MONTREAL -- The future of Pebercan Inc. is uncertain after its sole venture is set to collapse with the cash-strapped Cuban government's decision to scrap a long-standing oil production sharing agreement.

The move caused the Montreal-based company's shares to plunge more than 23 per cent in the first trading since it announced the change late last week. Shares of its partner, Toronto-based Sherritt International Corp., fell nearly 14 per cent.

Pebercan announced Friday that the Cuban government is scrapping a production sharing contract nearly 10 years early and will pay $140-million (U.S.) in compensation.

A Pebercan spokesman said the severing of ties came after Cuba missed payments.