had to hire southern help but couldn’t they have looked closer or within Nunavut to do these hires. Someone has to be held accountable. To let a beneficiary company to go that deep into the red? And to let it continue for years without anyone inside KC saying anything? Or even KIA demanding that overhead costs should be taken care off in a sound fiscal way. The Kitikmeot beneficiaries that this affected should demand answers! Lots of people lost there jobs, and yet the top still get paid. There is something fundamentally wrong here.

    • Posted by okay on

      Southern Staff who would have said this is wrong or such and such are wrong would have been fired. So the Southern staff who survived are those who got along or go along very well with the Inuit’s elites. Now, we are seeing the results. It is the same in the GN.

  5. Posted by Northern Guy on

    If this was any other private sector corporation the Board would have sacked the entire executive management team long ago for non-performance. Wake up Inuit of Nunavut! This is your money being frittered away.

  6. Posted by Northern Inuit on

    Another KIA AGM, another non explanation.

    You could see the writing on the wall last year, Mr Omilgoitok not giving any explanation or insight of the troubles on the horizon. Mr Stevenson not talking about the plans for Beneficiary jobs or what they planned to do with their assets.

    If you dig deeper into the Deloitte Bankruptcy paperwork you can see how it was planned for a long tine coming, Friends Companies were paid off their debts by “selling” them Loaders and Light Plants for pennies by Kitnuna Projects.

    Kitnuna Petroleum was saddled with all the shit assets, all of the buildings and tank farms were given to this company. Conveniently the millions of dollars of bad debt of fuel bills from Kitnuna Projects and Kitikmeot Supplies was tallied as “Bad Debt” so Kitikmeot Supplies would not have to pay this amount but don’t worry they are not at risk for bankruptcy they told us.

    Kitikmeot Corp just keeps on collecting their pay

  7. Posted by pissed off on

    What a terrible situation.
    They say“ we only disclose our financial information to our shareholder which is KIA “

    THis is like a gigantic F,,,,, You !!! to all the people of the Kitikmeot and to the federal government which one way or the other has funded this tragedy for the last number of years.

    What does one of those people need to do to get fired and never hired again in the region ?

    I guess one reason is that this region is so closely knit that everytime you want to raise an issue the effect is that you reach too many families so in the end ANYTHING goes.

    However the Federal Government has no family ties and should insist on a serious forensic clean-up before putting another penny in the region. THis would uncover many painful truths but it would be for the better in the long run.

    THanks

    • Posted by Inuk1 on

      Holy, cool your jets. You don’t need to hate the on the whole region because of the KIA Business arm KC. The hate on for the Kitikmeot knows no bounds. It’s pretty grotesque to be honest.

  8. Posted by Comefromaway on

    I worked there for 5 years on and off. The incompetence of senior managers was legendary. They would hire us from east coast but some staff just drank and took advantage of local girls. Drugs were everywhere too but Management did nothing to stop them. Local staff were kept in the dark about many things. There was no discipline, no one got fired for no shows or being drunk or high on the job. Near the end you had someone in charge with next to no experience running a crew and playing favorites with his drinking buddies. The hard workers from away were treated poorly unless you were part of the clique. Money was squandered on favored staffs accommodations whilst others were in mouldy bunkhouses. Kitnuna should have been a force for good for this community for many years. Gross incompetence, nepotism and a huge lack of accountability cost Cam Bay dearly. Such a waste

  9. Posted by Ikaluktutuiakmiut on

    An example of the rich staying rich while the poor get poorer. All the companies that hire southerners don’t put money back into our community rather than training locals. Everywhere in Nunavut there are still less Inuit in the workplace and a constant parade of new faces.

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