Once praised for breathing life in the U.K. sector of the North Sea, Calgary-based Oilexco’s local business is now in receivership despite finding some of the past decade's biggest area fields.

It’s not the first Calgary-based oil company to lose out despite finding massive reserves of oil and gas. Late last year, shareholders in First Calgary Petroleums surrendered their stock to Eni, as the company needed hundreds of million of dollars to realize those reserves — at the height of the unfolding credit crunch.

Now Oilexco, with the Brenda field, Huntington and other projects underway, is under order from a court to have four administrators from Ernst & Young take over the function of the Board of Directors.

“Oilexco North Sea Limited's operations will continue to be conducted in a safe and orderly manner,” a statement said.

But what of the company? It’s being sold off with Morgan Stanley and Co. Ltd. conducting the fire sale.

Once a darling of investors in Toronto and London, Oilexco is no more in the North Sea. Like First Calgary Petroleums, the company proved it is not enough to capture vast reserves by the drill bit. If development is dependent on new debt and borrowing is scarce, those reserves will might never be produced.