Pipeline News February 2009 by Pipeline News

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

February 2009

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SHALE GAS Are the pieces falling into place?

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PIPELINE NEWS February 2009

NuVista adopts an acquire and drill later strategy

News

Notes Evraz up, then down

It wasn’t too long ago there was talk of hoarding pipe and a tubular shortage. That’s changed, however, with news on Jan. 21 that Evraz Regina Steel, formerly Ipsco, would be laying oﬀ over 100 workers in its tubular division. The layoﬀs are close in number to a recent increase, just a few months ago. The workers are organized under United Steel Workers Local 5890. Evraz vice president of tubular operations Jim Clarke noted on Jan. 21, “Drilling rights right now are at a 10-year low for this time of year. “We have a traditional slowdown in Western Canada oil drilling business in spring anyway. However, our customers are telling us this year that they expect activities after spring breakup to be much slower then we would have assumed a few months ago.”

Badger reduces monthly build Due in part to the current weakness in the oil and gas industry, Badger Income Fund says it has reduced its monthly build rate by approximately 50% for the foreseeable future. In the third quarter of 2008, the trust indicated it planned to build new daylighting units at a rate of six to eight units per month. At the beginning of 2008, Badger had 334 units in its fleet, adding 84 units and retiring four during the year for a total fleet of 414 units as of today, representing a 24% growth in its fleet year-to-date in 2008. In a period of economic uncertainty plus weakness in the oil and gas industry Badger said it believes it is prudent to reduce its build and focus on revenue generation to keep its current fleet in use. Badger traditionally works for contractors and facility owners in the utility and petroleum industries. One key technology is the Badger Hydrovac which is used primarily for digging in congested grounds and challenging conditions.

By Geoff Lee Pipeline News Calgary – NuVista Energy Ltd.’s survive and thrive strategy in 2009 will follow a familiar and successful pattern after announcing a preliminary capital budget of $290 million in December 2008 with up to $75 million allocated for new acquisitions. The publicly traded oil and gas company, based in Calgary, will scale back exploration and development capital expenditures in the first half of 2009 to fund a $53 million purchase of gas properties in its Ferrier/Sunchild, Wapiti and northwest Saskatchewan core areas. The acquisition closed Jan. 29. Alex Verge, president and CEO hopes to stick with the budget plan but he said, “The environment is really strange so I think at this point it’s become difficult to promise a budget that becomes greater than cash flow. “We are going to try for the first six months of the year to stay within our cash flow including our acquisitions. It’s a common trend largely due to the economic uncertainty. “Most of the companies in this sector right now are trading significantly below their net asset value by any conservative measure. It’s unlikely companies will want to raise equity to fund aggressive drilling programs.” “We had a meeting with our technical teams in January and we told them we need to be prepared to execute a $290 million program. That being said, most of the exploration and development will come between June and December.” Verge adds if equity markets bounce back and budget assumptions about commodity prices are correct “We are going to be in a position to deliver on that $290 million budget.” NuVista has budgeted to participate in drilling 90 to100 wells this year but that total will include only six or seven wells in Q1 and no more than13 in Q2 including a couple of wells in the west central area of Saskatchewan. “Most the drilling we are doing in Saskatchewan with the exception of the northwest can be done in the third or fourth quarter,” said Verge.

“

No new drilling will take place this winter on the new acquisitions in keeping with NuVista’s early plans to live within their cash flow and cut back on Q1 capital spending. “Not only do we expect service costs to come down but it is cheaper to drill those wells (west central Saskatchewan) in the summer because you don’t need a lot of equipment associated with cold,” explained Verge. The corporate production target is to produce between 27,500 and 28,000 bbls of oil equivalent per day with a 72 per cent natural gas weighting. “If you recall when we acquired Rider Resources Ltd. (March 2008), we really scaled back our first quarter drilling program,” said Verge. “We moved a lot of our wells in Alberta out to June and July from the first quarter and some of our wells from west central Saskatchewan got moved as well. “Basically what happened is both areas got drilled. They just got drilled in the last half of the year. What we are doing this year is no different. It’s just a straight result of having this acquisition come early in the year.” With the northwestern Saskatchewan acquisition, NuVista increased its interest in a gas property from 37 per cent to 76 per cent and gives the company strategic access to gas in the Primrose Air Weapons range that Verge thinks could open up to drilling in the future. “With the acquisition, we pick up complementary interest in one of the only pipelines that goes through Meadow Lake Provincial Park” said Verge. “That’s the pipeline that leads to the Primrose weapons range.” Verge describes the northwestern Saskatchewan acquisition as “very stable with a long life with very reasonable quality production.” Current production from the acquired properties is approximately 1,600 bbls of oil equivalent with a 73 per cent gas weighting. NuVista bases its growth and shareholder value on an “acquire and develop” business model to develop new opportunities for drilling. ɸ Page A6

We are getting to a point in this basin (western sedimentary) where it’s cheaper to acquire properties than drill them yourself

”

-Alex Verge president and CEO

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PIPELINE NEWS February 2009

News

Notes Polygen plant delayed

This photo, found on Nordic Oil and Gas’ website, are of oil seeps they have found in the Preeceville area.

Others are seeking shale gas, Nordic is looking for oil

TransCanada Corp announced in mid-January it was delaying the proposed polygeneration plant for Belle Plaine, between Regina and Moose Jaw. The facility would generate electricity, hydrogen, nitrogen, steam and carbon dioxide. The price tag is pegged at $4 billion. Those costs are being re-evaluated. A decision is expected in the next six to 12 months.

By Brian Zinchuk Photos courtesy Nordic Oil and Gas Pipeline News

and heavy oil in Alberta and heavy oil and shale gas in Saskatchewan.” “Western Warner owns a 20% interest in Special Exploratory Permits covering 22,879 gross acres of P Preeceville – Nordic Gil and Gas of Winnipeg is & NG leases with the rights from the surface to the one of several companies with land position in the top of the Precambrian. The results from seismic shot Preeceville area, where shale gas is perking some in- have identified up to 80 possible exploration locations in the area.” terest. But Nordic is not necessarily Nordic’s website notes, taking that path, looking for gas. “The Preeceville region is, in No, they’re looking for black gold. the company's view, an area of “It’s an area that probably a lot great promise and potential. The of people have never heard of,” says company has an 80% interest in Don Bain, corporate secretary for 37,124 gross acres of P&NG Nordic. “An area no one knew anyleases with rights to the basething about.” ment covering an additional Nordic is affiliated with West22,879 gross acres. ern Warner Oils Ltd., established Bain says, “We’ve got a fairover 80 years ago. Western Warner’s ly big holding. We were the first website notes, “Western Warner people in the region. Nobody Oils Ltd. is one of Canada’s oldest thought much of it.” oil and gas companies having been However, he notes, “We involved in the exploration and dehaven’t gone after the shale velopment of oil and natural gas regas.” sources since 1926. Celebrating its In November, 2007, through 80th anniversary of incorporation in 2006, Western Warner today is This map shows Nordic’s the work of a third party, oil seeps were found in an area the major shareholder in Desoto Preeceville holdings. north of Preeceville. There were Resources Limited, a privately-held 34 “shows” in total, extending Alberta company with substantial land holdings and assets in the Joff re, Alberta area. over 400 feet along the Pewei River. “This was the real McCoy, not tractor oil,” Bain In turn, Desoto Resources is the largest single shareholder in Nordic Oil and Gas Ltd., a Winnipeg- says, adding that major oil fields have been discovbased public company listed on the Toronto Venture ered as a result of oil seeps. He’s not suggesting for a Exchange, trading under the symbol NOG. Nordic is minute, however, that is the case here. “Exploration an independent company engaged in the exploration drilling is like that. One in ten, two in ten.” ɸ Page A6 and development of natural gas, coal bed methane gas

Ironhorse Winter Program Underway Ironhorse Oil & Gas Inc. reports that its winter 2009 drilling program is underway in the Shackleton, Saskatchewan and Pembina, Alberta areas. Drilling has commenced on the company’s Shackleton property where Ironhorse plans to drill, complete and tie in up to 32 (16 net) gas wells. The company currently has two drilling rigs working in the Shackleton area, together with the associated equipment and services necessary to complete and tie in the gas wells. The new gas wells will be placed on production as they are drilled and completed - as the pipelines for the new wells were installed in November of 2008. As of March 1, 2009 Ironhorse said it expects the new gas wells will result in Ironhorse’s net daily production increasing from 950 bbls of oil equivalent per day to 1,500 BOE per day which will be 99% gas weighted. Ironhorse said it is evaluating and planning to undertake additional drilling and exploration activities in other areas throughout 2009.

EDITORIAL

PIPELINE NEWS February 2009

Pipeline News Publisher: Brant Kersey - Estevan Ph: 1.306.634.1015 Fax: 1.306.634.0141

Mission Statement: Pipeline News’ mission is to illuminate importance of Saskatchewan oil as an integral part of the province’s sense of community and to show the general public the strength and character of the industry’s people.

Editorial Contributions: SOUTHEAST Brian Zinchuk - Estevan 1.306.634.1015 SOUTHWEST Swift Current 1.306.634.1015 NORTHWEST Geoﬀ Lee - Lloydminster 1.780.875.6685

Associate Advertising Consultants: SOUTHEAST • Estevan 1.306.634.2654 Jan Boyle - Sales Manager Cindy Beaulieu Glenys Dorwart Kristen O’Handley Deanna Tarnes SOUTHWEST • Swift Current 1.306.773.8260 Doug Evjen Andrea Bonogofski NORTHWEST • Lloydminster Daniela Tobler 1.780.875.6685 MANITOBA • Virden - Gail Longmuir 1.204.748.3931 • Estevan - Jan Boyle 1.306.634.2654

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Pipeline News Estevan, SK Ph: 306.634.1015 Fax: 306.634.1041 Published monthly by Glacier Ventures International Corporation, Central Oﬃce, Estevan, Saskatchewan. Advertising rates are available upon request and are subject to change without notice. Conditions of editorial and advertising content: Pipeline News attempts to be accurate, however, no guarantee is given or implied. Pipeline News reserves the right to revise or reject any or all editorial and advertising content as the newspapers’ principles see ﬁt. Pipeline News will not be responsible for more than one incorrect insertion of an advertisement, and is not responsible for errors in advertisements except for the space occupied by such errors. Pipeline News will not be responsible for manuscripts, photographs, negatives and other material that may be submitted for possible publication. All of Pipeline News content is protected by Canadian Copyright laws. Reviews and similar mention of material in this newspaper is granted on the provision that Pipeline News receives credit. Otherwise, any reproduction without permission of the publisher is prohibited. Advertisers purchase space and circulation only. Rights to the advertisement produced by Pipeline News, including artwork, typography, and photos, etc., remain property of this newspaper. Advertisements or parts thereof may be not reproduced or assigned without the consent of the publisher. The Glacier group of companies collects personal information from our customers in the normal course of business transactions. We use that information to provide you with our products and services you request. On occasion we may contact you for purposes of research, surveys and other such matters. To provide you with better service we may share your information with our sister companies and also outside, selected third parties who perform work for us as suppliers, agents, service providers and information gatherers.

Editorial All this has happened before... It’s becoming clear that while activity in the Saskatchewan oilpatch is down from its lofty heights of 2008, it’s still moving along. In 2007, the year started with around 60 rigs active and rose to the 70 range until spring breakup. In 2008, the start was just under 50 and rose to under 70 before the spring dropoff. As of Jan. 19, this year, there were 45 rigs active, with 82 down in Saskatchewan, for a total fleet of 127. That means just 35 per cent were active, according to Nickles.com Rig Locator. Alberta’s percentage is higher, at 56 per cent (316 active of 569), while BC’s is at 81 per cent at the same point (108 active of 134). Manitoba, with only 13 rigs, is hardly statistically significant. Yet they, too, are running at 7 of 13 rigs active. Rig counts are a bellwether indicator, because drilling activity translates into service rig completions, pipeline tie-ins, and everything else that follows in the production chain. You don’t need a completion if you haven’t drilled a well. Nor do you need to flowline it to a battery. Simply put, this winter, fewer people are working on Saskatchewan drilling rigs, and that’s going to be a downer throughout the sector compared to last year’s frenetic pace. It might even be back to something we used to consider normal. With oil plummeting by approximately three quarters of its peak price, this is to be expected. The question arises as to what will happen with those who were working on the rigs? We’re going to see a form of bumping, like when there are layoffs in a union shop. The most recent influx of new workers will be the first flushed out of the

system. Experienced hands will have an edge finding work, and those who had moved up the food chain (roughneck-motorhand-derrickhand-driller-toolpush) might find themselves moving back down a notch, just to keep the paychecks coming. Companies will have the option of being more selective in their workforce. It’s going to be more than just a body filling a position. Resumes will come to mean something again. One strategy we heard was using the swing shifts of some rigs to fill another rig’s staffing. It means more rigs working, with fewer staff. It’ll be hard on the workers, as they’re not going to see much, if any, time off between now and spring break up, but at least they’d be working, provided their rig is working. There’s talk from the fed of ramping up EI to deal with the economic turmoil. As this edition goes to press before the federal budget comes out, it’s a crapshoot to figure out what will come of it. But with more people nation-wide out of work, it’s unlikely that benefits will go up substantially in value. While EI covers a certain percentage of a person’s insured income, it also maxes out at a certain amount per week. For someone used to bringing in big bucks, the EI check is a shadow of a real paycheck. Those who have worked in the field for a while and know there are ups and downs will be ready. Those who jumped in for quick money and spent it just as fast will be selling off the toys they can no longer afford. That’s the nature of the business. It has happened before, and will happen again.

PIPELINE NEWS INVITES OPPOSING VIEW POINTS. EDITORIALS AND LETTERS TO THE EDITOR WELCOME. Email to: brian.zinchuk@sasktel.net

PIPELINE NEWS February 2009

Opinion Enhanced oil recovery a boon Lee Side of Lloyd Geoff Lee

Since I began to report on the oil and gas sector in the Estevan area last summer and more recently in Lloydminster, one of the most common terms or themes that arises is enhanced oil recovery. In the Bakken light oil play, horizontal drilling, multi-stage fracturing and waterﬂoods are among the most practiced enhanced oil recovery techniques. In the Weyburn area, CO2 ﬂooding is being used to bring new life and oil to old wells with great results. In the heavy oilsands of Alberta and Saskatchewan, THAI technology is being used to increase recovery rates of in-situ bitumen. THAI is an evolutionary process for in-situ combustion which combines a horizontal production well with a vertical air injection well placed at the toe. THIA has the po-

tential to recover 70-80 percent of bitumen-in-place, versus 20-50 percent from current in-situ technologies including steam. To recover more heavy oil in Saskatchewan, sand production is being used in vertical wells and experiments are under way to recover oil in horizontal wells with controlled sand production. All of these enhanced oil recovery techniques remind me of the Kellogg’s Corn Flakes slogan “Taste them again for the first time.” For the oil industry, these new and emerging oil recovery processes and technology, is like being able to rediscover their producing wells all over again and again. It’s the eternal fountain of oil to keep the industry flush with resources and cash. Although oil and gas prices have hit unexpected lows lately, the future of the industry looks promising as new enhanced oil recover technologies will come into play, driving well-paid research and development jobs in western Canada along with local economies. Many of the new technologies and processes tested in western Canada have provided Canadian oil and gas companies with the ability to diversify globally and export Canadian technology and expertise to oil and gas fields around the world. New enhanced oil recovery processes are currently being tested in the Saskatchewan oilsands that

have only begun to be explored and developed. While most of today’s oil and gas news is negative about prices or layoffs, reports of enhanced oil recovery technologies and approaches are akin to sowing the seeds for a sustainable harvest of oil for years to come. That’s good news, not just for oil and gas companies, but for construction and retail sectors. The nice thing about revisiting existing wells to recover more oil is that it saves companies a lot of time and money by not having to explore for new areas to drill. In addition, many of the techniques in use or being developed are environmentally friendly, which helps the industry create a positive public relations image. Being environmentally friendly is proving to be beneficial to the bottom line as a green consciousness takes hold with consumers and industry critics. New enhanced oil recovery techniques are also helping to slow the depletion rate of oil which should lead to lower inflation and some middle ground in oil and gas pricing to avoid unstable price hikes that we saw last summer. Enhanced oil recovery will also help to boost the stock price of publicly traded companies and restart investment. “Recover it again for the first time” could the new slogan for oil and gas producers.

Electric cars still rely on fossil fuels The announcements coming out of Motor City at the start of the Detroit Auto Show on Jan. 11 showed a large shift in the automotive world – one that has the same implication of the shift from coal to diesel in ships and on rail. But in a twist of irony, we will have gone from solid coal to liquid fuel and back to coal again in roughly one century. Mid-January was a – flutter with announcements about electric vehicles. Ford and Canadian auto-parts manufacturer Magna entered a strategic alliance to build electric vehicles. Honda announced production of its latest version of the Insight. Toyota is updating the Prius. Chrysler’s talking electric. GM is betting the farm on the EV. Between all the automakers, there’s going to be a bevy of hybrids and electrically powered vehicles coming out in the next few years. There’s one problem, though: batteries. Like the TV commercial a few years ago of the toy jumping crying out “More batteries!” as it gobbled them up, all these electric vehicles are going to need batteries in quantity and quality the likes of which the world has never seen. “We're really looking for a breakthrough in battery technology,” the Globe and Mail quoted Barb Samarzdich, Ford's vice-president of powertrain engineering, as saying. That may be the understatement of the year. Battery technology has progressed at an amazing rate over the last 15 years. When I got my first cell phone, its nickel-cadmium battery when t along way to defining it as a “brick phone.” If you were lucky, you got 30 minutes out if it before you had to makes use of the forgotten skill of swapping battery in mid-conversation. My current phone’s battery is about the size and weight of four toonies, and lasts for days. Such advances, however, have not been totally analogous to electric vehicles. A car needs a lot more oomph than a cell phone. That means orders of magnitude more raw materials needed to create the batteries for just one car, never mind millions each year. Even so, most of these new vehicle announce-

From the top of the pile

all this to come about. In the mean time, we will be putting gas in our tanks for quite some time to come. Brian Zinchuk is editor of Pipeline News. He can be reached at brian.zinchuk@sasktel.net.

Brian Zinchuk

ments are hybrids. It’s of necessity, because we simply can’t make batteries that can allow a vehicle to perform the way a liquid-based fuel currently can. They are now like the brick phones – limited capacity, limited utility. The world of electronics has gone wireless. Cars have always been so. They will work pretty much anywhere. It’s tying them up that is going to cause the headaches. The electrical grid and our capacity to produce electricity are going to need mammoth upgrades to adapt from a liquid fossil-fuel based transportation system to a plug-in model. We’re talking pylons and wires and power plants, and lots of them, to support plug-in cars. Most cars will be plugged in during the night, when there is lower demand. This may allow the existing grid to handle some of the electrical conversion, but not all of it. Wind power expansion will help, and in some ways is the quickest way to expand. The complexity of construction and lead time to build a wind farm is but a fraction of a nuclear plant, damn, or new coal mine and its correlating power plant. Here’s where our circle is complete. Wind, hydro, and nuclear power will all play a part. Inevitably, the world will turn back to coal. It still provides a large portion of the baseload power generation for much of the world. For a large portion of the world, their plug-in cars will be powered by Your car might end up being electric, but you’re coal. still driving on coal. Photo by Brian Zinchuk However, it’s going to a long, long time for

PIPELINE NEWS February 2009

Nordic is looking for oil instead Éş Page A3 During the summer of 2008, they did two exploration test wells, but neither proved commercially productive. They did, however, discover additional oil. â&#x20AC;&#x153;We knew it was there,â&#x20AC;? Bain says. The ďŹ rst well had to

be abandoned due to a lost bit. The second was not productive. â&#x20AC;&#x153;Since then, weâ&#x20AC;&#x2122;ve been mulling our options,â&#x20AC;? he says. In late 2008, they enlisted a seismic company to shoot 3-D seismic over 4.5 square kilometres. It was happening â&#x20AC;&#x153;as we speak,â&#x20AC;?

he noted, when interviewed in mid-January. The work was done within a half-hourâ&#x20AC;&#x2122;s drive of Preeceville. â&#x20AC;&#x153;Once we start drilling again, you never know what you will ďŹ nd. Itâ&#x20AC;&#x2122;s a very active and busy area â&#x20AC;&#x201C; a fair bit of exploration, lots of opportunity.â&#x20AC;?

This photo, found on Nordic Oil and Gasâ&#x20AC;&#x2122; website, are of oil seeps they have found in the Preeceville area.

NuVista adopts an acquire and drill later strategy Éş Page A2 â&#x20AC;&#x153;The market expects us to have acquisitions as part of our business base,â&#x20AC;? said Verge. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve have a track record of being reasonably good at it

and generating a positive return.â&#x20AC;? Verge says the latest acquisitions were â&#x20AC;&#x153;reasonably priced. Weâ&#x20AC;&#x2122;re back to 2004 levels,â&#x20AC;? he said. â&#x20AC;&#x153;We are getting to a point in this basin (western sedi-

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mentary) where itâ&#x20AC;&#x2122;s cheaper to acquire properties than drill them yourself. â&#x20AC;&#x153;Everything we are delaying today, we feel we will be able to do cheaper either at the end of this year or the beginning of next year.â&#x20AC;? â&#x20AC;&#x153;Basically between now and June we will create ourselves the ďŹ nancial ďŹ&#x201A;exibility to do another acquisition of this type or use our balance sheet to acquire something even larger. â&#x20AC;&#x153;We will also have the ability to step on the gas when it come to the exploration and development program and drill more or less 90 to 100 wells between June and the end of the year.â&#x20AC;? With volatile commodity prices and uncertain economic conditions, Verge says the predominant mood in Calgary is tenuous. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve seen a number of people

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lose money on their stock options so thatâ&#x20AC;&#x2122;s taking way peopleâ&#x20AC;&#x2122;s desire,â&#x20AC;? he said. â&#x20AC;&#x153;On the street, we are hearing that some larger ďŹ rms in Calgary are going to dramatically cut back their capital budget but they are cutting staďŹ&#x20AC; along with the capital budget. â&#x20AC;&#x153;We are not planning on cutting any staďŹ&#x20AC;. In fact, weâ&#x20AC;&#x2122;re saying itâ&#x20AC;&#x2122;s business as usual. Itâ&#x20AC;&#x2122;s just like last year. You need to be able to drill these wells and hit the ground running in June. We keep bringing this to our exploration meetings because we want to be ready to go hard in June. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re going to have the opportunity to inventory and we will have the wells licenses and ready to go. When we drill them will depend on commodity prices and the environment for acquisitions.â&#x20AC;?

PIPELINE NEWS February 2009

Locked and loaded for the Weyburn oilpatch Crocodile Dundee said, “That’s not a knife. THAT’S a knife.” Well, Andrew Shanaida of Chip 9 Machining took that concept to assault riÁes, and hung one up as a sign in Weyburn. See story and more photos on Pages A8&9. Photo by Brian Zinchuk

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PIPELINE NEWS February 2009

Gunsmithing and machining: By Brian Zinchuk Weyburn – You want to be sure to get someone’s attention? Point a gun in their face. Well, maybe don’t do that. But you get the point. Guns get noticed. As such, there’s now a giant, to-scale, 14-foot,

6-inch long CAR-15 Colt Commando, a derivative of a Vietnam-era M-16 taking aim at the sky in front of Chip 9 Machining, a Weyburn machine shop along Highway 39. Andrew Shanaida and his wife Alison took over the shop ﬁve years ago. “When we took it

over in 2004, the previous owner for 16 years was winding things down. It took a bit of work to rebuild the clientele. “Advertising, we found, to be our most valuable tool.” Shanaida is a journeyman machinist. Originally from Weyburn, he

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qualiﬁcations are now internationally recognized. Saskatchewan’s training pushes you to be a machinist/welder, while in Alberta, Shanaida says you have to be a machinist/millwright. “A machinist is the

guy who builds it. The millwright puts it together.” The shop employs another journeyman, and an apprentice. Alison Shanaida does the books. ɸ Page A9

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PIPELINE NEWS February 2009

smokin’ patch combination ɺ Page A8 “Our meat and potatoes is oilfield,” he say, with a niche in service and repair on conventional pumpjacks. “One of our biggest clients is EnCana,” for whom they do some R & D work. “We’ve got a pumpjack saddle component we’ve redesigned as a retrofit for these older pumpjacks out there. “Because the patch is moving and growing so much in this area, Estevan used to be central. As the patch moves north, we’re trying to make it known we’re here to do the repair work,” he says, speaking of their Weyburn location. In taking over the shop, a lot of equipment went out the door, pronto. “I had to drag this shop’s ass into the 20th century,” he says. They got rid of a lot of worn out equipment in the second year. “We’ve been constantly upgrading our equipment.” A big part of that was the addition in the last year of not one, but two four-axis CNC machines. “This last summer, just by the hair [of our teeth], with the Canadian dollar being at par, we bought two CNC machines. We made a move.” Big guns Walking into Chip 9 is not your typical machine-shop experience. You see, machining and gunsmithing make a good combination, and Shanaida does both. In an era of gun control where most gun shops have closed and you can’t even buy a .22 at Canadian Tire anymore, he opened a gun shop. Guns have been part of the business since day one. There are pistols under glass, holographic sights, and a rack hung with various body armor vests. Who buys the bulletproof vests? “Paintballers,” he says. There’s no actual armour plating, but it stops paintballs from hurting so much. As for the big gun outside, he says. “I had an idea in my mind. We wanted something that would get people’s attention. When travelling, you’re always looking for landmarks. We didn’t want to go with just a regular hunting rifle.

What determined the size was some electrical insulation boxes he found as scrap. It’s been scaled up remarkably closely to the real thing, but no, it is not functional. The coating shop in the back is applicable to several applications, not just gunsmithing. The bluing and Parkerizing capabilities are handy. The Shanaida family moved back to Weyburn after becoming dissatisfied with the Alberta experience. “We spent about eight years in Alberta, spinning our wheels. The money was there, but there’s always someone to take it from you. We weren’t getting anywhere.” He considered going to school for mechanical engineering at the University of Alberta, but they wanted to move back to be closer to their parents. Another option was a job at the RCMP FDivision in Regina, doing repair work at their armoury. However, they couldn’t nail down a start date for him. “In the mean time, this shop was for sale, and I though, ‘Let’s give it a go.” The gunsmithing has led to the shop’s certification as a military contractor, an association with the Canadian Association of Defence and Security Industries (CADSI) It qualifies Chip 9 Machining to sell to police departments and corrections.

This tool, a design of Chip 9 Machining, incorporates the gunsmithing and oil patch machining sides of the business. It uses a daytime green laser to align shivs, combined with a block insert and a carpenter’s square. Photo by Brian Zinchuk

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A10

PIPELINE NEWS February 2009

2008 was the second best year on record for oil and gas wells drilled in Saskatchewan. Photo by Brian Zinchuk

2008 banner year for Sask drilling By Brian Zinchuk Regina – Last year was a banner year for drilling in Saskatchewan, posting the second highest number on record for wells drilled. According to Saskatchewan Energy and Resources, the total came in at 4045 oil and gas wells, up 17 per cent from 2007. It should come as no surprise, with the number of active drilling rigs in Saskatchewan hovering around 80 to100 for much of the latter half of 2008. September saw that number spike at over 100. In comparison, 2007

was the tenth best year on record, with 3451 wells drilled. “These drilling numbers are the latest indicator of the robust performance of our oil and gas industry,” Energy and Resources Minister Bill Boyd said. “Combine them with the record revenues we received last year from the sale of petroleum and natural gas rights, and it’s obvious that the industry has tremendous conﬁdence in Saskatchewan as both a dynamic oil jurisdiction and an excellent place in which to do business.” Of the well drilling

total, 2,824 were oil wells, a 23 per cent increase over 2007’s ﬁgure, and 1,221 were gas wells, a 5.6 per cent increase over 2007’s number. The highest drilling count was in the Weyburn-Estevan area, where 1,398 wells were drilled, largely reﬂecting the continuing interest in the Bakken play. The Kindersley area was next with 1,006 wells drilled, followed by the Lloydminster area with 865 wells and the Swift Current area with 776 wells drilled. One-third of the total wells drilled in 2008 were

horizontal. Boyd noted as recently as 20 years ago, horizontal drilling technology was experimental, but that horizontal wells now account for roughly 45 per cent of Saskatchewan’s total oil production. The year saw prices all over the map, with WTI oil starting 2008 at $99.62, peaking at $147.27 in July and plummeting to $33.87 by Dec. 19. This is the time of year when the provincial Ministry of Finance wants to know what numbers it should plug into the upcoming budget. That’s going to be a tough one for Energy and Resources to

come up with. “I have seen forecasts from ‘experts’ from $20 to triple digits,” says Roy Schneider, of Energy and Resources. “It’s kind of a take-your-pick thing.” So what does Energy and Resources tell Finance when they ask? That number is a closely guarded secret until the budget comes out. “We will be expect to tell them something very soon. It will be tough to come up with a number,” he notes. One forecast had suggested Saskatchewan would see a 9 per cent rise in drilling this year. That

forecast is since being revised, he says, noting it’s out the window. Schneider notes, “We’ve had some good drilling years in the past with prices at the current level. In 2003, the price was just $31.99 for a yearround average. That was Saskatchewan’s best drilling year on record. “We are still cautiously optimistic this can be a positive year in the oilpatch,” Schneider notes, pointing out that with recent changes to Alberta’s royalty structure, Saskatchewan has become more competitive.

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PIPELINE NEWS February 2009

A11

Red Dog Drilling on Rig #3 - A locally owned & operated company where their employees make their business successful! Rig #1 2,500 Metre Double

Rig #2 2,800 Metre Double

Rig #3 3,500 Metre Telescopic Double

Photo Courtesy Brian Zinchuk

Thanks to Dave Oldhaver, Kevin Skjerdal & all the crews who have continued to work hard on Rig #1 & Rig #2. Red Dog Drilling would like to thank all the fabricators, suppliers and contractors that helped in the building of Red Dog Rig #3. Thanks to Brad Gall and Tyron Tangedal for their assistance & hardwork in the building & design of Rig #3. Thanks as well to all the crews that helped put it together.

Wayne Zandee President

Tel: (306) 634-8311 Fax: (306) 634-8360 Cell: (306) 421-1465

Email: reddogdrilling@sasktel.net 308 C Superior Ave.

Box 1085

Estevan, SK

S4A 2H7

The Ă&#x20AC;rst trip up the derrick is a two-hook affair to retrieve the fall arrestor cable. This is the trip down, after having pounded a few frozen pins into locking position.

Cong

ratul Congratulations a

tions

Red Dog Drilling Inc. on the Completion of

Congratulations s n o i t ula t a r g Con McCOMB AUTO SUPPLY LTD.

Rig #3

342 5th Street, Estevan - Phone: 634-3601

A12

PIPELINE NEWS February 2009

Not buying off the lot:

Tyrone Tangedal, left, and Dean Deroo assemble plumbing in the pump shack of Red Dog Drilling’s Rig No. 3

Story and photos by Brian Zinchuk Estevan – For most products, big and small, you go to the store or dealer, and pick it off the shelf or buy it off the lot. You need a hair dryer, you might go to the department store. A pickup? Head over to the local dealer and take one for a spin. A dozer? You might have to pre-order it, but it’s likely to be quite literally run-of the-mill. Not so for drilling rigs. While it is possible to go to a company and order a standard model, it’s also pretty common to build it yourself. Red Dog Drilling Inc. of Estevan is finishing off Rig No. 3. Once again the rig will be launched in February. As

the number indicates, it’s the third rig they’ve built. The first Rig was started in November, 2004, and drilled its first hole in February, 2005. Rig No. 2 drilled for the first time in February, 2007, and Rig No. 3 will be ready to drill its first hole in February, 2009 – all two years apart. “ It was not planned that way,” says Wayne Zandee, president of Red Dog. “But is kind of neat all the same.” Rigging in His Blood Zandee was born with “rigging blood.” His father, Al Zandee, along with several uncles, all have a history in the oilpatch. His father worked on rigs from 1959 to 1977. He worked as a rig manager for General Petroleums starting in 1972.

Congratulations Red Dog Drilling Rig #3 Thanks for the opportunity to be involved! Welding & Fabrication ig9203 - 35 Avenue, Edmonton, Alberta

R spec

Ph: (780) 485-6885

Wayne himself worked rigs for several years, as well as was a field superintendent before he started Red Dog Drilling Inc. in 2004. Looking at a historical photo in last month’s Pipeline News, Zandee thinks he recognizes the derrick, just by its shape.“I think I worked on that derrick. That was the first rig I worked on Simmons Drilling No. 2, he says.” That was back in 1979. The only thing original would be the derrick, now, he says. “If it’s kept in good shape and looked after for many years, you can use it for a long time,” he says. Telescopic Double “Rig No. 3 is a 3500 metre telescopic double,” Zandee says. It’s the company’s first telescopic unit. Such a design means one less load when doing a rig move, as the derrick and drawworks all go on one load. You don’t need a separate truck for the derrick. ɸ Page A13

Drawworks incorporates innovative mounting of rotary clutch Rigworks Oilﬁeld Solutions out of Leduc, Alberta, built Rig No. 3’s drawworks – Model RWD 700T. Dan Flaherty of Rigworks Solutions has been in Estevan for the last couple of weeks to help commission the new drawworks and to install the drilling control panel and brake linkage on Rig No. 3. “Drawworks design has changed quite a bit from the 1950s, early 80s,” notes Flaherty. He notes that space is a challenge on telescopic double drilling rigs. Rig No. 3 drawworks incorporates an innovative rotary shaft design for the gear box. The advantages are improved safety and serviceability. A conventional gear box design for the rotary shaft would be rotating at all times. With the Rigworks design, the rotary shaft is only rotating while drilling.

PIPELINE NEWS February 2009

Red Dog Drilling assembles Rig No. 3 that you don’t create a one-oﬀ that is too diﬀerent from the norm. “You don’t want to stray too far, or you could be building a pink elephant – nobody wants it.” Components came from several suppliers in

the Edmonton region. “We went to a few different companies. The drawworks came from Rig Works of Leduc.” The buildings came from Rig-Spec in Edmonton. Major components, including the sub structure,

derrick and drawworks carrier came from Hyduke Drilling Solutions of Nisku, and the electrical from Mustang Controls and the plumbing from Wil-Tech Industries in Estevan. ɸ Page A14

Congratulations Red Dog Drilling on the launch of

rig #3!

634.SIGN

306.

ɺ Page A12 “We wanted it to be quick moving,” Zandee says, noting it was a primary design priority. Rig No. 3, while similar to other telescopic doubles in the Industry, has its own design in some ways. “There are companies that will build you a complete rig,” explains Wayne Zandee, president of Red Dog Drilling. “You’ll get what you get. It may not always be what you want.” “I preferred my own guys put their ideas into the design of the rig. There are no better people to get input from than the guys who work the iron everyday. They have a sense of ownership and pride in a rig when they help design it,” he explains. That included a lot of sitting down and sharing of ideas. Some of it came to plumbing decisions, how you rig up your plumbing. Thought went into making quicker to rig up and roughneck and driller friendly. Last but not least, safety was a crucial factor when it came to all design work. However, it’s important in building your rig

A13

621 5th Street Training Opportunities

Estevan Safety Training Courses The pieces are coming into place, with the substructure, bottom left, pump shack, right, and derrick, top right, on location by Nov. 27, 2008.

(Rural locations speciÀed) CPR/1st Aid - Feb. 18-19; 21-22, Mar. 2-3; 16-17; 21-22,

Congratulations Red Dog Drilling on the completion of Rig #3.

Call #5 KRJ Industrial Park: 421-9576 or 421-2244

Congratulations Red Dog Drilling on Rig #3

Specializing in Rig Mats Canadian Owned and Operated www.lougheedwelding.com 405 - 18th Ave • Nisku, AB T9E 7T5 BUS: 780-9555-3700 • FAX: 780-955-4724

Carnduff - Feb. 10-11, Carlyle - Feb. 16-17, Mar. 30-31, Oxbow - Mar. 23-24 ConÀned Space - Feb. 5; 20, Carlyle - Feb. 25; Mar. 18, Oxbow - Mar. 25 H2S Alive - Feb. 4; 17; Mar. 11; 24; 28, Carnduff - Feb. 12, Carlyle - Feb.19, Brandon - Feb. 19, Oxbow - Mar. 26 CPR/1st Aid Refresher - Feb.12, Mar. 11 TDG/WHMIS - Feb. 5, Mar. 10 Detection & Control - Feb. 13 Ground Disturbance - Mar. 20, Carlyle - Feb. 20, Oxbow - Mar. 27 Ground Disturbance Train the Trainer - Mar. 4-5 OH&S/WHMIS - Feb. 16, Carlyle - Feb. 18 Special Provisional Engineer - Mar. 23-26

Early Safety Training Week in Estevan & Carlyle Feb. 16-21. Students ages 16-21 may apply an Early Safety Training Bursary

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Carlyle Safety Training Week - Mar. 30-April 3 - take all four classes & save $100

SEESS (Southeast Environmental Safety Seminar) - Mar. 18 in Weyburn Incident Command System (Enform) - Mar. 9 The Petroleum Industry in Canada (Enform) - Mar. 31 - Apr. 1 Supervision, Team Leadership & Motivation (Enform) - Apr. 6 Safety Inspection Skills (Enform) - Apr. 14-15 Safety Training for Jobsite (Enform) - Apr. 16-17

Call us if you need a class set up just for you - we deliver safety training on our site or yours. We also offer 1A Truck Driving - call 637-4921 for info. Check out our website at www.southeastcollege.org

Congratulations Red Dog Drilling on the completion of Rig #3! Proud to be of service!

A14

PIPELINE NEWS February 2009

Roughneck friendly & safe ɺ Page A13 Roughneck friendly and Safe “It’s an important factor for someone who’s been around rigs for a long time.” Zandee says. Constantly in their minds was the concept of making the Rig No. 3 ‘roughneck friendly’ and ‘safe’. That meant more usable room in the pumphouse, for instance. They put all of the plumbing overhead “so you don’t have to step over lines.” “Our electrical on this rig is much simpler to rig up.” ”The hydraulic catwalk is

Above: Subtrades have been in and out of the assembly site, with this welder on location in late November. Right: Outlaw OilÀeld Hauling delivers the drawworks, which went straight into the shop at Wil-Tech Industries.

deﬁnitely a plus”, he notes. This rig will be equipped with a wireless remote controlled hydraulic catwalk. This is a huge safety feature for the hands – it eliminates the need for workers to be on the catwalk while tubulars are being lowered and raised to the rig ﬂoor. Rig No. 3 incorporated many of the trademarks of Mustang Controls out of Devon, Alberta for just that reason - because they are rig user-friendly and safe. Pat Christopher, Foreman for Mustang Controls, has

been camping out in Estevan for the last three weeks completing the electrical on Rig No. 3. A Mustang trademark is a driller’s console that is mounted on the rig floor – enabling the driller to perform all of his duties from one position on the Rig floor. This increases safety and productivity. Mustang Controls is also the promoter and designer of the mounting of transformers in each building using higher voltages and decreased cord sizes – roughneck friendly again. Mustang Controls also installed their Crown Alert System on Rig No. 3 – a system designed to reduce the risk of crown strikes by the traveling block. Crown Alert is a reliable, economical approach to derrick safety, according to Red Dog. Assembly “September was when we really got into it,” says Brad Gall, whose been working on the rig steady from then until the January day when the derrick finally fully extended. “Four months – that’s pretty good.” Gall says, noting it can take a lot longer than that. ɸ Page A15

Hyduke Energy Services Inc. is pleased to join you in congratulating Wayne Zandee and his team at RED DOG DRILLING INC. on the addition of their third drilling rig. Hyduke is committed to supporting RED DOG DRILLING’S success as they grow in the future. Hyduke Energy Services Inc. has over 30 years experience in the drilling equipment and supply industry. Our manufacturing facilities are API 4F and ISO certiÀed, our business model supports being a Single Source Supplier to our customers. We are proud to have served RED DOG DRILLING INC. in the fabrication of the mast, substructure and mud pump building for RED DOG, Rig 3. Congratulations on the purchase of the RS-F1000 mud pump, sold and serviced by Hyduke.

*," 1 /-Ê Ê- ,6 UÊ iÃ } ]Êi } iiÀÊEÊ > Õv>VÌÕÀiÊ > `Ê `À }ÊÀ }ÃÊEÊÜ À ÛiÀÉÃiÀÛ ViÊÀ }Ã UÊ, }ÊViÀÌ wV>Ì UÊ * Ê Ê{ ÊViÀÌ wi` UÊ Õ `Ê«Õ «ÊÃ> iÃÊEÊÃiÀÛ Vi UÊ À }ÊyÕ `Ê Õ`®ÊÌ> ÊÃÞÃÌi Ã UÊ" wi `ÊÃÕ«« iÃ UÊ Ã«iVÌ ÊEÊViÀÌ wV>Ì ÊÃiÀÛ ViÃ UÊ/ÀÕV Ê Õ Ìi`ÊiµÕ « i Ì UÊ ÕÃÌ ÊEÊ«À `ÕVÌ Ê >V } UÊ* iÕ >Ì VÊV ÌÀ ÊÃÞÃÌi Ã 9 1 Ê , 9Ê- ,6 -Ê ° ÊÊÈä Ê ÊÓ£Ê Ûi Õi ÊÊ Ã Õ]Ê LiÀÌ> ÊÊ > >`>Ê/ ÊÇ8 ÊÊ* i\ÊÇnä®Ê xx äÎxx ÊÊ >Ý\ÊÇnä®Ê xx äÎÈn ÊÊ > \Ê v J Þ`Õ i°V ÊÊ7iLÃ Ìi\ÊÜÜÜ° Þ`Õ i°V

Recently added service - Industrial Paint & Sandblasting!

A15

PIPELINE NEWS February 2009

Tangedal & Gall instrumental

A cable is threaded into a shiv on Jan. 20.

ɺ Page A14 Red Dog Rig No. 2, built locally in Saskatchewan, took longer only because we were in a big supply crunch at that time, Zandee says. “The pumphouse on Rig #3 was basically

put together by Tyron Tangedal,” Zandee says. Tangedal, having worked rigs for 11 years prior, 6 years as a driller, started with Red Dog in March of 2005 as a derrickhand and is now the rig manager for Rig No. 3. Brad Gall is project

supervisor/field superintendant for Red Dog. His prior experience includes working as a rig manager with Big Sky and Lakota. This was his first rig build from the ground up, but the fourth or fifth rig build that Gall has been involved with. The pair did a large portion of the custom work and design on the rig, combined with Zandee’s input. Gall’s work included planning and coordination of services, including electricians and pipefitters in Alberta. Tangedal lived on site in the rig manager’s shack. Saturdays and Sundays were all part of the job of putting this new rig together. Gall spent the better part of two and a half months in Edmonton, working on the project. The rig manager’s shack was one of the first arrivals, followed by the

substructure. Eventually the drawworks and derrick would ﬁnd their place, too. The company’s site, on the east side of Estevan, has seen all sorts of subtrades coming and going, installing instrumentation, welding, and the like. Some of the work has been done right next door, at Wil-Tech. Crews, consisting of driller Brad Lamontage, derrickhands Les Oldhaver and Jay Martel; motorhands Dean DeRoo, Dillon Krupka, Joel Chicoine and Jeremy Anderson worked hard in the yard rigging up the rig, once it all arrived. A very well-known oil ﬁeld dog named Lincoln – has been seen around the site, the pet of a local welder, Zane Olson whose also been working on the project. ɸ Page A16

Congratulations Red Dog Drilling!

Thank you for allowing Mustang Controls to supply your rig wiring, accumulator and crown saver.

780-987-7300

Devon, Alberta

Congratulations

RED DOG DRILLING on the completion of

RIG #3

Brendon Abernethy, of Wil-Tech Industries, works on a control panel for Red Dog Drilling Rig #3.

Congratulations on the

Completion of Rig #3

Senchuk Ford Sales Ltd. 118 Souris Ave. N. Estevan •

634-3696

Congratulations to

Proud to be a part of it!

Complete Hydraulic System was supplied and installed by WIL-TECH INDUSTRIES.

Serving the Oil Industry for 17 years.

69 Escana Street, Estevan, Sk.

634-6743

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RIG MOVING Phone: 482-3244

A16

PIPELINE NEWS February 2009

The crew who has assembled Red Dog Drilling’s Rig No. 3 includes, back row from left: Jay Martel, Les Oldhaver, Tyrone Tangedal, Brad Gall and Dean Deroo. On the stairs are Crystal and Wayne Zandee, who head up the operation.

Red Dog Rig No. 3 is fully extended for the Àrst time on Jan. 20

Congratulates Red Dog Drilling on the completion of Rig #3

RIGWORKS specializes in manufacturing complete drawworks packages from 300 HP to 3000 HP; also complete Mud Pump Packages.

3904 - 84 AVE. LEDUC, ALBERTA Phone: 780-980-0449 Fax: 780-980-0454 www.rigworks.ca

PIPELINE NEWS February 2009

This dog has been everywhere in the Estevan oilpatch. His name is Lincoln, and he belongs to welder Zane Olson. What are the odds a welder would name his dog “Lincoln?”

Congratulations Red Dog Drilling on Rig #3!

A17

Rig manager Tyrone Tangedal, left, and Àeld superintendent/project supervisor Brad Gall were an important part of designing and building the new rig for Red Dog Drilling.

634-3009

Estevan

We Are Proud To Be Your Complete Drill String Component supplier

Proud to be of service to

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Congratulations On The Completion of Rig #3. 30 Ton Picker DENNIS TROBERT Owner - 421-3807 Winch Trucks Norm Meyers Bed Trucks Sales - 421-8640 Low Boy & High Boy Trailers Les McLenehan General OilÀeld Hauling Dispatcher/Sales - 421-8810

A18

PIPELINE NEWS February 2009

Families paramount: not just numbers ɺ Page A17

Price tag Zandee won’t say what the ﬁnal cost is, but notes that prices can be all over the map. For a typical double, you can expect to spend upwards to $8 million. By doing their own build, they save money. “It’s more cost eﬀective to do it this way”.

On January 20th,, the day the derrick fully extended for the first time, Gall could be seen stopping his truck, taking a picture as the sun cast its setting hues on the derrick, before heading off to a much-deserved few days off.

Finding work and Staffing Expanding the small drilling company’s ﬂeet by one more unit, from two to three, is a big move, especially at a time when the industry is slowing down due to the drop in oil prices. “It is an issue. There’s less work out

there now. You have to be very strategic to keep all your rigs working. It will be the reputation of Red Dog Staﬀ, Rig Managers and workers on Rig 1 and Rig 2, that will sell Rig 3.” Caroline Zandee, runs the admin side of the company. She notes how important it is to

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Phone: (780) 434-7488 Fax: (780) 435-2144 9305 - 56th Avenue Edmonton, Alberta T6E 4Y2

Congratulations

Red Dog Drilling

keep families working. “Our guys are important to us - They’re not just a number,” she stresses. “We know all of our men. They are our most important asset.” “Caroline notes that ‘hands stay with good leaders and we have good leaders – Kevin Skjerdal, Dave Oldhaver and Tyron Tangedal, the rig managers for Rig No 1 and No. 2 and No. 3.” “Being local helps in getting the best men for the job,” Wayne says. “The good local hands will want to stay with local contractors.” “When an operator goes looking for a rig, that’s what they look at – track record and reputation. We have had operators that have called for speciﬁc rigs because of their reputation.” The company will have 66 staﬀ at full strength, with three rigs running. “We have chosen to

work three – eight hour shifts in a 24 hour period. This rotation, as opposed to two 12 hour shifts seems to work the best as we get the maximum performance out of our employees. Most of our employees are local and are able to drive back home and still be able to spend time with their families, which is important to them. However, they may run the third rig by using swing crews for the other two, reducing the number of new hands needed. If there’s work for all three rigs, it would mean not much time oﬀ until spring breakup. People are coming in regularly now, seeking work. It seems the days of extreme labour shortage may be ending. “We’ve had a lot of people apply,” Caroline says. A few minutes later, a younger man came in, resume in hand, looking for work.

Congratulations

on on the the

Completion of Rig #3 Proud To Supply Your OilÀeld Needs. From everyone at

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634-2312

PH. (306) 634-9846 FAX (306) 634-2465 EMAIL: promo@crownad.ca www.crownad.ca

1020 6th Street, Estevan

Proud to Provide Our Services Congratulations to

on the Completion of Rig #3

SV F

on the launch of Rig #3 Continuing your commitment to the S.E. Saskatchewan energy sector

Siever Vermeersch & Fonstad

An Association of Professional Accountants 1123 - 4th St., Estevan Ph: 306-634-7331

CONGRATULATIONS FROM VARSTEEL LTD.

Proud Supplier of Red Dog Drilling 634-3561

Estevan

PIPELINE NEWS February 2009

She’s just about ready. Red Dog Drilling Rig No. 3 will be ready this February to start punching holes.

A19

Congratulations Red Dog Drilling Rig #3!

18 Hwy. 39 East, Estevan Phone: 634-3412

JR R Reg Olynyk 24 Hrs: (780) 220-5938 Fax: (866) 889-4703

LTL SERVICES ALBERTA • SASKATCHEWAN HOT SHOTS AVAILABLE EMAIL: jrltl@telusplanet.net

Red Dog Drilling on the completion of Rig #3

Congratulates

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A20

PIPELINE NEWS February 2009

All brine in 09’ New tanks are installed on Jan. 12 at Arcola’s Bakken Salt Water Disposal. Eagle OilÀeld Services of Arcola did the lifting, while McGillicky OilÀeld Construction of Estevan did the hook-ups. Photo by Brian Zinchuk

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A21

Relief valve nears completion By Brian Zinchuk Estevan – “There’s the reason right there,” Ken Sholter says, pointing to an empty elevator shaft in early January. By not having a functioning elevator in place, it’s been one more thing to hold back the hotel that is coming to completion long after the initial plan. Operating under the Motel 6 ﬂag, the hotel should be open some time in February. With 68 rooms on three ﬂoors, it should provide a pressure relief valve for some of the housing issues that have faced Estevan. But if it had been completed on time, those issues might not have been as pressing. “There was no space for quite a while. Probably this hotel would have solved a lot of problems,” he says. Sholter is the managing partner and majority shareholder in the hotel. He acts in a similar capacity at Estevan’s Perfect Inns, and used to be involved in the Weyburn Perfect Inns. Ken Sholter surveys the halls nearing completion of the new Motel 6 in Estevan. It’s located near the Walmart, on the east side of the city. Photo by Brian Zinchuk

The new hotel was in planning for two years this past November. They went through two project managers before being satisfied with the third – Dominion, out of Winnipeg. The project was hit hard by inflation. Did it hurt? “Oh yeah, big time. In Regina, the cost of this would have been 20 per cent less.” Much of labour had to be imported from Brandon and Winnipeg. Actually, it could have been twins, he says, for the length of time it’s taken to build. Supply and demand was the big reason behind the new hotel. The rumors of it being fully booked before even opening are mistaken, however. “That’s normal,” he says of such rumors. It’s also normal for those rumors to be false. “I know the demand is here. I wish we were open already.” Even if there is a slowdown, he expects the allure of a new hotel should help fill rooms. A good chunk of those rooms will be used by oilpatch people. “We’re basically catering to the business sector of southeast Saskatchewan, ag, mining and oil.”

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A22

PIPELINE NEWS February 2009

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ESP provider sets up Estevan shop Estevan – The shrimp was tasty and the steak juicy and thick at BoretsWeatherford’s grand opening in Estevan Jan. 22. Borets is a large Russian Electric Submersible Pump (ESP) supplier, according to Brad Ward, sales manager for Borets-Weatherford. Borets purchased the electric submersible pumping division of Weatherford, and Weatherford took a stake in Borets. All this occurred in January, 2008. The Estevan location opened the doors to its new facility in the fall of 2008, located on the west side of the city. Prior to that, they were operating out of a Weatherford facility. Electric submersible pumps take the a lot of the concepts of conventional pumping, with a rod string reciprocating a sucker pump or a spinning a progressing cavity pump, and throw them out the window. Instead, three electrical cables of a very heavy gauge are insulated with an elastomer, and protected by lead sheathing. The down hole underground setup includes, from bottom up, a telemetry unit, motor, seal, intake and pump. At the surface, an electrical control unit known as a Variable Frequency Drive (VFD) is about the size of a large refrigerator. Unlike other pumping systems, it’s silent. If need be, it can be tucked out of the way, out of sight. It requires high voltage three-phase power, and can be run from a gen set. As a closed system, there are no leak paths, such as stuﬃng boxes. By eliminating the rod string, you also eliminate the wear on the tubing. The system works for light and medium crude, as well as water applications, but isn’t designed for the high sand cuts associated with heavy oil production. Pumping capacity can run from 75 to 25,000 bbl/d. “We get as big as 1250 hp down hole,” explains Ward. “Typical around here is 140 cubic metres per day. In addition to ESP setups, the company oﬀers surface horizontal pumps as the local bread and butter. “We run a lot of surface horizontal pumps here, and more and more down hole,” Ward says. ɸ Page A23

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Garth Hoffort of Innovative Supervision tries out the mammoth shrimp provided during the Estevan Borets-Weatherford grand opening Jan. 22. Photo by Brian Zinchuk

PIPELINE NEWS February 2009

A23

Grand opening for Borets Weathorford in Estevan Éş Page A22 The Estevan facility currently hosts a spooling truck and spooling equipment. â&#x20AC;&#x153;We plan to grow,â&#x20AC;? according to Ward, noting they built the facility with three bays. Thereâ&#x20AC;&#x2122;s not a lot inventory kept in Estevan. Most of that is at their Nisku, Alta., manufacturing plant.

â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re just nicely getting open, just got the facility put together,â&#x20AC;? he says. Staffing is an issue, in that right now they have just one local employee. The rest are rotated in from Nisku. â&#x20AC;&#x153;We are looking for staff â&#x20AC;&#x201C; spool truck drivers and installers â&#x20AC;&#x201C; electricians,â&#x20AC;? Ward explains.

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A24

PIPELINE NEWS February 2009

Oil industry pitfalls hit the Battlefords By Josh Schaefer Freelance Reporter

An unidentiÀed employee welds a tank on Jan. 21, the day a number of layoffs were announced at G.L.M. Industries facilities in Battleford. Photo by Josh Schaefer

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Battleford - The economic hard times have finally hit the Battlefords. On Jan. 21, G.L.M. Industries in Battleford quietly handed out temporary lay off notices to a number of its employees. G.L.M. wouldn’t comment on the number, but one employee who did not wish to be identified has said anywhere between 20-30 people were given the notices. Dean Hartman, of G.L.M., said that although they did not want to comment at the time, layoffs like this happen numerous times throughout the year. “We’ve hit the end of the five year peak,” he explained. “About every five years, the oil industry starts to slow down, and it eventually goes back to normal.” He could not speculate at when those who were laid off will have the chance to come back to work, but explains that it’s a hard time for the oil industry. “Across western Canada, there’s probably about 10,000 people that were laid off. The worst hit is Fort McMurray.” With the entire country heading towards an economic recession, layoffs have been seen all across western Canada, most recently, Evraz in Regina. With oil trading at just under $150/bbl only six months ago, and now sitting at around $40/bbl, the reason for cutbacks is quite evident. G.L.M. Industries is taking another look at some of the larger projects that they’ve started and are trying to find ways at saving money in creating their storage tanks for the oil patch. For now, it’s business as usual for the rest of the Battleford operation, but with gloomy forecasts in the economy one can only hope that this is the last cut of jobs for awhile. G.L.M. Industries’ Battleford facility is one of four located in Saskatchewan and Alberta, and was opened in 1980. Employees usually fabricate a typical 1000bbl tank in approximately five days.

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A25

Kisbey Pumpjacks If you look hard on the left, you’ll see a rig working on the next in this line of wells, near Kisbey. Photo by Brian Zinchuk

SaskPower joins Sask 1st Call, ¿nally Regina - It took six years, but SaskPower has finally joined other Crown utilities along with two dozen pipeline companies in Saskatchewan’s 1st Call network. Its absence in the call-before-you-dig program left a gaping hole in the system. The addition should reduce headaches for anyone dealing in ground disturbance. Sask 1st Call is Saskatchewan’s location screening and notification service for contractors and customers who are planning to dig or excavate. The network includes SaskEnergy, TransGas, SaskTel, SaskPower and 24 other pipeline companies. In 2008, Sask 1st Call surpassed 100,000 requests, which was a 14 per cent increase over 2007. “The addition of SaskPower is an important step in the continued growth of Sask 1st Call, a service that supports the strong and steady growth of our economy,” said Ken Cheveldayoff, Minister of Crown Corporations. “Sask 1st Call is all about our Crowns and the private sector working together to ensure the safety of our communities and the reliability of services provided by the infrastructure of all member companies.”

With the addition of SaskPower, Sask 1st Call now covers approximately 400,000 kilometers of buried infrastructure throughout Saskatchewan with the goal of one day being a full One Call organization, as found in other jurisdictions in North America. “Having many different companies to contact for line locates can be confusing for any contractor, with an equipment operator, and potentially the entire community, at risk, if buried infrastructure is accidently hit while excavating,” said Ron Canfield, President of NIS Contractors. “Contractors depend upon Sask 1st Call, and now that SaskPower is a member, the safety of our crews is greatly enhanced.” Sask 1st Call was established as a subsidiary of SaskEnergy in January 2003, and provides a service to member companies that have underground infrastructure. A call to the Sask 1st Call’s tollfree number will connect you to a trained and experienced Customer Service Representative (CSR) who will take all the pertinent information concerning the proposed excavation and enter it into the screening database. The software will then determine

which of the member companies have underground facilities at that location and notify the company that a line locate is required. Each company is then responsible to mark its lines as usual. This locating service is provided with no charge to customers.

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A26

PIPELINE NEWS February 2009

Let the wedding bells ring By Brian Zinchuk

It’s wedding time in the oilpatch, when sometimes it’s cheaper to expand by buying out another Àrm than it is to drill your own wells. Photo by Brian Zinchuk

Kindersley - In the wedding business, this is the time of year when all the arrangements are being made. In the oil business, there’s some nuptials being planned, too. With the tanking of the price of oil over the last six months, it was bound to happen – companies are going to begin a round of mergers and acquisitions. “It’s no secret – the focus in Calgary right now is consolidation of small juniors,” says Arnie Hansen, founder, president and CEO of Reef Resources. It’s not a mail order bride, but they did put out an ad on Nickles Daily Oil Bulletin in early January. The ad read, “Small Calgary based publicly trading junior oil and gas company, interested in a potential merger with a private company with similar goals and objectives. Short term focus area's are a blend of low to medium risk Saskatchewan oil and gas prospects with a long term focus on development of multiple section/twp shale gas ﬁeld(s) in southern Saskatchewan and Alberta. Management brings extensive production, operations management and development skills.” Hansen explains, “We’re looking for a target company, with 100 to 300 BOE production per day.” Areas they are looking at include west central and southwest Saskatchewan, and east central Alberta. “Anywhere south of

Saskatoon or Edmonton,” he notes. They specifically are not interested in foothills deep gas plays. It has a lot to do with royalty changes in Alberta. Reef ’s core areas are in the Kindersley and Senlac areas of west central Saskatchewan, where they recently revised a farmin agreement with Marianas Energy Ltd. for the two sections. Reef also has project underway in southwestern Ontario. Share prices for public companies have been pummelled in recent months, so how does one evaluate the value of private company at present? Compare net asset value to net asset value, Hansen explains. “The public capital markets aren’t your friends,” according to Hansen. He notes there is a huge disconnect in market value right now, and it is unfair to compare public to private. Private companies, he notes, are having difficulty finding capital. “For the most part, you need to raise equity to drill,” he says. Growth will be through merger and acquisition, he says. Reef is also going to keep its eye out on land sales, as there may be bargains to be had. “You have to be selective in Alberta due to revised royalties,” he says, adding Saskatchewan is more stable. Reef Resources is publicly traded on the Toronto Venture Exchange, under the symbol REE.

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PIPELINE NEWS February 2009

A27

Finding the code for Saskatchewan shale gas White Hill Lakes - Mooncor Oil and Gas is seeking out heavy oil on the western side of Saskatchewan, but if the find shale gas, it’s an added bonus. “We’re an unconventional oil and gas company, specializing in shale gas and heavy oil,” says Richard Cohen, chair of Mooncor. Mooncor has approximately 12 sections at White Hill Lakes, in northwest Saskatchewan, where some wells on the property were drilled in the 1960s. “We went out and drilled five shale gas wells on the property.” He says the partner they were working with didn’t go deep enough, and there were issues with the frac. “We are very keen on drilling another series of wells at White Hill Lakes,” Cohen says, looking for heavy oil. If they find shale gas, that’s an added bonus. That quest will includes drilling

into the shale and taking core samples. “First we want to shoot 20 km of 2D seismic. We’re pretty conﬁdent there’s a shale gas play in that area.” Can you get the recovery is the key, he notes. As such they want their heavy oil at Waseca as the primary consideration. Mooncor has also recently acquired about 60,000 acres on the BC-Alberta border on the Alberta side. In late January they had scheduled a recompletion on a suspended well. “That’s got us really excited,” he says of the Alberta prospects. In a depressed market, he notes, you have to be careful in choosing. “We could have a major, major discovery there.” That, in turn puts White Hills Lake on the backburner. The company also has some land

Snow removal Clarence Molyneux of Turnbull Excavating was in high demand after Estevan got roughly seven inches of snow in one night in mid-January. After clearing out Trican’s lot, it was down the road to Brandt’s yard.

in southwestern Ontario, yet another shale gas play. It’s a farm-in on Utica Shales. There’s also a land acquisition program in the Antrim Shales in the same region. “In Saskatchewan, you’ve got the Colorado Shales. There has not been a lot of success in unlocking it.” Stealth Ventures, working at Alberta’s Wildmere area, seems to have had some success, he notes. “They have cracked the code on recover the gas.” Cohen calls it a major success story that could bode well for Saskatchewan. “We’re going to be using some of the

same technologies and contractors,” according to Cohen. “Hopefully some of the shale gas producers in Saskatchewan will be able to duplicate what Stealth has done.” “I think Saskatchewan is one of the new frontiers if they ever get the Bakken and shale gas going.” On the heavy oil side, he says they’ve got some sanding issues they are overcoming, trying to get the wormholes formed in the formation. It was getting to the point where they had to call in a ﬂushby once a week. That’s down to once a month.

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A28

PIPELINE NEWS February 2009

Arcola’s new industrial park sells out, fast

A tanker enters Arcola from the north.

JJ TRUCKING

Arcola – In a prime place to take advantage of the growth of the Bakken oil development, Arcola is feeling the warmth of Saskatchewan’s hot play. “We were fortunate. Twenty years ago, they renovated and added onto the school. The hospital? A fair amount went into tit. Now we’ve had an inﬂux,” says Mayor Harry Laurent. In 2006, he notes, “As a council, we felt we were out of room,” so they chose to develop some lots. “Within a year, they were gone. “Holy ___, we’re in trouble,” he recalls. The second phase saw 17 lots developed. Six have sold so far, with 11 left. Laurent says he “kind of expects” to see them sell this summer, for new stickbuilt or ready-to-move units. Modular and trailer homes are not allowed. The vast majority of new homes in the community of just under 600 are ready-to-move. Just one of the 16 is custom-built. Local builders don’t have time to build homes, he notes. They’re too busy building things like shops. Laurent is in a special position to know. He is one. His company, Harry Laurent Construction, has been busy doing commercial work. The interview takes place in the small back room of his other venture, a lumber yard called Arcola Building Supplies, located on main street. The building is old and cramped, which is why he’s one of several businesses setting up shop along the highway. The new industrial park, with seven lots, is being developed by Scott Hislop. “He chose to be a bit aggressive,” Laurent explains. The result is a payoﬀ for the town. “By doing so, he sold all that land.” ɸ Page A29

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PIPELINE NEWS February 2009

A29

Arcola Mayor Harry Laurent sketches out the industrial lot expansion along the highway at Arcola.

Arcola’s Co-op is expanding. OilÀeld trucks fuelling up is a common sight at the co-operative.

Kelly

Growing Arcola ɺ Page A28 “It sold out, fast.” Indeed, Laurent says there are plans to develop another ﬁve lots, likely this summer. Technically the industrial development is in the RM of Brock, not the town proper, but to the average Joe, they would consider it part of Arcola. Some of the lots have already been built on, others are waiting. One shop is under construction. The tenants include Aikiens Construction, a trucking company owned by Colin Brownridge, a two shop bay, Laurent’s Arcola Building Supplies, and an Alberta ﬁrm whose shop is already up. Finally, Lees Sales and Service intends to move its service station from the main street of the town to the industrial lots. “We’re building the walls right now in out other shop. We hope to be open for the spring,” Laurent says. The new facility will also house Harry Laurent Construction. “I sure hope it works. I’m too old to go broke,” he says with a laugh. “People are happy with the new government in rural Saskatchewan. You can feel it. “It’s been good for Arcola. “For a small centre, we hold our own. I credit

it to the businessmen and residents of Arcola. They’re friendly, aggressive, and they make stuﬀ happen. My concern

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A30

PIPELINE NEWS February 2009

I'll see you in court

Arcola – The brick exterior exudes permanence, authority, institution. The high ceilings in the main courtroom must have had countless accused criminals staring up at its curved corners, wondering if the daylight coming in would be the last they see for a while. The old Arcola courthouse lives again, but this time, instead of sending people to the big house, they can live in the big house. The big court house, that is. In 2008, Arcola Lodge opened its

doors as a dormitory-style boarding house. What were once oﬃces and legal meeting rooms are now bedrooms. The judge’s chambers, with the private toilet, is a now a washroom. It will eventually have a whirlpool tub. The grand staircase, which once carried robed barristers to important matters of law, now services roughnecks and truck drivers. What was once likely a secondary courtroom on the main ﬂoor now hosts a big screen TV and lounge area. A bar pool table sits in the middle of the lobby.

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bricks have been there for 80 years. “W. Amos Feb. 15, 1926,” one says. A more recent one writes, “B.K. May 23/73” The holding cells are two steel cages, with a common, solid wall, and square rods for bars. There’s a slot for food or securing and cuﬀs through the doors. If their dungeon-like appearance wasn’t foreboding enough, the black paint seems to suck the life out of you. It’s possible someone may have died down

there, Van Dinter notes. A client refused to go downstairs at night because he thought he saw a ghost. At the time of our visit, they had six boarders. The vast majority of the clientele are oil-patch related. With a room you get cable TV, linens, washer and dryer, and use of a kitchen. “All you bring is your clothes, and that’s it,” he says. If anyone gets unruly, he says the cells are still usable.

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Sleeping in court Mike Van Dinter lives there, running the lodge for owner Charles “Chuck” Aschenbrenner. He bought the place after his sister, Ramona, and her partner Gary Kerr purchased the High House, a heritage building on main street which houses Buddy’s Pub, Shirley’s Buffet and Michael’s Pizza. Ramona Aschenbrenner says her brother fell in love with the courthouse after she fell in love with the bar. “I moved in in August from London, Ontario,” Van Dinter says. The previous owner had used the heritage building for antiques. The upper floors had been blocked off for a number of years, and it didn’t do the building any favours. Van Dinter is plugging away, fixing this and that as the building returns to life. “We have 12 rooms. Some have two beds,” Van Dinter says as he takes Pipeline News on a tour. The “Presidential suite” has a view and a private deck, he points out. One crew filled the place towards the end of last year. “They claim this place is haunted,” he says as we head down to the basement. There, you can see where police used to process prisoners. A creaky old boiler looks like it could have been used on the Titanic, and is quite possibly the same vintage, since it’s hard to imagine how they could have got it into the building without demolishing a pathway in. In the southwest corner are the cells. If the graffiti is authentic, then some of the notes scrawled on the

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

B-Section February 2009

What's going on around Preeceville? Shale gas exploration in Saskatchewan

Gas in northeast Sask As early as 1932, wells were being drilled in the Hudson Bay area due to local reports of surface gas seeps near the town. From 1932 to 1950 over 100 wells were drilled in the eastcentral area of the province, (from the Pasquia Hills to Yorkton area), some of which reported gas shows within the Colorado shales. Saskatchewan government well ½les show that some of these wells fuelled nearby farms for an unde½ned period of time. According to local historical reports, by 1937, Coal Gate Oils Co., Ltd had three shallow wells in the Kamsack area producing and supplying gas to the local electrical company (Paluck, 1988). By 1946, over 74 gas wells had been drilled, in the immediate vicinity of Kamsack. Of these, nineteen where producing. Saskatchewan government oil and gas well ½le records attributed production from these wells to only one well with total gas reported to be 4,744 x 103 m3 (168,389 mcf). Gas fuelled the electrical plant, part of the town and several farms nearby for over 15 years, albeit often with disrupted service in town due to lack of pressure, condensation and freezing problems and occasionally spring ¾ooding. -Source: Spinning stories, a woven history : Kamsack,Togo,Veregin, Runnymede, Cote.-- Kamsack, Sask” which is a Kamsack History Book, published by the Kamsack History Book Committee, 1988.

By Brian Zinchuk Pipeline News

“Essentially, it's gas that is produced from rocks that are extremely ﬁne grained,” explains Melinda Yurkowski, a senior research petroleum geologist with the Saskatchewan Ministry of Energy and Resources. In conventional gas plays, the gas would be found in sandstones and siltstones, with a much

Preeceville - The Montney shale gas play is to British Columbia what the Bakken oil play is to Saskatchewan. It's where all the action is, where heavy investment and adoption of newer technologies are making a big difference. Land sales in each of those regions have been some of the heaviest the respective provinces have seen. What's not so well known is that Saskatchewan has several operators seeking out shale gas, too. The centre of the action is unassuming Preeceville, a farming and livestock community about an hour's drive north of Yorkton at the intersection of Highways 9 and 49. If you're a hunter, you'd recognize the area as being defined as 'forest fringe' on game maps. There are moose and whitetail. A little further north, and you hit the bush. It's in this region that numerous compan- This core was taken from Ventures Kamsack No. 4. Photo courtesy Sasies have acquired explor- katchewan Energy and Resources. ation permits. Nordic Oil and Gas is one of the most prominent, and higher permeability than shale. (Permeability is has received the most local attention. There's also the ability of a rock to transmit fluids). While a Panterra, which has land positions in three areas conventional gas formation might have its permeof the province. Midway Gas Corp has the largest ability measured in millidarcies, for shale, Yurkowholding in the region, with 307,000 hectares under ski explains, it is orders of magnitude less permepermits for the Preeceville, Weekes and Porcupine able. “We're looking at nanodarcies.” The gas itself is CH4, methane, a biogenic gas. Plain areas. Hunt Oil has been drilling in the area this The trick is to get it out of the ground. “What you winter, including a well north of Norquay near a need is a conduit to get the gas to the wellbore,” Yurkowski says. blip on the map known as Arabella. That can be through natural fractures, via hyThese are areas where drilling rigs are not commonplace. When a flare was visible near Preece- draulic fracturing, or through siltstone or sandville, it attracted quite a bit of attention, according stone interspersed as thin layers in the shale. With the very low permeability, how do you to local residents. Right now, it's still in the exploratory phase. extract it? It's being done in several shale basins “We don't have any production yet,” says Paul already, such as the Barnett shale in Texas. But Mahnic, acting director of the Petroleum Tenure we don't know enough about the geology of these Branch, Saskatchewan Ministry of Energy and shales in Saskatchewan to know how well this would work here, she explains. Resources. ɸ Page B2 What is shale gas? Heil DOT 407, 55 Cube, insulated, Super B, internal lining, alum wheels 6 units in stock

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Shale gas exploration in Saskatchewan ɺ Page B1 It's been known there's gas in the region for quite some time. Kamsack had its own gas utility in 1937. The Kamsack geology is similar to that at Preeceville, she notes. “Generally speaking, we have a lot of Upper Cretaceous shales, especially in southeastern Saskatchewan, where they're pretty thick,” Yurkowski says, noting that in the

Weyburn area, they can be up to 1000 m thick. They gets thinner as you go north, she points out. In the Preeceville area, the section is about 250 m thick, but that's highly variable. Not all shales hold gas, she notes. “You have some richer zones, and some leaner zones.” A lot of the wells in the area have been drilled to a depth of 300 to 435

m, according to the Saskatchewan Oil and Gas Infomap, found at www. er.gov.sk.ca. It's not the ﬁrst time wells have been drilled in the area, either, the map shows a number of abandoned dry wells punched in 1952 and 1955. One is north of Stenen, another near Ketchen. There were several around Endeavour, north of Preeceville. One 1958 well is an anomaly, at

1027 m, compared to the much shallower depths drilled in the area. A 1967 well near Danbury, north of Hyas, is also listed as dry and abandoned. Another 1968 dry hole is found a few kilometres southwest of Panterra's current wells, just southwest of the town of Preeceville. Recent interest Interest started up again in 2004 and 2005,

with a number of exploration permits issued. Those permits are soon reaching their ﬁve-year deadlines, and it's coming time to convert some into licences. “Is it going to be commercial? Is there enough to make a go of it?” says Mahnic of Saskatchewan shale gas. He notes issues of infrastructure, compressors and density of wells. “It's there. I would

think price is going to be the big thing.” As for the BC excitement in the Montney play, well it's diﬃcult to compare Saskatchewan's potential with BC recent success. “It's a very diﬀerent environment,” Yurkowski says, noting the BC play is far deeper, with higher pressure, and getting incredible amounts of gas. “It doesn't really relate at all.”

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PIPELINE NEWS February 2009

A who’s who of shale gas in Saskatchewan Who’s doing what in Saskatchewan shale gas? With shale gas gaining prominence, especially in Northern British Columbia, Saskatchewan is now seeing some attention in the quest for unconventional natural gas. Much of the action is around Preeceville, an hour north of Yorkton. This list is courtesy of Saskatchewan Ministry of Energy and Resources. Crown Petroleum and Natural Gas Dispositions in areas prospective for shale gas Notes: ‘gas wells’ includes both wells completed and cased for gas. The following information is in the public domain and can be gathered from the Saskatchewan Oil and Gas InfoMap at the ministry website (www. er.gov.sk.ca). No postings in shale gas areas for February 2009 land sale. Preeceville Area Panterra Resource Corp Three permits issued in 2005 (5-year term) Permit (183,500 ha) located in Preeceville area

One to remember Estevan – Estevan’s Oilﬁeld Technical Society is planning a bonspiel to remember this year, and for good reason. It’s their 50th, after all. The event will take place at the Estevan Curling Club Mar. 26-29. There will be a banquet and dance at the Beefeater Plaza on the Friday. The vent is known for its massive amount of door prizes. Recent years have also had an added bonus – with winning teams receiving an envelope with some cash after each win. “It’s our 50th, so we’re going to step it up and

make sure it is the year everyone remembers,” says Jeﬀ Mosley, vicepresident of the Estevan OTS and one of the organizers. Entry fees are $300 per rink, and that guarantees four events. “We’re shooting for 64 teams again,” Mosley says. Registration can be done online at the Estevan OTS website (estevanots.com). Registrations close Mar. 20.

north of Yorkton in East Central Saskatchewan (Referred to as “Foam Lake” by Panterra) 17 gas wells Permit (155,800 ha) in Moose Jaw area (Near Davidson, Craik and Elbow) 16 gas wells Permit (79,600 ha) located 50 miles northwest of Prince Albert (Referred to as “Shell Lake” by Panterra) 3 gas wells Western Warner Oils Ltd. Aﬃliated with Nordic Oil & Gas 10 leases issued in 2006, 2008, and 2009 (5-year primary term) 30 km north of Preeceville 12,900 ha 3 gas wells Leases selected from permits Midway Gas Corp. Three permits in Preeceville area, around Weekes and Porcupine Plain One issued in 2004, two in 2006 (5-year term) 307,140 ha 11 gas wells Saskatoon Assets Inc. One permit northeast of Preeceville (198,000 ha) Issued in 2007 (5-year term) 4 gas wells Hunt Oil Company of Canada owns these wells Nucoal Energy Corp.

One permit immediately northwest of Yorkton Issued in 2008 (5-year term) 60,500 ha No gas wells Rest of Saskatchewan Lane Land Services Ltd. Three permits from south of Melville eastwards to Cupar (30 miles north of Regina) Issued in 2008 (5-year term) 199,700 ha No gas wells Great Plains Exploration Inc. One permit in Big River area, 50 miles northwest of Prince Albert Issued in 2006 (5-year term) 53,900 ha 1 gas well Redstar Oil and Gas Inc. owns well Keppoch Energy Ltd/Pan Paciﬁc Land Corporation One permit 40 miles northeast of Prince Albert Issued in 2005 (5-year term) 37,285 ha No gas wells Whitland Consulting Inc. One permit in Duval area 35 miles northwest of Regina Issued in 2007 (5-year term) 96,700 ha 1 gas well Well conﬁdential to Feb 28, 2009

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PIPELINE NEWS February 2009

Nearly quadrupled in size, doubled in staff: Wil-Tech By Brian Zinchuk

The staff at Wil-Tech Industries has grown to about 24 over the last three years. Photo by Brian Zinchuk

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Estevan – It was close – within minutes, really – of being wiped out by fire. A lightbulb broken during the installation of insulation in the expansion of Wil-Tech Industries set the building on fire during its construction phase in on Dec. 2, 2007. Passersby called it in, and a quick response by the Estevan Fire Service turned a potential calamity into a setback. Fast forward to January 2009, when Wil-Tech held its grand opening after the completion of an expansion that nearly quadrupled their floorspace and doubled their staff over three years. The fire service was high on this list of people thanked by Jim Wilson, who heads up the family firm. It’s also fitting, perhaps, that the grand opening came within days of the 25th anniversary of Jim and Crystal Wilson coming together as a couple. Married for 23 years, they have been running Wil-Tech together for 17 years. During that time, all three of their children, Nicole, Steven and Dustin, have become part of the firm. Wil-Tech specializes in hydraulic systems and explosives. Part of the expansion was the branding as a “Parker Store.” Parker is their primary hydraulic line, and representatives were on site for the occasion. “We do motion control, fluid connector products, hydraulics, and pneumatics,” noted Tony Balla, western regional manager for Parker. “If it moves, we’ll have a component on it.” ɸ Page B5

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PIPELINE NEWS February 2009

‘From local service to a provincial-type player’ ɺPage B4 The company is also the Explosives Unlimited dealer for southern Saskatchewan. The company has supplied approximately 20 drilling rigs’ complete systems, the most recent being Red Dog Drilling Rig No. 3, assembled right next door. Barry Gervais, shop foreman, took Pipeline News on a tour of the ex-

panded facility. Behind the oﬃce is the Parker store, with a sales desk and inventory. In the back is the expanded shop. They’ve gone from 5,000 square feet to 19,000 square feet. There’s a new machine shop, mostly for in-house work or when customers bring something in to be ﬁxed. A new cylinder teardown bench can generate 55,000 foot-pounds of torque. They’re pretty rare, apparently. How did they do it before? “Struggle,” Gervais says. “Make do.” A new cylinder hone works on the inside of mammoth cylinders. The

hone is capable of working on cylinders up to 24 inches in diameter, and 40 feet long. “It’s all automatic and computerized,” he says. Jim Wilson says “The hone and disassembly bench ﬁt some of the

largest cylinders you will ﬁnd.” The hone is among the largest in Western Canada. He notes that some of the largest equipment is in the Estevan area, with the local mines. “We feel we have

Jim Wilson thanks everyone for coming, and for their support of Wil-Tech during the grand opening of their expansion.

that thing for weight,” Gervais says. It’s also environmentally friendly. Two overhead cranes assist in the ability to repair long truck-mount cranes. In the past, customers had to go to Saskatoon or Edmonton for such work. ɸ Page B6

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PIPELINE NEWS February 2009

Major growth in three short years ɺ Page B5 There’s also a 350 hp test unit for extremely large pumps. A 125 hp component test stand is used for hydraulic pumps, motors and valves. The services truck on display has a new chassis under it. The refreshment table prominently features Jim’s chilli, for which he received an award in 2008. Jim and Crystal cooked it all for the big day. “It’s been about three years – concept to completion,” he notes. This place has basically been a plan I’ve had for years. I’ve been sourcing equipment for years, purchasing pieces here and there. “I did a lot of re-

search. Our goal was to be the largest and most extensive.” The company now seeks to expand their horizons, marketing to a much larger area. Most of Wil-Tech’s work is in the oilpatch, but they also cater to mining, SaskPower, and agriculture. “Obviously the energy sector is our lifeblood in Estevan,” Jim Wilson told the gathered crowd at the ribbon cutting. “Our key to our business is it is diverse, although the majority of our business comes from the oilﬁeld,” Wilson explains later. “It’s been a long haul,” Jim says. “We did

have some major setbacks including a major fire.” “The customers are why this happened. Without their support, we wouldn’t be here.” He thanked the staff as well, noting a lot are like family. Well, four are. “We started in a little back bay, 17 years ago,” Crystal Wilson says, noting how proud they are of their employees and kids. The total staff now numbers around 24. Working so close with family, she says, “Some days are good. Some days are bad. We had to make a decision: work is work and family is family.” It’s plain to see, she’s happy to have them around. The Wilson family cuts the ribbon on the opening of their substantially expanded shop at Wil-Tech Industries. From left are Steven Wilson, Crystal Wilson, Jim Wilson, Nicole Wilson and Dustin Wilson.

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PIPELINE NEWS February 2009

Taking a chance: Why not drill your own well? Kisbey - South of Kisbey, there is an oil well, a single, solitary oil well in the middle of the busy Bakken oil play. There are other wells in the area, but this one is special. That well was drilled by a local farmer, Terry Johnston, with the backing of “friends and family.” It’s operated under the company name T-45 Oil Corp. Johnston’s modest about the whole thing, after having garnered the attention of a national newspaper around the time the well was drilled. It’s a producer, but its decline rate was a little more than expected, and Johnston wishes it put out a little more. “There’s still oil there, but it is going to be a long time paying out,” he says. Seeing all the action around, it was something he just had to do, or he’d regret it for the rest of his life. “I’m just a farmer. I’ve been interested in it all my life,” says Johnston, noting he wanted to drill a well for a long time. The Johnston farm is on the south edge of Kisbey, a little village between Arcola and Stoughton on Highway 13. While the Johnstons’ land is in the area of the Bakken action, they didn’t hold the mineral rights to it. “We had quite a bit of drilling activity on our land,” he notes. Instead, he acquired the freehold lease rights of a neighbour whose land was more in the centre of things. A geologist was hired through a connection with a small local oil company Johnston is involved with.

They didn’t have seismic to go by, but rather it was a shot in the dark on account of the proximity of nearby wells. It would end up as a horizontal multi-stage frac. The well was drilled in early June, 2008, and went into production in early July. “The day before it [oil] hit the best price.” Asked if drilling your own well is like jumping out of an airplane, he responds, “Very much like that.” The company is now focusing on a water disposal well drilled just outside of Arcola that went into operation this fall. Will they be drilling more wells in the future? “Probably we will at some time,” Johnston says.

T-45 0il drilled is Àrst, and so far, only well, south of Kisbey in June. Photo submitted

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PIPELINE NEWS February 2009

Getting rid of brine Arcola – A new venture just east of Arcola is already expanding. Bakken Saltwater Disposal is operated by T-45 Oil Corp, a one-well private oil company that drilled its ﬁrst, and so far, only oil well near Kisbey this last summer. The saltwater disposal well was drilled in the fall, and is a diversiﬁcation of sorts for T-45.

When Pipeline News visited in early January, three additional tanks were being installed, each at 1000 bbls. There’s room to add another three 1000-bbls tanks, if needed. There are three unload points, with the capacity to add additional points, should conditions warrant. The unload points are in a U-shape around the south, east and north sides of the facil-

ity. The Bakken play had been working its way from the west, so the owners saw the new disposal well as an opportunity to meet a local need. A similar well, operated by Palko Energy, is located north of Midale. The owners of the Arcola facility conferred with Palko in setting up their operation.

Increased demand has led to an expansion of capacity of Bakken Salt Water Disposal, just east of Arcola. Photo by Brian Zinchuk

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PIPELINE NEWS February 2009

Newalta now corp, reigns in spending Newalta Inc. announced that on Dec. 31, 2008, it completed the previously announced unitholder and court approved conversion whereby all outstanding trust units of Newalta Income Fund were exchanged for common shares in the capital of Newalta on a one-for-one basis. The amalgamation of various subsidiary operating entities of Newalta in connection with the conversion was completed on Jan. 1, 2009. Newalta specializes in waste dis-

posal, and has Saskatchewan operations in Alida, Halbrite, Plover Lake, Richmound, Regina, Swift Current landfill and Unity landfill. On Jan. 19, Newalta announced measures to curtail spending. According to a release, “Management deferred orders on long-delivery equipment and as a result, outstanding commitments are very modest. Total capital expenditures in 2008 are expected to be $125 million, comprised of growth capital expenditures of ap-

TransCanada among power generation contenders Regina - With a growing demand for power in the province, SaskPower has issued a request-for-proposals (RFP) for new electrical generation. Following a requestfor-qualifications to find private sector partners interested in providing new generation, SaskPower has invited five companies from across Canada to submit proposals for between 100 megawatts (MW) and 200 MW of peaking generation to be in service for the 2011/2012 winter peak. The companies are Trans Canada Energy Ltd., ATCO Power Canada Ltd., Northland Power Inc., Epcor Utilities Inc. and SNC-Lavalin Inc. A week before the request for proposals was

issued, TransCanada announced it was delaying its plans to build a polygeneration plant near Belle Plaine, between Regina and Moose Jaw. The 300 MW plant had initially been slated for operations to commence in 2013. “As Saskatchewan’s economy continues to grow, there is an increased demand for power as people invest in the province and make it their home,” Crown Corporations Minister Ken Cheveldayoﬀ said. “As part of this process, SaskPower is exploring opportunities for private ownership or investment in new generating facilities.” The deadline for the submission of proposals is April 8, 2009. The suc-

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cessful proponent will be announced in July 2009. SaskPower will is continuing with the development of other supply options. Future options under consideration include clean coal™, polygeneration, demand-side management, cogeneration, natural gas, imports, nuclear, large and small hydro and renewables – like biomass and wind. Jan. 18, 2009, marked the 80th anniversary of the creation of SaskPower.

proximately $105 million, and maintenance capital of approximately $20 million. Capital investments in the first half of 2009 will be tightly controlled and are expected to total approximately $15 million, comprised of growth capital expenditures of $10 million, and maintenance capital of $5 million. The capital program for the remainder of 2009 will be established in the second quarter based on the performance of the business and the outlook for the market.

“Actions to control costs and reduce debt including the control of all discretionary spending, travel and hiring restrictions, and the suspension of salary increases are expected to have a positive impact in the first quarter. As certain areas of Newalta’s business are continuing to grow while others are facing weakened demand, management will reallocate people to retain the talent developed throughout the company, wherever possible.”

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B10

PIPELINE NEWS February 2009

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Jeremy Johnston, owner of JJ Trucking, has seen his Áeet nearly double in the past year. Photo by Brian Zinchuk

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Arcola – With all the new Bakken wells in the Arcola area, there’s plenty of lease work to be had. “It’s been extremely busy. Every day you can possibly work, you do,” says Jeremy Johnston, owner of JJ Trucking. “For us, our end of it is still busy.” When did they see the uptick? “Really for us, it was this time a year ago,” Johnston says when the action hit them. “We were doing municipality work, some commercial, and oilfield work. We still do all that, but more of a percentage is oilfield.” “We’re in trucking, sand and gravel business, reclamation work.” Johnston says oilfield work now makes up about 70 per cent of their business. It’s led to a near doubling of their fleet in a year. “We run 12 trucks.” Those trucks include belly and end dump, as well as lowboy trailers. They have seven payloaders, two extra graders, and a few excavators. One quad-trac tractor sees winter duty in snow removal, and scraper duty in the summer. “Once the berms are put back, we gravel them up. In low-lying areas, we haul material in to build the lease. Around the Kisbey area, there’s lots of lowlying land that needs material hauled in.” The firm has gravel and clay pits near Arcola. ɸ Page B11

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PIPELINE NEWS February 2009

B11

No shortage of work to be done for trucking company ɺ Page B10 The company has a shop just west of Arcola along Highway. Headquarters are in the old Land Titles building, a heritage building with an ornate interior that could pass for a old-time movie set. They are going to build a new building on Main Street. Why? “I just want to be in town,” Johnston says. “Keep Main Street going.” Originally from a farm near Kisbey, Johnston, 31, started out with one truck in the late 1990s. During those early years, his time was partially taken up by competitive snowmobile racing. Indeed, there’s a sign on the entrance to town proclaiming “Home of 2001 USSRA World Champion Snowmobile Racer Jeremy Johnston.” “I was picked up by Team Ski-Doo and ran out of Valcourt, Quebec,” he says. “A guy in town, Garth Gordon, was doing some drag racing. We got into the oval circuit together.” Gordon actually works with Johnston now, one of about 25 staﬀ. All good things must come to an end, however. “The business got busy, and I couldn’t get away anymore. It’s full time.

You’re away all winter. You race every week. “I still do some SkiDooing just for fun.” With a slowdown in the patch, will he have time for more sledding? “We haven’t seen it yet, but we are prepared to see it.” “So much work backed up, it’s taking time to clear.” “We’re in a really good area,” he says, noting recent land sales mean there will be lots of drilling to do over the next several years to keep the rights. Indeed, Arcola was so pressed for housing, that Johnston bought a house a while ago to put up a couple guys. “You had to ﬁnd a place to stay.” A local restaurant can’t ﬁnd help, and was closed the day Pipeline News came to visit. A Chinese restaurant closed a couple years ago, at probably the least opportune time. “The boom comes, and they’re gone,” he says. If things do peter out in Arcola, Johnston says he would try to seek work elsewhere, if necessary, paying particular attention to highways projects. “They’re talking about doing some work around here.” “I think we’re very fortunate to be where we are with what is going on in the world.”

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B12

PIPELINE NEWS February 2009

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Pictured L-R: General Manager - Wayne Vande Velde and Vice-President - Suzanna Nostadt

Arcola - The nice thing about family businesses is that when you decide to spend some time in warmer climates, the younger generation should be able to run the shop And indeed, that’s what’s going on with Eagle Oilﬁeld Services, an Arcola-based company that has two primary divisions – equipment sales and trucking. They also have a blasting and coating division. Cody Grimes takes care of the sales, while Micky Grimes leads the trucking eﬀorts. Paul Grimes is the president, while Bev Grimes takes

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going. “We got a boom truck half-way through the first year,” he says, noting they started with a boom truck and picker at the same time. “We started renting tanks and selling tanks and hauling tubing,” he explains. The fleet has since grown to three winch trucks, two picker trucks, one knuckle picker and over a dozen trailers. They move rig shacks and mats, but not the rig itself. The fleet is set up for short haul trucking, with most of their work within an hour radius of Arcola. ɸ Page B13

Tremcar West Inc. is the Àrst Western Canada tanker trailer service repair shop, part of Tremcar Technologies Inc, Tremcar U.S.A., and Hutchinson Industries and all of the other subsidiaries. Tremcar Technologies Inc. is a family owned business originating in 1962 in Quebec and has become one of the largest tanker manufacturers in North America. The owner and president Mr. Jacques Tremblay with his keen insight and resources recognized a desperate need in the Western provinces for a coded service shop capable of tanker repair, testing, inspections, part sales, customer service, and tanker trailer leasing. Mr. Jacques Tremblay’s long awaited service repair shop ofÀcially opened on Oct. 18, 2008. The Vice-President Mrs. Suzanna Nostadt (20 years) experience in the tanker trailer business and the General Manager Mr. Wayne Vande Velde (25 years) experience combined with Mr. Jacques Tremblay (46 years) of expertise and his son Daniel Tremblay and their family of companies are looking forward to serving the businesses in Weyburn, Estevan and the surrounding areas.

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care of the admin side. The last two are the ones who get to enjoy the warm weather. Paul has been involved in the industry for 30 years via Eagle Energy Ltd., a private oil producer. Micky, 25, went into the service rigs after high school, and was received his boom truck ticket at the very early age of 19, having apprenticed under his uncle, Kevin Grimes. In those days, the company wasn’t moving much, and needed pickers and winch trucks. Micky got his class 1 drivers licence, and that got things

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A swamper directs his crane operator on a tank lift near Arcola. Eagle OilÀeld Services of Arcola does most of its hauling work within an hour of home base.

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Phone: (306) 634-4797 or 634-7334

PIPELINE NEWS February 2009

B13

Location a major asset to Eagle Oil¿eld Services ɺ Page B12 While Micky went into the hands-on portion of the industry right away, Cody, 26, graduated with a commerce degree from the University of Manitoba, then came home. On the equipment side, he says, “We design tanks, pressure vessels, treaters, full water knockouts, portable test separates and header packages.” They also do well heads and tubing sales.

An example might be an API12F-certified steel tank with a nozzle placement set up specifically for treating Bakken oil. “When we first started, we rarely dealt in new equipment,” Cody says, noting a lot was reconditioned. “As this boom hit, there’s no way you could keep up with the equipment needed, nor was there anything left to buy. We spent months lining up suppliers, engineers,

and talking to people in the patch.” In 2006, Eagle Oilfield Servicing went into new product sales, with their first test separator built in 2007. Cody speaks of their location advantage – one hour from Estevan, Weyburn, Carduff, Kipling and the Manitoba border. It also means they end up competing with businesses from Estevan Weyburn and Carlyle. “A lot of the time you do get overlooked. You have to

spend some extra time to sell the equipment.” But on the trucking side, Micky notes, “We’re closer to everything else.” They found SaskJobs.com to be great for ﬁnding employees, but it’s hard to ﬁnd places for people to stay. They fre-

quently receive resumes from people from Ontario. There’s a dormitorystyle boarding house in town, set up in the former court house. “We’ve used that a lot,” Cody says, until they ﬁnd somewhere more permanent to stay. For 2009, Cody notes,

“We’re optimistic. It’s going to change things a bit. Can we predict what’s going to happen? Not a clue. But we’re still buying equipment.” Micky notes that weekends now are a lot calmer. They might work six days a week instead of seven.

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201-2750 Faithfull Ave. Saskatoon Sk. S7K 6M6 Tel: 306-382-5075 Fax: 306-382-5073 Cell: 306-292-9388 d.fox@sunbeltnetwork.com

www.sunbeltnetwork.com Cody Grimes, left, and Micky Grimes head up the equipment sales and trucking divisions, respectively, of Eagle OilÀeld Services in Arcola. Photo by Brian Zinchuk

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PIPELINE NEWS February 2009

A 4x4 and two quads: oilpatch, hydro and mining surveying Virden, Man. â&#x20AC;&#x201C; The 'Trilogyâ&#x20AC;&#x2122; part of Lennon Trilogy Professional Land Surveyors is an inside joke. You see, it was started by four people, but they called it a trilogy, based on the Hitchhikerâ&#x20AC;&#x2122;s Guide to the Galaxy. It was a trilogy, too â&#x20AC;&#x201C; of four books.

Eventually the four book trilogy became ďŹ ve, but thatâ&#x20AC;&#x2122;s a whole diďŹ&#x20AC;erent point. Itâ&#x20AC;&#x2122;s a bit of gooďŹ ness for a serious business, one that relies on exacting precision. The company has landed a major contract this past year, surveying on

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the Enbridge Alberta Clipper project. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re anticipating another busy year, even with oil going low and the economy going to crap,â&#x20AC;? says Deke Baley, operations manager, matter-of-factly. The company was founded by his father, Ken Baley, who was a Manitoba land surveyor out of Winnipeg. He wanted to expand the operations for the company he was working for to Virden, but that was a no-go, so Trilogy was created, with the four of them â&#x20AC;&#x201C; Ken, Ian, Todd and Deke Baley. Most of Trilogyâ&#x20AC;&#x2122;s work was focussed on the oilďŹ eld. They would end up purchasing Lennon Surveys of Brandon, who work mostly in legal surveys. â&#x20AC;&#x153;We didnâ&#x20AC;&#x2122;t want to put all of our eggs in one basket,â&#x20AC;? says Baley. The company has three land surveyors on staďŹ&#x20AC; â&#x20AC;&#x201C; Ken Baley, the father who runs the show, Todd Baley, one of the sons, and Grant Watson. Ian Baley is project manager, while Deke Bailey handles operations. Thereâ&#x20AC;&#x2122;s one other brother â&#x20AC;&#x201C; Kyle. But he doesnâ&#x20AC;&#x2122;t work in the family business. Rather, he does computer work, in the Bahamas. Deke says, â&#x20AC;&#x153;He was the smart one â&#x20AC;&#x201C; must be doing something right.â&#x20AC;? Lynn, the mom of the pack, is a retired nurse. Sheâ&#x20AC;&#x2122;s able to put her medical skills to use as the safety co-ordinator. É¸ Page B15

13thAnnual Southeast Environmental & Safety Seminar Join us at McKenna Hall in Weyburn, SK Wednesday, March 18, 2009 for this informative one-day seminar on Environmental & Safety issues Featured Speakers John Grigg - Sask Watershed Authority Curtis Weber - Workerâ&#x20AC;&#x2122;s Compensation Board Randy Nygren - Ministry of Environment Steve Wallace - Sask Heavy Construction Safety Association Colin Steadman - Safety/Environment Tim Vandenbrink - Fire & Safety

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PIPELINE NEWS February 2009

B15

Keeping up on old relationships pays off ɺ Page B14 Starting as a rodman in 1993, Deke notes, “Before that, dad took you in the back yard and made you do everything.” The three brothers all worked on survey crews on pipelines in the early 1990s. Keeping up those relationships paid oﬀ now.

Ian’s been dealing with the Alberta Clipper and Southern Lights pipeline projects for Enbridge. “We did work on the Keystone line, south of Portage La Prairie to Morden,” Deke notes. “We had a crew up in Jasper for a year and a half,” he says, working on

the Kinder Morgan line through the national park. The company has grown substantially from its 2001 start, now with approximately 32 employees. “We’d go out, do the ﬁeld work, draft all night, and get the product out,” says Deke. ɸ Page B16

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SWIFT CURRENT Kevin Burton - Technical Service Rep • 421-3473 With a lot of their work around Virden, Lennon Trilogy Professional Land Surveyors has their own private survey marker just outside the ofÀce, allowing the GPS system to send out the proper data to Ànd exacting locations in the Àeld.

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PIPELINE NEWS February 2009

Expansion still being considered

A family operation, surveying was taught in the backyard before going in the Àeld for the Baleys. Three of four brothers banded with father Ken Baley to start Trilogy, and later Lennon Trilogy Professional Land Surveyors, in Virden, Man. Deke Baley is operations manager.

ɺ Page B15 During the summer months, they could have used a few more crews. They had two from Brandon, four from Virden, and three working on the pipeline, subbing through Tri-City.

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“We added three crews to do it,” Deke says. “We’re anticipating we’ll have enough work for them to keep going on regular oilﬁeld work. We’re looking at expanding.” That includes surveying for mining claims in northern Manitoba. But they don’t have to go too far to do mining work – just a little west and a little north, it turns out. Saskatchewan Party Leader Elwin Hermanson once said that dinosaurs had died on both sides of the Alberta/ Saskatchewan border, yet from some reason there was a lot more oil and gas development on the Alberta side. Similarly, the inland sea dried up on both sides of the Saskatchewan/Manitoba border. There’s a major potash mine just to the west of that line, at Rocanville. It follows there may be some potash east of it too. “We’re doing some potash work north of here,” he says. “You can see the [Rocanville] plant from where’ we’re surveying.” Asked if there might be a new mine, he says, “I think in the next ﬁve years, we’ll see one pop

up.” While there is likely potash on both sides of the border, working on both sides is another matter. In a highly regulated field, to work in Saskatchewan requires a Saskatchewan license land surveyor. “We do have an agreement with a firm to do some work in Saskatchewan now,” he says. It involves sharing resources and manpower between southeastern Saskatchewan and southwestern Manitoba. Manitoba Hydro is doing a lot of new construction of dams in northern Manitoba, and there’s ancillary transmission line work to go along with that. It takes people willing to go in the rough stuff and battle mosquitoes to do that sort of work. That’ll be in 40 above and also in the extreme cold. “It’s not a very physical job,” he says, but there’s a lot of walking. The crew chief does a lot of calculating, and there’s plenty of public relations work with landowners, consultants and environmentalists. “A city crew will be a half tonne and some equipment,” Deke says. “Ours will be one 4x4 with two quads on top.”

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PIPELINE NEWS February 2009

B17

A million acres: now just to squeeze the shale gas out of it Preeceville – With exploration permits spread throughout southern Saskatchewan, PanTerra Resource Corp has got one of the strongest land positions in the province for shale gas development. “We’ve got a million acres,” says Fred Rumak, president and CEO. Those acres have been earned by spending $12.5 million, drilling 36 wells and shooting seismic. “Everything’s been going okay,” Rumak says, but adds it is a long, drawn-out process. “We’re out in the field as we speak,” he explains, contacted in mid-January.” We’re in the completion phase, perforating, fracturing and testing.” All the wells at this point are vertical. “You don’t drill horizontalwells until you know what you’ve got vertically.” “Right now we’re in our Moose Jaw block,” he explains. Panterra’s project list, www.panterraresource.com/projects. html, indicates work at Foam Lake, Moose Jaw, and Shell Lake. However, those locations are a little off from where the action is really taking place. The Moose Jaw block, for instance, is actually in the area of Davidson, Craik, Elbow and Eyebrow, “All in that area,” he says, and has 16 wells. “We’re in the experimental completion stage. We’re getting ready to go into them in the spring time.” The Shell Lake block is actually closer to Spiritwood. “We did some geophysical work at Shell Lake,” he says, including seismic. There are three wells in that block, with nine townships centred around Spiritwood. As for “Foam Lake,” well, it’s actually closer to Preeceville, with wells right outside of the community. “We’ve got 20 townships there,” Rumak says. Other operators in

the Preeceville area include Nordic Oil and Gas and Hunt Oil. There are 17 wells drilled by PanTerra in the Preeceville area. “We have some initial results that are encouraging enough to go back in,” he says. Preeceville is not exactly oilpatch country. The amount of infrastructure there is minimal. But PanTerra has spoken to TransGas, and there’s ample pipeline capacity in area, they’re told. “It’s all timing and money, and money is hard to come by right now for a lot of people,” he says. Their capital was raised in the spring time, and they have some flow-through dollars. The company is “prudently spending to advance the project,” he notes. Some of those exploration permits are coming due relatively soon, in late 2010. “We have five years to convert,” he says, referring to conversion from exploration permits to leases. Shallow and steady The shale gas PanTerra is looking for is shallow. “Basically, they’re lower rate production, but the reserves last a long time,” Rumak says. A conventional gas well might have a five to ten year lifespan, varying on how it is produced. Northern British Columbia is getting a lot of press for its burgeoning shale gas play. BC is high impact, high risk and high reward, Rumak says. In contrast, Saskatchewan is lower impact, and lower risk, but longer reservoir life. To develop Saskatchewan’s shale, “The

horizontals may be the ticket,” he says. As for multi-stage fraccing, he’s not sure. “It would probably be.” “It gets very pricey. We’re hoping we don’t have to get into all that.’ The geology may allow for completions at less cost, that may not have as complicated a stimulation package as originally thought.

While PanTerra is out there, trying to get it started, they’ll be looking for some muscle at later stages in the game. “We’ll be looking for a partner once we get to a certain stage,” he says. “We can’t do it on our own.” “We’ve got to get someone serious, not Mickey Mouse.” He’s referring to a senior producer.

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B18

PIPELINE NEWS February 2009

Anticipating a busy summer

Arcola – Things may have backed oﬀ a little bit, but for TPZ Services Ltd. of Arcola, that means they might actually be able to breathe a little bit now. TPZ Services Ltd. is headed up by brothers Mike and Brent Heidinger. They provide general

oilfield hauling, including pipe, rods, casings and the like. “We stock anybody’s pipe in the yard that asks us,”Mike Heidinger says. The fleet includes four tractors, three pickers, four bed trucks and five one tonnes, working principally within 100 miles of home.

TPZ has about 22 on staff, working out of three shops in Arcola and on 70 acres of land. One shop is under construction, across the road from the main building. It will primarily be for parking vehicles. “We’ve been busy for five to six years.

It’s just been busier,” Heidinger says. Christmas, road ban season and the Calgary Stampede are about the only times they have seen a slowdown. “Our customers are talking 150 to 200 holes they’re going to drill. Between three customers, that’s 600 holes,” he

says, anticipating being busy all summer. He speaks of the troughs in the oil business, noting, “I’ve been through this before, in 1997. We felt that, we all did.

“Anyone new, fired up in the last year, could be in trouble. “We’re pretty solid now. We’ve been out there for for 13years. They guys we work for are awesome.”

Scott Birnie of TPZ Services, Arcola, sorts pipe on a cold January day. Photo by Brian Zinchuk

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PIPELINE NEWS February 2009

B19

Breaker fracs its ¿rst horizontal gas well near Provost Provost – Breaker Energy Ltd. plans to invest $80 million this year on a cash flow budget and continue its trend of delivering annual average production and production per share growth in 2009. The company’s original 2008 budget was set at $70 million. It was subsequently raised to $174 million. The company said its diversified high quality, year-round accessible asset base provides flexibility to expand beyond the $80 million projected 2009 funds from operations budget if economic conditions warrant during the year. Average production for 2009 is estimated at 7,700 bbls of oil equivalent per day with a year end production rate of 8,450 boe/d. The company continues to demonstrate success with its three major horizontal multi-frac resource

plays at Irricana, Provost and Fireweed, highlighted by a significant flow test at its first Provost horizontal. The company also completed it first horizontal multi-frac well in its extensive Viking gas resource play at Provost. The initial flow rate, with significant frac fluids left to recover, was approximately 2.5 mmcf a day. The well was drilled in 13 days and completed with seven successful fracs. Breaker said it has 80 potential horizontal drill locations in its extensive inventory at Provost, with a large operated infrastructure including a companyowned gas plant and gathering system in this all-season accessible area. Current production in the area is 1,100 boe/d. Breaker also acquired 460 boe/d in its fourth quarter.

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PIPELINE NEWS February 2009

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

C-Section

February 2009

Sand research could boost heavy oil productivity in horizontal wells By Geoff Lee Lloydminster – It’s back to the drawing board, but the initial results of laboratory studies by the Alberta Research Council using sand production to improve the productivity of heavy oil in horizontal wells look promising. The research, led by ARC scientist Brigida Meza, is based on the need to adapt the proven cold production recovery process of vertical wells to horizontal wells to boost productivity and cut costs. Cold production using sand has boosted the recovery rate of conventional heavy oil primary production to between five and 20 per cent in vertical wells equipped with special pumps. “We have the example in vertical wells whereby, if you produce sand, you can recover more oil and extend the life of the well,” said Meza. “The problem is if you produce sand aggressively in horizontal wells, the well gets blocked so you have to clean it and that gets too expensive.” Finding the right slot size in well liners, to match the grain size distribution of sand and fluid flow rates could reduce the need for costly sand cleanouts in horizontal wells. A controlled sand production strategy that increases the permeabil-

The Lloydminster Petroleum Society hosted a January learn and lunch featuring a talk by Alberta Research Council scientist Brigida Meza titled “Sand on Demand.” Photo by Geoff Lee

ity of the surrounding formation could help to optimize cold production in horizontal wells from unconsolidated heavy oil reservoirs. Meza updated guests on her controlled sand production experiments during the Lloydminster Petroleum Society January lunch at the Best

Western Hotel with her “Sand on Demand” presentation. “We are trying to see if we can control sand production and produce a small amount for a long time and get the beneﬁt of improved oil production and extend the life of a well,” explained Meza.

“There is a strong interest in the development of viable and environmentally sustainable bitumen/heavy oil recovery processes that are less energy intensive and use less water than steam based processes. “Injecting water or gas to increase the pressure of the reservoir or

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steam with bitumen comes with an energy cost. “It is important to try to extend the life of primary recovery because it’s less energy intensive and more environmentally sustainable. “With primary, you recover oil with the energy the reservoir has.

You don’t have to add anything to the reservoir to help ﬂuids come to the well. The research Meza is doing at ARC is aimed at increasing oil production rates and recovery factors through the managed production of sand. ɸ Page C3

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PIPELINE NEWS February 2009

New sand research could boost productivity in horizontal wells ɺ Page C1 Meza believes this approach has the potential “to mitigate the decline in oil production rates in horizontal wells “in a manner similar to cold production.” Meza’s project is based on the premise that a limited amount of sand into horizontal wells, small enough to avoid plugging, may help to increase the permeability of the formation around the wells leading to increased production rates. Meza used heavy oil samples from Husky Oil in Lloydminster to closely replicate field conditions in the lab studies. “We did the research in Edmonton with oil from Lloydminster because this is a very important heavy oil area,” she said. “This is where cold production was redeveloped in the 80s. Our main aim at (ARC) is to develop technology that can help Alberta.” The research focused on parameters such as the effects of slot size, confining pressure, fluid velocity and sand grain distribution on sand production and strategies for enhancing primary production in horizontal wells through managed sand production. In her presentation Meza reported that based on the project findings, it is possible to generate significant

increases in permeability around the well through controlled sand production. “This improved permeability includes a reduction of skin effects and the formation of high permeability channels,” Meza said. “It also highlights that with proper slot size selection and correct handling of production flow rates, that sand production could be managed. “This opens the possibility that primary heavy oil production with sand in horizontal wells could be developed into a technical and economic success.” The correct strategy Meza believes will help heavy oil producers to “increase oil production with reduced energy and a smaller environmental footprint with the secondary processes they are currently exploring. “The conclusion is that we need to continue investigating but it’s very promising,” she said. “It may be possible to do it, but you have to have the correct slot size and you have to handle your fluid flow rate correctly.” Meza noted that more research has to be performed to support the findings “especially with numerical modelling to forecast the impact of managed sand production on oil production rates.”

Scientist Brigida Meza, the guest speaker at the Lloydminster Petroleum Society January lunch helps Husky Energy host Ryan Roen with door prize draws. Photo by Geoff Lee Troy Illingworth Cell: (780) 808-3183 Tim Sharp Cell: (780) 871-1276

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PIPELINE NEWS February 2009

WaterÀood tool has raised the By Geoff Lee Edmonton - Oil has fewer places to hide during a reservoir flooding, thanks to Wavefront Energy & Environmental Services Inc. and its Powerwave technology. Powerwave uses an enhanced oil recovery process that is well suited for oil companies looking to maximize their oil recovery and productivity in new and mature waterfloods in the current economic downturn. Wavefront is a fluid injection technology company based in Edmonton. The company reported in December, 2008, that its year-long test using three of its patented Powerwave injector tools produced an additional 14,500 barrels of oil from 16 wells for a major oil company near Wainwright, Alberta. The test company earned a reported net return of $1.2 million from the Powerwave application. “Powerwave is an injection technology,” said Brett Davidson, president and CEO of Wavefront. “We all know that oil companies inject fluids to enhance production. Powerwave is an optimization technique. “Our technology is aimed at any flooding process. We have a means by doing the flooding operation, to access what we call bypassed oil trapped in nooks and crannies. Until Powerwave came along there weren’t many ways to get that

bypassed oil.” Powerwave technology is designed into a downhole tool attached to the end of an injection string of tubing. The tool generates pulses of water emitted from a valve that opens and closes similar to kinking and straightening a garden hose to move fluid in a more uniform and accelerated front. An electrical solenoid opens and closes the valve. “What this highly accelerated water does is – it doesn’t follow the path of least resistance,” explains Davidson. “It creates its own path. It opens up more flow paths to the injected water so the distribution of the injected water is greater. It makes greater contact with the oil in place, and over time, that means increased oil production from the overall reservoir.” Wavefront has orders for more than 100 Powerwave tools, some of which are now being used in a CO2 flood in the Gulf Coast of the United States. Sales reps have been fielding calls lately from companies in Syria, Venezuela, Saudi Arabia and all regions of Canada. “The reaction has been very positive,” said Davidson. “It all comes back to companies wanting to maximize oil recovery. “If you look at a heavy oil reservoirs in the Lloydminster area, companies are lucky to get 20 per cent recovery. If you come to a company and say ‘with Powerwave, you can increase your recovery to 30 or 40 percent,’ that’s significant.” Wavefront generates cash flow through the licensing of its patent. The company doesn’t sell any products. The minimum licence period is one year at a cost of $36,000 per tool. Clients also pay for their service rig time to install the tool that can pay for itself with the increased oil productivity. “I have had a lot of investors call me and ask what the price of oil has to do with Wavefront and at the end of the day, my answer is, companies are always interested in maximizing productivity and profitability regardless of the economic conditions,” said Davidson. “Powerwave gives them the opportunity to do that at minimal cost.” Davidson formed Wavefront in Lloydminster in 1997 in partnership with two professors with some early research focused on cold heavy oil production. When their Powerwave technology was developed, the first Powerwave project was with former heavy oil company Wascana operating in Saskatchewan. “Our roots have always been in heavy oil because that what we are most familiar with,” said Davidson. “Heavy oil is the most difficult situation for the technology to be applicable with. ɸ Page C5

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PIPELINE NEWS February 2009

bar on enhanced oil recovery Wavefront president and CEO Brett Davidson displays one his company’s patented Powerwave injection tools being used to enhance oil recovery and productivity in mature waterÁood. Photo courtesy Wavefront

ɺ Page C4 “That’s where we got our first results. Not only have we done field-wide stimulations like a waterflood, but we routinely do well stimulations or workovers on wells in Lloydminster and Saskatchewan. “We have a long history in the Lloydminster area on both sides of the border in the area of well stimulations and enhanced oil recovery.” Wavefront’s subsidiary company, Wavefront Sand Pumps & Rentals Ltd., located in Marsden, SK, is involved with well stimulations using Powerwave. Wavefront is predominantly involved in older waterfloods that have been going on for 10 years or longer but the company is also working on a new waterflood for a Calgary-based junior oil and gas company in Saskatchewan. The first generation of Powerwave tools was trucked on two 53-foot long trailers, but the latest model is a four foot long missile shaped object with a stainless steel body designed in various diameters from three to seven inches. “We are working on other facets of waterflooding too,” said Davidson. “We are looking at tools to pulse for steam applications. We have had a lot of calls from

companies that operate steam assisted gravity drainage applications (SADG) asking if the technology will work for applications injecting steams. We have used Powerwave in the past to fracture coal bed methane beds.” One of selling points for Powerwave is reduced operating costs. Powerwave allows companies to increase the rate they inject water without having to increase pump pressure and electrical output. With the valve on the Powerwave tool closed, energy builds up like in the kinked hose analogy, and when it’s open, there is an accelerated flow. That allows the reservoir to accept the liquid more readily and reduce the amount of pressure needed to inject the equivalent of fluid. “If you look at Powerwave compared to other technologies, it’s very cost effective,” said Davidson. “Powerwave gives the operator the ability to increase their yield from existing oilfields with very little investment. “If you want to get more oil, you could drill another well. Drilling is more expensive than trying to implement Powerwave to determine the upside potential on extra oil recovery.”

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PIPELINE NEWS February 2009

Marwayne lays the groundwork to grow with oil and gas

The No Need to Nock store, owned by Kari Rook-Whelan who stepped out for a photograph, houses the village’s mini-mall in a historic 1940 stone building.

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Photos and story by Geoff Lee Marwayne –If first impressions count, the Village of Marwayne, located at the crossroads of Highway 45 and Hwy. 897 on the Lloydminster-Cold Lake corridor, scores strongly on many fronts. But don’t take our word for it. Last summer, Marwayne took part in an exercise called First Impressions Community Exchange (FICE) with visitors from the town of Weskatanau who found Marwayne to be a clean, friendly and vibrant community. “In their initial impressions, they noticed what lovely flowers we had; they loved

our signage; they liked our wide streets and thought our entrances were attractive,” said village CAO Joanne Horton. “They liked the customer service from businesses and felt very welcome.” The out of towners’ impressions were music to the ears of Mayor Jenelle Saskiw who is working with council and community groups to implement the key initiatives of a new Marwayne Sustainability Plan for the future approved in October, 2008. The plan stresses the need to develop and market a new industrial park, serviced residential lots and small town core values to attract new oil and gas, agriculture and retail businesses and families. “Councils come and councils go, and we wanted to make a plan so that things could keep rolling 20, 40 and 50 years down the road,” said Saskiw. “The number one priority is to get the south industrial subdivision going. Once we have that, everything else will fall into place. “Having a new industrial park can really increase our business base and keep this community vibrant. We are a young community and it’s essential that we get this park up and running so we can maintain the longevity of the community.” ɸ Page C7

PIPELINE NEWS February 2009

Planning on growth of oil and gas sector ɺ Page C6 Marwayne annexed a quarter section of land from the County of Vermillion River in July, 2008, to add 51 muchneeded industrial lots.

new land,” said Horton. “We know we are lacking in our non residential assessment. We need the added tax base so people can live and work here. “We are just starting

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to determine the target market of the new subdivision,” said Horton. “We are thinking it’s oil and gas service companies but we don’t know for sure. We are just in the process of doing the planning for the subdivision. “We are checking on the pricing and asking what people can afford and what do people want. Do they want fully serviced lots or partly serviced? We have to determine how to ﬁnance this and determine what the market will dictate. We are grappling with all that. “Interest in lots is coming from oil and gas service industries. They want to locate here because Marwayne is on that corridor between

We are just starting to determine the target market of the new subdivision

Cheryl Eikeland who owns the historic Marwayne Hotel built in 1926 hams it up with village CAO Joanne Horton. The interior of the hotel is Àlled with historic photographs of Marwayne.

The lots will be sold by the land owner and the village will determine how to finance servicing in the coming months. “Council identified the need to find some

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Cold Lake and Lloydminster. “We have several oil and gas companies here. They are located in the county but they are strong Marwayne supporters.” Marwayne’s major employers include Arc’n Spark Welding, ITS Contaminated Transport, Riverhill Enterprises Ltd., T & T Oilﬁeld Services Ltd., and Cargill Limited. Mayor Saskiw says the village is looking to grow its agriculture base “but oil and gas would be perfect because we are that corridor from Lloydminster to Cold Lake.” Marwayne is also one of the few communities in oil and gas country with an abundance of serviced residential lots. There are 22 available lots in the Marwayne Estates Subdivision where prices range from just $25,000 to $52,000. Lots are tax-free for the year they are purchased. ɸ Page C8

PIPELINE NEWS February 2009

First impressions have been leaving their mark ɺ Page C7 “Last year, we had six new houses built. For a town with only 225 houses, that’s a lot of new houses,” said Horton. “We are hoping we have enough inventory for a few more years.” New housing includes a mix of single detached homes, mobile homes, RTM homes and a rental duplex that is new to the market. Marwayne has a population of 569 and has been growing by five per cent a year, just higher than the provincial average. The community boasts a modern K-12 school, a seniors’ residence, a public library, a volunteer fire department and a community hall. Recreation facilities which are run by volunteers from the Marwayne Agriculture Society include an arena, a curling rink, an outdoor skating rink and tennis courts.

“

“We have great recreational facilities” said Saskiw. “Our vision is to see a recreational area developed in the south part of town. Everything would be a one-stop shop from a new or improved community hall to our ball diamonds, hockey rink and curling rink all in one (centralized) area. “We are a young vibrant community so I think if anybody came in and had a look what is offered here, they would be very excited about moving here.” “We have been asking newcomers why they relocated here - Joanne Horton and they say it’s because this is a friendly place,” added Horton. “Because of FICE, I can tell you what people’s first impressions are of our town. The first impression is that we are busy and our businesses are active and we are friendly.” ɸ Page C9

Because of FICE, I can tell you what people’s ﬁrst impressions are of our town. The ﬁrst impression is that we are busy and our businesses are active and we are friendly

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Mayor Jenelle Saskiw holds up a report of positive Àrst impressions of Marwayne recorded by invited visitors from Weskatanau last summer.

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PIPELINE NEWS February 2009

Working to expand ɺ Page C8 The FICE report card has led to actions plans for Marwayne’s sustainability blueprint to identify opportunities for new retail stores, downtown revitalization, tourism and heritage attractions and recreational facilities. “The next step in planning concerns recreation,” said Horton. “The community will have to come to the table and tell us their priorities and ask how we can make this work.”

Marwayne Mayor Jenelle Saskiw brought her young daughter, Orysha to work to demonstrate her town is a young and vibrant community.

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PIPELINE NEWS February 2009

Ninety-six teams to sweep into Lloyd for the 42nd heavy crude bonspiel By Geoﬀ Lee Lloydminster-Throwing rocks at the house can be relaxing or competitive. These are the two ways curlers can approach the 42th annual Lloydminster Heavy Crude Open Bonspiel to be played March 11 to 15 at the Lloydminster Curling Club.

This is one of the biggest open oilﬁeld bonspiels of the season and it attracts competitive and recreational curlers from all parts of Alberta and Saskatchewan vying for trophies and just plain fun. Among the serious curlers is organizing chair and defending A-event champion John Stanyer, who

First Truck Centre was the winner of the B-event. The tournament will celebrate its 42nd season March 11-15 at the Lloydminster Curling Club with up to 96 teams of competitive and recreational curlers. Photo by B&R Photography Ltd - Lloydminster

“

works for works for Weatherford. Over the years, it’s Stanyer plays third on a rink skipped by Doug built up a following -JohnStanyer Zingel from Wild Rows Pump Services Ltd., along with second Martin Code from Husky Oil Ltd. and lead Doug Larson from Devon Canada Corporation. “Doug Larson and I have curled together for four or five years and I’ve curled with Doug Zingel several times,” said Stanyer. “We have to come back and defend our title. Hopefully, we will win all of our games.” Stanyer has also won the Maidstone Oilmen’s Bonspiel in past years with other curlers. He plays three times a week in league play up to Christmas and twice a week the rest of the season. He says at 50 it’s getting hard to curl, let alone win. Ninety six teams will play off this year, the same as in 2008, but down from the all-time high of 112. To enter, 100 per cent of a player’s income must come from oilfield employment. “Over the years, it’s built up a following,” said Stanyer. “Last year, we had trouble attracting teams for some reason, so we cut it back to 96. This year, we decided to do that again. “One of the reasons we did that is to hold all the curling in Lloydminster instead of having to include another rink out of town. With everything at one venue, it’s easier to manage.” The bonspiel is a tournament format and each team is guaranteed four games in eight respective events with the serious curlers like Stanyer duking it out in the A and B events. ɸ Page C11

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Lloydminster Heavy Crude bonspiel

John Stanyer, played third on winning A-event team of Weatherford BMW in 2008. The team will be back to defend its title. Stanyer, chair of the upcoming 2009 Lloydminster Heavy Crude Open Bonspiel, Photo by B&R Photography Ltd - Lloydminster

ɺ Page C10 “The way it works, if you lose your ﬁrst game, you drop down to the second event. If you lose your second game you can drop into the third or fourth event etc. If you lose your fourth game you are out of the spiel,” he explained. “We give prizes for the ﬁrst four positions in each event. The prizes we get from companies we use as door prizes. Entry fees are used to purchase prizes too. If we have anything left over, we can donate to the curling club and we have done that.” Stanyer’s main role on the organizing committee is to handle the registration and invoicing. When contacted in mid-January he admitted he was leery about entry numbers because of the economy. “Time will tell on that,” he said. “We can’t really get a handle on it until we see how the entries are doing. “We’ve had teams from Calgary and Edmonton and Kindersley

and Elk Point. It’s a good economic boom for the town. You get guys staying at the hotels. We have had good representation from oil companies. It’s a chance to do some networking but everyone at that time of the year is looking at having a good time and relaxing. No sales are taking place. “The March 11 start is a good time for bonspiel. You’re getting into break-up. Usually the oil companies have had a pretty good run through the year and it’s a time to relax a bit.” One of the highlights of the event is the annual banquet and a presentation to the oilman of the year who is yet to be announced by the organizing committee. The oilman of the year is also feted during an opening ceremony the evening before the banquet. More than 700 people are expected to attend the awards banquet at the Stockade Convention Centre.

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PIPELINE NEWS February 2009

Crescent Point boosts its Bakken resources with Villanova purchase

By Geoff Lee Calgary – Crescent Point Energy Trust has strengthened its presence in the Bakken play in southeast Saskatchewan with the completed acquisition of Villanova Energy Corporation in midJanuary.

Look both ways One of the busiest intersections in Lloydminster for oilÀeld and industrial truck trafÀc is this turnoff from Highway 16 to 62 Ave. leading to one of the city's main industrial parks on the Alberta side of the border. Photo by Geoff Lee

Villanova is currently producing approximately 1,750 boe/d of high quality light oil in the Bakken. The acquisition increases Crescent Point’s total undeveloped land holdings in the Bakken to 416 net sections with the addition of Villanova’s 26 net sections of undeveloped Bakken land. Ninety-ﬁve percent of Villanova’s oil production is in the southeast Saskatchewan Bakken play. The deal also provides Crescent Point with further economies of scale through Infrastructure utilization and increased netbacks through tie-ins to Crescent Point’s Viewﬁeld gas plant. Crescent Point currently has more than 10 years of drilling inventory, equating to more than $1.8 billion of development capital projects to

maintain current production. The Villanova acquisition was ﬁnalized for a total consideration of 4.625 million of Crescent Point’s trust units plus the assumption of approximately $23.6 million of Villanova debt. Total consideration is approximately $123.1 million based on a value of $21.51 per trust unit.

PIPELINE NEWS February 2009

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PIPELINE NEWS February 2009

Hurry hard and register to the The Granite OilÀeld Services team won the A event of the 2008 Maidstone Oilman’s Bonspiel. The event was sponsored by Keranda Industrial Supply. Left to right are Mike Armstrong, Tyson Armstrong, Mickey Armstrong and Monte Armstrong. Photo courtesy Danica Lorer

By Geoﬀ Lee Maidstone - Hurry hard and register today for the eighth annual Maidstone Oilmen’s Bonspiel March 4 to 8. The Maidstone Curling Club can handle up to 28 teams and will welcome back last year’s Aevent squad skipped by Monte Armstrong, one of the owners of Granite Oilﬁeld Services Inc. in

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Lloydminster. “It’s a good little spiel. It’s lot of fun,” said Armstrong who is also on the executive of the Lloydminster Curling Club. “When you play in a small town bonspiel there’s a good atmosphere. They put on a good event and it helps their curling club. It’s important to support those.” Aside from Lloydminster curlers like Armstrong, the bonspiel attracts teams from Unity, Turtleford and St. Walburg. Cal Donald, the ice maker, wants readers to know it’s one of the more fun bonspiels. It’s also a major fundraiser for the curling arena which has just three sheets of ice and needs some TLC as the rink is showing its age.

“We’ve ﬁxed our rocks. We bought a nipper (ice maintenance tool) for the ice and used proﬁts for general improvements to the curling club,” explained Donald who gets lots of practice making perfect ice for the oilmen’s bonspiel. “We have our regular curling and we have an open bonspiel, a ladies’ bonspiel and a youth bonspiel so it keeps you busy. I also work at the Lloyd curling club too. It’s a full time job. I also farm.” To qualify, each team has to have three of its four players work for an oil-related company. Mixed teams are welcome. The entry fee is $250 per team and each team is guaranteed three games. ɸ Page C15

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The 2008 Maidstone OIlmen’s Bonspiel included a few chuckles courtesy of comedian Jody Peters who performed at the banquet. Photo courtesy Danica Lorer

PIPELINE NEWS February 2009

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Maidstone oilmen’s bonspiel ɺ Page C14 “We normally get anywhere between 24 and 32 teams but we are shooting for 28,” said Scott Owens, president of the curling rink and tournament committee chair. “It makes for an even draw and we can handle that many teams. We’ve ﬁlled it mostly every year.” By contrast, the Lloydminster Heavy Crude Open Bonspiel that follows Maidstone, March 11 to 15, has 96 teams on eight sheets of ice. The entry fee for the big Lloyd event is $400 per team. The Maidstone Oilmen’s bonspiel is the only oil-related tournament of the year in town and Owens notes it’s good for the community and the curling rink too. He thinks the economic downturn will have little bearing on tournament entries. “I don’t think the economy will have a negative impact on the tournament,” he said. “If anything, we will get more people interested in curling if they have a lighter workload.” Donald says the bonspiel is a boon for motels, hotels and restaurants in town. “People stay over and they support the restaurants. Our lunch counter at the arena does very well too,” he added. “We have a bar and a live Calcutta auction. We auction all the teams oﬀ so people can do a bit of gambling. People guess who is going to win the bonspiel. We have a banquet on the Saturday night with a comedian or a hypnotist. So it’s a full weekend. There are trophies and prizes every year. There are nice prizes. “It ends on a Sunday and the Lloydminster bonspiel starts on the following Wednesday, so it’s a good warm up for Lloyd bonspiel. Some guys like to warm up and play at Maidstone then they are ready to play in Lloyd.”

Mickey Armstrong Àres a rock with sweeper Mike and Tyson Armstrong ready to brush the stone to the mark. Photo courtesy Danica Lorer

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PIPELINE NEWS February 2009

Fraccing proves its worth globally By Geoff Lee It’s the frac being heard around the world by Packers Plus. The completions technology company is applying its multi-stage fracing technology throughout the world as oil and gas companies learn how it re-energized the oil and gas industry in tight formations like the Bakken and the James Lime. Packers Plus has completed open hole multi-stage fracs for companies in West Africa, Mexico, the Middle East, Romania, Argentina and most recently for Petrochina and another client in northern China in partnership with Schlumberger announced in December. “We took our multi-stage fracing equipment over there in conjunction with Schlumberger,” said Jim Athans, Packers Plus international operations manager in Houston, Texas. “We did some continuous stage fracing for Petrochina and we enchanced their production. “Schlumberger is the one that approached the Chinese oil companies and showed them this new completions technology just like we are using in other parts of the world. “It is really enhancing their gas production. They are getting it back tenfold.” In a December news release, Athans described the project as “a textbook job and the entire well operation went very smoothly. The well exceeded the customer’s expectations.” Packers Plus multi-stage fraccing system, greatly increases the effectiveness of acidizing and fracturing operations by producing a distributed placement of stimulation fluids throughout the horizontal zone. “If you are planning on doing an acid frac or a sand frac you want to do a continuous operation to save you some rig time,” explained Athans. “What you are doing is individually fraccing each zone. Therefore you are getting a better penetration instead of doing several zones at one time where you are limited on your penetration because as you know fluid will go to the least resisted area.” The Packers Plus foray into China in follows close on heels of a open hole completion in Romania noted earlier in 2008. Oil and gas companies in Indonesian could be next in line in 2009. “We have achieved success across North America this year and have found that our technology is becoming widely accepted in the marketplace,” reported Packers Plus president Dan Themig in a news release. “Because of this we are seeing that translate into more international work as well. “As we complete more wells in different formations across the globe, we continue to demonstrate the versatility of our technology. This results in high-value production

results for the customer.” Working internationally is also helping Packers Plus to stay busy and competitive in an economic downturn. “If you look back on your downturns, you will see that international business has stayed up,” said Athans. “We are focused on Canada and the U.S. as well. Our work has not slowed up. Our company doesn’t anticipate this downturn to last very long. We are still gearing up and we’re still in the hiring mode. Everyone (globally) has plans to extract more oil and gas. “In the Congo we are using our technology for oil and in china it’s oil and gas. In Argentina it’s gas. You can use it for oil and gas. It works in tight formations and other formations. You’re going in and fracturing the zone and opening it up.” Today, Packers Plus technology is also proving itself in formations such as the Montney, Barnett Shale, Marcellus and Shaunavon and other ﬁelds throughout the world.

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PIPELINE NEWS February 2009

C17

Lloydminster weathering the economic storm better than most By Geoff Lee Lloydminster - Lloydminster could be the best place to shelter from the economic effects of low oil prices, a slump in housing starts and rising unemployment that is having a big impact in other parts of the country. The buzz on the street is that Lloydminster is weathering the economic storm better than most places so far. Ward Read, the city’s community development officer and leading real estate personalities, Scott Musgrave, from Musgrave Agencies Ltd., and Keith Weinbender, broker and co-owner of Century 21 are among those who support those convictions. Here’s a selection of some of their statements and opinions on the local economy and the impact of the oil and gas economy on real estate in Lloydminster. Ward Read Community development officer, City of Lloydminster “As we have seen, with the price of oil going down, drilling activity has been reduced. We have to see how Alberta’s new royalty structure plays out in the long term. We are relatively doing quite well compared to the rest of the world.” “The retail sector shows good strength. By the spring, new retail developments will take place at the Power Centre at the west end of

Lloydminster.” “In October (2008) we were named by the Canadian Federation of Independent Business and the Financial Post as the number one community of any size in Canada for small business. A lot of our oilﬁeld service businesses would ﬁt into that small business type.” “Permits for renovations and improvements in residential, commercial and industrial properties were up with this year (2008). “I am still getting calls from investors in Ontario and so forth about multi-unit residential real estate.” Construction continues on a new condo development at the west end of Lloydminster. ɸ Page C18 Photo by Geoff Lee

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C18

PIPELINE NEWS February 2009

Lloydminster continues strong growth

Lloydminster continues to show strong growth commercial and retail real estate. Another new retail store is under construction at the new Power Centre across from Home Depot on the west end of the city. New construction is expected this spring. Photo by Geoff Lee

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more even marketplace between buyers and sellers. Buyers have been cautious because they have a lot to choose from. A year and a half ago, you may have had a choice of ﬁve homes. Now you have a choice of 20.” “If you have to be anywhere to ride out the slower economy I can’t think of any other place to be.” Scott Musgrave – Musgrave Agencies Ltd., real estate & development “In Lloydminster, we are tied to the oil patch. As the oil patch slows down, so does real estate. “In terms of values, the values have dropped since the peak in 2007, but they are still above where they were in 2006 and

the year previous to that. Sales in January 2009 will not exceed 2007 (for the same month) for our ﬁrm, but they will exceed that of other years. Sales have slowed down but it’s not a crisis.” “About 25 per cent of our clients are in the oil patch.” “We haven’t seen any repossession of a house or panic in house sales. I think the fear of the stock market has more eﬀect on real estate than the price of oil. The best dollar for oil we had was last spring. That should have been our best time for real estate if it were an embedded relationship. In 2007, there was an attitude that the best thing to invest in was real estate.” ɸ Page C19

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Keith Weinbender – Broker and co-owner Century 21 “Real estate hit its peak in the fall of 2008. We have seen a 10 per cent adjustment since that time. It is hard to judge where we are at. This time of the year is our slowest time even when things are really busy.” “We have noticed is that things have started to pick up again in the last few weeks. Buyers are starting to buy. There are some good deals out there. It’s been a buyers’ market for the past few months.” “In 2009, I am looking at getting back to a

PIPELINE NEWS February 2009

C19

New retailers looking into building in Lloydminster in 2009 “In 2008, we dealt with more traditional buyers instead of speculative buyers. In terms of overall sales, 2008 was good and was the second best in terms of pricing.” “Commercial development is as strong as

it’s ever been. We have new retailers looking at Lloyd. We have sold six raw lots in January (2009) to people who want to build homes.” “Apartments are still hard to ﬁnd today. There is a future need for oil. At some point, that price

will be strong again. We are the third youngest community in Canada. Employment income is higher than the national average. It’s a solid community. Over the long haul, Lloydminster is one of the best investments in Canada.”

New home construction New home construction has slowed along with the economy, but builders are using the cooling off period to catch up on a backlog of single home starts in 2008. Permits for renovations for all types of properties rose signiÀcantly in 2008. Photos by Geoff Lee

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C20

PIPELINE NEWS February 2009

Steam usage drives demand for By Geoff Lee Lloydminster –Lakeland College’s heavy oil operations technician program continues to generate steam for students on a number of employment fronts, particularly in the heavy oil sector, despite a noticeable cooling of the economy. That’s the opinion of HOOT program head, Ian Kossey and power engineering instructor, Terry Hagell who had a bit of breathing room in January with students on practicum, to speak about job prospects for students. “Even with oil coming down, these oil facilities are not going to turn off the switch and shut down,” said Kossey. “The students taking the course are looking at the long term. The demand for these jobs is still there. “I just got an e-mail from Esso. They are looking for 48 people right now. About 20 jobs are for oilfield positions involving some work with steam and 28 positions working in oil plants.” The HOOT program trains students in the basics of electricity, process control/instrumentation, thermodynamics, steam generation and water treatment combined with heavy oil operations . Those who pass the provincial 4th class power engineering exam can obtain high-paying entry level jobs in refineries, hospitals, oil and gas facilities, power generating plants, and pulp mills. “We’ve go 40 students in our program consistently,” said Kossey. “It’s over-subscribed every year by double that. It’s a unique program. The course combines both power engineering and heavy oil courses. “You can get into oilfield maintenance, operating plants and batteries and you can get into pulp and paper or into a school or a hospital. You can get into a lot of careers with this. About 60 percent of the course is power engineering, and using that, you can work wherever they make steam.” Graduates can earn more than $60,000 in their first year training Power engineerto operate and maintain a variety of industrial equipment like boilers, ing student Trent turbines, generators, pumps, compressors, pressure vessels and comRawluk takes plex controls. notes while inThey head into the workforce with certification for defensive drivstructor Terry ing, first aid, CPR, H2S, confined space entry, WHMIS and transporHagell checks tation of dangerous goods. gauges on the “You can come out of this course with very little investment for Lakeland College laboratory time and money and go out and the return on your money is phenomsteam turbine. enal,” said Hagell who worked for Husky for 19 years before joining (submitted) the power engineering faculty this school year. Hagell says with Husky, new HOOT grads assigned to operations might work on the oil side or the steam side with thermal floods. With the upgrader, they could be working on one of the process units, the distillation units or the hydrocracker or hydrotreater units. “The industry is crying for good skilled people that have the right attitudes,” said Hagell. “What companies are looking for in attitude are people with the ability to work on their own and in a team role. You have to have the attitude that you will keep learning. “What they require now at most of these plants is a 3rd class power engineering ticket. What they do with new hires is have them sign a learning contract to meet expectations. Two of those expectations would be to upgrade to a 3rd class and be qualified to work in a unit that you’ve been assigned to train in. ɸ Page C21

Ian Kossey, head of the Heavy Oil Operations Technician program at Lakeland College, says job prospects for students are strong thanks in part to the growing use of steam to recover oil.

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PIPELINE NEWS February 2009

Lakeland College H

C21

T grads

ɺ Page C20 “If you are working at the hydrocracker at the upgrader, you are working with 22,000 kPa of hydrocarbons mixed with hydrogen at 430 C. You need to know what you’re doing.” While some oil companies have laid oﬀ employees, Hagell thinks low commodity prices and the global recession will have little impact on the demand for HOOT graduates. Students Terry Peters and Tanner “The amount of energy we use keeps increasing and the amount of Pidwerbesky energy that’s out there in fossil fuels keeps decreasing,” he said. “They work on an asare talking about other sources of energy like nuclear power, but it’s all signment in the using the same type of equipment. There will always be jobs no matter boiler room lab. what the source of energy is.” (submitted) Kossey meanwhile, says another factor behind the continued recruitment of HOOT grads by the heavy oil sector is the growing use of steam for enhanced oil recovery. “As long as we have a demand for oil, steam is good, he said. “Power engineering and SAGD (steam assisted gravity drainage) is going to be increasing. It’s the way of the future as far as getting the oil out of the ground. “It’s all about recovery rates. Right now, we recover about seven to 10 per cent of heavy oil with cold oil production. With steam, the recovery rate can go as high as 30 to even 60 per cent depending on the formation.” HOOT uses a working boiler at Lakeland as a teaching tool. “We get students to run it,” said Kossey. “It’s not a huge scale but it’s a good starting point to teach them what power engineering is all about. “The practicum is important. Students are out in the ﬁeld and are getting their steam time. They come back in April for another four months of class time. We have the lab, but for them to see all of the equipment that they will eventually be working on, brings it all together.” 24 HOUR SERVICE

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C22

PIPELINE NEWS February 2009

Encana posts $500,000 reward for tips on B.C. bombings Calgary – EnCana Corporation is oﬀering a huge cash reward of up to $500,000 for information leading to the arrest and prosecution of whoever is responsible for four bombings of EnCana pipelines facilities in the past three months near Dawson Creek, British Columbia. The most recent bombing occurred on Jan. 4, at a metering shed on an EnCana well site south of Dawson Creek. Two of the bombings, under investigation by the RCMP, occurred at pipelines and one at a well head. “The safety of our workers and the people who live in the communities where we operate is of paramount importance,” said Mike Graham, EnCana’s executive vice-president & president, Canadian Foothills division in a news

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release. “That’s why we are putting up this reward to help stop these bombings and end the threat that they pose to people in the Dawson Creek area. “Whoever is responsible for these bombings has to be stopped before someone gets hurt. We hope this reward will encourage anyone who has knowledge of those responsible for the bombings to come forward and help put an end to these dangerous attacks that threaten the well-being of our staﬀ, those who work for us and the residents and communities in the Dawson Creek area.” Anyone with information about these bombings who want to qualify for the reward are encouraged to contact the RCMP.

Business For Sale

J-Dub Oilﬁeld Services Located in Kyle, Saskatchewan

$575,000

ON HOODED SWEATSHIRTS (with the purchase of 24 or more)

Business provides steam boiler service for cleaning, unclogging etc, in both the oil ﬁeld and frozen culverts.

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EQUIPMENT AND INVENTORY:

1986 Ford 6000 cab over 5 speed diesel, 200,000 kms, air over hydraulic brakes, 24’ insulated van body, tire chains, inside van body, 30 horse Saskatoon boiler, 11 HP 3,000 psi Honda pressure washer with hose and fittings, 750 gallon water tank, 250’ of steam hose with fittings 1991 IHC 4700 5 speed diesel, 255,000 kms, 16’ van body, inside van body, 30 HP Saskatoon boiler, 300 gallon water tank, 250’ of steam hose with fittings

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2003 Glycol trailer 100 gallon glycol tank, 740,000 BTU burner, 100’ of hose with ﬁttings, roughneck heater, 6,500 watt generator (new) 100 gallon slip-tank with 12 volt pump 2000 Kenworth T300 6speed, 24ft van body, 15 horse Saskatoon boiler, kubota generator.

LAYOUT: Parking lanes, ofﬁce, mezzanine, bathroom

MECHANICAL: Natural gas heat (Gordon Ray heaters), town services

FEATURES: • excellent building on 3 lots • gravel parking • work lined up for winter of 2009 for all 3 trucks. • 2 workers with boiler tickets ready to work • business contact list available • local RM of Lacadena work available Other companies in the area are: • Husky • Enerplus • Grizzly • Flagstone • Action Energy

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PIPELINE NEWS February 2009

C23

Canadian Phoenix to rise higher from the ashes of the economy Calgary – Canadian Phoenix Resources Corp. is coming off what CEO Thomas Stan says in his guidance statement is “its most exciting quarter” and has set a capital budget of approximately $37 million in 2009 with estimated cash flow of $8 million. “Canadian Phoenix has cash in the bank, undrawn credit lines, and a structure that will enable us to continue to consolidate companies and assets,” stated Stan. Canadian Phoenix’s production forecast for the year is approximately 2,389 bbls of oil equivalent per day comprised of four per cent light oil and natural gas liquids, 29 per cent heavy oil and six per cent natural gas. “While both the financial and commodity markets have been going through a turbulent period, it is a time of opportunity and we appreciate the ongoing support of our shareholders,” said Stan. Stan says Canadian Phoenix plans to grow in 2009 by “actively pursuing acquisition opportunities as juniors are forced to either seek creditor protection or sell off key assets to stay in business. “As they are brought under the Canadian Phoenix umbrella, we can and will provide the capital and technical expertise to incubate these businesses for a liquidity event in the future, at a time of higher commodity prices and improved market fundamentals.” In the third quarter of 2008, Canadian Phoenix made news with the acquisition of a 50.01 percent investment interests in Serrano Energy Ltd. and a 56.51 percent interest in Marble Point Energy Ltd. Marble Point’s operations are focused on shallow natural gas production in the Dodsland area of Saskatchewan. The company purchased approximately 1,000 BOE per day of production in the Dodsland area in April 2008 through two separate transactions. In the third quarter, Marble Point drilled 20 natural gas wells on the property adding production of 225 BOE per day. The average production for the three months ended Sept. 30, 2008 was 1,712 BOE per day (93 percent natural gas). Marble Point intends to further develop these lands through down spacing and the drilling of additional wells and is currently drilling an additional 120 wells on the lands it acquired and from its own drilling inventory, at four wells per section spacing.

In light of the current economic uncertainty and ﬂuctuation in commodity prices, Marble Point is focused on future prices before deciding on its 2009 capital program. Marble Point also has cash in the bank and a $42 million credit facility with a chartered bank which has been partially drawn to repay that debt. Serrano’s operations are focused on heavy oil in the Lloydminster area of Saskatchewan and it has an interest in the Blackrod area on the southern end of the Wabiskaw oilsands deposit south of Fort McMurray. By the end of the third quarter, Serrano had drilled 49 wells in 2008 and was averaging production of 826 BOE per day for the quarter. Serrano minimized capital spending during the fourth quarter and activity will be restricted to only those commitments it had previously entered into in 2009 given low commodity prices. Serrano raised $7 million through a ﬂow-through share private placement which closed Nov. 19, 2008. In addition, Serrano has agreed to transfer, pending regulatory approval, a 15 percent working interest in the Blackrod oilsands leases to Pearl Exploration and Production Ltd. in exchange for certain capital commitments and the return to treasury of 4.04 million Serrano common shares held by Pearl. Following the completion of the private placement and the transaction with Pearl, Canadian Phoenix will hold 56.5 percent of the issued and outstanding shares of Serrano. Canadian Phoenix completed a workover on a well in the Campbell area of Alberta that increased production to approximately 235 BOE per day. The company is also currently engaged in an exploration program with industry partners to participate in the completion of two exploration wells, drill two more exploration wells, and shoot a three-dimensional (3-D) seismic program in the Samson area of central eastern Alberta. Canadian Phoenix will also participate in the drilling of three more exploration wells - one in the Klua area of British Columbia, one in the Parkland area of Alberta and one in the Fourth Creek area of Alberta.

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ATV / SLED DECKS Adjustable width decks also available • Easy to load & unload • Reversible ramp for your snowmobile & quad • High quality brushed aluminum requires no maintenance • Rounded headache rack • 4 side LED lamps • Super Clamps Included • Strongest (and longest) ramp system on the market

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C24

PIPELINE NEWS February 2009

Penn West focuses drilling in Shaunavon area By Geoﬀ Lee Shaunavon – Penn West Energy Trust will focus its 2009 oil drilling program on its productive Lower Shaunavon resources in southwestern Saskatchewan on reduced corporate spending between $250 million and $325 million in the ﬁrst

half of 2009. “The primary drilling focus in Saskatchewan will be in the Shaunavon area,” said Penn West CEO Bill Andrews. “We started already.” “We’re basically continuing a program that we’ve had ongoing for awhile. We will have one

or two rigs drilling in there full time over the next year. The plan this year calls for about 35 to 40 new wells to be drilled. That’s about the same as last year. “We like the area. It’s lighter oil and it’s a decent production rate. We will use horizontal drill-

R.B. (Rick) Kenderdine President Eight Nine Units Serving the Saskatchewan and Manitoba Oilfields for Over 20 Years Suppliers of: A) Topco/Weatherford Float Equipment CTE Float Equipment

ing and multi frac completions.” The plan to “aggressively develop” the Lower Shaunavon is in keeping with the company’s plans to emphasize low-risk projects with a focus on low-cost volume additions through production optimization and low to medium risk drilling favouring light oil and natural gas over

heavy oil. “Shaunavon is a play that was developed in the last three to five years and it’s seen a lot of activity,” said Andrews. “Four or five companies are active in the area.” As for generating cash flow, Andrews says Shaunavon “is good that way.” Penn West’s first half capital spending budget for 2009 is a reduction of approximately 50 percent from first half 2008 capital expenditures. The trust also announced a cut in its distributions to 23 cents per unit from 34 cents subject to changes in commodity prices, production levels and capital expenditures. Penn West said in its cap-

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ital spending news release that it anticipates its 2009 capital expenditures will total between $600 million and $825 million. Records show 2008 capital spending likely exceeded $900 million. In announcing its 50 per cent reductions to first half spending this year, the trust stated industry costs have not yet declined to the same extent as commodity prices. The company plans to limit its near-term capital expenditures until supply and service costs are more reflective of current commodity pricing. Penn West said it is positioned to maintain financial flexibility as it evaluates opportunities available to it in 2009 and beyond. “We always have a reasonable (drilling) program in and around the Kindersley area so we will continue that,” said Andrews. “Up in Lloydminster area, we won’t be doing a lot of drilling but we will be doing a lot of optimization work.” ɸ Page C27

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PIPELINE NEWS February 2009

C25

Oilsands Quest working its Axe Lake and Raven Ridge properties By Geoﬀ Lee Axe Lake – Oilsands Quest Inc. resumed work in January on its overburden study and reservoir test activities at test sites 1 and 3 at Axe Lake in northwest Saskatchewan. The project follows the preliminary engineering of a 30,000 barrel of oil per day commercial project reported in Pipeline News last August. Building facilities and key equipment are now in place for phase one of the test program at the test site 1, including power and steam generators, water treatment handling equipment and process control facilities. The company is leading the establishment of Saskatchewan’s emerging oil sand industry in addition to developing its contiguous Raven Ridge bitumen properties in Alberta. McDaniels & Associates Consultants Ltd. estimated the total discov-

ered and undiscovered oil at Raven Ridge and Axe Lake combined at up to 6.5 billion barrels in 2008. Oilsands Quest properties cover more than 730,598 acres over two provinces. The company also has more than 489,730 acres of oil shale land in the Pasqua Hills area in east-central Saskatchewan. Work also re-started in January on Oilsands Quest’s 2009 winter exploration drilling program on Raven Ridge in Alberta. “We expect drilling at Raven Ridge will increase our resource estimates and capitalize on last winter’s exploration success on these lands,” said Jamey Fitzgibbon, president and chief operating oﬃcer, in a news release. Approximately 50 workers and three core hole drilling rigs are being mobilized with a plan to drill and log 25 core holes in the Raven Ridge

area in Alberta. Drilling is planned to commence on Township 94, Range 1, West 4, towards the end of the week and the field portion of the program is expected to be completed by late February. The exploration program will gather additional data to assist in confirming geological models and bring further confidence to the company's resource estimates, Oilsands Quest said. “Given the uncertainty prevailing in the markets, it is imperative that we maintain the balance between preserving our liquidity and increasing our value through high impact investments,” said Christopher Hopkins, chief executive officer. “We will control our costs and sustain our team and assets through this globally challenging period.” Last year’s winter exploration program totalled 175 exploratory and delineation drill sites (150

in Sask. and 25 in Alberta). The company also completed extensive 2D and 3D seismic surveys in both provinces and upgraded Raven Ridge from a prospect to a discovery. At Axe Lake test site 3, the company is continuing its preliminary testing of low energy heat transfer and ﬂuid mobility within

the reservoir this winter. At test site 1, the company is completing construction and commissioning of steam/injection facilities as it plans for ﬁrst steam injection later in 2009. Oilsands Quest is undertaking a comprehensive drilling, coring and testing program to evaluate the physical properties

of the complex layering of sand, lacustrine clay and till within the Quaternary age sediments overlying the McMurray formation in the Axe Lake area. The data gathered will be used to accurately calibrate laboratory, modeling and simulation work and help conﬁgure the instrumentation at test site 1.

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We are Canada’s largest supplier of Industrial, Safety and Fastener products. With 155 branches coast-to-coast, 5 distribution centres and the largest inventory in Canada – we have what you need, when and where you need it! For over 100 years we’ve been supplying Canadian customers with the products required to keep their businesses running. Additionally, we help you save time and money through our broad range of value added services including industry leading inventory management and e-business solutions. Call us today to learn how your company can save time and money.

1.888.602.0000 www.acklandsgrainger.com

Dale Foss 780-808-9366 Beginner & Intermediate Tues. & Thurs. 5:15-6:30 pm & 7-8:30 pm Wed. morning 9:30-11:00 am

Daniela Tobler 780-872-2332 Beginner: Mon. 5:30-7:00 pm Intermediate: Wed. 5:30-7:00 pm

Fluid • Pressure • V acuum

C26

PIPELINE NEWS February 2009

Alberta starts 2009 with new royalty regime One constant thread Pipeline News has heard over the past eight months is that the changes in Alberta’s royalty regime has driven business east, into Saskatchewan. January 1 saw Alberta’s royalty regime updated. The proposed new oil sands royalty regime in Alberta became ef-

fective January 2009. Royalty rates are determined by a sliding scale based on the price of West Texas Intermediate (WTI) oil in Canadian dollars per barrel. The Base Royalty Rate, charged on gross bitumen revenues prior to payout, will remain at one per cent up to $55 Cdn per barrel. This will

increase for every dollar oil is above $55 Cdn per barrel to a maximum of nine per cent when WTI is priced at $120 Cdn per barrel. The Net Royalty Rate, charged on net bitumen revenues after payout, will remain at 25 per cent up to $55 Cdn per barrel. The rate will increase for every dollar

CONTRACTING INC.

oil is above $55 Cdn per barrel to a maximum of 40 per cent when oil is priced at $120 Cdn per barrel. The province will exercise its existing right to receive “royalty-in-kind” on oilsands projects (raw bitumen delivered to the Crownoperated Alberta Petroleum Marketing Com-

mission in lieu of cash royalties) to support value-added upgrading projects in Alberta. The royalty rate in Saskatchewan unchanged The oil sands royalty regime for Crown lands in Saskatchewan are based on one per cent of gross revenues prior to payout and 20 per cent

Transportation and Logistics Rig Transportation Services Pipe Storage Facility • Concrete Work • Carpentry

3297 North Service Road W. Swift Current, SK. S9H 4G5

• Pre-Engineered Buildings

Direct: 306.773.1660 Toll Free: 888.221.1022 Fax: 306.773.1660 rheitt@flintenergy.com

after payout. (Payout is achieved when there has been cash recovery of eligible capital costs and expenses.) No changes for 2009 have been announced or planned. In fact, premier Brad Wall has publicly stated that he aims to provide a regulatory environment that will help build the emerging unconventional oil and gas sector in Saskatchewan, and that this may include government help with research and development.

Imagine the difference a wish can make.

40229221•09/05/08

• Custom Design & Manufacturing • Site Trailers • Wellhead Shelters • Self-Framing Metal Buildings

1-800-267-WISH www.childrenswish.ca

• Utilidor • Office Trailers • Tex Fencing • Containment Buildings

Website: www.jamalcontracting.com Email: jamalcontracting@shaw.ca

- Hydraulic Hoses & Fittings - Safety Equipment

306-778-6294 #3 - 1071 Central Avenue N Hillside Plaza, Swift Current, SK skswf@stores.fastenal.com www.fastenal.com

40229200•08/08/08

1-888-313-3302

- Nylon Slings - Ridgid Tools - Pipe Fittings

SpeciÀc Targeting Contact your local pipeline sale rep. to get you 35,000 Circulation on your career ad!

PIPELINE NEWS February 2009

C27

Primary drilling focus to be in the southwest for Penn West ɺ Page C25 Penn West has positioned its capital project inventory to enable expansion of the company’s 2009 program when commodity prices and industry costs improve from current levels. Penn West said it anticipates production volumes will average approximately 180,000 bbls of oil equivalent

per day in the first half of 2009. (This volume would be reduced by the amount of any dispositions that close in the first half of 2009.) Third quarter 2008 production averaged over 190,000 BOE a day. Late in 2008, the trust placed various producing assets deemed non-core into the market for sale. It

anticipates closing all pending deals by the end of the first quarter with estimated combined proceeds of $150 million. These proceeds will be applied to bank debt. In 2008 Penn West hedged its 2009 production to cushion the impact of commodity price volatility. It currently has approximately 31 per cent of

Career Opportunities D

o you want to work for a progressive, growing company that provides room for advancement??

its 2009 crude oil production hedged (before royalties) with a floor WTI (West Texas Intermediate) price of $80 (U.S.) per bbl and a

ceiling price of $110.21 a bbl. According to Penn West approximately 20 per cent of its 2009 natural gas volumes have

been hedged (before royalties) with floors of $7.88 (Cdn.) per gigajoule and ceilings of $11.27 per gigajoule at AECO.

FLUSHBY OPERATOR for Elk Point area. Must have or willing to get B.O.P. ticket. Excellent wages, benefits and scheduled days off. Safety tickets an asset.

Contact Cody 780•645•0040

RJ HOFFMAN HOLDINGS IS ACCEPTING APPLICATIONS FOR

Then join our Team!

CLASS 1A & 3A DRIVERS Based out of St. Walburg, SK or Lloydminster, AB

Savanna Well Servicing Inc. is actively seeking personnel for the following positions:

•Drillers •Derrick Hands •Floor Hands

Entry level positions available. Excellent wages, immediate benefits!

Please apply with resume, current driver’s abstract (Class 3 or higher), & copy of tickets to:

Flush By and Steamer positions available. We train drivers. $23/ hr starting driving wage or higher wages for experienced operators. We pay overtime and provide beneﬁts. 7-3-7-4 schedule. Maximum 14 hr days. For more information contact Eugene at 780-205-5680 or fax resumes with references and drivers abstract to Eugene at 780-871-0782 or email to employment@rjhoffman.com 1509 RAILWAY AVE. BOX 275 CARNDUFF, SK. S0C 0S0 306-482-5105

SAVANNA WELL SERVICING INC. Carlyle, SK Office: 306.453.2616 Cell: 403.510.6616 Fax: 306.453.2614 Trobitaille@savannaenergy.com

is currently accepting applications for the following position: in the Estevan/Carnduff area

• Chemical Circulating, Batching and Delivering • Part-Time Pressure Truck Driver (1A Required) Applicants must have a minimum of 3 years oilÀeld experience and a clean driving record.

Email or fax your resume to Kris at: candnoilÀeld@sasktel.net • Fax: 306-482-5213

C28

PIPELINE NEWS February 2009

Boating ads aimed at summer

By Geoff Lee Wainwright –If it’s February, spring and summer can’t be far away. That’s the promise that led Owen Johnston, owner of OJ’s Leisure Products in Wainwright, Alta., to purchase boating ads in the January edition of the Pipeline News to entice oil patch consumers to warm up to the idea of buying a summer boat now. You might need a big axe to chop a hole in the ice for your boat now, but warmer

weather is definitely on the mind. “Between now and spring is our busiest sales months,” said Johnston who has owned the Yamaha franchise since 1994. “Boat shows are starting now. The attraction for buying a boat now is that it’s cold outside. “It’s a mind game. People want to look at something that’s they associate with warm. On the May long weekends, people open their cabins up so you’ve got January, February

Career

March and April to get hooked up with a new boat and get ready for a new season. “All of our stock comes in November so it’s ready for sale before April in May. A sunny day will bring a lot of people in for browsing.” Johnston says, “The oil patch worker is one of our main clients.” OJ’s ads feature his popular line of G3 boats for fishing and Grew fibreglass boats for waterskiing and lake

cruising. Prices for the most expensive models range from $12,000 to $60,000. “We sell a lot of the G3 boats,” said Johnston. “They are very popular. They have the pontoon boat line and you can pull a wakeboarder or someone on a tube. The other side of the G3 line is the deep V fishing boats for deep water and flat-bottomed jon boats.” OJ’s has more than 40 boats in stock. John-

ston says a sunny day will bring a lot of people in to browse. Johnston says another plus for advertising early is that most people don’t worry about

test driving a boat. “It’s not like a car or a snowmobile,” he explained. “With boats, people know they float and a motor pushes them.” ɸ Page C29

www.suretuf.com

CNC Plasma / Oxyacetylene Operators Applicants must have welding background. Driver’s license required. Reliable, team player. Wages depend on experience. Beneﬁts available. Performance bonuses. Only those to be interviewed will be contacted. Apply in conﬁdence to: Fax (780) 808-2689

ELECTRICAL APPRENTICES & JOURNEYMEN REQUIRED Require safety certiÀcates & valid drivers licence. Competitive wages and beneÀts package.

Fax resume to 637-2181 or deliver to: 62 Devonian Street, Estevan, Sk.

Opportunities

Estevan Branch of Welding & Maintenance Ltd. Estevan location is seeking individuals to Àll the following positions:

Hydrovac Operator

Crew Foreman

Experienced FOR LLOYDMINSTER AREA

MUST: • Have Valid Drivers License & Be A Team Player • Safety Tickets • Picker & Bobcat Experience An Asset C’s OFFERS: • Top Wages • Benefits Package • Performance Bonuses • Scheduled Days Off • Opportunity For Advancement • C.O.R. Safety Program • AB & SK B31.3 Q.C. • Premium Equipment DUTIES: • Daily Operation Of A Light Picker Truck • Pipe-fitting & Construction

OILFIELD SERVICE LTD.

CONSULTING & CONSTRUCTION

Apply in confidence to: Fax (780) 808-2273

Zargon Energy Trust requires a

Production Field Foreman For South-East Saskatchewan focused mainly in the Estevan area. Minimum 10 years oil and gas operating experience, 5 years at a supervisory level. Forward your resume in confidence to: gkozan@zargon.ca prior to February 6, RE: Production Foreman. Zargon is a sustainable energy trust with a 16-year history as a publicly traded company. For more information, visit Zargon’s website at: www.zargon.ca.

• 1A licence required • Clean drivers abstract • Applicants with experience and safety tickets preferred • Will train the successful applicant

Crew Foreman • Pipeline Foreman Crew and Pipeline Labourers • Applicants with experience, safety tickets and valid driver's license preferred • Group RRSP Plan • Group Insurance beneÀts package and competitive wages offered

All inquiries will be kept conÀdential.

These positions are open immediately. Contact - Dan Beaulieu 634-0551 Or Fax: 634-9448 Email: dbeaulieu@carsonwelding.com

PIPELINE NEWS February 2009

C29

lusting oil patch consumers

Éş Page C28 A couple of the most popular boating lakes are Pigeon Lakes near Bonnyville, Alberta and Lake Diefenbaker in Saskatchewan. Johnston says he has sold boats to people in the oilďŹ&#x201A;ield from as far away as Saskatoon, Grande Prairie, Fort McMurray and Calgary. â&#x20AC;&#x153;We get a lot of people from Lloydminster,â&#x20AC;? said Johnston. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve got a really good service department, so word of mouth travels pretty fast. Weâ&#x20AC;&#x2122;re set up with dynos (for tuning) and all of our guys are licensed. Johnston started his franchise selling Yamaha ATVs, snowmobiles, side by sides and motorcycles and added Yamaha boats four years ago to meet demand. â&#x20AC;&#x153;Boating has become more popular in Alberta,â&#x20AC;? he says. â&#x20AC;&#x153;Baby boomers have

more disposable income and older families are spending more.â&#x20AC;? Johnston expects sales to be good this year despite the slowdown in the oil and gas sector. â&#x20AC;&#x153;Last year and the year before were great years,â&#x20AC;? he said. â&#x20AC;&#x153;People still want to have fun and take holidays. They still want to go to the lake. With boats, itâ&#x20AC;&#x2122;s a diďŹ&#x20AC;erent clientele â&#x20AC;&#x201C; itâ&#x20AC;&#x2122;s family oriented. Itâ&#x20AC;&#x2122;s something the whole family can use versus a motorcycle or a snowmobile. â&#x20AC;&#x153;Everyone in the service sector is still working. Production may be down but they are not laying anyone oďŹ&#x20AC; at the (Lloydminster) upgrader. In the tarsands, new projects are being put on hold but all the people who back up the system still have to come to work.â&#x20AC;?

Resources Guide

a l t u s g e o m a t i c s . c o m

OILFIELD HAULING LTD. Specializing in Hauling Well Site Trailers Specializing in well site and pipeline surveys Yorkton 306.783.4100

Swift Current 306.773.7733

Edmonton 800.465.6233

Weyburn 306.842.6060

Lloydminster 780.875.6130

Calgary 866.234.7599

Regina 800.667.3546

Medicine Hat 403.528.4215

Grande Prairie 780.532.6793

Bruce Bayliss Owner/Operator OfĂ&#x20AC;ce: 482-3132 Dispatch: 485-7535 Fax: (306) 482-5271

Lloyd Lavigne â&#x20AC;˘ Kirk Clarkson Owners/Managers 6506 - 50th Avenue Lloydminster, AB

Phone: (780) 875-6880

5315 - 37th Street Provost, AB T0B 3S0

Phone: (780) 753-6449

Fax: (780) 875-7076

24 Hour Service

Box 178 Carnduff, Sk. S0C 0S0

Specializing in Industrial & Oilfield Motors

24 HOUR DISPATCH

780-205-7666

&DQDGD V OHDGLQJ GLVWULEXWRU RI LQGXVWULDO Ă HHW DQG VDIHW\ SURGXFWV

Lloydminster, AB

Proudly Serving Alberta & Saskatchewan

â&#x20AC;˘ Full Hydrovac Services â&#x20AC;˘ Capable of Steam www.silverbackhydrovac.com â&#x20AC;˘ geoff@silverbackhydrovac.com

3URXG WR SURYLGH VHOHFWLRQ TXDOLW\ DQG H[FHOOHQFH WR RXU FXVWRPHUV

- OilĂ&#x20AC;eld Maintenance - Service Crews - Pressure Welding - Pipeline Construction - Battery Construction - Rent or Sell New & Used Equipment Randy: 634-5405 - Cellular 421-1293 Darcy: 634-5257 - Cellular 421-1425 â&#x20AC;˘ Fax: 634-4575

LOCALLY OWNED & OPERATED BOX 843, ESTEVAN, SK.

WK 6WUHHW (VWHYDQ Â&#x2021;

24 Hour Service - 634-8737

Quality

LAMICOIDS metal cable tags EfĂ&#x20AC;cient Service

& m&

Wheel diggers â&#x20AC;˘ Chain digger Wolfe 600 horse plow Interchangeable wheels & chains

Call Linda for more information

Estevan Trophy & Engraving Phone/Fax: 634-6005 Email: estevantrophy@sasktel.net

Dwight G. Blomander, CFP â&#x20AC;˘ â&#x20AC;˘ â&#x20AC;˘ â&#x20AC;˘

Life Insurance Disability Insurance Critical Illness Insurance Employee BeneĂ&#x20AC;t Plans Tel: (306) 761-7506 â&#x20AC;˘ Fax: (306) 352-9474 E-mail: dwight.blomander@gwl.ca Toll Free: 1-888-495-7275 Cellular: (306) 421-1935 THE

Great-West Life ASSURANCE COMPANY

600, 2010-11th Avenue, Regina, SK S4P 0J3

C30

PIPELINE NEWS February 2009

Resources Guide

Bully Blast & Paint Services Ltd. â&#x20AC;˘ Shop & Field Service â&#x20AC;˘ Structural Steel â&#x20AC;˘ Tank Linings â&#x20AC;˘ and more Your Sandblasting, Painting & Coating Specialists with over 20 yrs. experience in the industry

Spool Coating now available Bus.: (306) 457-2264

Cell: (306) 461-9679

P.O. Box 54 â&#x20AC;˘ Benson, SK â&#x20AC;˘ SOC 0L0 bullyblasting@sasktel.net

TERRY DODDS (24 hrs.) (306) 634-7599 Cell. (306) 421-0316

COIL COIL TUBING TUBING SERVICES SERVICES FLUSHBY FLUSHBY SERVICES SERVICES

M.E.T. OILFIELD CONST. LTD. â&#x20AC;&#x153;All Your Construction and Maintenance Needsâ&#x20AC;? SPECIALIZING IN: ENGINES, PUMP UNITS, UNIT INSPECTIONS, PIPE FITTING, TREATERS AND PRESSURE TICKET WELDING Box 1605, Estevan, Sk. S4A 2L7 Cell. (306) 421-3174, (306) 421-6410, (306) 421-2059 Fax: (306) 634-1273

Serving Alberta, B.C. & Saskatchewan Toll Free

Dale (306) 861-3635 â&#x20AC;˘ Lee (306) 577-7042 Lampman, Sask.

1-866-363-0011 www.tazwellservicing.com

Cory Bjorndal District Manager Downhole Tools

93 Panteluk Street Kensington Avenue N Estevan, Saskatchewan S4A 2A6 PHONE: 306-634-8828 CELL: 306-421-2893 FAX: 306-634-7747 cory.bjorndal@nov.com www.nov.com

SONAR INSPECTION LTD. Head OfĂ&#x20AC;ce 1292 Veterans Crescent Estevan, Sk. S4A 2E1 E: sonarinsp@sasktel.net

Southeast Tree Care COR CertiĂ&#x20AC;ed Estevan, Sk. 634-7348

P: 306-634-5285 F: 306-634-5649

â&#x20AC;&#x153;Serving All Your Inspection Needsâ&#x20AC;? UT - LPI - MPI Wayne Naka Taylor Gardiner Cory Rougeau

www.pennwest.com 311 Kensington Avenue, Estevan â&#x20AC;˘ 634-1400

306-421-3177 306-421-2883 306-421-1076

100, 200 and 400 BBL Tanks

Vegetation Control (Chemical or Mechanical)

â&#x20AC;˘ Pressure Vessels â&#x20AC;˘ Well Testers â&#x20AC;˘ Frac Recovery â&#x20AC;˘ Wellbore Bleedoff â&#x20AC;˘ Ball Catchers â&#x20AC;˘ 400 bbl Tanks â&#x20AC;˘ Rig Matting â&#x20AC;˘ Complete Trucking Services

Please call us with your Custom Fabrication Requirements!

4â&#x20AC;? Hevi Wate Drill Pipe www.westeel.com

Brad Lamontagne (306) 577-9818 or (306) 739-2263 smrltd@sasktel.net

www.northern-steel.com

Peter Koopman - Industrial Tank Sales, Southern Saskatchewan Ph. 306-525-5481 ext. 311

Cell 306-596-8137

Serving the Saskatchewan Petroleum Upstream from our facilities in Regina & Tisdale.

JUSTIN WAPPEL - Division Manager Gordon Harty Box 95 Marwayne, AB T0B 2X0

401 Hwy. #4 S. Biggar, Saskatchewan PO Box 879 S0K 0M0 Ph (306) 948-5262 Fax (306) 948-5263 Cell (306) 441-4402 Toll Free 1-800-746-6646 Email: jwappel@envirotank.com www.envirotank.com

Bus. Phone

Fax No.

RADVILLE, SK

Res. Phone

(780) 875-9802 (780) 847-3633 (780) 847-2178 Fresh Water Hauling Custom Bailing & Hauling

â&#x20AC;&#x153; Line Locating for All Your OilĂ&#x20AC;eld, Residential or Farm Needsâ&#x20AC;?

Cell: (306) 869-8181 â&#x20AC;˘ Cell (306) 463-8021

([Y )KRR )KRR ,G^ SKR LOZ`VGZXOIQ&SOJLOKRJY[VVR_ IUS ]]] SOJLOKRJY[VVR_ IUS

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PIPELINE NEWS February 2009

TIME IS RUNNING OUT TO PLACE YOUR LISTING IN THE 2009/10 CANADIAN OILFIELD SERVICE & SUPPLY DIRECTORY (COSSD) 72,500 copies of the COSSD are distributed throughout the Western Canadian Sedimentary Basin, into the US, and internationally.

LISTINGS START AT ONLY

FOR A FULL YEAR OF EXPOSURE DEADLINE: FEBRUARY 13, 2009

$242

.00 PLUS GST

ALSO AVAILABLE ON DVD AND ONLINE

Jane Howat TOLL FREE (888) 563-2946 ext. 144 Email: sales@junewarren.com

cossd.com

C31

C32

PIPELINE NEWS February 2009 #4633 2008 GMC SLT NEW 3/4 4X4 6.0L

#5246 2009 GMC SLT Z71 All Terrain 4x4

#5192 2009 GMC NEW 4X4 Ext

#5046 2009 Pontiac NEW Torrent

#4998 NEW 2009 Chevrolet Uplander

#5137 NEW 2009 Buick Enclave

NEW 2008 MSRP 58715

NEW 2009 MSRP55000

NEW 2009 MSRP 38985

NEW 2009 MSRP 29745 9

NNEW 2009 MSRP 29745

NEW 2009 MSRP 45110

$40,900*

$45,900*

$30,800*

$24,500*

$20,200*

$39,150*

#5259A 2008 Chevrolet Trailblazer LT3 4X4

#5079A 2003 GMC SLT Envoy XL 4X4

#5085A 2006 GMC SLT Crew 4x4 Diesel

#5143A 2006 Chevrolet H/D Crew 4x4

#5110B 2000 Chevrolet 4x4 Ext

#4238A 2003 GMC SLE Ext 4x4

$32,500*

$15,500*

$26,500*

$17,500*

$5,000.*

$16,500*

#5169A 2005 Chevrolet LT Diesel Crew 4x4

#Consignment 2003 Pontiac Montana 7 pass

#5023A 2007 GMC SLE Z71 Ext 4X4

#5061A 2006 GMC SLE Diesel 4X4 Crew

#5260A 2008 Chevrolet Trailblazer LT3

#5181A 2004 Pontiac Aztek

$22,500*

$9,900*

$25,900*

$26,500*

$32,500*

$7,800*

#4727A 2007 GMC SLT Acadia AWD

#5091A 2003 Chevrolet Silverado 4X4

#5204A 2006 Chevrolet Trailblazer 4X4

#5218A 2006 GMC SLE Z71 4x4 Ext

#5004A 2007 Chevrolet Uplander

#5197B 1998 F150 4X4

$35,900*

$10,350*

$19,900*

$20,900*

$16,500*

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#5065A 1990 Chevrolet V 6 5 SPD

#5126B 2007 Kia Sportage AWD 2.7

#4972A 2005 Chevrolet LT Crew Z71 W DVD

#Consignment 2004 GMC 1 Ton Diesel crew 4x4

#5124A 2001 Chevrolet Tahoe 4x4

#5263A 2005 Pontiac Montana w DVD 8 Pass

$1,250*

$18,700*

$20,900*

$26,500*

$13,900*

$12,500*

#5052A 1999 GMC SLE Ext 4x4 Lifted

#5189 NEW 2009 Pontiac G 6 SE

#5120 NEW 2009 Pontiac G 6 GT Coupe

#5185 NEW 2009 Chevrolet Cobalt LS

#4952 NEW 2009 Pontiac Vibe AWD

#5156 NEW 2009 Chevrolet Malibu LT1

Value Point

NEW 2009 MSRP 29990

NEW 2009 MSRP 32940

NEW 2009 MSRP 19365

NEW 2009 MSRP 27094

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$24,900*

$27,500*

$15,800*

#C413 2006 GMC SLT 4X4 Crew Diesel

#5248A 2006 Chevrolet Optra LT

#5152 NEW 2009 Chevrolet Cobalt LT

#Consignment 2007 Chevrolet Cobalt

#5138 NEW 2009 Pontiac G8 GT

NEW 2009 MSRP 22760

Take over lease

NEW 2009 MSRP 41725

NEW 2009 MSRP 31130

$18,250*

$335/mnth*

$36,600*

$26,300*

#4614A 2007 Chevrolet Cobalt SS Supercharged

#5155A 2004 Chevrolet Impala

#4076 2006 Pontiac Grand Prix GT Demo

14000 Km

low km

$17,900*

$8,900*

$19,900*

$18,800*

#5149A 2007 Chevrolet Impala LS

#5012A 2008 Chevrolet Impala

#4104R 2007 Chevrolet HHR LS

#5013A 2008 Pontiac Grand Prix

#4966A 2006 Chevrolet Malibu LS V6

$14,900*

$17,900*

$14,500*

$17,700*

$11,000*

Value Point

$31,500* #4734B 2007 Chevrolet HHR LT

$14,900*

$12,500*

NEW 2009 MSRP 28595

$24,500*

$24,200*

#5167 NEW 2009 Chevrolet Impala LT

#5078A 2007 Chevrolet HHR Special Edition LT

#5176A 2005 Chevrolet Impala LS

35000 KLM

*CASH PRICES LISTED CALL DONNA FOR YOUR FINANCE REQUIREMENTS

1 888-773-4646

$10,900*

SALES POSITION OPEN CONTACT LARRY ALWARD

www.collegeparkgm.com

1 888-773-4646