CENTRE FOCUS
A HAND UP
LABOUR PAINS
FORT MCMURRAY EYES NEW ARENA
NEW, BETTER WAYS TO LIFT MODULES
WORKER SHORTAGE REMAINS A CONCERN
PAGE 26
PAGE 36
PAGE 77
Fall 2013 | $8.00
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contents
Volume 33 Number 3 Published Fall 2013
FeaTures COMMERCIAL
22
Power to the people Alberta’s first transmission project to go up for competitive bid will bring increased capacity to the busy oilsands region By Tricia radison
INFRASTRuCTuRE
Sports and entertainment facility a catalyst project for Fort McMurray’s new downtown By Tricia radison
INDuSTRIAL
31
36 43
Growing pains $1-billion petrochemical plant expansion will be good for the province—but only after jumping a few hurdles
COver sTO ry
26
Build it and they will come
By Godfrey Budd
A hand up
46 ALGAE
TO ENERGY
An innovative northern Alberta pilot project will convert oilsands CO2 into fuel and other products
University of Alberta researchers help PCL discover new and better methods of module lifting By Joseph Caouette
By Jim Bentein
Accelerating schedules New software tool could provide significant savings in time and money on oilsands projects
8
Project Update
11
Nuts & Bolts
61
People, Products & Projects
70
ACA Report
72
CCA Report
77
Trade Talk
81
83
Business of Building
SPECIAL FEATuRE
A HAND UP
Water, water, everywhere
LABOUR PAINS
87
CENTRE FOCUS
New, better ways to lift modules
worker shortage remaiNs a coNcerN
fort mcmurray eyes New areNa
PAGE x x
PAGE x x
PAGE x x
ACI Awards
Fall 2013 | $8.00
Our annual look at key energy projects around Alberta
Though in many cases it was short term, construction firms feel impact of summer floods
POSITIVE ENERGY PM40069240
By Jim Bentein
7
Editor’s Note
Bottom Line
By r.P. stastny
52
InsIde
ON THE COVER: COnsTruCTIOn Is underway aT nOva CHemICals COrPOraTIOn’s POlyeTHylene 1 PlanT In JOFFre, alTa.
THE ENERGY ISSUE
PLUS | Water, water, everywhere
pAge 52
90
Legal Edge
92
Time Capsule
PHOTO: nOva CHemICals COrPOraTIOn
Alberta Construction Magazine | 5
EDITORIAL EDITOR Chaz Osburn
cosburn@junewarren-nickles.com
editor’s note
ASSISTANT EDITOR Joseph Caouette jcaouette@junewarren-nickles.com CONTRIBUTING WRITERS Jim Bentein, Godfrey Budd, Gerry Cameron, Ken Gibson, Christopher Huffaker, mychal martin, Tim mavko, Tricia radison, amy smith, r.P. stastny EDITORIAL ASSISTANCE MANAGER marisa sawchuk msawchuk@junewarren-nickles.com EDITORIAL ASSISTANCE sarah eisner, matthew stepanic
CREATIVE PRINT, PREPRESS & PRODUCTION MANAGER michael Gaffney
mgaffney@junewarren-nickles.com
CREATIVE SERVICES MANAGER Tamara Polloway-webb tpwebb@junewarren-nickles.com CREATIVE LEAD/SENIOR DESIGNER Cathlene Ozubko cozubko@junewarren-nickles.com GRAPHIC DESIGNER Christina Borowiecki
SALES SALES MANAGER – ADVERTISING monte sumner msumner@junewarren-nickles.com SENIOR ACCOUNT EXECUTIVE Paul sheane psheane@junewarren-nickles.com For advertising inquiries please contact:
adrequests@junewarren-nickles.com AD TRAFFIC COORDINATOR – MAGAZINES lorraine Ostapovich
atc@junewarren-nickles.com DIRECTORS CEO Bill whitelaw
bwhitelaw@junewarren-nickles.com PRESIDENT rob Pentney rpentney@junewarren-nickles.com DIRECTOR OF SALES & MARKETING maurya sokolon msokolon@junewarren-nickles.com DIRECTOR OF EVENTS & CONFERENCES Ian macGillivray
imacgillivray@junewarren-nickles.com
DIRECTOR OF THE DAILY OIL BULLETIN stephen marsters
smarsters@junewarren-nickles.com
DIRECTOR OF DIGITAL STRATEGIES Gord lindenberg glindenberg@junewarren-nickles.com DIRECTOR OF CONTENT Chaz Osburn cosburn@junewarren-nickles.com DIRECTOR OF PRODUCTION audrey sprinkle asprinkle@junewarren-nickles.com DIRECTOR OF FINANCE Ken Zacharias, Cma kzacharias@junewarren-nickles.com
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Tel: 1.866.543.7888 email: circulation@junewarren-nickles.com Alberta Construction Magazine is owned by Junewarren-nickle’s energy Group and is published quarterly. ©2013 Junewarren-nickle’s energy Group all rights reserved. The contents of this publication may not be reproduced by any means, in whole or in part, without the prior written consent of the publisher. The opinions expressed by contributors to Alberta Construction Magazine may not represent the official views of the magazine. while every effort is made to ensure accuracy, the publisher does not assume any responsibility or liability for errors or omissions. Printed by Printwest. Postage Paid in edmonton, alberta, Canada If undeliverable return to: Circulation department, 80 valleybrook dr., north york, On m3B 2s9 made In Canada GsT registration number 826256554rT Printed in Canada Issn 1499-6308 Publication mail agreement number 40069240
EVERY SO OFTEN life has a way of reminding us that what we do, no matter how ordinary or routine it seems at the time, can have a far-reaching impact. Consider the story of Vern Hunter. Hunter was a toolpush—the foreman on a drilling rig—who, in mid-November of 1946, was ordered to move his rig to a different location just a short distance from Leduc, Alta. An ordinary day. An ordinary order. History would show otherwise. Hunter had a nickname no oilman would want: Dry Hole. He had received it after drilling a series of wells that didn’t produce oil across Saskatchewan. In fact, the company he worked for, Imperial Oil Limited, had drilled 132 dry wells and this location, 18 miles southwest of Edmonton, was to be its last shot at finding oil in Alberta. As fate would have it, that site—Leduc No. 1—would not only yield oil, but would also usher in an era that established Alberta as an energy powerhouse. I can’t help but wonder how many of you reading this right now might be doing something differently had Dry Hole Hunter’s and Imperial Oil’s fortunes not turned out the way they did. Nearly every industry in Alberta—and that certainly includes construction—has been impacted by the Leduc discovery. Sixty-six years after Leduc No. 1, remarkable things are happening on the energy front, and in the communities that support those in the oil and gas ranks. This issue, our annual Energy Issue, looks at several of those projects. Also in this issue, we have a follow-up on this summer’s disastrous flooding, a story on some cool modular innovations and a new column by Gerry Cameron, a registered associate investment advisor in the Edmonton region, that I think you’ll find interesting. As you go about your day, remind yourself that what you do matters. Maybe one of you is going through a period similar to what Vern Hunter experienced before Leduc No. 1. But remember this: what you touch can have a big impact, even if it seems ordinary or routine at the time. Chaz Osburn cosburn@junewarren-nickles.com
COMING NEXT ISSUE: Our 12th annual Top Projects awards
Alberta Construction Magazine | 7
project update
PCL North American headquarters expansion
LEED-certified structure with a glass and concrete exterior. 6. The building will feature about 44,000 square feet of office space, workstations and meeting rooms. 7. The project should be completed in the fall of 2014.
PHOTO/renderInG: PCl
Canada’s largest construction company, PCL Constructors Inc., is expanding its North American headquarters in Edmonton. Here are seven things to know about the project: 1. The new building will take the place of the first building constructed on the PCL campus nearly 50 years ago. 2. Project cost is $20 million. 3. The development will be virtually paperless, taking advantage of 3-D blueprints and plans accessible on wireless devices. Building information modelling (BIM) technologies will also be used. 4. This is the third addition to PCL’s headquarters in the past five years. 5. The expansion will be a three-storey,
TOP TO BOTTOM WE’VE GOT ALBERTA COVERED With five locations across the province we can help you get your hands on those essential tools or products when you need them most. It’s all part of our commitment to help construction professionals like you get the job done right the first time. Northland – Provincial Strength. Local Service. Keep on building, Alberta. FORT MCMURRAY EDMONTON RED DEER CALGARY LETHBRIDGE EVERYTHINGCONCRETE.CA
8 | Fall 2013 | albertaconstructionmagazine.com
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nuts& bolts News briefs for the busy construction professional
PHOTO: Brewster Travel Canada
The view from up here There will soon be a new way to take in the natural splendour of the province’s Rocky Mountains—provided you don’t have a fear of heights, that is. When the Glacier Skywalk officially opens next May, it will offer Jasper National Park patrons a vertiginous view of Sunwapta Valley through a glass-floored walkway. Jutting out 35 metres from the face of a cliff, the walkway will provide a prime vantage point for visitors to take in the entire sweep of the valley 280 metres below. Construction began last summer on the Skywalk, located one hour from Jasper, Alta., near the Columbia Icefield Discovery Centre. Brewster Travel Canada, owner and operator of the project, expects work to wrap up by winter, with an official opening planned for May 2014. The structure of the glass-floored walkway—dubbed the Discovery Vista—was completed at the end of July, while installation of the glass began in August and is to continue in September. However, the project includes other features, including a 300-metre interpretive trail running along the cliff face. Crews are currently working on installing interpretive nodes along the trail, which will touch upon the hist ory, geology and ecological diversity of the park. The bulk of this structure will consist of weathered steel, chosen for how it blends with the surrounding landscape. Sturgess Architecture and Read Jones Christoffersen Consulting Engineers Ltd. designed the project, while PCL Construction Management Inc. is serving as project manager.
When it opens next year, the Glacier Skywalk will provide a panoramic view of Sunwapta Valley in Jasper National Park.
Alberta Construction Magazine | 11
nuts & bolts
Carbon cartography To improve energy efficiency, you must first know where it is wasted. That’s why C3, Alberta Innovates – Tech Futures (AITF) and Alberta’s Industrial Heartland Association are using funding from Natural Resources Canada to map energy use in the Industrial Heartland, northeast of Edmonton. Scheduled for completion in March 2014, the feasibility study will measure the amount of heat wasted in the region and calculate the costs and benefits in repurposing it, says Jeff Reading, C3’s director of sustainability services. The project will pull publicly available data on energy usage and validate it with one of five corporate partners.
12 | Fall 2013 | albertaconstructionmagazine.com
“No one has done exactly what we’re doing,” Reading says, comparing the project’s comprehensive energy mapping to Toronto Pearson International Airport industrial zone cogeneration and European energy integration efforts. The potential outcomes are speculative, but the group is anticipating economic, environmental and social benefits. “Fundamentally, [waste-heat usage] is a productivity problem,” says AITF program lead Craig Aumann. Reading points out that waste-heat recycling could also help reduce greenhouse gas emissions. Aumann and Reading are both hesitant to speculate on how the waste heat would be used, but Reading says, “Keeping it as
heat could mean [heating and then transporting] water or other fluids depending on use. Depending on the energy intensity of the waste heat, it could be used to produce electricity [by running it through a turbine] before it is redeployed as heat. These questions are all part of what the study hopes to define.” The Industrial Heartland was chosen for its varied array of industry and proximity to AITF, but the team hopes to apply their discoveries across Canada. They also imagine deeper integration of energy conservation efforts across the industry, rather than having each facility pursue its own self-contained gains. “We see heat as the low-hanging fruit,” Aumann says.
PHOTO: Darryl Zubot
Energy usage in Alberta’s Industrial Heartland will be measured as part of a new study looking at ways to reduce greenhouse gas emissions and recycle waste heat in the region.
nuts & bolts
Pipe manufacturer makes Alberta debut Oil and gas pipe producer TMK IPSCO may have 11 plants in the United States and operations around the globe, but its presence in energy-rich Alberta so far has been limited to a Calgary sales office first opened in 2010. The company plans to change that with a new 33,000-square-foot pipe-threading facility near Sherwood Park, Alta.—its first in Canada. The location will allow the company to support drilling in the oilsands, as well as in the Duvernay and Montney shale plays. “We were looking for something that was central,” says David Diederich, vice-president and chief manufacturing officer. “We were really concerned about the access to the facility, especially rail access. This specific location has access to two major rail lines, so it gives you a lot of flexibility and it should help our costs as far as bringing pipe in.” The facility will offer the full lineup of TMK’s ULTRA premium pipe connections, ranging in size from 4 1/2 inches to 13 3/8 inches. There is enough space available at the plant to quadruple production in the future, the company says.
You.
Fueling your career
Project Management in Construction
Add another wing to the plan room Alberta’s online plan room just got a little bigger. For years, the province’s local construction associations have operated COOLNet Alberta, an online system for sharing plans and managing tenders. Thanks to an alliance with Reed Construction Data LLC, the group hopes to improve the way association members share data online, while also creating new project opportunities by connecting with Reed’s client base. “Building bridges within the industry makes more sense than putting up walls or both parties trying to go it alone,” says Dorothy Carson, executive director of the Lloydminster Construction Association. “Collaboration is a good fit here.” The arrangement mirrors a similar deal signed between Reed and Ontario’s local construction associations in 2011.
Business Analysis Business Process Management CAPPA Lean Management Oil & Gas Office Admin Petroleum Joint Venture Petroleum Land Admin Petroleum Land Business Project Management Stack Sampling Supply Chain Management Technical Writing
image: JOHN FOXX/PHOTOS.COM
New and improved COSSD website launches The Canadian Oilfield Service & Supply Database (COSSD)—a sister publication of Alberta Construction Magazine—has unveiled its revamped website at cossd.com. Sporting a simplified interface and more powerful search engine, the website now allows users to customize searches by category or location. Added features, such as product catalogues and company profiles, provide extra information to help users further refine searches. The new website launched in June to coincide with the release of COSSD’s 33rd print edition.
Continuing Education 403.440.6875 mtroyal.ca/conted INFO NIGHT, SEPT. 11, 5-8 PM
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Alberta Construction Magazine | 13
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H EAV Y
INDUSTRIAL
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BUILDINGS
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CIVIL
INFRASTRUCTURE
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Sharing your vision. Building success. We are more than builders. We are construction partners who are passionate about what we do and about our partners’ success.
Watch us build at PCL.com
nuts & bolts
$1.3 billion
Cost of the Woodland Pipeline Extension Project, which would connect the Kearl oilsands project to a terminal near Edmonton. Source: Daily Oil Bulletin
You.
Taking care of business
Project Management Business Analysis Business Process Management Accessible Housing Design Lean Management LEEDÂŽ in Practice Petroleum Joint Venture Supply Chain Management Technical Writing
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PHOTO: TELUS
City in the Sky From home to the office and back again— in a single elevator. Calgary commuters tired of the downtown traffic may be particularly interested in the Telus Sky, a 750,000-square-foot mixed-use tower planned for the city core. The $400-million development will cover an entire block and contain office, residential and retail space. There will even be a 5,500-square-foot art gallery for those looking for a bit of culture while on their coffee break. As the anchor tenant, Telus will occupy 155,000 square feet of the tower. Another 275,000 square feet of office space will be leased to other businesses, while the rest of the building will be divided between
Ask about company training
When it opens in 2017, the Telus Sky tower will add 750,000 square feet of mixed-use space to downtown Calgary.
retailers and residents. A total of 341 residential units are planned. Telus and its partners Westbank Corp. and Allied Properties Real Estate Investment Trust are aiming for LEED Platinum certification with the project. Among the more notable environmental features is a stormwater recycling system that will save millions of litres annually by using rain water for toilets and irrigation. When it first opens, Sky is expected to use 35 per cent less energy than similarly sized buildings. The final goal is to push that figure to 80 per cent, Telus says. Bjarke Ingels Group and DIALOG have been contracted as architects on the project, which is slated for completion by fall 2017.
Continuing Education 403.440.6875 mtroyal.ca/conted INFO NIGHT, SEPT. 11, 5-8 PM
Check website for future Info Night dates.
Alberta Construction Magazine | 15
KNOW WHAT’S COOL
www.coolnet.ab.ca
Construction Opportunities On-Line Network
nuts & bolts
Dover, Dover, don’t come on over
manulife real estate has revealed plans to build a 27-storey office tower in Calgary’s city core.
renderInG: Cnw GrOuP/manulIFe real esTaTe
Eight things to know about Calgary’s latest tower project The flood waters of June have receded and downtown Calgary is getting back to what it does best—erecting massive office towers. Manulife Real Estate is the latest to get in on the action, with its recently announced 707 Fifth Street building. Here’s what you need to know about the next addition to the Calgary skyline: 1 The building will stand 27 storeys tall 2 Floor space will total 564,000 square feet 3 The developers are aiming for LEED Gold certification 4 Skidmore, Owings & Merrill LLP is the designer 5 The building’s elliptical shape is intended to maximize sunlight and create a panoramic view of the Rocky Mountains 6 Amenities on-site will include a fitness centre, conference facility and winter garden, as well as access to the +15 Skyway 7 The tower will serve as the head office of Brion Energy Corporation and its 270 staffers 8 Completion is expected in March 2017
Brion Energy Corporation is surely pleased to see its Dover oilsands project move one step closer to reality. Too bad the neighbours don’t share its enthusiasm. The Alberta Energy Regulator has given the go-ahead to Brion—a joint venture between Athabasca Oil Corp. and PetroChina Company Limited—on what could become the next oilsands megaproject for the province. Timelines have not yet been finalized, but a few key facts are known: the project would advance over five phases, each producing 50,000 barrels per day; steam assisted gravity drainage is the production method of choice; and an estimated 4.1 billion barrels of bitumen could be produced over the project’s lifespan. Brion also sees Dover generating significant economic spinoffs for the province. It puts annual economic activity from the project at $5.3 billion, which includes over $1.5 billion in tax and royalty revenue for all levels of government. Construction would require over 30,000 person-years of employment, the company estimates. However, several hurdles remain before shovels can hit the ground at the site, located 95 kilometres northwest of Fort McMurray. First, the Alberta government cabinet must sign off on the project. And then there is the matter of Moose Lake. Encompassing land around Namur and Gardiner lakes, Moose Lake is an important cultural site for the Fort McKay First Nation. The community welcomes resource development, but it is also concerned that the project could devastate the local caribou and moose populations. In a press release, Chief Jim Boucher says that it is “unacceptable” for Dover to be within 1,200 metres of the reserve lands. During regulatory hearings earlier this year, Fort McKay asked for a 20-kilometre buffer zone to preserve the area. While disappointed that the buffer request was denied, Boucher has no intention of backing down. “The fight to protect Moose Lake is not over,” Boucher says. “Fort McKay is gearing up to mount a rigorous opposition to the Brion Energy project until a satisfactory solution is found.”
You.
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Alberta Construction Magazine | 17
nuts & bolts
AROUNDCANADA
1,000
number of leed certified projects in Canada.
numbers to know
LOOKING GOOD FOR WOOD The rebound in the U.S. housing market and strong demand from China means a good year for Canada’s wood products industry. The Conference Board of Canada predicts that revenues this year will rise to a six-year high, reaching $24 billion. Industry production will continue to rise each year through 2017. However, the pace of growth will slow down in the later years of the forecast, as production will be constrained by lower timber supply—a result of the mountain pine beetle infestation in British Columbia.
MORE OIL TO THE EAST Enbridge Inc. is seeking regulatory approval to expand an oil pipeline in southwestern Ontario. Enbridge has submitted an application to the National Energy Board proposing to increase the capacity of the existing 20-inch pipeline that runs from Enbridge’s Sarnia terminal to the Westover terminal north of Hamilton, Ont., reports the Daily Oil Bulletin, a sister publication of Alberta Construction Magazine. The 194-kilometre project would increase capacity to 180,000 barrels per day from 147,000 barrels per day and cost $15.1 million. Enbridge hopes to have the expansion in service by late in the third quarter of 2014.
18 | Fall 2013 | albertaconstructionmagazine.com
BIG COUNTRY ACQUIRED u.s.-based masTec, Inc. has acquired Big Country energy services Inc. masTec paid about $103 million in cash, picked up about $24 million in debt, plus an earn-out. Big Country, based out of Calgary, has construction offices in alberta, British Columbia and saskatchewan, as well as in wyoming and north dakota. It has about 1,200 employees and 600 pieces of construction equipment.
312,006 Amount of greenhouse gas emissions (measured in tonnes) from all LEED certified buildings since 2005. That equates to taking 58,980 cars off the roads for a year.
BILLION
number of litres of water saved from all leed certified buildings since 2005. That amount would fill 1,336 Olympic-sized swimming pools.
sOurCe: Canada Green BuIldInG COunCIl
ImaGes (ClOCKwIse FrOm leFT): TO2015; Hemera TeCHnOlOGIes/PHOTOs.COm; uladZImIr HrysHCHanKa/PHOTOs.COm
Construction is underway on the $56-million milton Pan am and Parapan am velodrome in milton, Ont. Jointly funded by the federal government and the Town of milton, the velodrome will open in fall 2014 and be used for both the Pan american Games and the Parapan american Games, both scheduled for the summer of 2015. The 250-metre timber track will feature two 42-degree banks.
nuts & bolts
PHOTO: PCl COnsTruCTOrs InC.
Now that’s a retirement gift In most industries, you get a gold watch when you retire. In construction, you get a building. PCL Constructors Inc. has opened the new Peter Stalenhoef Centre of Modular Excellence at its modular fabrication yard in Nisku, Alta. The $10-million facility is named for the former chief operating officer of the company’s heavy industrial division, who retired earlier this year. With a total of 35,000 square feet, the building will provide a permanent home for PCL’s modular assembly office and training facilities. In the past, the company’s modular construction staff were scattered across 14 portable trailers, but the new building will provide a spacious central location for the staff, with many amenities—including indoor washrooms,
PCl employees celebrated the opening of the $10-million Peter stalenhoef Centre of modular excellence at the company’s nisku, alta., modular fabrication yard in June.
welding supervisor Lindsey Salkeld notes. “Having everyone—tradespeople and staff—situated in one building makes each work day more efficient due to less walking to and from several different trailers to meet each other regarding communication and planning,” Salkeld adds.
News of the centre came with the announcement of a scholarship in Stalenhoef’s name. Students from the PCL Industrial Student programs will be eligible for the $2,500 award, which honours those who demonstrate leadership, teamwork and strong work ethic.
Alberta Used Oil Management Association www.usedoilrecyclingab.com
1-888-922-2298
Find Your Recycling Centre
Alberta Construction Magazine | 19
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THE ENERGY ISSUE
Alberta’s first transmission project to go up for competitive bid will bring increased capacity to the busy oilsands region
PHOTO: naTalIa KuZmIna/PHOTOs.COm
By Tricia Radison
The Fort McMurray West Transmission Project is powering up, and dozens of companies are competing for the right to be the one flipping the switch. The Alberta Electric System Operator (AESO) has announced that a new 500-kilovolt transmission line will be built to increase capacity between Edmonton and Fort McMurray. The project includes a new substation 25 kilometres west of Fort McMurray, a 500-kilovolt single-circuit transmission line about 100 kilometres long that will run from that substation to an existing substation in the Wabasca area, and a 500-kilovolt single-circuit transmission line about 400 kilometres long that will run from the Wabasca substation to one near Wabamun, Alta. Not surprisingly, the driving factor for the line is oilsands development, which is straining the region’s current transmission capacity. Peak load in the region has more than doubled over the last decade and is expected to more than double again over the next 10 years, rising from 1,735 megawatts this year to 3,905 megawatts by 2022.
POWER TO GROW With industry a major economic driver, AESO wants to ensure that the province has the power it needs to grow. “Alberta’s quality of life and economic well-being, especially the maintenance and creation of jobs, depends on an adequate and reliable supply
of electricity to all Albertans, now and well into the future,” says Dawn Delaney, senior external communication advisor for the organization. The project will be the first of its kind in Alberta to be put out for competitive bid. “In Alberta, we are going to be spending a lot on transmission lines in the coming years. The provincial government is very interested in minimizing the cost of building those lines, and one of the ways you can do that is to inject some competitive pressures or tensions into a marketplace,” explains Elizabeth Moore, director, competitive process, AESO. “The hope is that by putting these projects out to competitive bid, we are going to force folks to sharpen their pencils and come to the table with some really good pricing.” According to the AESO’s Long-term Transmission Plan, the total cost of all planned projects between 2011 and 2020 is $13.5 billion. The forecast cost for the Fort McMurray West project in that plan is $1.6 billion. The province mandated the AESO to develop a competitive process, which it did after looking at what has been done in the transmission sector in other jurisdictions, as well as in other sectors in Alberta. It came up with an approach very similar to the publicprivate partnership approach used for large infrastructure projects like Stoney Trail in Calgary and Anthony Henday Drive in Edmonton.
Alberta Construction Magazine | 23
commercial
In our over 60 years in the construction industry, we have become one of Canada’s top contractors through adhering to our values of freedom, trust and innovation. We are thinkers before we are builders. We strive to advance beyond the limits of what comes easy to us to continue to innovate and provide our clients with quality service.
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24 | Fall 2013 | albertaconstructionmagazine.com
The Fort McMurray West project will add approximately 450 megawatts of import capability into the Fort McMurray area and approximately 700 megawatts of export capability out of the area. In this case, the company that wins the bid will be responsible for developing, designing, building, financing, owning, operating and maintaining the project. That’s actually nothing new when it comes to transmission lines. Prior to this project, new transmission projects went to the transmission facility owner (TFO) that operated in the area where the project was needed. The TFO was then responsible for all of the project’s different phases. One of the goals of moving to a competitive process is to increase innovation throughout the life cycles of new facilities. Moore says that the drive to keep costs down has resulted in technical innovations in other jurisdictions. “In Texas, they came up with an innovative tower design that met the required functional specifications, but was lower in cost than the towers that had traditionally been used,” she says. The competitive process is already underway. About 30 companies responded to the AESO’s request for expressions of interest. Considering there are currently only four major TFOs in Alberta, it’s obvious that the plan to introduce some competition is bearing fruit and that many others want to play. In the next stage, scheduled to wrap up in September, the AESO will put out a request for qualifications. A short list of up to five respondents will be asked to submit proposals, and the AESO will select the most qualified proponent that is prepared to deliver at the lowest cost. Three independent selection panels will evaluate both the qualifications and proposals. Members of the panels will have expertise in areas such as finance, technical requirements, environmental issues and stakeholder consultation. “We looked for parties who had expertise in certain areas to do a proper evaluation and who didn’t have any tie to companies that do this in Alberta today, so that we can ensure a fair and open competition,” Moore says. The Fort McMurray West project will add approximately 450 megawatts of import capability into the Fort McMurray area and approximately 700 megawatts of export capability out of the area. Construction is expected to begin in 2014 with the project going into service in 2019.
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sports and entertainment facility a catalyst project for Fort mcmurray’s new downtown By Tricia Radison
26 | Fall 2013 | albertaconstructionmagazine.com
ENORMOuS CHANGES are in the works for Fort McMurray. The once-sleepy community is about to blossom into a carefully planned urban centre with a vibrant core offering opportunities for recreation, culture and shopping—a place where people want to work and live. A vast number of projects are planned over the next nine years, with one of the first being a downtown sports and entertainment facility scheduled to open in time for the 2017 hockey season. Expected to seat between 7,000 and 9,000, the facility will be used for spectator events involving sports and entertainment like concerts and family shows. While hockey will be the main sport, the venue will also be ideal for bonspiels
PHOTO: yurIy arTemenKO/PHOTOs.COm
BUILD IT
infrastructure
renderInG: rm OF wOOd BuFFalO
and they will come and figure-skating exhibitions and championships, as well as for basketball and lacrosse. The ice will also be available for community tournaments, in addition to local schools and other groups that have competitive sports programs. Between concerts, family shows and other events such as monster truck shows, trade shows, motocross and rodeos, there could be 100 spectator event days and about 150 activity days at the venue each year. The downtown location has raised a few eyebrows, as evidenced by online comments. Some wonder about the wisdom of drawing thousands of people into the heart of the city when there isn’t enough parking and roads are already crowded. But the decision was strategic.
“Across North America, there has consistently been a positive correlation between sports and entertainment facilities and the residential, retail and entertainment development in the community,” says Ron Taylor, executive director of the City Centre Area Redevelopment Plan. Taylor has been helping municipalities develop similar facilities for about 15 years and has seen the results first-hand. He was involved with Budweiser Gardens in London, Ont., a 9,100-seat facility that sparked the redevelopment of that city centre, as well as with a 5,200-seat facility that has helped fill restaurants and other establishments in downtown Kingston, Ont.
Though a formal design for Fort mcmurray’s sports and entertainment facility does not yet exist, this rendering gives an idea of what it could look like at its location.
Alberta Construction Magazine | 27
infrastructure
“Building a facility like this in the core is a proven and tested way of bringing more business and people into the area, and a catalyst to redevelopment. It helps to create a very vibrant downtown, and whenever you have lots of activity and people you have a much safer, more secure place,” he says. The facility will serve as an anchor for a retail and entertainment corridor along MacDonald Avenue. Not only will there be approximately 30,000 square feet of retail and restaurant space around the perimeter, but there will also be a significant opportunity for commercial development, which could be either office or hotel space. The sports and entertainment facility will be built through a model that’s becoming increasingly popular in the province: the public-private partnership (PPP). The municipality asked for expressions of interest and qualifications and chose four of the seven respondents to submit a request for proposal. The winning proponent will become the private partner in the PPP, responsible for designing, building and operating the facility.
28 | Fall 2013 | albertaconstructionmagazine.com
“The majority of the facilities that have been built in the last decade or so have been built with the participation of the private sector in all or parts of the process,” Taylor says. “Most cities will only build a facility like this once in every 30, 40, even 50 years, so they don’t have the very specialized expertise that’s required to design, build and operate an arena like this.” With projects like MacDonald Island Park and its expansion, some of the expertise required for recreational projects is already in Fort McMurray, but much of it will have to be brought in. Won’t that be a problem in a city known for tight short- and long-term rental space, especially in light of all the other projects the city has planned, including improving transportation infrastructure, adding new multi-level parking structures, improving public spaces and building a new civic centre? Taylor acknowledges that accommodation is a challenge, but he says that there are ways to address the issue, such as tying down block bookings of hotel rooms in new hotel developments. More hotel space is also in the works with several projects either in the approval stage or starting construction.
He is also optimistic that that they won’t run into labour-shortage issues. “The advice we’re getting from the construction industry is that there will not be a problem getting materials or attracting labour. The economy is fairly slow across North America and, for that reason, there is a migration of trades in many of the sectors to Alberta and northern B.C. We’re confident that we will have the labour necessary to build the facility and all the other things that are underway,” he says. In fact, Taylor believes that increased construction activity in Fort McMurray will make it easier to get projects completed on schedule and on budget. With more activity, suppliers of construction materials and services will be more inclined to set up business in the city, putting those resources on the Regional Municipality of Wood Buffalo’s doorstep instead of hundreds of kilometres away. Site preparation is likely to start in spring 2014, with construction getting underway in early 2015. The cost will be determined through the proposal process.
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THE ENERGY ISSUE
Growing pains $1-billion petrochemical plant expansion will be good for the province—but only after jumping a few hurdles By Godfrey Budd
CONSTRuCTION IS uNDERWAY on an approximately
$1-billion expansion of NOVA Chemicals Corporation’s Polyethylene 1 (PE1) plant at the company’s Joffre, Alta., petrochemical complex. The project has earmarked $900 million for its capital cost. Start-up and commissioning spending in the fall of 2015 is expected to bring the total tab to nearly $1 billion. Ledcor Projects Inc. is the general contractor.
PHOTO: nOva CHemICals COrPOraTIOn
This image of the nOva Chemicals Joffre site Polyethylene 1 plant shows one of the two existing reactors (far right of photo).
Alberta Construction Magazine | 31
Construction underway at the nOva Chemicals Joffre site Polyethylene 1 expansion project.
32 | Fall 2013 | albertaconstructionmagazine.com
The PE1 expansion will include what NOVA describes as a world-scale polyethylene reactor (R3), adding to the two existing reactors, commonly referred to as production trains. “The new reactor is called world-scale because of the size. You have to build at this scale to be competitive,” explains Rick Van Hemmen, manufacturing director for western Canada at NOVA. R3 has been designed to produce between 950 million and 1,100 million pounds of linear low-density polyethylene per year, adding roughly 40 per cent more polyethylene production capacity at PE1. “The existing capacity is 1.5 billion pounds per year, and this will bring it to 2.56 billion,” Van Hemmen says. Based on size, the Joffre complex has certainly been competitive. It is an integrated polyethylene and ethylene—the feedstock for polyethylene—facility that includes three ethylene plants and two polyethylene plants. While it’s no longer
the largest site globally, as it was in 2001, the complex is still the biggest of its kind in North America. Although more railcar storage space at the existing rail yard north of the site and a new electricity substation are part of the proposed infrastructure, the PE1 expansion is nearly all within the site’s existing footprint. Interconnection approval from the Alberta Electric System Operator for a potential 33 megawatts of extra load to the grid was received in February, and a regulatory application for the substation was scheduled for this summer, according to a project fact sheet from NOVA Chemicals. The additional load will be provided by the existing co-generation facility at the site. No additional off-site transmission lines will be needed. Other related infrastructure for the expansion includes an additional flare stack and cooling tower to be integrated within PE1, plus on-site rail track for about 450 railcars to accommodate the expected 30 per cent increase in rail traffic in and out of the site.
PHOTO: nOva CHemICals COrPOraTIOn
industrial
industrial
NOW YOU KNOW Ledcor’s facility in nisku, alta., will build 51 modules for nOva Chemicals Corporation’s Polyethylene 1 expansion Project. The biggest module will be 100 feet long, 20 feet high and 20 feet wide.
COMPETING FOR MANPOWER A June project update from NOVA observes, “As there is significant competition for construction resources in Alberta, we are working with our contractors to actively promote our project and encourage the central Alberta workforce to choose our site.” It is a two-way street, some might say. The PE1 construction project surely confers benefits to the provincial economy. Some 40–60 per cent of the capital cost is to be spent in Alberta, the majority for direct labour. But it is just possible that the challenges alluded to in NOVA’s June update could have stymied the project altogether, despite the increased global and North American demand for product. “Our research shows that it is considerably more costly in Alberta to build this type of plant from scratch, compared to elsewhere. Cost certainty is always an issue. If we had not got the existing capacity in ethylene, the decision to build would have been much more difficult,” Van Hemmen says. Alberta Construction Magazine | 33
industrial
In a project like this, he says, labour is a major part of the total capital cost. Although labour costs are lower in central Alberta than in the Fort McMurray region, they are still higher than at most comparable sites elsewhere in North America.
“The new reactor is called world-scale because of the size. You have to build at this scale to be competitive.”
Fortunately, a number of factors were in play to tip the decision in favour of the expansion. The scale of the expansion is relatively modest, Van Hemmen says, and the presence of existing infrastructure helps. Also, the project’s central Alberta location means good access to labour. Construction will average about 250 tradespeople with a peak workforce of up to 600 from late 2014 to perhaps mid-2015.
ANOTHER HITCH The drop in natural gas production in Alberta over the last decade or so could have posed a feedstock supply challenge for the expansion, as ethane is traditionally extracted from
34 | Fall 2013 | albertaconstructionmagazine.com
PHOTO: nOva CHemICals COrPOraTIOn
— rick van Hemmen, manufacturing director, western Canada, nOva Chemicals Corporation
industrial
natural gas streams for the production of ethylene and polyethylene. Also, variability in the natural gas supply because of the ups and downs of the commodity’s annual demand cycle can limit feedstock supplies, as the ethane component is quite small. But two new “non-traditional” sources are taking care of the potential shortfall—shale oil off-gases from the Williston Basin and ethane from oilsands production. “These are providing a steadier supply than natural gas, which is subject to seasonal variables. The new sources are now playing a crucial role. At a rough estimate, they now account for 20–25 per cent of the total ethane feedstock supply to the site,” Van Hemmen says. The new feedstock supply will also turn existing underutilized ethylene production capacity into full production once the expansion is running. With a secure feedstock supply, ethylene production at the site will increase without any extra capital required. The scope of the project includes piling, concrete, structural steel, module assembly, piping, mechanical, electrical and instrumentation. “We’re really taking it from the ground up. There are few subcontractors. We self-perform the vast majority of our work,” says Alex Lauchlan, Ledcor’s project manager for PE1. The project, which Lauchlan says is comparable in scale to some single-phase expansions in the oilsands, will have, however, a higher ratio of steel than what is typical in the Fort McMurray area. “It’s due to large vertical structures [for the Joffre site expansion]. They use a lot of steel for vertical vessels that are surrounded by structural steel,” Lauchlan says. Alberta Construction Magazine | 35
Through a system of sliding connectors, the module lift frame has greatly simplified the process of rigging up modules for PCl Constructors Inc.
36 | Fall 2013 | albertaconstructionmagazine.com
PHOTO: PCl COnsTruCTOrs InC.
industrial
THE ENERGY ISSUE
University of Alberta researchers help PCL discover new and better methods of module lifting By Joseph Caouette
ANYONE INTERESTED in learning about the newest technologies in
Alberta’s modular construction industry needs to go back to school—or, more specifically, to Muhlenberg College in Pennsylvania. Back in 2007, the small Allentown liberal arts college was looking to add to its student housing, and Mohamed Al-Hussein, a University of Alberta (U of A) construction engineering and management professor, was among those working on the project. Five dormitories were required, each with space for 145 students across three floors. Using traditional on-site construction methods, the project would have taken months. Instead, the work was completed in 10 days.
Alberta Construction Magazine | 37
industrial
Modular construction may be fast, but that doesn’t fully explain the tight turnaround. For that, Al-Hussein credits a spreader-bar system he helped devise to make lifting the modules more efficient. Such ingenuity is part of what earned him an Industrial Research Chair in the Industrialization of Building Construction from the Natural Sciences and Engineering Research Council (NSERC) in 2011. Over the past six years, the primitive system has evolved into something capable of handling the largest industrial projects in Alberta. Earlier this year, PCL Constructors Inc. accepted an Excellence in Innovation Award from the Canadian Construction Association for a more complex version of the same system, and Al-Hussein couldn’t be
38 | Fall 2013 | albertaconstructionmagazine.com
happier about it. He may have helped birth the idea, but he gives full credit to PCL for nurturing the lift frame into its present form. “They spent all the energy and money to analyze the system,” he says. “They put a lot of resources into making it work.” The module lift frame is merely the latest result of a fruitful 17-year relationship between PCL and the university’s industrial research chairs. As part of the program, every dollar the contractor puts into a project is matched by NSERC—a crucial incentive because innovation doesn’t come cheap. “It cost us over a million dollars to build this first lift frame, and in this market that’s a pretty big investment in hardware,” says Ian Johnston, president and chief operating officer of PCL’s heavy industrial division. “It
also took a bit of convincing of our clients to try this out so they could make sure it was absolutely safe and absolutely no risk from their point of view.” If anything, the system is safer than traditional lifting methods simply by virtue of cutting down on the time spent rigging modules. A typical job requires several false starts: lift, lower, adjust, and repeat over and over until the load is properly balanced. Each time the crane has to set the module down, extra time is added to the schedule, and with it, more expenses: crane rentals, fuel costs and crew wages. “These are highly paid tradespeople— you’d have 10 or 12 on crew doing it,” Johnston says. “You start doing the math and it costs many hundreds of thousands of dollars easily to be setting modules.”
PHOTO: PCL Constructors Inc.
Using the module lift frame, a crew can hook up and lift four modules in a single day.
industrial
Now at use on its second job, the system has shaved entire weeks of module-lifting time from the schedule. Johnston estimates that lifting three modules might have taken a crew two days. Using the lift frame, the same crew can do four modules in a single day now. The secret is the slide. The module is connected to two parallel spreader bars, each capable of sliding back and forth to allow crews to make quick adjustments on the ground. The system can easily handle the largest modules in the province—24 feet wide by 120 feet long and weighing 350,000 pounds— and can even accommodate 500,000-pound modules if needed in the future. But one module lift frame, however effective it may be, can only help one module lift crew at a time. To find bigger efficiencies, PCL and its partners at the U of A are developing crane planning and optimization software to improve every stage of the job, from choosing the right crane to deciding the order of each module lift. Traditionally, cranes were selected using a combination of skill and chance. Engineers would manually calculate the best option,
comparing crane costs, sizes and availability to narrow down alternatives. But a person could spend weeks and only touch upon a fraction of the possible scenarios, Johnston notes. “In the end, you’d make your best decision and the job would get done,” he says. “But this [program] allows you to run hundreds of scenarios of different sizes and combinations of cranes.” The program taps into PCL’s database, which includes information on over 300 cranes and more than 25,000 crane configurations. Out of all of these variables, the program can settle on the best of all possible decisions—and then create a simulation of the lift, providing a handy visualization of the job for clients and workers. “These cranes cost many, many millions a month,” Johnston says. “Even small optimizations provide pretty substantial savings, and this has proved to provide big optimizations, so some very significant dollars can be saved.” No wonder the company has embraced research with such enthusiasm. Unfortunately, it’s an attitude not exactly common among other heavy industrial builders, many of who
prefer chasing contracts to pursuing ideas with only a faraway promise of payoff. “PCL is one of the few companies that really spend time and money on research,” Al-Hussein says. “They get really personally involved in research.” But other companies would do well to pay attention to the work of Al-Hussein and his colleagues. PCL’s award-winning module lift frame was inspired by a six-year-old U.S. college dorm. Who knows where the next promising idea may be hidden? Ask Al-Hussein and he will suggest Europe. He’s already staked out his next project: introducing tower cranes from Germany into oilsands construction as an environmentally friendly, fuel-efficient and safer alternative to the more commonly used mobile cranes. He’s eager to tackle the challenge, but resistance is expected—Albertans love their mobile cranes, it turns out. “Some researcher did some research into why North Americans love mobile cranes,” he says. “Apparently, it’s culture. So we have a culture of using mobile cranes and people don’t want to change.”
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THE ENERGY ISSUE
Imagine using software to accelerate your oilsands project. university of Calgary researchers are working on making that a reality.
Accelerating schedules new software tool could provide significant savings in time and money on oilsands projects By R.P. Stastny Researchers at the University of Calgary (U of C) have been working on a software tool that could cut significant costs from oilsands projects by compressing construction schedules. The Schulich School of Engineering researchers say the power of computing technology could not only save time and money, but also make the industry more economically sustainable. The tool is called ScheduleAccelerator. “What differentiates our tool from current scheduling software is that we have added inputs that guide a project manager towards the most effective ways of accelerating their projects in order to get maximum monetary benefit,” U of C researcher Reza Dehghan told Oilsands Review, a sister publication of Alberta Construction Magazine. Given the billions of dollars involved in building oilsands projects, accelerating construction schedules even by one day can bring significant monetary benefits to owners. This tool, however, can be used on any large project outside of the oilsands.
PHOTO: JOey POdluBny
OVERLAPPING AND CRASHING Dehghan, who holds a doctorate in project management from the U of C, started research into schedule compression five years ago with a focus on “activity overlapping”—doing multiple tasks concurrently. He was joined by PhD candidate Kamran Hazini, who is doing complementary research focused on “activity crashing”— reducing the task durations by adding more resources. This research program was supervised by Janaka Y. Ruwanpura, U of C’s viceprovost (international). The researchers began by studying the theory behind project acceleration, specifically the time/cost trade-off. Hazini studies how construction duration can be shortened, for example, by adding overtime work and more workers in the field. Both overlapping and crashing actions increase cost, but reducing the overall construction duration also reduces certain other construction costs and provides earlier revenue flow from the completed facilities. “If you do this trade-off so that the benefits exceed the costs, construction schedule contraction can be a benefit to the project and the oil company,” Dehghan says. After modelling the time/cost trade-off, the researchers developed an algorithm to solve this trade-off equation. The algorithm was then converted into a computer tool that is incorporated into a Microsoft Office environment. Alberta Construction Magazine | 43
industrial Bantrel, a Calgary-based engineering, procurement and construction (EPC) company that does a lot of work in the oilsands, was instrumental in the development of ScheduleAccelerator by providing the Schulich School researchers exposure to a recent oilsands project during the formulation of the time/cost trade-off algorithm. This cooperation also provided the researchers a first level of testing. “There are two types of field tests that we could do,” Dehghan says. “We performed one, which involved taking a real project schedule and accelerating that schedule.” Bantrel says that “a typical major project level-three schedule can contain thousands of activities. It is envisioned that this tool will enable project management to assess various critical path sub-networks for opportunities to reduce or compress the overall schedule.” Traditionally, EPC project schedules are developed by project managers applying their understanding of the processes, durations and resource allocation derived from years of professional experience in managing previous projects. But this experience can vary from one project manager to another.
FINAL SAY “So if you want to compress the schedule, it is [also] up to the project manager, scheduler or planner to identify which activities [need] to be crashed and what activities need to be overlapped. And these exercises are being done very subjectively in the industry,” Hazini says. The advantage of the ScheduleAccelerator is that it provides additional inputs and performs calculations based on all the inputs, and it offers suggestions, he says.
“For example, activities A, B and D may be the best candidates for crashing, while activities C, F and G are better to be overlapped,” Hazini explains. It also provides a cost estimate for each option it produces, and by performing a cost-benefit analysis, is designed to suggest the most viable solutions. Says Dehghan: “The beauty of this tool is that it doesn’t come up with one or two suggestions. It can provide the project manager tens or hundreds of solutions to accelerate the project.” The tool represents a new approach that tests and re-examines traditional project schedule assumptions, according to Bantrel. It has the potential to advance schedule development and project execution with substantial benefits for oilsands owners. The work Dehghan and Hazini still need to do is to find a current, rather than a historic, oilsands project on which to run this tool. For that to happen, it will need to be made more user-friendly. “The tool is currently developed in [the] Microsoft Project platform that interacts with Microsoft Excel and should be customized for each project,” Hazini says. “We need to build the tool into either Primavera, which is the program most planners are using in the industry, or fully integrate it into the Microsoft Project software to make it easier for practitioners to use.” The work of improving the tool so it can move from the world of academic research to the engineering office is expected to take another year. So for now, schedule compression is still very much ongoing research to which Dehghan and Hazini hope to attract more researchers who could work on other features they haven’t been able to, as well as to improve speed and functionality.
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THE ENERGY ISSUE
A
lgae’s ability to remove large amounts of CO 2 from the atmosphere has long been known, but the challenge for science and industry has been finding a way to harness that power to tackle climate change. Now a Toronto company believes it may have unlocked the secret. Pond Biofuels Inc. has developed a way to deploy algae to absorb the CO2 from industrial smokestack emissions and then turn it into useful products. With the support of partners at the National Research Council of Canada and oil and gas producer Canadian Natural Resources Limited (CNRL), the company recently announced a $19-million pilot at CNRL’s Primrose oilsands plant near Bonnyville, Alta. The three-year project will focus on converting CO2 emissions to fuel, fertilizer and livestock feed. The technology has already received rave reviews from St Marys Cement Group, a Toronto company that built a pilot project with Pond at its cement plant in St Marys, Ont. It now plans to move on to commercial development. “Their technology is a game changer,” says Martin Vroegh, corporate environmental manager at St Marys Cement. He says the process has been working “brilliantly” in the pilot, which has impressed the company enough for it to become a partner in Pond. Not only is the algae trapping all of the CO2 from about one per cent of the southwestern
Ontario plant’s 500,000 tonnes of annual CO2 emissions, but “we are scrubbing most of the NOx [nitrogen oxides], SO2 [sulphur dioxide] and particulates,” Vroegh says. The system works by redirecting a percentage of the hot gases from the plant’s flare stack to Pond’s facility, where algae from the nearby Thames River absorb CO2 and release oxygen through photosynthesis. Commercial status is on the schedule for 2014, with a plant that can absorb 100,000 tonnes of CO2 per year. The pair plans to eventually build a similar facility at the cement company’s giant plant in Bowmanville, Ont., which emits 1.5 million tonnes of CO2 annually. Vroegh says there is no question the technology works, “but we need to be producing value-added products that make it sustainable.” The biofuel produced using the technology sells for about $100 per tonne, which makes it a low-cost product, he explains. A commercial plant could produce 250 million litres of biodiesel annually, but fertilizer and other by-products would add additional value. Beyond such benefits, there is also the important matter of social licence. The cement business is one of the world’s largest industrial CO2 emitters, while the St Marys plant produces almost one tonne of CO2 for every tonne of cement. That’s why Vroegh believes Pond’s approach is so important to his industry.
“It captures 100 per cent of what we feed it,” he says. Along with the social licence, the company is preparing for climate taxes that will inevitably be imposed on large emitters around the country at some point, Vroegh says. St Marys sells cement at $200 per tonne, meaning even a $15-per-tonne carbon price—such as that paid by large emitters in Alberta—would add significantly to its costs.
Spreading quickly Alberta’s oilsands producers, in particular, face a particularly tough challenge in earning a social licence. The industry has faced a constant barrage of criticism over its environmental record, including CO2 emissions. Even Vroegh, while noting the importance of Pond’s deal with CNRL, says, “Canada has the dirtiest oil on the planet.” Pond chief executive officer and chief scientist Steve Martin, who invented the technology along with partner Max Kolesnik, says the CNRL pilot will likely be the first of many in the oilsands. “There will be other announcements [of pilot projects at oilsands facilities],” he says. “I would see it propagating quickly.” Certainly, everyone in the industry will be paying close attention to the technology, which CNRL believes could lower CO2 emissions by 15 per cent from its integrated Horizon oilsands mining project and by 30 per cent at Primrose, for a total reduction of 1.5 million tonnes of CO2 equivalent
Alberta Construction Magazine | 47
feature
THE ALGAE PROCESS LIGHT
ALGAE
O2
BIO OIL • Biojet fuel • Biodiesel
CO 2 WASTE HEAT A AT WASTE WATER WAT A ER AT
PRODUCTS • Nutraceuticals • Livestock feed • Fertilizer • Other
PHOTOBIOREACTOR HARVEST WASTE HEAT
sOurCe: Cnrl
each tonne of algae can reduce CO2 emissions and yield biofuel and biomass products, which can be used as fertilizer, livestock feed and for other products, according to Cnrl.
emissions. For each tonne of algae, the company expects to produce 0.3 tonnes of biofuel and 0.7 tonnes of biomass products like fertilizer and livestock feed. That same tonne of algae will also remove 1.8 tonnes of CO2 from the atmosphere while releasing 1.3 tonnes of oxygen. Whatever the final results, his company will spread the information throughout the industry via Canada’s Oil Sands Innovation Alliance. CNRL is a member of the group, which brings together most of the oilsands producing community to share knowledge and accelerate environmental technologies.
Algae factory There are still barriers before algae spreads across the oilsands. For instance, algae does not live on CO2 alone. It needs sunlight to grow, which can be in short supply in northern climates like Canada’s. That’s where Martin’s background as an optical engineer enters the picture.
48 | Fall 2013 | albertaconstructionmagazine.com
Previously employed by tech giants IBM, Intel Corporation and the former Nortel Networks Corporation, he was one of the early developers of laser optical technology. He also has advanced degrees in chemistry and physics, and served as director of the University of Toronto’s Jeffrey Skoll BASc/MBA program, which offers an accelerated engineering and MBA degree to students. Because algae and its potential had been the domain of bioscience, Martin says he had never really considered its potential for helping to solve the world’s climate change problem. But after reading an article in the Washington Post about algae and its CO2trapping potential, he became convinced the solution lay in laser optics creating artificial light that would promote the growth of algae. Using high-efficiency LED lights, the company tries to keep electricity costs low while spurring photosynthesis. At the CNRL
feature
AT A GLANCE PROJECT:
Algal carbon conversion project LOCATION:
Primrose oilsands operations near Bonnyville, Alta. FUNDING:
$9.5 million (the National Research Council of Canada), $6.3 million (Canadian Natural Resources Limited) and $3.2 million (Pond Biofuels Inc.) GOAL:
To use algae to convert CO2 emissions into useful products, such as biofuels, livestock feed and fertilizer POTENTIAL EMISSIONS REDUCTION:
1.5 million tonnes of CO2 equivalent
project, waste heat and water from the plant will also be used to promote algae growth. “We know we can grow algae from a smokestack using a bioreactor,” Martin says. “The next question is whether it can be commercialized, and that is what we plan to prove at the CNRL site.” He would have preferred moving ahead with a commercial project with St Marys sooner rather than later, but progress has been constrained because “smokestacks are highly regulated,” he says, adding that regulators don’t understand the power of algae. “If you have a working algae factory, you don’t need a smokestack,” he says.
Old as the dinosaurs While producing fuel from algae might seem like a novel concept, it is actually an old idea—prehistoric, even. Using the technology to produce biofuel strikes at a basic misunderstanding of how fossil fuels evolved, Martin says. Alberta Construction Magazine | 49
feature
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The impact goes far beyond the oilsands and cement industries, however. There are 3,000 industrial facilities in North America alone that produce at least 100,000 tonnes of CO2 per year and are responsible for about 30 per cent of overall emissions. “The technology [applied at all of those facilities] has the potential to bring industrial emissions down to the levels of the 1940s,” he says. Canada has the potential to be a “world leader” in implementing the technology to clean up the environment, Martin says. Not only that, but it has a chance to forge a new sector—the algae energy industry.
These photos are of Pond Biofuels’ pilot project in Ontario with st marys Cement Group. similar technology will be used in alberta.
PHOTOs: Cnrl
“The belief has been that oil is derived from dinosaur bones, but that’s more or less insane,” he says. “How did the dinosaurs all end up in the same place?” Instead, it is the product of algae, from which a variety of oils can be derived. Algae sounds like a natural fit for the oil industry, but Martin believes it was important to begin at a cement plant first. Beyond being a vital part of any industrial economy, cement is a major source of CO2 emissions, with about five per cent of the world’s total emissions produced by the industry. It lies at the base of almost every industry that produces significant greenhouse gas emissions, including construction, transportation and yes, oil and gas. Even renewable-energy projects need it. For instance, an average wind turbine is supported with tonnes of cement, which in turn are responsible for tonnes of emissions. Having proven the technology in the cement industry, the company believes the oilsands offers the next major step in the technology’s development, and the government seems to agree. The CNRL project is supported by $9.5 million in funding from the National Research Council, in addition to $6.3 million from CNRL and $3.2 million from Pond. “The [oilsands] industry is saying [managing CO2 emissions] is about their right to operate,” Martin says. “The cheapest thing you can do is to pollute. But when pollution is no longer allowed, there’s not much a producer can do.”
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flood
Though in many cases it was short-term, construction firms feel impact of summer floods By Jim Bentein
52 | Fall 2013 | albertaconstructionmagazine.com
flood
Lafarge Canada’s yard in south Calgary was an early casualty of the swollen Bow River when the waters rose on June 21.
Photo: ©ISTOCKPHOTO.COM/GEFHunter
T
he devastating floods that hit southern Alberta and the Fort McMurray region this past summer will increase business for some construction companies, according to an analyst with the Dundee Capital Markets Inc. research team. Maxim Sytchev, senior analyst, infrastructure and industrials with the Torontobased firm, doesn’t see larger companies being impacted, however. Sytchev uses Aecon Group Inc. as an example: the company generated first-quarter revenue of US$567 million and reported backlog in the quarter of US$2.1 billion.
“Given the size of the company, [the impacts of flooding] won’t move the needle dramatically,” he says. Despite estimates that the province will need $5 billion to rebuild infrastructure after the late June flooding, Sytchev said larger construction companies especially won’t experience much financial impact. In fact, the impact was negative in the short term, since workers were unable to get to their offices and work sites in the Calgary area and in the Regional Municipality of Wood Buffalo. “It’s wrong to be thinking someone would make a killing,” he says.
Alberta Construction Magazine | 53
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PHOTO: SHAUN ROBINSON
One of the typical scenes in Calgary once the floodwaters receded.
54 | Fall 2013 | albertaconstructionmagazine.com
flood
Sytchev has studied the impact on the construction industry in Louisiana and other southern states after Hurricane Katrina in 2005, and in New York and New Jersey after Hurricane Sandy in 2012 and the same pattern holds, which he suspects will also be the case in Alberta. “There is a small negative impact in the short term, with a greater rebuild opportunity in the medium term (six to nine months),” he wrote in an analysis sent to clients in late June. “[There is] no reason to anticipate anything different in Canada.”
LOSSES IN BILLIONS The Insurance Bureau of Canada pegged losses as of late July at about $1.3 billion, but Premier Alison Redford said in August that “well over” $5 billion would be needed just to rebuild infrastructure. “Part of that is going to be financed through the federal government and the prime minister has made a commitment to that, which we are grateful for, and part of it will come from provincial revenue,” she told a Calgary radio station in August. Sytchev says there will be some businesses he works with that are more seriously affected by the flooding than others—but the floods are unlikely to lead to a financial windfall for any company. Most of the companies he covers have significant exposure to Alberta, which has been one of the busiest areas of North America thanks to the oilsands and other energy-related development, as well as public works. Yet Sytchev concluded in his report that many of the firms would be only slightly impacted by the flooding. If construction companies do have projects that are affected, it is unlikely to lead to a substantial financial hit, he said. “Generally speaking, contract terms stipulate either a force majeure or cost recovery when there is a significant event,” he wrote. Sytchev concluded the analysis saying that three of the companies he tracks could be affected somewhat, since the majority of their contracts are in the province: • Churchill Group derives 58 per cent of its revenue from Alberta, but Sytchev predicts the flooding will have little impact, with the exception of a possible delay in
completion of some large projects, such as its $113-million contract for an addition to the Lethbridge Hospital. • ENTREC Corporation, a heavy-lift and heavy-haul service provider with an 80 per cent exposure to Alberta, was impacted because utility workers were dealing with flood impacts and were unable to do wire lifting and other logistical tasks for equipment to be moved. However, Sytchev concluded that impact would be short-term. • North American Energy Partners Inc., with 90 per cent exposure to Alberta and a heavy concentration of its activities in the oilsands, was heavily hit by the flooding in the Fort McMurray area. However, once again, the impacts were short-term. There will be some beneficiaries, Sytchev wrote, mentioning Edmontonbased Stantec Inc. in particular, a company that is involved in “literally thousands of contracts,” across a diversified range of sectors. “Given the persistent strain on provincial infrastructure even without a disaster event, in the medium term we could see a re-acceleration in repair/maintenance/ spending in general,” he wrote. Edmonton-based PCL Construction Management Inc. is probably as good a barometer of the flooding’s impact on the construction sector as any. Rob Otway, Calgary district manager with PCL, says the company saw its operations impacted in the areas affected for about a week during and following the flooding. “We had three projects [affected] because of [the inability to utilize] tower cranes,” he says. “But, for the most part, the impact was minimal.” Otway, who is also the chair of the Calgary Construction Association (CCA), said some projects in the Calgary area will experience delays because of the flooding, like the $25-million St. Patrick’s Island pedestrian bridge being built by privately owned Graham Construction. The bridge, which is designed to link Memorial Drive and the East Village area of the city across from the confluence of the Bow and Elbow rivers, was heavily affected by the flooding. The project was to be completed by the end of the year, but Otway says he doubts that will be the case. Alberta Construction Magazine | 55
flood
Graham Construction would not comment on the status of the project. Otway says suppliers to the construction industry, such as aggregates and concrete giant Lafarge North America Inc., which saw its southern Calgary cement plant heavily damaged by the floods, was able to access supplies from plants elsewhere in the Calgary region, including its Foothills plant.
TALE OF TWO CITIES “It’s quite surprising how [quickly] the construction companies and the suppliers were able to get up and running again,” Otway says. Commenting on the situation in Calgary, Otway says, “It was largely a tale of two cities, with some residential neighbourhoods and commercial areas near downtown Calgary affected, but outside of those areas it was situation normal.” The Saddledome, home of the Calgary Flames, sustained extensive damage, although it is expected to be up and running again for the upcoming NHL hockey season. Calgary-based CANA Construction Ltd., which built the original Saddledome and completed a $30-million renovation to the interior in 1995, has been awarded the multi-million dollar contract for repairs. Otway says the executives of CCA and city officials have met to discuss expediting repairs to several city-owned buildings. City officials have estimated total costs around $257 million to repair the damage to
Mobile Offices Workforce Camps Storage Products Modular Buildings
city-owned facilities. These repairs include: • The Calgary Zoo: $50 million • The Calgary Police Service’s downtown administration building (structural damage): $31 million • McDougall and Civic Centre parkades: $34 million in repairs • Calgary Transit facilities: $11.7 million • Calgary’s historic old city hall (built in 1911): unknown costs • Talisman Centre multi-sports complex: $6.2 million (contract received by Bird Construction) Otway says suppliers of electrical and plumbing fixtures rose to the challenge and brought in most of the supplies that were needed for the repair work, although there were delays in obtaining some items.
HITS TO HOMES Otway sees the biggest long-term impact from the flooding being on the residential construction sector, with estimates of 10,000– 15,000 homes destroyed or needing repairs in the Calgary region. Dave Smith, president of CCA, has been warning contractors that shortages in trades will drive up wages of skilled tradespeople province-wide. He says the rebuilding in southern Alberta will create so much work for tradespeople who live in the south, there will be fewer willing to head north for work in the oilsands or on other industrial projects. “People who have been working in the north from Calgary will stay here,” he says. “If people have their druthers, they’d rather work in Calgary.”
Scenes such as this, with streets covered in debris and mud, were common in Calgary following the devastating summer flood.
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Offices in Edmonton, Calgary, Fort McMurray 56 | Fall 2013 | albertaconstructionmagazine.com
PHOTO: sHaun rOBInsOn
flood
Alberta Construction Magazine | 57
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REPUTATION MATTERS The Calgary Region of the Canadian Home Builders’ Association (CHBA) is working to protect reputable contractors by launching a media campaign to help consumers avoid being swindled. Consumers are encouraged to visit a website (hiringacontractor.com) jointly developed by the CHBA and the Canada Mortgage and Housing Corporation, which advises homeowners to “Get it in writing!” before hiring a contractor. The website guides consumers through the process of hiring a reputable renovator. The organization’s RenoMark program (renomark.ca) also offers a step-by-step guide and encourages consumers to hire CHMA members, who must subscribe to a code of conduct. The same advice is given regarding hiring a contractor for a complete rebuild, with consumers urged to retain a CHBA member.
58 | Fall 2013 | albertaconstructionmagazine.com
Smith also agrees with Otway that the residential construction sector is the most affected, although some of the 870 CCA member companies that are involved in institutional, commercial and industrial projects are also being impacted. He says this year’s flooding will cause the construction sector to rethink how it does things, including incorporating design features that shield buildings from damage when similar events occur in the future. The flooding that hit the Calgary area in 2005, which was not as serious or as widespread, didn’t cause the industry to engage in “sober second thought,” but he thinks this year’s flooding will. “It’s just a matter of rethinking the design of buildings,” he says. That is exactly the point professor Tang G. Lee wants to hit home. Lee, an architectural professor at the University of Calgary, supports moves by the Alberta government to deny any future assistance to homeowners who insist on living on flood plains.
“This is a wake-up call,” he says. “Rivers are supposed to flood. That’s how they clean themselves.” But Lee also believes residential contractors and homeowners need to be more proactive, designing houses that can withstand flooding. As an example, Lee points to the very buildings in downtown Calgary where major structural damage was avoided—office towers and other high rises. In many cases the parkades were inundated with water, but upper floors escaped damaged. “The way they design those buildings they want the parkades to flood,” he says. “You’ll notice that most of the parkades have holes in the concrete, so the water escapes and the building is not compromised.” In many flood-prone areas of Asia and the Netherlands, as well as in New Orleans, houses are designed that way as well. “Don’t have a finished basement,” Lee advises. “Just elevate what would have been a basement and make it a crawl space, with the electrical and plumbing and the furnace on upper levels.”
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Winter weather no worry for plastic rail ties At last, here’s something Edmontonians and Calgarians can agree on: rail ties. Edmonton has signed up to use ECOTRAX recycled plastic rail ties at road intersections on its light rail transit system. That makes the city only the third Canadian client for the ties after Toronto and Calgary, which recently purchased 500 ties for use on its own transit lines. Harsh winters can make mush of traditional ties, but the plastic ties are expected to better weather the cold. Unlike wooden ties, the plastic ECOTRAX does not absorb water, which should protect it from damaging freeze-thaw cycles. Axion International Holdings Inc., supplier of the ties, also describes the product as “completely impervious” to salt. Over 150,000 pounds of plastic will be diverted from landfills for use in the ties, the company estimates. Learn more at axionintl.com.
edmonton plans to use recycled plastic rail ties like those seen here at all of the road crossings on its light rail transit system.
PHOTO: aXIOn InTernaTIOnal HOldInGs InC.
Green construction prize up for grabs An international sustainable construction competition is offering US$2 million in prize money, and Canadian builders are invited to show off their best projects. Now entering its fourth cycle, the Holcim Awards highlights sustainable construction projects from around the globe. Canadians will compete with other North American entries in a regional category before the worldwide competition in 2015. In addition to the main category, there is also a Next Generation
competition open to young professionals and students between the ages of 18 and 30. In previous years, 10 different Canadian projects have been among the honourees. Examples include the low-impact, CO2-neutral North Vancouver Outdoor School and the Evergreen Brick Works revitalization in Toronto, which converted an abandoned factory into an energy-efficient exhibition and education centre. To submit a project or find out more information, visit holcimfoundation.org.
HOW TO SUBMIT ITEMS Does your company have news about personnel changes or new products? Or did it just land a new project in Alberta? We want to know about it. Here’s how to get your news to us. EMAIL ITEMS TO: jcaouette@junewarren-nickles.com or SEND IT TO: Assistant Editor, Alberta Construction Magazine, 220-9303 34 Avenue NW, Edmonton, AB T6E 5W8 or FAX TO: 780-944-9500 Please include the full name and location of the company.
Alberta Construction Magazine | 61
people, products, projects
Glimpse the future of commercial design There’s no need to fear the Swarm. It may sound like a sinister sci-fi concept, but it’s just a new type of distribution centre designed by Riddell Kurczaba Architecture Engineering Interior Design Ltd. The plan has been named one of the winners of the 2013 Distribution/Fulfillment Center of the Future Design Competition conducted by NAIOP, the Commercial Real Estate Development Association.
62 | Fall 2013 | albertaconstructionmagazine.com
Now in its second year, the competition invites architects and designers to envision what a distribution/fulfillment centre might look like in 2020. The goal is to get the industry thinking about the trends currently reshaping commercial construction, explains Thomas Bisacquino, president and chief executive officer of NAIOP. “Just as the days of shopping via catalogues have gone by the wayside, today e-commerce is transforming yet again how consumers purchase and receive goods, and the resulting impact on commercial real estate could be far reaching,” he says.
Riddell Kurczaba’s winning design, entitled the Swarm, uses vertical warehousing to create a massive mixed-use centre. A central building would provide 500,000 square feet for retail warehousing, while 300,000 square feet of perimeter buildings would contain a combination of residential and office space. Traditional retail stores would still be found at street level, receiving goods from the warehouse via a light rail transit delivery system. The company will present its design at Development ’13, an annual commercial real estate conference held in San Diego on October 7–9. More information can be found at naiop.org.
Photo: Riddell Kurczaba Architecture Engineering Interior Design Ltd.
The distribution/fulfillment centre of the future is depicted in the Swarm, an award-winning concept design by Riddell Kurczaba Architecture Engineering Interior Design Ltd.
people, products, projects
Gentle is the new abrasive What’s tough enough to blast away the grease from a piece of heavy-duty machinery, yet delicate enough to blow the dust off of a multi-million dollar metal sculpture? It’s a new process called dry-ice blasting, and EcoJet Inc. is offering it as an alternative to traditional abrasive blasting. EcoJet recently put the process in action cleaning Zhang Huan’s Rising sculpture in Toronto. Made of 22 tonnes of polished stainless steel, the sculpture had been dulled after a year of exposure to dust, car exhaust, acid rain and other contaminates. By blasting the metal with CO2 pellets, the company says it was able to restore the sculpture to its original shine. Due to the extremely cold nature of the pellets—around minus 79 degrees Celsius—debris turns brittle and falls away. The company says the process is gentle enough that it can remove ink from a business card with only minor damage to the paper. Two methods are available: pellet blasting for tougher debris and snow blasting for jobs where a lighter touch is required. Because the dry ice simply returns to CO2 form, the system leaves behind no secondary waste and can be used on sensitive areas, such as live electrical components. Visit ecojetinc.com for details.
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Alberta Construction Magazine | 63
people, products, projects
Hilti (Canada) Corporation has a new scanner that allows workers to pinpoint the location of rebar inside concrete structures.
There’s a lot more inside concrete than water and gravel. Anyone working on a concrete deck, wall, column or larger structures like tunnels and bridges has to worry about stumbling across rebar or live wires, for instance. Hilti (Canada) Corporation has a pair of devices to help uncover the buried contents of concrete. The new PS 250 Ferroscan System focuses on finding rebar inside concrete structures. The water- and dust-resistant scanner allows users to pinpoint the presence of rebar at depths ranging from four to six inches. Hilti has also unveiled an upgrade to its PS 1000 X-Scan Radar Detection System, which scans concrete structures and produces large-area images of the buried contents. The system now also includes an EM sensor to find live 50/60 hertz electrical cables at up to three inches of depth. More information can be found at hilti.ca.
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64 | Fall 2013 | albertaconstructionmagazine.com
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Painless printing
The Designjet family of printers from HP was made with ergonomics in mind.
Many offices now provide ergonomic chairs and desks for employees, so why not an ergonomically designed printer to match? HP has launched two new printers for use in engineering, construction and architecture offices. The two Designjet printers are made to handle large-format jobs, such as blueprints and designs. The company says the printers were designed to address the various pain points experienced by users. As a result, both devices feature front-end loading and top-end output trays—effectively removing the need to bend down to load paper and collect prints. The T920 is intended for small- or medium-sized work groups, while the T1500—which can handle multiple jobs at once—is made for larger offices. Because both devices are connected online, users can remotely view or even print projects from the field. Visit hp.com to learn more.
Alberta Construction Magazine | 65
people, products, projects
montabert has launched its micro CPa line of drill attachments in north america.
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66 | Fall 2013 | albertaconstructionmagazine.com
C’est la drill France’s Montabert is bringing a new line of drilling attachments to North America. Offering 45-degree feed rotation in vertical applications, the Micro CPA H22/H25 attachments can drill holes measuring one to 1.75 inches in diameter to a depth of 20 feet. These single-pass drills are designed to work on five- to 10-ton carriers. The Micro CPA 360 R25/R32 attachments provide 360-degree rotation and can switch between vertical and horizontal drilling. Designed to work on carriers ranging from eight to 15 tons in size, these attachments drill holes 1.75 to three inches in diameter at lengths of 30 feet. While new to the continent, the attachments have been used in pipeline trenching jobs and utility work around the world, the company says. For more information, go to montabert.com.
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Perfect for a rainy day A new brand of insulation sheathing board from Roxul Inc. is designed to keep buildings dry under the wettest conditions. The company’s ComfortBoard commercial insulation sheathing is made of stone wool, a material woven from rockbased mineral fibres. Intended for commercial rainscreen wall systems, the rigid, dense insulation is resistant to water, yet remains vapour-permeable. Roxul says the material is also sound absorbent and non-combustible. Several thicknesses are available, ranging from one inch to three inches. The thermal properties of the product also vary, and users can select from several different R-values: R4, R5, R8, R10 and R12. More details are available at roxul.com.
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ATCO offshoot appoints director of operations Boris Daskal has been appointed director of operations for ATCO Sustainable Communities Inc. A 25-year veteran of the construction industry, Daskal has previously worked as vice-president of GovanBrown Ltd. and as director of construction at MTEC Corporate Construction. He is the first to serve as operations director at ATCO Sustainable Communities, which began operations in July 2012. The company—the latest addition to ATCO’s growing stable of divisions—provides prefabricated construction services to First Nations and other remote communities.
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Alberta Construction Magazine | 67
people, products, projects
Bexson Construction Ltd. was recognized for its work on the new headquarters of Foremost Universal LP in Lloydminster, Alta.
Designed to win An Alberta company was among the prize winners honoured for roofing design in a U.S. competition. Bexson Construction Ltd., based out of Lloydminster, Alta., has taken top prize in the office category at American Buildings Company Excellence in Design awards. The company was recognized for its work
on the local headquarters of Foremost Universal LP. Over 125 entries vied for awards in 13 categories. American Buildings Company—a manufacturer of metal building and roofing systems—hands out the awards to companies from its network of over 850 authorized roofers.
Calgary’s Integrated Pipeline Projects Canada Ltd. has changed its name to UniversalPegasus International (UPI). UPI purchased Integrated Pipeline four years ago, and the two companies have been gradually combining operations ever since. The name change brings the Canadian company fully under the banner of its American parent. “The majority of our clients cross the border or work in a number of different geographies,” says Philip Luna, chief executive officer and president of UPI. “They want to connect with a single contractor that has common tools, processes and people.”
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aca report
ACA keeps its focus on 2013 priorities By Ken Gibson ACA Executive Director, Alberta Construction Association
The Alberta Construction Association (ACA) outlined its 2013 priorities in the previous issue of Alberta Construction Magazine. Here is a brief update on progress toward those priorities and identification of emerging priorities.
GOVERNMENT ADVOCACY • Maintaining predictable, consistent, and adequate provincial and municipal investment in infrastructure. ACA is finalizing a submission to government for the fall that emphasizes the importance of infrastructure, the costs of inadequate investment and steps industry takes to provide value for the taxpayer. • Keeping training clear of labour relations issues. ACA is opposed to public funding of apprenticeship training by third parties. ACA continues to raise this item in its ongoing advocacy. • Providing input to consideration by the Alberta government should government require contractors to utilize apprentices in order to bid government work. ACA is finalizing a submission to government to gather the data to better determine if there is a problem, and to establish baseline data as a first step to measure performance of any future strategies to address problem sectors.
• Continuing advocacy for sensible immigration programs. ACA will be meeting with federal ministers to advocate solutions to address the unique situation of our province. • Strengthened partnerships with school boards, post-secondary institutions and other construction associations for policies and programs to support the development of a skilled domestic construction workforce. ACA is involved in industry partnerships in both Calgary and Edmonton and is looking to share practices with other Alberta communities. • Providing educational best practice seminars for public procurers of design and construction services. Piloting of seminars begins this fall. • Collaborating to provide industry advice to Alberta Infrastructure. ACA is active on a number of committees and plans to showcase the partnerships at the Infrastructure Partners Conference this October in Edmonton.
SAFETY/WCB • Input to Occupational Health and Safety’s Worksafe Alberta strategy. ACA advocacy is ongoing. Managing silica dust is emerg ing as a priority. • Continued input to implementation of occupational health and safety administrative
penalties and worksite tickets. ACA advocacy is ongoing. • Dialogue with the Workers’ Compensation Board’s (WCB’s) Alberta branch concerning interpretation of refusal of modified duties policy. ACA is requesting WCB review its policies, particularly the application of no-fault to post-incident employment actions.
STANDARD PRACTICES • Recommendations for two changes to the Alberta’s Builders’ Lien Act (BLA): mandatory annual progressive release of holdback and Crown bound to BLA. ACA is advocating Service Alberta proceed with industry consultations regarding mandatory progressive release. • Advocacy with Alberta Health Services (AHS) and other owners for adoption of industry standard practices. ACA has facilitated discussions through which the expertise of local construction associations operating COOLNet Alberta can enhance services for AHS. Dialogue concerning adoption of industry best practices continues.
RESEARCH AND TECHNOLOGY • Service partnerships with Productivity Alberta. ACA is providing input to Productivity Alberta regarding a pilot project for integrated project delivery. • Initiatives with aceBIM (Alberta Centre for Excellence for Building Information Modelling). ACA now serves as a member of the board of aceBIM. • Partnerships to showcase the applied research capabilities of Alberta colleges and technical institutes. This initiative has been impacted by budgetary impacts at the post-secondary institutions.
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70 | Fall 2013 | albertaconstructionmagazine.com
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cca report
Owners, architects, engineers and contractors see success through collaboration By Mychal Martin
The history of major construction works can be traced back to 4,000 BC in ancient Mesopotamia, where the grand ambition of large-scale projects began to require division of labour into separate tasks and trades in order to construct massive structures of stone and timber. The techniques, the technologies and the materials have developed over the last 6,000 years; however, the stratification that separates the different partners —contractors, owners, design consultants, trades and manufacturers, and suppliers— has been constant.
and building information modelling (BIM) technology are all calling for further dialogue between sectors of the construction industry to collectively find best practices and solutions to common issues. The goal of the inaugural Owners, Architects, Engineers and Contractors (OAEC) Workshop held in late February at the BMO Centre in Stampede Park, Calgary, was to breakdown the barriers that inhibit communication and collaboration between these key stakeholders for the betterment of the industry as a whole. In order to approach this workshop from an industry-wide perspective, CCA brought
“[The OAEC Workshop was] a great interactive workshop—a real opportunity to learn from the perspective of other industry partners away from the day-to-day work issues.” — Aled Jones, Associated Engineering Group Ltd. The modern world is defined by interconnectivity, where ideas are transmitted at nearly the speed of thought. In looking at how far the construction industry has come, the Calgary Construction Association (CCA) recognizes the need to abandon traditionalist thinking about the relationships between owners, architects, engineers and contractors in order to allow for continued development. Integrated project delivery methodologies, LEAN building practices
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together a dynamic group of partners from the Alberta Construction Association, Alberta Infrastructure, the Alberta Urban Municipalities Association, the Canadian Construction Association, Canadian Public Procurement Council, the City of Airdrie, the City of Calgary, Consulting Architects of Alberta, Consulting Engineers of Alberta, SAIT Polytechnic, the Surety Association of Canada and the University of Calgary. This group came together to develop an agenda
Photos: Calgary construction association
cca report
with topics that are both relevant and practical. Workshop attendees chose a morning and an afternoon interactive roundtable session from four possible topics: 1. Assess the risk of a project—sharing versus shedding the risk; 2. Increase the quality of plans + specs— developing best value; 3. Effectively manage the change order process—creating an efficient and fair process; and 4. Collaboratively resolve disputes—shift conflict and transform working relationships. The motto for the OAEC Workshop was “Success through COLLABORATION,” and with the support of partnering associations the workshop quickly sold out—a testament to its underlying philosophy. The BMO Centre hosted more than 180 participants representing public sector owners and buyers of construction services, architecture firms, consulting engineers and the contracting community. This wide variety of professionals shared perspectives and ideas with other industry partners in a positive, constructive environment, generating an energy that was palpable. The event was regarded as a great success, and the CCA’s next goal is to carry that energy forward, enabling the participants’ positive experiences and wealth of knowledge to generate best practices and solutions for the industry as a whole. The first step will be to collectively develop best practices for change order procedures. CCA has invited participants who engaged in discussions regarding change orders to lend their expertise to the formation of an interdisciplinary, all-encompassing best practices guide to the change order process from a collaborative project perspective. The initial ad hoc committee meeting will be held in Calgary at the Construction Centre on September 12, 2013, and CCA is looking forward to sharing the findings of this venture with the industry at large. The second annual OAEC Workshop is scheduled for February 26, 2014, and will once again be hosted at Calgary’s BMO Centre in Stampede Park, so mark your calendar. CCA is looking forward to further success through collaboration with the OAEC community.
A panel takes part in a discussion titled “Project delivery methods—roles and responsibilities.” Refereed by Kerry Powell (Gowlings), with OAEC representatives from left to right: Brian Soutar (Alberta Infrastructure), Adrian Wilson (ISL Engineering and Land Services Ltd.), Craig Webber (Group2 Architecture Interior Design Ltd.) and Serge Massicotte (Massicotte Construction Ltd.).
Ian Reid of Bird Construction facilitates an interactive how-to session called “Assess the risk of a project— sharing versus shedding the risk” at the CCA’s OAEC Workshop.
Alberta Construction Magazine | 73
cca report
WE’RE GREATEST TOGETHER By Amy Smith The Calgary Construction Association (CCA)’s Youth Employment Program and Women in Construction committee jointly hosted the 4th Annual Stampede BBQ on July 9, welcoming over 500 CCA members. Despite the recent flooding that hit Calgary and surrounding towns only a few weeks prior, the sun was out that day to shine on Calgarians. The band Easy Street returned for another year to entertain attendees with country tunes eliciting their Stampede spirit. Mayor Naheed Nenshi made a special guest appearance to thank contractors for all that they have done and are doing to get the city back up and running following the flood devastation. Nenshi recognized the admirable spirit and support shown by the community through the adversity of the floods and left everyone with the Calgary Stampede’s sentiment “We’re Greatest Together.” Following visits with Nenshi, CCA chair Rob Otway of PCL Construction Management Inc. recognized the most recent graduates of the Gold Seal Program and presented Gold Seal Certificates to a dozen individuals who have helped to set a higher standard of excellence in the industry. Congratulations to the most recent certificate holders! The Youth Employment Program continues to be an integral part of the CCA’s mandate to address skilled labour shortages by placing young and driven workers in the trades. The Women in Construction group are also excited to be hosting their inaugural Yes We Can! Open Golf Classic, which will take place on September 26, 2013, at HeatherGlen Golf Course. If you have any questions about these two initiatives or would like to invest in today’s youth, please visit yepcca.cc or contact Aly Pringle at aly@cca.cc. The CCA would like to thank all of the committed volunteers, many of whom are members of the CCA Board and the Women in Construction committee, for their efforts to set up, register attendees, cook, clean and more at the barbeque. For highlights of this year’s event, watch the “2013 CCA Stampede BBQ” video on YouTube. See you next year, partners!
Photos from the top: CCa chair rob Otway (centre), along with members of the band easy street, welcomes Calgary mayor naheed nenshi to the 4th annual stampede BBQ.
The Prostate Cancer Centre was on site with its man van offering complimentary prostate-specific antigen blood tests for men over 40. Calgary’s most recent Gold seal Certified individuals. Back row (left to right): CCa chair rob Otway (PCl Construction management Inc.), stephan wilson (Hamar Industries), Colin nelson (ledcor Group), wilfred Biederstadt (ledcor Group), Chris Bardell (ledcor Group), Geoffrey lobley (ledcor Group), alaa abdelwahab (schindler elevator Corporation) and dave smith (Calgary Construction association). Front row (left to right): larry morrison (luff Industries ltd.), eva Fabian Billing (Bee-Clean Building maintenance), Bruce reardon (Black & mcdonald), mike Gibson (Canem systems ltd.) and Jason szekely (stuart Olson dominion ltd.).
74 | Fall 2013 | albertaconstructionmagazine.comm
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The CCa welcomed over 500 attendees to celebrate the Calgary stampede.
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trade talk
The cavalry is not coming U.S. workers may no longer be able to help save Canada’s construction industry from a labour shortage By Jim Bentein
illustration: Hemera Technologies
In case you haven’t noticed , the
U.S. economy is back from the brink—and that could be bad news for the construction industry in Canada. Labour forecasts routinely predict a shortage of construction workers in Canada due to several factors: a greying workforce, Alberta oilsands developments, liquid natural gas export terminals planned in British Columbia, and resource and utility projects in Saskatchewan and Newfoundland and Labrador. Many in the industry were counting on their American cousins to help replenish the dwindling pool of tradespeople. Instead, the United States may be hit just as hard—if not more so—by a shortage of skilled trades. In the fall of 2012, a report released by the Construction Labor Market Analyzer forecast a shortage of about two million skilled workers across the United States by 2017. And this is far from being the only sign of renewed demand for construction workers south of the border.
Bullish forecasts The National Association of Home Builders (NAHB), a residential housing trade association based out of Washington, D.C., has predicted significant gains in the singlefamily and multi-family housing sector. It
has cited bullish forecasts from brokerage firm UBS Securities LLC that predict 1.1 million new housing starts this year, rising to an annual average of 1.3 million for the next three years. There is so much new activity in parts of the United States, such as energy-producing states like Texas and North Dakota, that a labour shortage is looming—and it is already rearing its head in parts of the country, the organization says. “The survey of our members shows that since June of 2012, residential construction firms are reporting an increasing number of shortages in all aspects of the industry— from carpenters, excavators, framers, roofers and plumbers, to bricklayers, HVAC building maintenance managers and weatherization workers,” says David Crowe, NAHB’s chief economist. “The same holds true for subcontractors.” At the same time, industrial contractors involved in the petrochemical, fertilizer and related sectors may soon also feel the labour crunch as well. Project planners are deeply concerned about a shortage of workers to build new plants and expansions, according to Martha Moore, senior director of economics and policy analysis with the American Chemistry Council. Her organization released a report last spring forecasting a new boom in eight Alberta Construction Magazine | 77
trade talk
Canadian concerns These projections come at the same time as a similar forecast for the Canadian construction sector by BuildForce Canada, a new organization designed to carry on the Construction Sector Council’s labour market research. Of the nearly 1.3 million people employed in Canada’s construction sector, BuildForce expects 210,000 to retire by 2021 as the population ages. Another 44,000 new positions will be added to the non-residential construction sector—an increase that will be only slightly offset by the loss of 8,000 jobs on the residential side of the industry. In A lber ta, where a n est i mated $200 billion will be spent on major projects by 2021, the industry will be particularly affected by labour shortfalls. The province can expect to see demand for over 40,000 skilled workers by 2021, according to BuildForce. To date, the industry has been coping with the shortages by tapping the federal government’s Temporary Foreign
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key industrial sectors in the United States due to inexpensive and plentiful natural gas. Like so many others, the report calls the development of large new shale gas reserves a “game changer” for the United States. The report forecasts 200,000 new direct jobs will be created in the eight manufacturing sectors between now and 2020, with an additional 979,000 jobs created in the supply chain and elsewhere in the economy. That’s a total of almost 1.2 million new jobs—and it doesn’t even count the direct and indirect jobs created in the energy production sector and the spinoff employment. In addition, another 1.1 million jobs will be added to the construction and capital goods manufacturing areas, as well as their associated supply chains, before the end of the decade, the report predicts. “There will only be so many welders and pipefitters and other craft workers for this build-out,” Moore says. “There has been a lack of interest in those sectors, and they have an aging demographic.”
trade talk
Worker Program, which includes skilled workers coming from the United States. But it appears that the supply of workers south of the border is limited—and foreign workers overall will be more difficult
favour of foreign ones. As a result, the government is ending its Accelerated Labour Market Opinion process, which allowed employers to bring in foreign workers more quickly. Companies will now have
Of the nearly 1.3 million people employed in Canada’s construction sector, BuildForce expects 210,000 to retire by 2021 as the population ages. to access due to changes in the program announced this past winter. The federal government claimed the program was suppressing wages and leading to companies skipping Canadian workers in
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to have a firm plan in place to transition to Canadian workers and must pay prevailing wages. In mid-May, a group of construction and other organizations known
as the Alberta Coalition for Action on Labour Shortages launched a campaign to spur Ottawa to make an exception to the changes so that the hard-pressed Alberta industry could continue to access foreign workers. In a letter to the federal government, the coalition says that the industry needs the program to stave off an “acute” labour shortage. The organization notes that skilled labour shortages persist despite the fact that Alberta, with only 10 per cent of Canada’s population, churns out 20 per cent of the country’s apprentices. Average wages paid to Alberta workers are also 21 per cent higher than the national average. The province has a five per cent unemployment rate that, according to the group, “confirms we lack enough skilled manpower to fully develop the opportunities before us.” The cost of missing those opportunities could sting, too. The coalition notes that the Alberta Chamber of Resources has calculated each unfilled position could be worth $175,000 in gross domestic product for the province.
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Do you collect cattle... or big hats? By Gerry Cameron
“Big Hat, No Cattle” is a term I first came across reading the book The Millionaire Next Door, published in 1996 by two marketing professors: William Danko and Thomas Stanley. They first heard the expression from a 35-year-old Texan who owned a very successful business that rebuilt large diesel engines. But unlike many people who overspend on symbols of wealth like expensive clothes, watches and luxury cars, this millionaire drove a 10-year-old car, wore jeans and a buckskin shirt. He lived in a modest house in a lower-middle-class area where his neighbours were postal clerks, firefighters and mechanics. The millionaire substantiated his financial success with actual numbers. He confessed to Danko and Stanley, “My business does not look pretty. I don’t play the millionaire part, don’t act it. When my British partners first met me, they thought I was one of our truck drivers. They looked all over my office, looked at everyone but me. Then the senior guy of the group said, ‘Oh, we forgot we were in Texas!’ I don’t own big hats, but I have a lot of cattle.” In a recent Financial Post article, Jonathan Rivard, a financial advisor with Edward Jones, remembers visiting a senior executive’s home in north Toronto. It had all the trappings of wealth: a Porsche and a Mercedes in the driveway and an in-ground pool in the backyard. The executive’s kids attended private school, and entertainment took place at the family cottage. However, Rivard discovered that the executive was actually living from paycheque to paycheque. He soon realized there’s perceived wealth and actual wealth. Fabio Campanella, a chartered accountant based in Toronto, sees this all the time. Professionals making good money straight out of school and spending it straight out of school. “I have physicians and lawyers as clients who make a gross income of maybe half a million a year, and after two or three years they still have nothing to show for it,” he says. Jeffrey Schwartz from Consolidated Credit Counseling Services of Canada is also seeing high-income clients living lavishly and getting caught up in a lifestyle that traps them into living way beyond
their means. In order to keep up with the Joneses, they want to show the same thing: private schools, live-in nannies, luxury vehicles and secondary properties. But they are not entirely to blame. Many people believe wealth is having an abundance of material possessions. Wasn’t it Malcolm Forbes, one of the wealthiest people to have lived, who quoted the phrase, “He who dies with the most toys wins”?
“I don’t own big hats, but I have a lot of cattle.” — Texas millionaire However, Danko and Stanley define wealth differently. They do not define wealthy, affluent or rich in terms of material possessions. They have found that actual millionaires tend to live in middle-income neighbourhoods, drive economical cars, wear simple watches and buy suits off the rack. And the people they define being wealthy get much more pleasure from owning substantial amounts of appreciable assets like stocks and bonds than from displaying a highconsumption lifestyle. A lot like the 35-year-old Texan. Editor’s note: Gerry Cameron is a registered associate investment advisor at Canaccord Genuity Wealth Management, a division of Canaccord Genuity Corp. and member of the Canadian Investor Protection Fund. He wants you to know that these views (including recommendations) are his alone, and are not necessarily those of Canaccord and does not assume any liability. If you want to contact him, he can be reached at gerry.cameron@canaccord.com.
Alberta Construction Magazine | 81
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GETTING ON THE ROAD TO RECOVERY AFTER THE FLOODS
IllusTraTIOn: PIalHOvIK
By KPMG’s Business Resilience Practice
Major events such as the recent southern Alberta floods have resulted in significant displacement of communities and disrupted business operations, and they have had devastating consequences for some of the people living in neighbourhoods hit directly by flooding. For businesses in the construction industry that depend on physical and human assets—those most directly affected—rapidly mitigating the challenges and getting back to business as usual is imperative. The recent floods have affected businesses in four key ways. First, key staff and their families may have been personally impacted and unable to perform the duties normally expected of them, resulting in increased labour or resource costs and lower productivity. Second, the loss and damage of infrastructure, plant and equipment had an immediate impact on some businesses and will have long-term implications on capacity and resourcing. Third, project delays, rework or cancellation of projects may have incurred financial and resource costs for construction businesses. Finally, supplier impacts and interruptions to the supply of goods and services may have created challenges through higher input costs and limited availability. As operators of impacted Alberta-based organizations go through the recovery and rebuilding process, it is important to consider what can be done to accelerate the recovery process and build the resilience of the business against potential future disasters.
Many businesses will need to deal with the immediate impacts, as well as put in place plans and processes that can help an organization minimize the impact of future disruptions. It is worth completing a post-incident review (PIR) that will allow focus on the key areas to get back to business as usual after a significant event. A PIR would normally involve: • Reviewing the actions that were taken by the management team and staff in response to the incident; • Capturing and reviewing the details of what you did well; • Identifying what could be done differently or better next time; • Identifying plans or infrastructure that need to be put in place to be better prepared for future responses; and • Assigning responsibility for making sure that the opportunities for improvement identified during the review are implemented so that the lessons observed can become lessons learned. Conducting a PIR is also an excellent way to build rapport and engagement with your employees by recognizing individual and group successes and discussing opportunities for improvement.
RETuRNING TO BuSINESS AS uSuAL
IDENTIFY BuSINESS IMPACTS
While the short- and long-term impacts on individual businesses will vary, there are four key steps all businesses can take to assist in recovery and defend against future disasters: 1. Conduct a post-incident review. This will help to prioritize your recovery efforts, recognize staff participation and provide a foundation for your future planning. 2. Identify business impacts and the implications for insurance claims and accounting issues arising from the flood. 3. Look into the process and evidence required to access relevant government assistance to support your business.
The business impacts can be substantial and will potentially have accounting and financial disclosure implications. Property and equipment and inventory damaged by floods may be potentially impaired or written off. Compensation from third parties (such as insurance companies or the government) can be recognized only after an unconditional contractual right to receive the compensation exists. That often means the impairment is charged to earnings in an earlier period than the related compensation. Costs incurred for cleanup activities are expensed when incurred; future operating losses are recognized only after they occur.
4. Develop a business continuity plan that will help you minimize the impacts from future disruptions.
POST-INCIDENT REVIEWS
Alberta Construction Magazine | 83
business of building
In addition, entities impacted by floods may need to consider whether the impact on profitability will affect their ability to recover assets recognized in the financial statements (such as deferred tax assets) or meet the business’s debt obligations in the short and medium term. Other considerations may relate to the unavoidable costs of meeting the obligations under a contract that exceeds the economic benefit of the deal.
COMPENSATION FROM THIRD PARTIES Businesses should consider third-party compensation available for inventory, damaged property and lost profits. Certain businesses may have insurance policies under which they are compensated for the loss of property, plant and equipment, other assets and/or business-interruption losses caused by a f lood. Where the loss is not covered by insurance, accessing government financial support for eligible costs will require compliance with the relevant guidelines. Navigating through a claims process can be challenging, especially as it may include liability, negligence, employee dishonesty and personal injury claims. Insurance-related litigation has become increasingly common, with disputed claims including those made by third parties affected by insured incidents. Investigations may require forensic accounting and insurance claims expertise; however, professional fees to support claims preparation and reporting associated with an insurable loss are often covered under a business’s insurance policy. Further information regarding government-related financial assistance can be found on the Alberta government website at alberta.ca.
BuSINESS CONTINuITY PLANNING A final step in the recovery process should be to develop or update your business continuity plan (BCP). A good plan is a concise, useable document that provides guidance on how to respond to a disruption. It should detail how the crisis management team is organized; how you will communicate with stakeholders such as staff, contractors and clients; the steps to take to keep critical business activities going during the disruption; and guidance on how to return to normal. For those businesses that did not have a formal plan in place before the flooding, it may be possible to use the steps taken during the response as the basis of a BCP.
A business’s ability to respond to a disruption is primarily driven by the capability of its people. Once a BCP has been developed, it is critical that it is regularly exercised so that the people on the team know what is expected of them and how to respond. Too many businesses create a plan only for it to sit on a shelf gathering dust, and then find that it is of little or no use when it is needed.
A FINAL THOuGHT The consequences of major disasters not only have a short-term impact for businesses involved in the construction industry but also medium- and longer-term implications. Developing plans for how your business will respond to major events will be as important as dealing with the immediate impacts of the event itself.
Editor’s note: KPMG LLP has a national team of BCP professionals with experience developing, reviewing and testing their clients’ ability to respond to business disruptions: Elaine Wong, partner, risk and compliance, Calgary; Ed Matley, national leader, business resilience, Vancouver; James McAuley, partner, insurance claim services, Toronto; Randy Kraft, building, construction and real estate leader, Calgary. Information is available at kpmg.com/ca
SUMMARy This column highlights some of the key points that businesses may need to be aware of when dealing with the impacts of this year’s flooding. This includes dealing with the losses and impacts of a disaster, accounting and financial issues, and business continuity and resilience planning for companies within the construction industry.
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84 | Fall 2013 | albertaconstructionmagazine.com
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aci awards
ROCK SOLID alberta’s concrete industry honours its own for top-notch design and construction By Christopher Huffaker
The American Concrete Institute is a non-profit technical and educational society with 99 chapters across the globe, including one in Alberta. Every two years, the Alberta chapter hands out Awards of Excellence for outstanding design and construction efforts in the province’s concrete industry. In 2011, winners included the Fort Edmonton Footbridge and the St. Joseph Seminary. This year’s awards were announced at a banquet in Kananaskis, Alta., on May 31. Here are a few details on the 2013 winners.
52nd Street SE—Grade Separation and Road Widening Category: Bridges Owner: The City of Calgary, Transportation Infrastructure Engineer: AECOM Canada Ltd. Contractor: Graham Infrastructure Ltd. Concrete supplier: Lafarge Canada Inc.; Armtec Limited
Partnership; BURNCO Rock Products Ltd.
Geotechnical and stormwater consultant: Klohn Crippen Berger Ltd. Mechanically stabilized earth retaining wall consultant:
The Reinforced Earth Company Ltd.
Belgravia Green Net Zero Energy Home The team that was honoured for its work on 52nd street se in Calgary.
Category: Sustainable Owner: Effect Home Builders Ltd. Architect: KB Design Engineer: Solnorth Engineering Ltd. Contractor: Effect Home Builders Ltd. Concrete supplier: Edmonton Transit Mix Solar-electric system design and development:
Howell-Mayhew Engineering, Inc.
all PHOTOs: aCI
Gregg Logistics’ New Facility
Gregg logistics’ new facility won in the advanced Concrete Construction category.
Category: Advanced Concrete Construction Owner: Gregg Properties Ltd. Architect: Stantec Architecture Limited Engineer: Stantec Consulting Ltd. Contractor: Dawson Wallace Construction Ltd. Concrete supplier: BURNCO Rock Products Ltd. Concrete placing and finishing: Dynamic Concrete Pumping Inc. Turnkey concrete floor design: TWINTEC USA, Inc.
Alberta Construction Magazine | 87
aci awards
The City of Calgary—Airport Trail Tunnel Category: Civil Owner: The City of Calgary Engineer: CH2M HILL Canada Ltd. Contractor: PCL Construction Management Inc. Concrete supplier: Inland Concrete
Agrium Fertilizer Plant—Prill Tower Structural Restoration Category: Restoration Owner: Agrium Inc. Engineer: Read Jones Christoffersen Ltd. Contractor: CPI Construction Ltd. Concrete supplier: Stel-Marr Concrete Limited Geotechnical review and concrete strength testing:
members of the winning team in the Buildings category pose with their awards. The winning project was Calgary’s emergency Operations Centre.
Thurber Engineering Ltd.
The City of Calgary—Emergency Operations Centre Category: Buildings Owner: The City of Calgary Architect: Manasc Isaac Architects Ltd. Engineer: Read Jones Christoffersen Ltd. Contractor: Bird Construction Company Concrete supplier: Inland Heidelberg Cement Group
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the legal edge
GIVING AND GETTING NOTICE By Tim Mavko reynolds mirth richards & Farmer llP
Every construction project involves the flow of information: from owner to architect, from architect to contractor, from contractor to subcontractor, and so on. Every project also faces uncertainties: events that increase the cost, stretch the time or even imperil the job. Successful parties manage these risks by managing the information about the risks: if the right people know the right things at the right time, they can adjust accordingly. The key to ensuring the necessary information flows as it should is notice provisions. These are the important—but all too often ignored—terms in construction contracts that require one party to notify another when certain, specified things happen (or don’t happen). For example, the commonly used CCDC-2 2008 form of lumpsum contract requires a contractor to give notice within 10 days of the start of a delay, in order to get more time. In the ACA Form A standard subcontract, an unpaid subcontractor must give five days’ notice before terminating for nonpayment. Notice provisions are contract-specific. The time, the place, the event and even the method for giving notice varies from contract to contract. What is good notice for one contract may fall short for another. Even within contracts there can be different kinds of notice for different types of events—emailing the consultant might be adequate notice for a delay, but notice of a default might have to be hand-delivered to the head office. Moreover, notice can cut both ways: from contractor to owner, but also from owner to contractor. A given contract, for example, might allow (or require) an owner to give notice of a change, a deficiency or even a default. In such cases, the notice often starts the clock for the contractor to respond, and a contractor who doesn’t act in time risks losing out—sometimes significantly. Because notice provisions vary, and because timing can be crucial when giving or receiving notice, successful parties review and understand the notice provisions before they sign a contract. That way each party is ready to act when, for example, the architect issues a sudden design change at the start of a long weekend and time is tight. As well, if the parties figure out the notice requirements before they sign, it’s still possible to renegotiate onerous or even impossible deadlines. (How about 24 hours to price and accept every change request, or swallow the cost? Or 12 hours, including weekends and holidays, to dispute every direction? Saw them both recently.)
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Courts tend to read notice provisions carefully and enforce them strictly. For example, in the case of Dilcon Constructors Ltd. v. ANC Developments Inc. (2000) 6 C.L.R. (3d) 34, a contractor sued an owner for delay. The Alberta Court of Appeal agreed that the owner delivered equipment late and therefore caused the delay. However, the contract required the contractor give immediate notice of the delay in writing, which the contractor failed to do. Rather, the contractor had complained at site meetings, and although the complaints had been recorded in the site minutes, this was not enough to qualify as written notice. Because the contractor didn’t give appropriate notice under the terms of the contract, the court denied the contractor’s sizeable claim.
even within contracts there can be different kinds of notice for different types of events. Furthermore, the notice must be meaningful. In the more recent case of Graham Construction & Engineering (1985) Ltd. v. LaCaille Developments Inc. (2006) ABQB 898, the contractor gave good notice of the direct cost of numerous changes, but didn’t follow up with specifics of the impacts of the delay. At trial, the judge denied the claim, saying: “Put simply...the delay information given in writing by [the Contractor]...constituted nothing more than ‘grumblings,’ insufficient to crystallize the positions of [the parties] on the issue of delay.” Grumbling, it seems, isn’t notice. At their core, most notices are about money. Something has changed, or will take longer, or has failed to happen. Something is going to cost more and somebody will have to pay. Proper notice helps the parties control those costs. To quote an anonymous but wise project manager: “If you are going to spend someone else’s money, you damn well better tell them.”
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time time capsule capsule
TIME CAPSULE
Wainwright Hotel
Note for next issue:
The photo has 3 layers (in InDesign, just copies of the same image).
Bottom layer is set to screen at an opacity of 40% The memorial Clock outside the wainwright Hotel was not destroyed in the fire that claimed the original hotel. This photo of the replacement hotel, which
Middle layer is set to multipy at an opacity of AFTER THE ORIGINAL Wainwright Hotel 100% burned to the ground, a replacement hotel was built in 1929 using poured-in-place,
Top layer is set to multiply atconcrete an opacity of 40%. board-formed for its exterior
walls. This concrete construction was the the challenge These valuesunusual can bebecause adjustedofper photoof transporting the heavy material to a rural comused, but by having these three layers, you get munity. But the fire, which razed most of a good b/wWainwright’s contrast while still having the paper commercial district, ushered in awithout reform inlosing construction. Theinresidents how through, any detail the photo. never wanted to suffer such a devastating loss again, so concrete seemed like the ideal solution. Also, the frameOccupying has an inverse corner threerounded lots on the north corner of Second Avenue and 10th Street in angle of 0.1667�
92 | Fall 2013 | albertaconstructionmagazine.com
the commercial district, the Wainwright Hotel is also notable because of the influence of Spanish Colonial Revival design. Elements such as the stucco-covered concrete walls, the broken parapet and the canopy roof projections clad in redpainted metal to resemble clay tiles pay homage to the Spanish Colonial Revival movement, which was at the height of its popularity when the hotel was built. Designated a Provincial Historic Resource 80 years after it was built, the Wainwright Hotel is the future home of the Buffalo Park Centre. The Buffalo Park Centre will be the centrepiece for Main
Street, which is undergoing a multi-million dollar Streetscape Project. The hope is to transform the historic site into an interpretive and education centre, which will include an art gallery, an archive, a reading room and two floors of arts, heritage and community studios, offices, and meeting rooms. The Buffalo Park Centre will capture the history of the Buffalo National Park, which was established in 1909 with a mandate to preserve the plains bison. In its 30 years of operation, Buffalo National Park played a critical role in saving the plains bison from extinction.
PHOTO: GlenBOw museum
exists today, is from the early 1930s.
Where do I find a
The Wainwright
Professional Electrical Contractor?
Hotel is notable for a number of reasons, including the influence of Spanish Colonial Revival design.
KEY FACTS
Since 1993 the ECAA received professional status under the Professional and Occupational Associations Registration Act as Professional Electrical Contractors (PEC), making them the first trade Association in North America to grant professional status to electrical contractors.
Professional Electrical Contractors, PECs are Educated in all Aspects of Business
Construction Date: 1929
Builder/Architect: R.H. Trouth of Edmonton
Architectural style: No one style, but reminiscent of Spanish Colonial Revival design
Date of designation: On January 30, 2009, the Wainwright Hotel was designated a Provincial Historical Resource Sources: hermis.alberta.ca, buffaloparkcentre.com
• • • • • •
Project Management Estimating Accounting Safety Principles Legal Issues Affecting Contracting Business & Public Relations PECs are accountable for their work and business practices and strive for excellence in the Electrical Industry.
For more information on PECs Call the
Electrical Contractors Association of Alberta Ph. 780 451-2412 Email: ecaa@ecaa.ab.ca
Toll Free 1-800-252-9375 Web: www.ecaa.ab.ca Alberta Construction Magazine | 93
advertisers’ index
AD IndeX Alberta Blue Cross . . . . . . . . . . . . . . inside front cover Alberta Construction Safety Association . . . . . . . 94 Alberta Used Oil Management Association (AUOMA) . 19 Anderson Hearing Aid & Audiology Service . . . . 66 Astec Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 & 21 ATB Corporate Financial Services . . . . . . . . . . . . . . . . . 4 Bantrel Co . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 Beaver Plastics Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 Bobcat Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Brandt Tractor Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 & 75 Brock White Canada Company . . . . . . . . . . . . . . . . . 64 Calgary Construction Association . . . . . . . . . . 16 & 69 Cal-Gas Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Canadian Natural Resources Limited . . . . . . . . . . . 39 Canadian Western Bank . . . . . . . . . . . . . . . . . . . . . . . . 42 Canessco Services Inc . . . . . . . . . . . . . . . . . . . . . . . . . . 76 CGS GRIPSTRIP Products Ltd . . . . . . . . . . . . . . . . . . . 86 Collicutt Energy Services Corp . . . . . . . . . . . . . . . . . . 80 Edmonton Exchanger & Manufacturing Ltd . . . . 49 Electrical Contractors Association of Alberta . . 28 & 93 EllisDon Construction Services Inc . . . . . . . . . . . . . . 24 F&M MAFCO LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 Force Pile Driving Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Graham Group Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Grant Metal Products Ltd . . . . . . . . . . . . . . . . . . . . . . . 88 Hertz Equipment Rental Corp . . . . . . . . . . . . . . . . . . 10 ICS Group Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 Imperial Oil Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89 Klimer Platforms Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 KPMG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 Kubota Canada Ltd . . . . . . . . . . . 6 & inside back cover Layher Scaffolding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 Lloyd Sadd Insurance Ltd . . . . . . . . . . . . . . . . . . . . . . . 84 Manulift EMI Ltee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 MAPEI Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Matrix Labour Leasing Ltd . . . . . . outside back cover Merchandise Mart Properties Inc . . . . . . . . . . . . . . . . . 3 MMFX Steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 Mount Royal University . . . . . . . . . . . . . . . . 13, 15 & 17 Northland Construction Supplies . . . . . . . . . . . . . . . . 8 Owens Corning Canada . . . . . . . . . . . . . . . . . . . . . . . . 71 PCL Constructors Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Phoenix Fence Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 Proform Concrete Services Inc . . . . . . . . . . . . . . . . . . 34 Proform Precast Products Inc . . . . . . . . . . . . . . . . . . . 66 Reynolds Mirth Richards & Farmer LLP . . . . . . . . . . 80 Rocky Mountain Equipment . . . . . . . . . . . . . . . . . . . . 91 Roxul Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Scona Cycle Honda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94 Spatial Technologies Partnership Group . . . . 40 & 41 Toole Peet Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 UA Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 U F A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 United Rentals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 University of Alberta, Extension . . . . . . . . . . . . . . . . 44 Western Construction Products . . . . . . . . . . . . . . . . 34 WesternOne Rentals & Sales . . . . . . . . . . . . . . . . . . . . 80 Williams Scotsman of Canada, Inc . . . . . . . . . . . . . . 56 Wolseley Engineered Pipe Alberta . . . . . . . . . . . . . . 68 Xylem Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
94 | Fall 2013 | albertaconstructionmagazine.com
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