Pipeline News August 2009

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

August 2009

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Volume 2 Issue 3

Focus Edition

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Moosomin Mayor Larry Miskiman Page B3 Hall of Fame Inductees Page B10-14 TransCanada’s Keystone Project Page C1 Each sideboom of the lowering in crew moves the pipe a little further into the ditch. The lead tractor picks it up, the following tractors cradle it over, and the tail tractor lays it in the ditch.

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PIPELINE NEWS August 2009

News

Notes

Oilsands Quest and Birch Narrows Dene Nation agree Oilsands Quest Inc. and the Birch Narrows Dene Nation, have signed a Memorandum of Understanding regarding the establishment of an economic relationship between the two parties.

The Birch Narrows Dene Nation is one of the leading First Nation communities with a tradition of land use in the vicinity of Oilsands Quests' permit lands in northwestern Saskatchewan.

The MOU confirms the agreement between the parties to work together to identify and address the economic benefits, as well as environmental, social and other potential impacts of Oilsands Quest's activities on its permit lands.

Oilsands Quest has followed a policy of creating local business and employment opportunities in northwestern Saskatchewan to support its exploration and development activities.

The MOU formalizes Oilsands Quest's commitment to the Birch Narrows Dene Nation to provide better access to business and employment opportunities with Oilsands Quest and provide a mechanism for building a strong relationship.

Petrobank enhances ¿nancing for Bakken Petrobank Energy and Resources Ltd. has priced its previously announced offering of convertible notes due in 2015 with an offering of $400 million (U.S.) principal amount.

Petrobank also reported that its annual borrowing base redetermination has resulted in an increase to its secured credit facilities to $400 million from $380 million.

The company said the offering and the increase to borrowing base further enhance its financial flexibility which allows it to: significantly expand its Bakken drilling program in southeast Saskatchewan; fund the first phase of May River, the commercial expansion of its proprietary THAI (toe-to-heel-air injection) technology and/ or capitalize on other potential opportunities.

Estevan lands new ETI campus, due 2011

By Brian Zinchuk Pipeline News Estevan – Estevan will be home to a new Energy Training Institute, part of Southeast Regional College.

The announcement was made on June 26, at the college’s Estevan campus.

The province and federal government will be contributing a combined $14 million. The city of Estevan is donating the land, to be located in the new industrial park under construction on the east side of the city. Other organizations have come forward to donate equipment.

The total bill is expected to be around $18 million.

The target completion date is March 31, 2011.

That date is important, because the federal government is eager to get infrastructure dollars rolling.

“We just had a project steering meeting this morning, and feel confident we can meet those deadlines,” Craig Brown, president and CEO of Southeast Regional College, said when asked about construction delays that have plague most projects in Estevan and area over the past year.

Brown noted the city of Weyburn very much wanted the facility, but in the end, there can only be one.

The tipping point in Estevan’s favour was the larger core of energy companies based in the Estevan area.

Jim Wilson, owner of Wil-Tech of Estevan, was one of the ardent supporters of the new facility.

“We wanted it in Estevan, and we fought for it to be in Estevan,” he said, but added, “It’s the Southeast Energy Training Institute, not the Estevan Energy Training Institute.”

“

The facility will start with existing safety training programs, but will branch out. There are plans to have a drilling rig on location.

According to Trent Jordens, general manager of Southeast Regional College, the facility will be 40,000 square feet, with between eight and 10 classrooms. There will be a large common area, a research area for studying, student lounge, and two labs equipped with technical equipment.

They hope to collaborate with the University of Regina and SIAST on developing appropriate training for carbon dioxide initiatives.

The ETI will also focus on alternative energy systems. For instance, the campus will include solar and geothermal systems. The purpose is not only to ‘go green’ but to provide hands on training capabilities for the students with these technologies.

Souris Moose Mountain MP Ed Komarnicki said the college was, “An investment now that will help us in the future.”

He described it as money well spent when the economy needs stimulus.

He noted this is the highest single investment in Saskatchewan in this round of knowledge infrastructure investments.

MLA Dan D’Autremont spoke of the huge need for training of staff, and said it was an opportunity to train people from south of the border. “We want those free American dollars,” he said.

He pointed to developments in clean coal and carbon capture as opportunities.

Lisa McConnell of BP Canada told Pipeline News, “We’re excited. Right now we’re sending our folks to Alberta for training. Being able to keep them at home is huge.”

“It’s been a long time coming,” Brown said. The board and staff worked on it for three years, he said.

“They’re very glad it’s coming to fruition.”

We’re excited.

Right now we’re sending our folks to Alberta for training.

Being able to keep them at home is huge.

”

- Lisa McConnell BP Canada

PIPELINE NEWS August 2009

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Carbon management

Deputy Minister of Energy and Resources Kent Campbell.

File photo

By Geoff Lee Pipeline News

Saskatoon – The Energy Council’s 2009 State and Provincial Trends in Energy and the Environment Conference held in Saskatoon in June, turned out to be an information gusher with the focus on carbon management.

More than 100 legislators and energy industry representatives from across the United States and Canada participated in sessions on uranium, wind energy, in-situ upgrading of heavy oil and bitumen and carbon sequestration.

“One of the highlights and the focus was carbon capture storage,” said energy and resources deputy minister Kent Campbell.

This was the first time Saskatchewan hosted the Council since becoming a member in 2007 and it was an opportunity for Saskatchewan to showcase their resources and commercial CCS projects.

“There was quite a bit of discussion around those technology issues and policy issues and how important those issues are for jurisdictions like ours that are fossil fuel producers,” said Campbell.

Campbell says there was a lot of interest in the Weyburn-Midale CO2 project that Encana and Apache have been running by piping CO2 from a North Dakota gasification plant and using it for enhanced oil recovery and disposal.

“The Petroleum Research Centre and the In-

ternational Energy Agency have been monitoring the disposal for the last 10 years so there is information set there that is kind of unique,” said Campbell.

The need for carbon capture storage in the U.S. got a boost with the recent approval of the American Clean Energy and Security Act by the House of Representatives.

If made into law by the Senate, the act would create a cap and trade plan of pollution permits to curb emissions.

Council chairman Mike Hill from the Alabama House of Representatives thinks it’s about time that happened.

“We have so much carbon we need to dispose of,” said Hill. “We have been talking about this for five years and Congress is finally catching on. It will be something that will cause energy prices to go up and that could be an indirect tax increase. That is something we’re going to have to do if we want to keep the atmosphere clean.

“What we have been talking about for years, Saskatchewan has been putting into usable models that can be utilized commercially.

“Saskatchewan has a couple of projects that takes the CO2 out of the burned fuel (gasification) and uses it in such a way to get tax credits for it.

The commercial uses are more advanced than what we have in the U.S.” The conference included an update on U.S energy legislation and regulations that Hill says caught the interest of Saskatchewan delegates who hope the U.S. and Canada will approve the extension of the TransCanada Keystone pipeline this year.

The pipeline will run from Hardisty, Alberta to a delivery point near existing terminals in Port Arthur, Texas.

“The Saskatchewan people are interested in knowing if it’s going to be free flowing,” said Hill.

“They learned what the

focus of the U.S. is and what direction they are going.

“One of the things they will be transporting on the pipeline will be carbon. There will need to be some open pipelines for a carbon transfer in between the oil transfers.

“Everybody is concerned about how to transfer carbon to be able to put it commercially in the ground. A pipeline is the only real cost-effective way to do that.”

Campbell says the Province wants to make sure that technologies such as CCS are included in a U.S. clean air act and says Premier Brad Wall has met with U.S. Energy Secretary Steven Chu. “Chu who has a science background,” said Campbell. “Having someone in that position with a science background is good for making the case for CCS.” Hill will also be plugging the use of CCS back in his home state that he says has some of the “dirtiest coal burning plants in the world.

“One of the biggest drawback of cleaning up the coal as it burns and capturing the carbon is the question of what are you going to do with the carbon when you get it captured.

“We are all concerned about clean air,” said Hill.

“We have all come to the conclusion if we don’t something about now we will have some tough times in the days to come.”

The three-day conference included a presentation on uranium as a nuclear fuel and included a flight for Council executive members to Cameco Corporation’s uranium mine at McArthur River.

“I fell in love with Saskatchewan,” said Hill who enjoyed the sightseeing. “We got to see all of the territory and the millions of lakes. It was a clear and beautiful day.

“It’s particularly interesting for us to see the wide range of resources here in the province. It’s equally impressive to learn

News

Notes

Painted Pony consolidates Alabama State Representative Mike Hill.

Photo courtesy Alabama House of Representatives website

about Saskatchewan’s role as a world-class technology centre for carbon management.

“It was a great meeting. We cover every aspect of energy. There is nothing we leave out in our meetings.

“What we do in the Energy Council is we share with each other so each state or province will be able to stay on top of the technology and latest trends.

“It’s an information producing organization.

We try to keep both governments aware of what we see are the trends and the problems that may be occurring in the energy field. It can lead to policies in the provinces and the states.

“We try to keep our federal government informed and where there is place to make policies, we certainly do that.”

From his point of view, Campbell says the forum helps to build awareness of Saskatchewan’s resources for U.S. legislators on the Council.

“We are on the map more than we have ever been,” he said. “There is a lot of awareness building to do with our U.S. counterparts to let them know how important Saskatchewan is to Canada’s energy security.

“It also allows the various fossil fuel jurisdictions to have a discussion around joint issues that we are facing and share some best practices.”

Painted Pony Petroleum Ltd. has signed the purchase agreement for the previously-announced transaction with a private company to acquire certain oil properties focused in the Bakken-prospective fairway in the company’s Midale/Huntoon core area in southeast Saskatchewan.

The completion of the acquisition is subject to certain conditions, including normal regulatory approvals, and was expected to close in July.

The purchase price is $2.7 million, before closing adjustments and related costs. The acquisition has an effective date of June 1 and is expected to close on July 31. The completion of the acquisition is subject to certain conditions, including normal regulatory approvals.

Production from the acquired properties, based on field estimates, is approximately 40 bbls per day for the month of June with an additional five bbls per day of Bakken oil shut in due to weather.

The assets, all currently operated by Painted Pony, include 550 net acres of undeveloped adjacent lands prospective for Bakken oil. The acquisition increases the company’s average working interest in the areas to greater than 90%.

Ammonite planning multi-well program Two vertical wells drilled in the second quarter will help to set up Ammonite Energy Ltd.’s first horizontal well in a Saskatchewan multi-well horizontal program to begin this summer.

During the second quarter, the company drilled two vertical wells where it now operates more than 19 gross sections of land at Kindersley and Elrose.

The wells have both been completed as producing Viking oil wells that encountered original reservoir pressure.

The wells were drilled to help identify the proper alignment and depth for Ammonite’s first horizontal well in a multi-well horizontal program to begin this summer. Ammonite believes that most of these lands are prospective for light Viking oil (34 to 39 degree API) and favorable for horizontal drilling with multi-stage fracturing at a well density of up to four wells per section.

The Saskatchewan Crown royalty for horizontal Viking wells has been reduced to only 2.5% on the first 6 000 cubic metres of oil production which greatly improves the economics of the project. In addition to the horizontal potential of these lands, Ammonite has identified several Bakken gas anomalies from its recent two-dimensional (2-D) seismic program. The wells will be drilled once natural gas prices improve.

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EDITORIAL

PIPELINE NEWS August 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.

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Editorial Does Canada need a strategic oil reserve?

Most people would agree it’s a good idea to have some money saved up for a rainy day. It’s increasingly become the habit of nations to do the same, except with oil.

China is building up its strategic petroleum reserves (SPR). Currently, the country keeps enough in reserve to keep it going for 30 days if it were cut off from imports. The plan is to build that reserve to 90 days, and they are on a massive tank-building endeavour to do it.

Other nations have been doing the same. India is working on its own. Ditto for the Philippines. European Union countries are required to have one. Denmark has recently created one. Poland is expanding its reserve to the 90 day mark. The UK is also a new entrant.

Japan, not surprisingly, is fastidious in having its own reserve, with 169 days of reserves between government and private storage.

The US has the largest strategic reserve in the world, with the capacity to backfill a 60 day loss of imports. They store all theirs as unrefined crude, in four mammoth underground facilities. Each uses salt domes deep underground, in a similar manner to how SaskEnergy stores natural gas in underground salt caverns.

Even oil exporters, like Iran and Russia, have been looking at the idea. Iran has one, and Russia is considering it. Don’t forget, Russia produces a similar amount of oil each day as Saudi Arabia.

And what about Canada?

Well, what about Canada? Do we have a cookie jar stuffed with black gold, just in case the world goes to hell in a hand basket? ..... No. We have the second largest reserves in the world, when you include all the oilsands. But that’s not all that easy to get at. Nope, 47 nations have a strategic reserve, but we are not one of them.

Google “Canadian strategic petroleum reserve,” and the first response you get is a discussion paper asking if we need one.

In February, 2008, Gord Laxer wrote on the op-ed page of The Globe and Mail, “If Canada reversed the Montreal-to-Sarnia pipeline, which brings foreign oil through Southern Ontario, Western Canadian oil would flow to Quebec and reduce imports by almost a third. Taking the portion of Newfoundland oil that is currently exported and redirecting it to Eastern Canada would further reduce imports. In combination, the two measures would cut imports to about half of current levels. Canada would need about 38 million barrels in its reserves.”

He might know a thing or two about this, since the Globe notes, “Gordon Laxer is author of Freezing in the Dark: Why Canada Needs Strategic Petroleum Reserves, a report released by the Parkland Institute and Polaris Institute.”

You see, we are building storage tanks – lots of them.

But they don’t belong to the government, nor does the oil they will contain. Enbridge is undertaking a substantial build program at its Hardisty, Alta. Terminal, where Pipeline News recently paid a visit. But those tanks are meant to send oil down Enbridge’s numerous lines that point in a southeasterly direction, cut across Saskatchewan and cross the US border near Gretna, Man. To a layman, it doesn’t make much sense for Canada to export western Canadian oil and import middle-eastern oil to supply eastern Canada. Go too far down that path, however, and you start getting Trudeau-esque National Energy Program ideas. We all know how that went.

Even if we did decide the oil in that tank farm should be prioritized for Canadian use due to some form of emergency, NAFTA gets in the way of us restricting our exports to the US. Perhaps we should have some sort of strategic reserves in eastern Canada. We don’t need to start monkeying around with long established trading patterns to do it.

Build some big tanks along the east coast and fill them up.

It might even give a bit of a boost to Western Canadian producers, and surely would make Newfoundland and Labrador happy.

PIPELINE NEWS August 2009

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Opinion No Robin Hoods in oil patch crimes Theft is getting out of hand in the oilpatch and it’s costing victimized companies thousands of dollars in replacement costs, lost operational time, security and investigation manpower and higher insurance premiums.

Some of the latest thefts reported by the RCMP in Saskatchewan include the loss of three oilfield hydraulic units from three well shacks northeast of Lloydminster. Substantial damage was caused to the site in the process of the theft.

RCMP are also investigating the recent theft of 490 metres of copper tubing from 14 oil sites north and east of Maidstone.

Another recent case under investigation involved the theft of an office trailer from an oil rig site near Coleville, Sask. The trailer contained tools, computers, documents, clothing and safety equipment, valued at about $100,000.

Regardless of what is being stolen, these crimes are not the work of a gratuitous Robin Hood dressed in green robbing from the rich and giving to the poor.

These are pure criminal acts and if a suspect is caught and found guilty, the judicial system needs to prosecute the culprit to the full extent of the law. The courts need to send a strong message that this type of crime will not be tolerated.

Lee Side of Lloyd Geoff Lee

The professional thief preys on the oilfield because of the remoteness of many assets and the ability to sell those assets easily and in close proximity. Theft also can occur as a crime of opportunity for personal gain and worst of all; it can be committed by trusted employees.

Whatever the motivation, stealing is a crime and when it occurs in the oilfield it can have dangerous and deadly consequences should oil and gas storage and transportation systems be tampered with.

Private security will work well to deter theft on a specific work site but that policing method is not practical or effective for small or large companies to patrol hundreds of miles of rural roads. Security cameras are better but unless authorities are immediately

alerted and are close by, the criminals and their stolen goods are long gone. If the crime occurs at night, video footage will be ineffective.

Identifying oilfield assets with multiple markings along with signage indicating the assets have been marked will help to deter some crimes and make recovery of stolen property easier.

Probably the most effective crime prevention program is public awareness that industry is prepared to make theft prevention one of its top priorities and will do what it takes to make oilfield theft too difficult and risky for the criminal.

The call for industry to circle the wagons is being made by Laird McLeod from Certified Secure Identification Corp. in Red Deer.

McLeod’s campaign is called the Oil Field Theft Prevention Initiative that is beginning to gather steam with major industry players and from Alberta Crime Stoppers.

The idea behind the initiative is to implement effective and cost-efficient prevention programs and get the message out to the public that oilfield assets are being watched, identified and guarded by many sets of eyes.

Putting thieves behind bars as a consequence of their actions is the ultimate way to protect oilfield assets. Jails don’t cost the industry any money.

Mainlining through the peaks and valleys From the top of the pile Brian Zinchuk

On July 16, I had something of a homecoming.

After nearly 10 years away from mainline pipelining, I got to spend a day on with the contractor that I had spent the most time with in my pipeline days.

Sure, last fall I got to go out with Willbros Pipeline Division in eastern Alberta for a day, and I photographed some of the Techint/Robert B. Somerville spread in western Saskatchewan in January. But this time around, it was with Waschuk Pipe Line, the company that paid my bills during the turn of the century. It felt a bit like home.

I went to work with Waschuk on the Alliance job three weeks after my wedding, starting on road bores and ending on final cleanup over a year later. I was one of the first ones hired and last ones laid off.

That’s not so much a reflection on me, a lowly oiler, but the excavator operator I was paired with – Randy Sorochuk. He’s a short Ukrainian guy origi-

nally from Swan Plain, and now hails from Dalmeny.

His skill with an excavator meant he was called on to perform almost every task a hoe might do on a pipeline, with me tagging along. We started with road bores, but then spent a fair bit of time on ditch, tie ins, cleanup, and special projects, including two river crossings that made for very long days. We might have even done some backfill, at least when we were doing tie-ins. No matter what he was called upon to do, Randy did it, successfully.

It was a wonderful opportunity, because few people get to work on such a diverse number of crews, or get to learn from such a good operator.

It was a good time. TransCanada had just put in a mainline. The year before, I worked on the Enbridge Terrace Expansion, finishing that job with Randy as my operator. It was by sheer coincidence we were assigned together on Alliance.

Then things dried up. I didn’t get a call out literally for years. One call-out was for a two-week job, but it didn’t make sense to quit a regular gig for two weeks, even if the pay was good. Eventually I would return to reporting. It was a huge cut in pay, but the paychecks were steady.

There was a lot of talk after the Alliance project that Mackenzie Valley Pipeline was right around the corner. It was going to be such a massive project, thousands of pipeliners from across Canada would be needed, and it would last several years. My mortgage would have been paid off from this job.

The much-ballyhooed Mackenzie Valley Pipe-

line seems no closer to reality today than it was ten years ago. The project website indicates a goal to be in operation by 2010, after four years of construction, even though construction is far from even starting.

There is some question to its economics. With the burgeoning development of shale gas in the US, in areas just a stone’s throw from major centres, it doesn’t make a lot of sense to bring down gas from Inuvik into the US Midwest. If anything, Mackenzie would end up fuelling the Fort McMurray juggernaut, but that would require the sleeping giant to awaken and get moving again.

The result of Mackenzie Valley stalling was a long hiatus in the mainline industry. It’s not the first time, and it won’t be the last. It takes a while to maximize the capacity of each new mainline, and they last literally for generations. One of the original mainlines for TransCanada from the 1950s is being reborn as the Keystone oil pipeline.

With the recent flurry of activity in pipeline construction soon drawing to a close, it will likely be another half-dozen years before we see it pick up again.

That means the big-inch pipeliners will do what they have always done – pull in their horns, pick up whatever small-inch projects they can, and wait it out until the next big job. Maybe that mortage will get paid off next time around?

Brian Zinchuk is editor of Pipeline News. He can be reached at brian.zinchuk@sasktel.net.

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

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PIPELINE NEWS August 2009

Enbridge ramps up SE

Peter Taylor heads up Enbridge division that collects oil from throughout the southeast corner of the province and sends it down the Enbridge mainline. Behind him is the Estevan control centre that is staffed 24-hours a day.

Story and photos by Brian Zinchuk Estevan – The growth

of Bakken production, in both southeast Saskatchewan and western North

Dakota and eastern Montana, has Enbridge substantially beefing up

its gathering capacity.

“Currently, we’re expanding,” Peter Taylor,

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manager of Enbridge’s Saskatchewan division, told Pipeline News in mid-July. Enbridge’s Saskatchewan division acts as a gathering system in southeast Saskatchewan and southwest Manitoba, collecting oil to enter the company’s mainlines.

Enbridge Saskatchewan works closely with Enbridge North Dakota, the company’s gathering system south of the border. They will be working even closer, with the preliminary proposal of reactivation of the Portal Link pipeline.

In southeast Saskatchewan, the company is currently working towards an approximate 100,000 barrel/day increase in capacity. A fur-

ther estimated 30,000 barrel/day increase is slated for North Dakota.

“We’re also looking at some future stuff.

We’re in the advanced design phase,” Taylor says, noting the list of options includes up to another 100,000 barrel/ day increase.

“We’re spending well over $100 million in North Dakota. We’re in that $100 million range in our expansions in Saskatchewan.”

The increase of Bakken oil production is the prime motivator for these developments. In the 1990s, a 12 inch pipeline had been built running from Steelman to the Canada / U. S. Border close to Lignite, North Dakota, then connecting to an existing pipeline to just west of Minot, N.D., the Berthold Terminal.

“There was an overcapacity situation in Saskatchewan. The pipeline in North Dakota was under capacity,” Taylor explains. The cost effective solution at the time was to run oil volumes from southeast Saskatchewan down the North Dakota line, where it would eventually make its way to Clearbrook, Minnesota.

“It gave us the opportunity to ship incremental over capacity into North Dakota and into Clearbrook,” Taylor says.

That stopped in 2006 with the growth of Bakken production in North Dakota. “North Dakota production had increased to the point where there was no more capacity available.” ɸ Page A7

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PIPELINE NEWS August 2009

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Sask gathering capacity

“

We’re spending well over $100 million in North Dakota. We’re in that $100 million range in our expansions in Saskatchewan.

”

-Peter Taylor ɺ Page A6 It got to the point where North Dakota producers were resorting to trains to ship out their product.

One of the points raised by North Dakota presenters at the Williston Basin Petroleum Conference in Regina this last April was the growing need for more pipeline capacity to handle all the new oil production.

“That’s what prompted the Phase Six Expansion that is being done to assist with the de-bottlenecking of the North Dakota system,” according to Taylor. It’s expected to be done by late 2010.

In Saskatchewan, the ACCE project, completed in June, 2008, converted an existing 12 inch line from Alida to Cromer, Man. It had been used for natural gas liquids, but would now be used for oil. “The 12inch line was very underutilized.”

The most cost effective alternative was to install a new, smaller, NGL line and convert the existing line to crude oil.

The addition of a 12-inch line allowed a substantial increase in capacity from the 16-inch parallel line, that up until now was all that was needed for southeast Saskatchewan production.

“We’ve gotten to a point now where production has increased even further in Saskatchewan, where we need another expansion to debottleneck the Midale and Gapview areas,” Taylor says. “There’s way more production there than what the system is capable of handling.”

The Midale and Gapview areas he is referring to

The Estevan ofÀce for Enbridge looks after the Enbridge gathering system in southeast Saskatchewan.

is more along the lines of drawing oil from the Bakken field around Stoughton and Benson. There are plans to expand the Benson terminal and add tankage. There would also be new pipe from Stoughton, first 8 inch, then transitioning to a 10-inch line.

Existing lines east of Stoughton will be reversed.

It’s more economical to take the oil southwards towards Benson than Bryant, then bring it around to Alida using existing lines and right-of-ways, than it would be to build a new line from the Stoughton area to Alida.

“This is underway right now. We expect it to be completed in late 2010,” Taylor explains.

The company is also looking to install a new 31 km 12-inch line from the Bryant booster station, near Midale, to Steelman. At Steelman, the plan is for increased pumping horsepower, piping changes, and increased tankage. It’s all an effort to remove bottlenecks to the system.

Continuing that concept, they want to convert a 12-inch NGL line from Steelman to Alida to crude oil use.

Additional capacity can be added by beefing up pumping horsepower, to a point. Two things can be done to increase capacity – increase pipe diameter, and/or increase pumping horsepower.

“You get to a point where there’s only so much you can get through a pipe. But we’re not there yet,” he says.

Portal link This brings us back to the Portal link. It used to

be used to send oil south to North Dakota. It is currently in hiatus, filled with nitrogen. The plan is to reverse this line, allowing North Dakota Bakken oil to come up into Saskatchewan, and go from Steelman to Alida to Cromer, where it can flow into the Enbridge mainlines.

But does it make sense to pump oil north into Canada, up and around through Cromer, and back down into the U.S.?

Taylor explains they are pretty much at the limit of what they can pump through the line that runs east-west though North Dakota. They’ve already added as much booster pumping capacity as possible as part of the Phase Six Expansion. “We can’t go any further upgrading this line.”

To put in a new line would mean a new pipeline roughly 300 miles long. “That’s a lot of money to put in new pipe.”

The portal link solution takes advantage of existing infrastructure. “It’s more economical,” Taylor says. “And it can be put in significantly faster.”

Enbridge’s Saskatchewan division is headquartered in Estevan, where it maintains a 24-hour operations control centre. “We have 127 [staff ] in this region,” Taylor says, noting that does not include contractors. About half of the staff are based in the Estevan Office, with the rest working in the field out of offices at Midale, Carlyle, Steelman and Alida. He notes, “There’s a fair amount of the commitment to the communities,” pointing out the longer-term, sustainable employment.

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A8

PIPELINE NEWS August 2009

(VWHYDQ 276

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A9

A10

PIPELINE NEWS August 2009

One for a friend, one on spec

By Brian Zinchuk Weyburn – Sometimes business opportunities just kind of happen. That was the case for Doug Dembiczak, who heads up Demby Trailer Ltd., located just a few miles south of Weyburn.

“We started renting out flatdecks and enclosed trailers in the spring of 2001, while I worked for a local wellsite testing company,” explains Dembiczak.

“It just sort of happened.”

“I decided to build a well-site water-hauler shack for a friend of mine. There was not much going on, so I built another on spec, and sold it before we finished it.”

“Since then, we’ve increased our production capacity, built a larger shop, and added service rig dog houses and skid shacks.”

“We’ve been manufacturing since the fall of 2003.”

The name Demby comes from his father’s cattle business. Demby is easier to pronounce than Dembiczak.

While their products can be leased, they are primarily built for sale. Some are built on spec – they like to have well site trailers in inventory. But most of their production is custom order.

That’s particularly the case with service rig doghouses, where it’s important to match the company colours. A doghouse nearing completion for General Well Servicing, Carnduff, is a medium green. It’s al-

most a John Deere Green, but Dembiczak says it’s more like a Rider Green.

That could be because he’s a wee bit of a rider fan. The Matt Dominguez autographed helmet on his disk matches the commemorative front page of the LeaderPost on the wall, a momento of the Riders’ 2007 Grey Cup. The Riders flag on the wall compliments the riders T-shirt worn by Dembiczak.

“You can’t live and work in this province unless you’re a Rider fan. I don’t miss one,” he says of the home games.

In the doghouse “This is what we’ve mostly been busy with since last fall,” Dembiczak says of the doghouse.

It has a desk, lockers, fridge and microwave. In the back is the washroom/toolroom/generator room.

Electrician Darren Moore of C & D Electric, Weyburn, is tying in the gen set before the trailer goes out.

They do most of the work themselves, with welders and carpenters making up much of the staff. Some aspects, like painting and electrical, are farmed out.

The company is CSA-approved and carries a certification for the Alberta Building Code, Part 10 – Relocatable Industrial Accomodation.

They’ve also built office, consultant and rig manager skid shacks. The well-site trailers are meant primarily for water haulers or vac truck operators.

“Most of it is custom order. We build specifically

to customer needs,” Dembiczak says. “The flat decks we build are more for extreme heavy duty use.”

In addition to their own product, Denby carries Trailtech flatdecks and C Jay Trailers enclosed trailers. Both are Saskatchewan-produced – the former at Gravelbourg, the latter at Moose Jaw. ɸ Page A11

The well site trailers that got the ball rolling for Denby Trailer at Weyburn are mean primarily for water haulers or vac truck operators.

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A11

Demby Trailer keeping busy

Electrician Darren Moore, subcontracting for Demby Trailer, Ànishes hooking up a gen set in a new service rig doghouse.

ɺ Page A10 They’re currently running at five staff, having peaked at 13 before things slowed down last fall. His wife Marilyn handles the admin side of the business full time.

At the recent Saskatchewan Oil and Gas Show in Weyburn, they had a well site trailer, two different service rig doghouse, and a flatdeck on display.

The oilshow was “great,” he says, noting an excellent reponse.

Did that turn into orders?

“Yes,” he replies.

Indeed, you can see some of their trailers on the right side of front page of the July edition of Pipeline News. It can be found at www.pipelinenews.ca under “past editions.”

They’ve sold trailers into the four western provinces as well as North Dakota, but business is principally from the southeast. Dembiczak says he’s grateful to southeast Saskatchewan for a lot of support.

A change in government has also made a difference, according to Dembiczak.

“I’ve noticed a huge increase in business ever since our current government was elected.”

Demby Trailer likes to keep a few wellsite trailers in stock. They are the trailers that launched the business.

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A12

PIPELINE NEWS August 2009

Feast or famine in the mainline business

The top of the food chain for Waschuk Pipe Lineâ&#x20AC;&#x2122;s Alberta Clipper work includes superintendent Dave Anderson, left, Mike Thorn, project engineer, and Dave â&#x20AC;&#x153;Chatterâ&#x20AC;? Prososfsky, general superintendent.

Â&#x201E; By Brian Zinchuk White City â&#x20AC;&#x201C; The mainline pipeline construction business is a tough racket to survive in.

When thereâ&#x20AC;&#x2122;s work, thereâ&#x20AC;&#x2122;s lots of work. But when it dries up, the drought lasts for years.

Saskatchewan sees a burst of mainline pipeline activity every ďŹ ve to ten years, the timeframe by which either Enbridge (formerly Interprovincial Pipe Line) or TransCanada typically adds another mainline.

TransCanada now has seven, and Enbridge, with the addition of the current line under construction, will have six.

The last spurt in Saskatchewan was in 1998 to 2000, when the thennewly renamed Enbridge built what was known as the Terrace Expansion.

It was followed by the greenďŹ eld Alliance Pipeline, of which Enbridge is a major shareholder.

TransCanada also had work done.

One of the major contractors on the Alliance job was Waschuk Pipe Line Construction Ltd., of Red Deer, Alberta. Waschuk is back in this province, building the eastern Saskatchewan portion of Enbridgeâ&#x20AC;&#x2122;s Alberta Clipper, from Bethune to Cromer, Manitoba.

For mainline contractors, itâ&#x20AC;&#x2122;s feast time, after years of famine. Not everyone survived the last one, with Marine Pipeline Construction being one of the major contractors to disappear. It was liquidated in 2004, after its American parent company, Murphy Bros. Inc, ran into ďŹ nancial trouble.

This time around, TransCanada is converting an existing gas pipeline to oil use. The project is called the Keystone Pipeline. Enbridge is building a new mainline, called Alberta Clipper. TransCanada is also looking to build a new oil mainline, called Keystone XL, across southwest

Saskatchewan. After that, things are likely to get real quiet in the mainline business.

The Mackenzie Valley Pipeline still seems a long ways oďŹ&#x20AC;. While there has been a lot of work around Fort McMurray in recent years, that dried up when the price of oil dropped like a stone last fall.

Family operation As a mainline contractor, Waschuk stands out in that it is family-owned and operated. Bill Waschuk is the head, as CEO. His children run the operation.

Wes Waschuk is president, Kevin Waschuk is vice president. Lorrill Waschuk retired a year ago.

They make frequent visits to the ďŹ eld oďŹ&#x192;ce, which, until late July, was based in White City. The tail end of the project saw the ďŹ eld oďŹ&#x192;ce in Virden.

In terms of scale, this project is huge. Wes Waschuk sat down with Pipeline News in White City on July 16 and offered some explanation.

The total dollar amount for Waschuk Pipe Line will be in excess of $250 million, he said. It

will be their second largest project, dollar-wise, with 345 km of 36-inch pipe. It follows a 323 km 42-inch job in northern Alberta, which involved tougher conditions and isolated camps.

The workforce peaks around 700, and that doesnâ&#x20AC;&#x2122;t include Enbridgeâ&#x20AC;&#x2122;s personnel on site as inspectors. There are in excess of 200 pieces of equipment on the job, 135 pickups and onetonne trucks, about 25 buses, according to Dave â&#x20AC;&#x153;Chatterâ&#x20AC;? Prosofsky, general superintendent. Most of that equipment is Caterpillar. â&#x20AC;&#x153;I deal with all the major issues that come up,â&#x20AC;? says Wes Waschuk, oďŹ&#x20AC;ering up dealing with the owner of the pipeline

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and labour as two examples. Heâ&#x20AC;&#x2122;s is not just president of the company. â&#x20AC;&#x153;Iâ&#x20AC;&#x2122;m the project manager, too,â&#x20AC;? he says. â&#x20AC;&#x153;Thatâ&#x20AC;&#x2122;s a plate-full right there. We have to work from four collective bargaining agreements we have to abide by.â&#x20AC;?

One of those issues was a ďŹ ve-day blockade of the right of way by First Nations people at the start of the project in August, 2008. That was dealt with by Enbridge.

Being an owner of the company has its advantages â&#x20AC;&#x201C; decisions can be made quickly. â&#x20AC;&#x153;If things canâ&#x20AC;&#x2122;t get resolved, I can make a fast decision,â&#x20AC;? he says.

Thatâ&#x20AC;&#x2122;s important, he notes, because, â&#x20AC;&#x153;in pipeline, everything is quick.â&#x20AC;? ɸ Page A13

PIPELINE NEWS August 2009

A13

Alaska before Mackenzie

Wes Waschuk is president of Waschuk Pipe Line Construction Ltd. Behind him are the aerial maps of the right-of-way that foremen post their daily progress on, by way of an arrow with the name of their crew.

ɺ Page A12 But long before that ever happens, a lot is gone over at the negotiating table before workers hit the ground. “There’s a very long negotiation process before you start the pipeline,” Waschuk says. “We’ve been doing this since ’65.”

In this case, the call for contractors came in late 2007, with contracts awarded in 2008, and construction starting in August of that year.

The completion date is pegged at Nov. 1 of this year.

Into the valley What’s next for the company, after Alberta Clipper?

Waschuk says they are hoping for the Gateway Pipeline, through British Columbia to the Pacific, and that the Mackenzie Valley Pipeline will get on track. He says they need to get the oilsands going again as an impetus for future projects.

“Things can come back as fast as they were

delayed,” he says. “There’s a finite amount of oil.”

“I believe [the] Alaska [pipeline] will be built first, then Mackenzie,” he says, citing an American desire for energy selfsufficiency. He notes they had put in cost estimates years ago, before Sept. 11, 2001.

During the last slowdown, he notes, “We took on smaller projects.”

As a family-owned company, they do not have the pressures to show regular returns for investors, but rather are responsible to themselves.

That means they can cut back as needed, a strategy employed before. “There was no big work for a long time,” he recalls.

One of their strategies, according to Waschuk and Prosofsky, is the use of rented equipment. When the project is done, you’re not carrying the extra investment in capital equipment.

“We probably have 40 pieces rented of large iron from our local Caterpillar dealer in Regina,” Prosof-

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“We are going into a valley now,” says Prosofsky. The company needs to keep lean and mean.

“You keep your overhead low during the lean times.”

“The one thing about the valley is you get rid of

inefficiently run companies,” Waschuk says.

Saskatchewan connections Prosofsky is from Hanley, a small community south of Saskatoon that has produced a large number of professional pipeliners. The Prosofsky clan is among them.

He notes that between Hanley and Kenaston, there are about 35 pipeliners, most of which are at work on the Alberta Clipper project. “The town of Hanley probably has 15 pipeliners.”

“Probably 90 per cent of our foremen are from rural backgrounds, basically farm boys. The definitely weren’t urbanites,” Prosofsky says. “Many of the foremen have been with Waschuk for 25 years when Waschuk was a small company.”

He notes that seven or eight senior supervisors for the company are from Saskatchewan.

A substantial portion of the workforce is also from Saskatchewan.

Prosofsky himself is a relative newcomer to the company, having been the spreadboss for Marine from 1995 until 2004, and for Majestic Pipeliners for seven years before that. In the intermission between Marine and Waschuk, he had a small company, doing consulting. That period included six months with Techint, the company that is now working with Robert B. Somerville on the western Saskatchewan portion of Alberta Clipper.

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“I had a daughter born in Moosomin in 1973 when we were working in Moosomin.”

His oldest son is one of three assistant superintendents, in this case, covering the back end of the job.

One last thing, how did Prosofsky get the handle “Chatter,” by which he is universally known? He’s been called that since he was 14 years old, he explains, a reflection on being talkative.

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A14

PIPELINE NEWS August 2009

Moving mountains of dirt: ditch crew

By Brian Zinchuk Glenavon – Everything in big-inch mainline pipeline construction is more demanding. Ditching is a prime example.

For a small-inch pipeline, ditching is much more forgiving. The pipe is much more flexible, or, in pipeline parlance, has more ‘rope.’ You might even notice the pipe sagging between plastic cones used to hold it up along the right of way. If a ditch isn’t perfectly straight or flat, the pipe will bend to conform to it.

No so for mainline work. There is precious little rope in a 36-inch pipeline. That means if there is no give in the pipe, the ditch has to fit exactly. If there are rises or dips in the ditch bottom, it can apply

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pressure to the pipe after it has been backfilled, leading to a possible failure years down the road.

Making sure the ditch and pipe match starts with the bending engineer going along the right of way. He’ll measure off how many degrees the pipe needs to be bent up (a “sag”, for a dip) or down (an “overbend,” for a small rise). These numbers are used by the bending crew to bend the pipe to match the contours of the land. They are also used to determine cut stakes, where the ditch will have to be deeper than its standard one-meter plus the thickness of the pipe.

Since the 36-inch pipe is nearly a meter across, the ditch is usually dug to 2 metres, no less, allowing for a little extra depth. It’s better to be a little deeper than too shallow. You can never be shallow.

The ditch crew uses two primary pieces of equipment – giant wheel ditchers and 45-tonne excavators, with the Caterpillar 345C or 345D being the standard. These excavators are about as big

as you can get and still haul on the road in one piece.

Dozers are used in a support role.

On this project, Waschuk is using nine excavators, all Cat 345Cs or Ds, two ditchers, a D8 dozer and a D6 dozer. There are 18 workers on the excavators, four on the ditchers, two dozer operators, two labourers, bus driver, strawboss (assistant foreman) and foreman on the ditch crew, according to strawboss Armand Cust. The crew is made up primarily of operating engineers, although the bus driver is a teamster and the two labours belong to the labourers union.

That crew of 29 will produce about 4 kilometres of two-metre-plus deep ditch a day, moving a veritable mountain of dirt in the process.

Ditcher The king of the prairie is the wheel ditcher. For the Enbridge Alberta Clipper project, Waschuk Pipe Line is using two. ɸ Page A15

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A15

In good ground ditchers can not be beat ɺ Page A14 In many ways, they function like the wheel excavators that used to be used at Fort McMurray. A giant wheel with numerous buckets, each festooned with teeth, rotates continuously. The buckets scoop from the bottom to the top, each scraping a few inches and depositing it onto the conveyor belt that runs through the centre of the wheel. The conveyor sends the dirt out to the spill pile. You can easily identify ditcher ditch from a distance by its uniform, smooth spill pile.

Ditchers are tremendously productive when they are in good ground, easily outpacing several excavators each. Whereas an excavator’s daily progress might be measured in hundreds of metres, a ditcher’s progress might be measured in kilometres.

“You can get up to two clicks if it’s good going,” says Brett LaCroix, oiler for ditcher operator Kevin Reiker.

As such, the oiler for the ditcher has to frequently go out and set up offset sighting rods for the operator to go by. He does this by measuring off the surveyed centre line stakes, and aligning them so that as many as 8 rods will be in a perfect line, one disappearing after another as you eyeball it. From his sideways-facing seat, the ditcher operator can look down the line and align his machine for a perfectly straight ditch.

For LaCroix, it’s his third year oiling on a ditcher. “I don’t mind it,” he says. “It keeps you in shape, all the walking, changing teeth.”

There are 188 teeth on all those buckets, as opposed to five on an excavator bucket. “Too many,” he says with a smile.

Ditchers have their limits, however. They don’t do cut stakes, they can’t do curves (called sidebends), and rocks are especially problematic. Sometimes the ditcher has to leave a rock and an excavator coming behind will have to dig it out. In rocky land, sometimes the ditchers just skip to the next, good digging portion.

With a high number of moving parts, ditchers are also prone to frequent breakdowns. An oiler can easily pump six or more tubes of grease a day, by hand, into a ditcher. Woe be to the oiler who thinks one or two tubes is enough. The mechanic and utility welder are usually on pretty close terms with the ditcher.

Ditcher operators also have the unfortunate reality of being one of the last operators hired onto a job, and among the first let go. While an excavator might be redeployed for clean up or tie-ins, a ditcher has one purpose – dig

ditch. When the ditch is done, it’s time to go home.

Excavator The excavator is the workhorse of the ditch crew. For this job, Waschuk has nine on the ditch crew.

While in non-union work, excavator operators typically operate alone, on union, big-inch pipelines, each excavator has two workers – an operator and an oiler. The oiler’s job is to measure the ditch to make sure it conforms to cuts stakes, perform daily maintenance, flag at road crossing, and act as a second set of eyes around power lines and underground utilities. ɸ Page A16

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A16

PIPELINE NEWS August 2009

Excavators are the workhorses ɺ Page A15 The excavator operators have got to be very good at what they do to stay on. That means producing a certain amount of ditch each day, and that ditch has to be perfect. The bottom has to be flat, which is not as easy as it seems. That’s because there are no linear movements on an excavator.

Every motion the machine makes is in an arc – the swing, the boom, the stick and the bucket. The operator has the feather two, three or even four controls all at once to create a straight line.

It takes about four to five minutes to dig a “set,” – as much ditch as you can dig at one spot without moving. The operator starts digging the outside edges of the ditch, and keeps narrowing it down so that it forms a sloped “V” shape. The walls are kept smooth so that nothing falls out later and becomes a headache for the lowering in or backfill crews. Rocks in particular are the concern here.

Once he’s done a set, he’ll spin around and look down at a stake between his tracks, pointing down his centerline. He’ll advance the machine, aligning the excavator with a painted centreline, done by the oiler. The oiler will use a long string and a can of fluorescent spray paint to mark where the centre of the ditch should be, using the surveyed stakes as guidance.

It’s important to stay on centreline, because little errors can amplify over time, and looking down at 300 metres of not-so-straight ditch can make for an unhapply foreman.

A smooth operator can be identified from a distance by the lack of jerkiness in the arm’s movement. He’ll move that bucket in a smooth, sweeping arc, from edge of ditch to in between his tracks, over to the spill pile and back again all in one fluid motion.

Excavators play a form of leapfrog all day long. They will set in, dig a stretch, then ‘pull the plug’ and scoot out.

Pulling the plug happens when two ditches meet, usually with two excavators working back to back. One will pull out and travel along the spill pile to the next digging location. The remaining excavator will rotate his tracks so they are now perpendicular to the ditch line. He’ll dig under himself, undermining, until the excavator is basically suspended by the corners of its tracks set across the ditch.

Reaching with the arm to the side, he’ll use the bucket to push the machine off the ditch line and into a hole left in the spill pile, running the tracks at the same time. From this position, he’ll then dig out the remainder of the plug, ensuring the ditch bottom is straight and smooth. Finally, he’ll climb the spill pile and travel along it until the next possible exit comes along.

When the pipe has not been welded up yet, this is easier, because it is possible to move a joint of pipe. But once the pipe is welded, it can mean a long ‘walk’ along the spill pile.

Excavators will often be used on other crews once the main ditch is completed.

Dozer The bulldozer provides a support role on the ditch crew, usually pushing spill away in situations where the excavator operator runs out of room in the regular work area. This is often the case near roads.

Dozer operators also spend a lot of their time going backwards, but on purpose. Dragging their blade in a technique called ‘backblading’ acts to smooth out the right of way similar to a grader.

The oiler on an excavator takes regular measurements of the ditch, to ensure it is at the proper depth. There must be a minimum of one metre cover over the pipe. The measurements are taken using a grade stick, typically a 1x2 with a long tape measure taped to the end. At the end of the tape measure, a rock is used as plumb bob.

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A17

Training paying off with a smile and a bit of chagrin. “I might think twice when I’m standing all day in pouring rain.”

As for the ever-present wind on the bald prairie southeast of Regina, she says, “I think I’ve eaten my fair share of sand and dirt.’

Speaking about the OETIS course, she says, “I think the majority of it gave me a good basis and understanding to come out here. Without that training, I don’t think I would survive out here. Everything we learned gave me a good basis – the do’s and the definitely don’ts.”

Stonechild adds, “Every day I’m learning some-

thing different, i.e. moving pipe out of the way.”

Her operator is providing a good example to learn from, with a ditch so smooth you could shoot a billiard ball down it. “Tell my wife I’m eating blueberries and bananas,” he says during his coffee break.

Lyle’s brother Stanley is the ditch foreman, his other brother, Armand, is the strawboss. It’s pretty common to see families working on the same job.

“I’ve been pipelining for 31 years,” he says, adding he’s “ran hoe,” e.g., operated an excavator, for 25 years. He’s also worked in gravel pits and in road construction.

Nina Stonechild says the training she received from the Operating Engineers Training Institute of Saskatchewan has been invaluable to her on the job.

Story and photos by Brian Zinchuk Glenavon – When Pipeline News last spoke to Lyle Cust has been been operating an excavator for 25 years. Here he’s working on the Waschuk Pipe Nina Stonechild, she was taking the Operating En- Line ditch crew. gineers Training Institute of Saskatchewan (OETIS) pipeline excavator operator course near White City.

That was during the spring time, before the mainline work on the Enbridge Alberta Clipper project fired up again.

She’s since been featured on the regular Rawlco Radio spot “Seed of Success,” which focuses on aboriginal achievement.

Stonechild is now working as an oiler on the ditch crew, alongside excavator operator Lyle Cust.

“I am not regretting this at all. I am learning a lot. I have a good operator that’s teaching me lots,” she says.

“It’s just the waking up early,” Stonechild adds

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PIPELINE NEWS August 2009

That’s the sound of men working on the main gang

By Brian Zinchuk Glenavon - The biggest crew on a mainline pipeline project is the main gang, also known as pipe gang. It’s the crew that welds the joints of pipe together for stretches that can be kilometres in length.

Most mainline con-

tractors will actually run two similar welding crews – the main gang, and a poor-boy crew. The poor-boy crew is often a little smaller and more nimble, making it easier for them to work in tighter quarters.

Depending on the number of welding shacks, the crew

can exceed a hundred.

For Waschuk Pipe Line Construction, there’s about 80 on the main gang.

At the front end of the crew are workers who clean up the ends of each joint of pipe, ensuring they ready to go. Several labourers will carry multi-headed propane

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torches, putting them inside the end of the joint of pipe and warming it in preparation for welding.

One of the most skilled sideboom operators on the job will drive the setting-in tractor. He will pick up each joint of pipe from the skid piles on which they are resting, and run it back to the front end of the welded pipe.

As the joint is brought back, the ‘goose’ is inserted into it. It has clamps and a multiheaded welder that will do the initial weld, joining the loose joint to the rest of the welded line pipe.

But before that happens, a pipefitter known as a ‘spacer’ directs the placement of the joint.

He’ll crawl on top of the pipe, and guide it so that there is an even space all the way around between the new joint and the line pipe he is kneeling on. If the gap is even all

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The spacer, on top of the pipe, right, guides the new joint of pipe onto the ‘goose,’ and internal welding rig.

the way around, the weld will be straight.

While this is going on, a group of labourers rapidly redeploys the skids that once held the loose joint in place. They will create a special skid pile under the pipe, cradling it so that it will not fall off. It’s hard work, and brutal when the weather is hot. Pipeline News saw one labourer whose hard hat didn’t stop dripping of the sweat pouring off his forehead.

Next are the welding shacks, in this case, five.

The first does what is known as the ‘hot pass,” the initial outside weld.

The next two are fill

passes, and the final two are cap welds.

The ends of the joints of pipe are bevelled, so each progressive weld fills in more of the bevel.

Each welding shack is carried by a sideboom, whose operator is sometimes said to be a ‘shackpacker.’

The sideboom will carry the power pack for the welders on its tail end, connected by umbilicals to the shack.

The boom operator will lower the welding shack onto the pipe, while welders’ helpers on each side direct it with taglines. ɸ Page A19

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PIPELINE NEWS August 2009

A19

The main gang and a poor-boy crew are the largest crews ɺ Page A18 Four men work in each shack – a welder on each side, assisted by his helper.

Once the shack is on the pipe, the helpers will open the doors, close the shack floor under the pipe, and close the front and rear doors around the bottom of the pipe.

The days of stick welding line pipe on mainlines are long past.

Automated welders, called bugs, do the actual laying of the bead, while the human welders direct them with remote controls.

The welders deploy the bugs, which are mounted onto bands that had been placed on the pipe previously. Each welder does his side, with one doing the top, and the other doing the bottom.

“I can control the rear welding head left to right and my wire speed,” notes hot pass welder John Bouchard in the brief moments between welds. “If it’s really wide, I’ll give it more wire. You want just a little concave for the cappers.”

In a highly choreographed exercise, welders

work together with their helpers to quickly weld and grind as needed. Before you’ve had time to ask yourself, “Are they done yet?” the bugs are stowed, the doors are opened everyone gets out. The helpers open up the floor again. The boom operator then hoists the shack onto the next weld.

Sometimes companies will use multiple shacks for each process on their main gang. These shacks will leapfrog each other, doing every second weld.

The welding crews will often start the project after the ditch crew, then pass them at some point, finishing well before ditch.

It’s a fast paced crew, and a lot can go wrong.

As such, a medic is usually in close proximity to the welding crews, just in case.

Once the welding crews are through, nondestructive testing, typically ultrasound these days, is performed on each weld. The standard used to be X-ray. If there are any defects in a weld, they must be repaired before it can be coated.

With the ultrasound completed, coating can then have its go at the pipe.

If you want to lose weight, start throwing skids like these labourers. They assemble a crotched skid pile under each joint of pipe as it is welded. The sweat was literally pouring out of the hardhat of one of them.

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A20

PIPELINE NEWS August 2009

Coating now automated on mainline

By Brian Zinchuk Glenavon - There was a time when coating the welds on a big inch pipeline could mean enough brush strokes for your arm to fall off. Denis McKeough, coating foreman for Waschuk Pipe Line should know. On the Alliance Pipeline ten years ago, he probably hand-painted close to 20,000 welds.

As the coating foreman since then, he now is looking after a less-phys-

ically intensive method – using an automated rig.

Corrosion is the big bogeyman when it comes to steel pipelines. Mainlines can, and have, operated for over half a century, as long as corrosion is kept under control. Any nicks or imperfections in the coating, however, can turn the steel into swiss cheese as the decades wear on. In the worst case scenario, years after the pipeline was built, a blowout can occur.

Coating is the protection against it. The length of the pipe is coated at the steel mill, before it is shipped out. However, the ends, where the joints of pipe are welded together, must be coated in the field.

This used to be done with a brush – a sloppy affair. Not anymore.

It used to take 90 seconds to do a weld by hand.

They can now do it in 45.

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Denis McKeough pulls the wraps of the automated coating machine now used by Waschuk Pipe Line Construction. Having caught up to the nondestructive testing crew, it was time to cover it up for the day.

away from the zone,” says McKeough, referring to the area where the coating is being applied. “We wore respirators, but it’s all the better.”

“It’s the quality. It’s more uniform and consistent than what we’ve done before with a brush and roller.”

Waschuk has been a pioneer with this sort of coating apparatus, bringing it to Canada in recent

years. General superintendent Dave “Chatter” Prosofsky says it was the only coating system approved for Enbridge’s Alberta Clipper project.

“Controlled environment is probably the big one,” he says of the benefits. “It’s not cheaper.”

Nick Smith, a Brit with a thick Yorkshire accent, is the project supervisor for Pipeline Induction Heat, the subcontractor

whose system is being used. He’s been working in Canada off and on for three years. During some of that ‘off ’ time, he was working in India for three and a half months.

“They’re out of the UK. They work all over the world. Waschuk was the first company in Canada to use them on large-diameter pipe,” McKeough says.

His crew still has the same number of people, at 31, but they don’t have to stand over a smoking pipe, he explains.

The ‘induction’ part of the name comes from the process of using magnetic induction to heat the pipe.

The coating apparatus wraps around the pipe in a manner similar to the automated welders used in mainline welding. The difference is the automated welder mounts on a band, where as the coating machine travels around the pipe.

The pipe is first prepped by way of sandblasting, then heated with the induction coil. The powder coating is then applied, resulting in a fusionbonded epoxy coating.

“We mount it on the pipe, and the single head sprayer rotates back and forth around the pipe to achieve the required coating thickness,” McKeough explains.

That machine is suspended from a sideboom, which carries it from weld to weld. The sideboom tows a container with has the complex mixing equipment. No pictures allowed in there, unfortunately. The applicator is connected by umbilical hoses hooked up the towed shack.

On the Web: http:// www.pih.co.uk. An animation of the coating process can be found under the fusion bonded epoxy link.

PIPELINE NEWS August 2009

A21

The crew everyone coil, through the break in the coating, down the pipe, into the ground, grounding out the jeeper, at which point it makes a noise. When this happens, the crew stops, and a labourer with a small hand torch will melt a ‘jeep stick,’ also known as a ‘patch stick,’ to cover

up the scratch. A recheck with the jeeper, and the team continues on.

The heavy equipment comes next, with a group of sidebooms doing the heavy lifting, literally.

One goes ahead and attaches a heavy duty sling to the far end of the pipe.

This is to prevent the pipe

from going anywhere it is not suppose to.

The remaining booms use cradles – slings with multiple rollers, to lift the pipe of the skid piles and swing it over and into the ditch. In between there is another jeeping party, making sure there are no jeeps. ɸ Page A22

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Scott Land & Lease Ltd. The ‘clam’ is a ‘pipeliner’ with a clamshell bucket attached. It’s used to clean out any slough-ins or missed rocks that may be in the ditch just prior to the pipe being lowered in. The pipeliner is a specialized dragline used on the back end, either as a clam, or with a ‘Mormon board’ for backÀll.

By Brian Zinchuk Glenavon - If there is any one image that has come to characterize mainline pipeline construction, it is the lowering-in crew in action.

You’ll see it everywhere from the logo of the Pipe Line Contractors Association of Canada to artistic wall prints.

After the ditch has been dug, the pipeline welded, ultrasonically tested and coated, it’s time to put it in the ditch.

That’s where the lowering in crew comes in.

It’s a crew that stretches out and compresses like a spring, with the advance parties going ahead, only to see the tail end rapidly catch up.

The ‘clam’ is one of those parties. It’s what is known a ‘pipeliner’ – an adapted Caterpillar excavator with a dragline boom instead of a digging arm. The cab is

raised, and the hydraulics make way for cables. The pipeliner has a clamshell bucket that is dropped into the ditch to scoop out any material that might have sloughed in or any rocks that may have been missed. The pipeliner’s oiler walks along the ditch, signalling to his operator where to deploy the clamshell bucket.

Also on foot you’ll come across the jeeping party. These labourers use a coil wrapped around the pipe like a slinky. The coil is energized with high voltage from a battery.

The apparatus is called a ‘jeeper,’ and looks for ‘jeeps,’ or scratches in the coating. (Think “Jeepers!

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The pipe is grounded at one end with a jumper cable, and the jeeper trails a wire on the ground. If there are any breaks in the coating of the pipe, electricity will flow through the

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PIPELINE NEWS August 2009

wants a pÕcture of ɺ Page A21 A small tracked skid-steer type loader sweeps the skid piles out of the way, to be collected later.

The booms work together in concert,

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their toes.

When they get going, the crew can make short work of long sections of pipe.

Following the lowering in crew is the surveyor, who uses a GPS to pinpoint each and every weld, sag, overbend and sidebend on the pipe. He walks along the pipe, placing the rod of his instrument on the welds and entering in the information into the computer. If every weld position is known, then the GPS coordinates are known for the entire pipe. It’s just a matter of the computer connecting the dots.

The last chance to check for imperfections in the coating, known as ‘jeeps,’ is just before the pipe is lowered in. Here, in the centre, a labourer performs a minor jeep repair while the rest of the crew waits.

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PIPELINE NEWS August 2009

A23

Found additional 202 lines on a lease

By Geoff Lee Edmonton – Not all utility and pipeline locating companies in western Canada are created equal.

Red-Alta Utility Location Ltd., a division of Consolidated Utility Services Canada (CUS) has made a move to stand out from the crowd by being the first to adapt industry training standards for its field operations.

The Red Deer-based company has partnered with the Ontario Regional Common Ground Alliance and its certified Damage Prevention Technician program and has also published the Canadian Line Locate Industry Best Practices Handbook for its customers.

“We are the only locate company in western Canada with the DTP program,” said Christina Davidson general manager of CUS’s Canadian operations.

“We looked at our internal training program and we wanted to step up the game. A lot training programs just look at locate theory. Locate theory is just one part of the equation.

“The more important part of the equation is once they get to the field that they understand what it is they are looking for and why they are looking for it. That’s why we adopted the DPT because it has a competency assessment component to it.”

The DTP training program has specific line locate modules on gas and oil pipelines, telecommunications, water and sewer and power line.

“I am proud to say that all of our oilfield line lo-

cate technicians have been fully certified through this program,” said Davidson. “We have more than 45 employees in pipeline locating.”

The new industry best practices handbook may help to make locating safer, reduce risk, potential damage and liability incurred from not heeding “call before you dig” practices.

“The handbook is to provide education and assistance on what our clients should expect from all locate contractors that they have on site,” explained Davidson.

“We published it because we felt that any existing attempts at those standards didn’t encompass everything we need it to.

“Pretty much anybody who can buy a truck, a locate machine and take a two-day course, can go locate pipelines. That’s a bit of an issue.

“So what we’ve decided internally is to set a standard and train our workers to that standard.

We want clients to understand that we have their best interest in mind. We reduce the risk of missed pipelines by pushing those standards.”

The crucial the first step in line locating is to call before you dig to one-call authorities such as the Alberta One Call Corporation and Sask 1st Call.

“Alberta is the only province that has legislated one call requirements,” said Davidson.

“The education program has been fantastic. It says if you have anything in the ground, you need to make a call and make sure you locate it before you

excavate it or before you do any kind of ground disturbance.

“We work those tickets on behalf of pipeline and utility companies.”

Failure to call first before excavating can lead to the type of accident that led the RCMP in Yorkton to evacuate a few city blocks after a city backhoe operator hit a natural gas line on June 4.

Fortunately, no one was injured but a preventative call to Sask 1st Call would have proactively alerted subscriber companies of plans to disturb the ground. Underground facilities must be clearly marked before work tickets are issued.

“The one call systems were implemented by utility owners and pipeline owners out of a vested in-

Red-Alta pipeline and utility line locating specialists are trained as certiÀed Damage Prevention Technicians.

Photo courtesy of Red-Alta

terest in protecting their assets,” said Davidson.

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

B-Section August 2009

On his third business, at the age of 21

Eugene Tippett’s boss says he’s so good with an excavator, he can pick up a quarter off the ground with the bucket and not get any dirt on it. We didn’t have a chance to test that, however. Tippett works with Boyd Excavating Ltd., in Moosomin.

By Brian Zinchuk Moosomin – The Boyd Excavating Ltd. fleet includes four excavators, a new screener, two front end loaders, five trucks, four gravel trailers and a lowboy, dozer and packer. The staff now numbers 17, including 10 that were hired in February.

And the owner? He’s 21.

Tyler Boyd might just be the walking definition of a successful young entrepreneur. His first business was raising boer goats. He started at the age of 12 with six goats, and grew the herd up to 150 by the time he was 18. But, like a lot of people, he found it’s hard to make a profit at farming, so he got out. BSE was brutal to the business. “I didn’t make any one it.

Because of BSE, I actually lost money,” he says over a fried chicken lunch at Moosomin’s Red Barn restaurant. Watching him, you’d think he knows everyone in the place. “I got my fix of farming right there.”

The second venture was a drain cleaning com-

pany, one that he eventually sold to his younger 16year old brother, Tim. The business meant towing a trailer behind his pickup, working with a rotorooter and a camera. He dealt with anything from a plugged kitchen sink to a sewer for the town. As for his brother, the entrepreneurial spirit is strong in him, too. “He’ll do two calls before school starts,” Tyler says.

That’s perhaps not surprising, since their dad runs a vac-truck business, Heartland Sanitary.

Now he’s on his third venture, the biggest by far.

“I bought a mini-excavator when I was 18,” Boyd says. “I sold that and bought my first larger trackhoe and a tandem truck when I was 19.”

It happened on his 19th birthday.

You’d think he’d be a natural in his chosen schooling, business management at Assiniboine Community College in Brandon. Not so. He was there for four months and decided it wasn’t for him. “I didn’t enjoy being in the city. I didn’t enjoy being in school.

I’ve known ever since I was in grade six or seven I

would be in Moosomin. Drain cleaning taught me more than school. When there’s a water break, I’m there within an hour. People don’t want to wait.”

“With excavating, we’re quite geared up for 24hur a day emergency calls. We have one unit ready to roll all the time. We’ve done a couple diesel spills, and lots of sewer and water breaks.”

A lot of that is providing service for smaller communities in the area that might not have their own excavation equipment.

As for running an excavator himself, Boyd still does it when he needs to fill in, but not usually.

Between all this, he found time to marry Amanda Sinclair, also of Moosomin, last August. Amanda runs fuel around, and does landscape work.

He’s since hired his mom to help out on the admin side. His 23-year-old sister Tenielle is the only one not involved in some way – that’s because she’s a helicopter paramedic in northern Alberta. ɸ Page B2

B2

PIPELINE NEWS August 2009

“There is no such thing as sitting still.”

Tyler Boyd takes a call while on the site of what will eventually be a new shop. Behind him is a new screener, a 2008 model.

ɺ Page B1 “We do a bit of everything. We’ll work for farmers, sewer and water, oilfield, whatever. We do contaminated soil hauling, too. We take it to Virden or Melville.”

They have sealed end-dump trucks for that purpose.

“Pretty much everything we have is John Deere,” he says, citing excellent service from Brandt, the John Deere industrial dealer for Saskatchewan. They also have a Komatsu zero-tail swing excavator, and a Bomag packer. “I go places you wouldn’t take a skid steer with that trackhoe,” he says.

His phone rings during lunch. “Where do you need it?” is the quick answer.

Just north of Moosomin, one of his excavators is working. The operator is Eugene Tippett. “He can pick up a quarter [with the bucket] and there won’t be any dirt on it,” Boyd says.

It helps to have new iron to be that precise. Their oldest equipment is from 2003, most is from 2006 to 2009.

“I wouldn’t be halfway to where I am today without the employees I have,” Boyd says, noting they are highly experienced.

Is it difficult, dealing with staff substantially older than he is?

“They respect me, and I let them do their own thing,” he responds. “I value their opinion more than I value mine.”

“I’m not good at fixing stuff,” he offers as an example. “I’ve got guys who are good in the shop. My job isn’t to run hoe anymore. My job is to keep these guys going.”

A little north of Estevan, there is now a flat area where there was once a small rise. That soil went to provide the base for a new hotel under construction in Moosomin. The site has the new McCloskey screener, and will be home to a new shop.

“I’ve had my eye on this land for a couple years,” he says.

The plans are for 80x100 shop, built with expansion in mind. Currently, they are working out of his dad’s shop, on a farm east of Moosomin.

The base for the new hotel kept them busy through the spring. “This used to be just swamp,” he says at the hotel site. They excavated out the frozen swam, going right down to firm clay. “We went down four feet and came up 15.”

“We went though all spring. At one point we had eight trucks hauling clay on a two mile haul. That’s a lot of clay.”

If this is how far he’s gotten by 21, where will he be by 25?

“As big as I can,” he responds. “I’ve had a few people ask me, ‘When are you going stop?’

“Donald Trump says, ‘If you’re not going forward, you’re going backwards.

There is no such thing as sitting still.’”

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PIPELINE NEWS August 2009

B3

Every few years, the Àood comes in

Larry Miskiman, mayor of Moosomin, heads up the local branch of Connexus Credit Union when he’s not attending to his civic duties.

By Brian Zinchuk Moosomin – Every five to ten years, either TransCanada or Enbridge typically builds a new mainline pipeline.

That’s good news for Moosomin, on Highway 1 near the Manitoba border. Both of the mainline right-of-ways run nearby.

Enbridge’s runs to the south, past Fairlight.

TransCanada’s mainlines run to the north.

However, by nature of geography, Moosomin is the only centre in the area that can accommodate sizeable crews. It also benefits from being a short drive from the Rocanville potash mine, which is undergoing a sizeable expansion. That project is expected to lead to hundreds of new jobs. Traditionally, about 40 per cent of the mine

workforce has lived in Moosomin, according to Larry Miskiman, mayor of the community of 2,500.

There are only a few other locations in Saskatchewan that have a similar confluence of geographical advantage – Regina and Moose Jaw. Both are near the mainlines. However, those two communities are much, much larger, and thus the impact of a crew

of hundreds moving into town for a few months is less pronounced.

Not only does Moosomin have pipelines and mines nearby, but it also has producing oilfields, too. There as been lots of activity at the Wapella field, to the west, over the last ten years, Miskiman notes.

The Rocanville field to the north is an old field, but has sprung up new wells in the last five years, he explains.

Right now, not only is Enbridge building an entirely new pipeline nearby, but TransCanada is converting an existing natural gas line to crude oil. They have a compressor station near Moosomin. “We look forward to it, each opportunity we have,” Miskiman says. “That’s why we try to accommodate the Waschuks of the world.

Waschuk is the prime contractor on the Alberta Clipper project for eastern Saskatchewan. Even with a substantial number of hotels and campsite in the small town, Moosomin still isn’t big enough to handle the crew of up to 700 Waschuk is working with. As such, the company has its workforce spread between Regina, Grenfell, Broadview, Whitewood, Moosomin, Kipling and

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Virden, according to Waschuk general superintendent Dave “Chatter” Prosofsky. The field office is at White City.

In mid-July, he says they had approximately 350 people working out of

Moosomin.

“We had our town guys drop everything and develop a 40 site full-service campsite,” Miskimin says.

It’s located next to the new hotel under

construction, owned by the same group who have been developing hotels in Weyburn. It cost $15,000 to do, and Waschuk partnered on the cost. ɸ Page B4

Moosomin’s Country Squire Inn has seen a lot of business from pipeliners working out of the community. However, manager Steve Shin notes it does make it more difÀcult, when you have events like weddings booked months in advance conÁicting with workers who would prefer not to give up their room for the weekend.

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B4

PIPELINE NEWS August 2009

The geographical advantage

To accommodate the inÁux of workers, the town of Moosomin installed a full-service campsite near the building site of the new hotel. It’s not much to look at, but it has water, sewer, and enough power to keep the air conditioners running.

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The beige coveralls and a grocery basket in hand after work are a deadgiveaway of a pipeliner. Bob Wick, from Outlook, is a strawboss on the Waschuk road bore crew. He’s shopping at Moosomin Fine Foods, which extended its hours to accommodate the inÁux of pipeliners in town.

ɺ Page B3 While there is a sizeable campground just north of town, having an overflow is important.

“We would always keep

it as a bit of an overflow,” he says.

“We try to support these people as much as we can,” he says, noting the pipeliners are gener-

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ally good people.

The Moosomin Fine Foods store extended its hours to 5:30 a.m., allowing workers to pick up prepared lunches.

“Most of the bars have restaurants that are staying open later and doing a brisk business,” Miskiman says. “The gas stations and other restaurants are filled to capacity. Co-op is crawling with people.”

“We’re kind of a regional centre,” he says.

“I think there’s a certain amount of people who like to keep things quiet. The majority of people see it as a great opportunity to help out the community.

“We look forward to having these people, and we’ll do what we can to accommodate them,” he concludes.

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PIPELINE NEWS August 2009

B5

New International dealer, Southern Industrial brings it all under one roof Â&#x201E; By Brian Zinchuk Weyburn â&#x20AC;&#x201C; Southern Industrial & Truck Ltd. of Weyburn is in the midst of major changes.

The company has just recently become a dealer for International trucks, picked up several trailer lines, and is constructing a large shop on west side of Weyburn to bring all its operations under one roof.

Southern Industrial

is one of a group of companies all owned by John and Dennice Rouse. The companies combined have three major lines â&#x20AC;&#x201C; a truck shop, clutch manufacturing, and a rig shop, building service rigs.

Dan Adrienne is the general manager, while John Rouse, a heavyduty mechanic by trade, spends most of his time in the shop. Dennice does â&#x20AC;&#x153;Everything,â&#x20AC;? according to John.

While thereâ&#x20AC;&#x2122;s been a slowdown in the patch, Adrienne says Weyburn is still booming, and the slowdown has been an opportunity to catch up on maintenance. â&#x20AC;&#x153;Maintenance is what we do.

Itâ&#x20AC;&#x2122;s been an extremely busy time for us.â&#x20AC;?

Rouse Industries manufactures the Rouse Clutch, built speciďŹ cally for oilďŹ eld applications.

It used to be built in Coquitlam, B.C., but is now

made in Weyburn.

J. R. Wellsite Power Ltd. handles generator sets, light towers and lifts.

Southern Industrial & Truck is the truck shop. Theyâ&#x20AC;&#x2122;ve performed well over 300 safeties on truck and trailers, both highway and oilďŹ eld, in the past year, Adrienne says.

But their shop has been outgrown, to put it mildly. â&#x20AC;&#x153;We have operations in three diďŹ&#x20AC;erent facilities right now,â&#x20AC;? says John Rouse. â&#x20AC;&#x153;We needed to get all our staďŹ&#x20AC; under one roof.â&#x20AC;?

Having several locations made it â&#x20AC;&#x153;terrible to manage,â&#x20AC;? he says, noting they needed to be one team.

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â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve been out of space for quite some time.â&#x20AC;? â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve always built a lot of oilďŹ eld equipment.â&#x20AC;? Rouse says. They needed to be an OEM to spec trucks for clients.

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PIPELINE NEWS August 2009

Southern Industrial Éş Page B5 Adrienne says, â&#x20AC;&#x153;International was so willing to work with special-build units for the oilďŹ eld, we decided that was the way to go.â&#x20AC;?

On the trailer side, they picked up the Winnipeg-built Arneâ&#x20AC;&#x2122;s Trailers line for lowbeds to gravel trailers, and also carry Neville Built grain trailers. On the oilďŹ eld application side, itâ&#x20AC;&#x2122;s the Advance badge they will be carrying for tankers.

The new shop is 36,000 square feet, with a truck side and a rig side.

A two-story oďŹ&#x192;ce space will be in the middle. The truck side will feature ten bays.

Everything is designed to handle oilďŹ eld equipment. There will be a private truckwash, capable of steam cleaning. â&#x20AC;&#x153;We expect to be in there by Nov. 1,â&#x20AC;? says Adrienne. Asked about

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the delays most companies in the southeast have had in getting shops built, he responds, â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re actually running fairly close to on schedule.â&#x20AC;?

That has meant having crews working 24 hours a day at times.

While cur- John Rouse and his wife Denrent staďŹ&#x192;ng for nice head up Southern Industrial the company is & Truck, as well as a couple oth35, thatâ&#x20AC;&#x2122;s ex- er companies. John likes to work in the shop. pected to grow pensive,â&#x20AC;? Rouse says of to somewhere between 40 and 50 by what they were looking the end of 2010. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re at. â&#x20AC;&#x153;We wanted a lot of looking for ďŹ eld techni- yard space to do a rigcians, service mechanics, up.â&#x20AC;?

Regarding anaccounting, reception,â&#x20AC;?

Adrienne says. He won- nexation, he says, â&#x20AC;&#x153;We ders why, with the slow thought that was over.â&#x20AC;?

Weyburn City Mandown in Alberta, they havenâ&#x20AC;&#x2122;t seen more quali- ager Robert Smith told ďŹ ed people coming for- Pipeline News the city ward. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s been tough to needed more land that could be fully serviced, ďŹ nd people,â&#x20AC;? he says.

The location of the and was seeking to exnew shop falls in the ru- pand the city a half mile ral municipality of Wey- in most directions exburn, just south of the cept to the west, where Co-op truck stop on the it would seek to annex a west side of Weyburn. mile. That would give it The location is particu- more room for highway developlarly important because commercial of its access â&#x20AC;&#x201C; at the in- ment, of which there has tersection of two high- been interests expressed ways, and it doesnâ&#x20AC;&#x2122;t hurt by developers. The area to be next door to a truck where Southern Indusstop and on a major route trial is building is considered optimal due to â&#x20AC;&#x201C; Highway 39.

However, there is the highway crossroads.

Smith notes that some contention with the cityâ&#x20AC;&#x2122;s plans for a mas- the level of servicing for sive annexation of almost a property makes a subevery quarter of land stantial diďŹ&#x20AC;erence in land touching the current city price, and it depends on limits. That would place the service level the custhe new shop, under tomer is looking for â&#x20AC;&#x201C; construction right now, sewer, water, all services within the city limits. in, or just lightly, with no The company speciďŹ cally water or sewer.

The Saskatchewan chose to be outside of the city due to what they felt Municipal Board is exwere exorbitant costs â&#x20AC;&#x201C; so pected to make its ruling much so that Adrienne on annexation, including says they considered oth- the arewa where Southern Industrial is building, er cities to move to. â&#x20AC;&#x153;The city was too ex- in September.

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Trent’s Tire Trent’s Tire in Estevan held its grand opening on July 14. Trent Emmel, an avid dirt track racer, brought in NASCAR driver Kenny Wallace for the event. Wallace drove the Eagle Drilling car that night at the Estevan Motor Speedway. The line ups were long, with hundreds of eager fans seeking the autograph of the professional race car driver.

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B8

PIPELINE NEWS August 2009

Keystone oil¿eld services Moosomin area No, they’re not American Loggers, or Alaskan crab Àsherman. These are the pump shop guys for Keystone OilÀeld Ltd. in Moosomin. They are, from left: Brayden Holloway, Brant Nielsen, and Brayden Hay.

Moosomin - On the west side of Moosomin, you’ll find Keystone Oilfield Ltd. It’s a conventional rod-drawn pump shop.

The majority of the wells in the area are pumpjack pumping systems.

Mike Browning is the manager. He notes they’re an oilfield supply

store, handling pumps and fittings. A satellite of the Virden operation, they service the Sinclair, Parkman and Kenosee areas, as well as the immediate area around Moosomin.

A little further down Highway 1, the company also has a store in Wawota.

“We’re working

lots around Sinclair,” Browning says. Indeed, the Sinclair field, where Manitoba is seeing most of its Bakken action, is about the same distance to either their Virden or Moosomin locations.

They have five fulltime and two part time staff at the Moosomin shop.

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PIPELINE NEWS August 2009

B9

Penn West makes $150k donation PennWest donated $150,000 in July to the new civic event centre for Estevan. The presentation was made in front of their Estevan ofÀce on July 16.

Photo courtesy the Estevan Mercury

Estevan – Penn West Energy Trust made a $150,000 donation in support of the new Estevan civic event centre on July 16.

The money will see the Zamboni, Zamboni room, two sections and a dressing room named in honour of the company.

“Work has been going on for a year,” says fundraising chair Kim Anderson, of the City of Estevan New Event Centre Committee.

“Penn West is proving the oil industry support the city of Estevan in the majority of its endeavours,” he told Pipeline News.

Anderson notes that through a lot of hard work by the committee members, they were able to bring Penn West into the fundraising. Penn West had come to the table several months before, he explained.

Anderson pointed out that companies based in Alberta still value the communities here they are working in, helping to entice employees to these communities.

“Penn West is proud to be a part of Estevan's new civic arena, and to promote recreation and cultural diversity in the area,” says Nicole Collard, Manager, Public Affairs. “Through Penn West's community investment program, we focus our corporate giving to support projects that are important and meaningful to our employees and the area in which we operate. We feel supporting the construction of this multi-purpose facility builds stronger communities and positive relationships. Estevan's new arena not only provides a physical structure to house sporting and cultural events, it also provides an opportunity for area residents to come together to enjoy the facility and its programs as a community.”

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B10

PIPELINE NEWS August 2009

Trucking entrepreneur honoured

Â?

Hall of Fame Inductee

Tony Day of Fast Trucking, is inducted into the Saskatchewan Oil Industry Hall of Fame during the Saskatchewan Oil and Gas Show in Weyburn.

Photo by Brian Zinchuk

Weyburn â&#x20AC;&#x201C; Starting with a tanker, and eventually building a rigmoving company, Tony Day has made his mark in the oilpatch.

On June 3, six people were inducted into the Saskatchewan Oil Industry Hall of Fame.

The following was the oďŹ&#x192;cial induction of Tony Day, the proprietor behind Fast Trucking: â&#x20AC;&#x153;Tony Day - or â&#x20AC;&#x2DC;Boss

Hogâ&#x20AC;&#x2122; as he is known to his friends in the industry - was born and raised in Admiral, Sask., where he also attended school. â&#x20AC;&#x153;After school, he did some jobs in construction and farming until one day in 1952 the Paul Gauthrie Company began drilling in his area.

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as a derrick hand and eventually became a mechanic and welder, working in the Eastend, Haywarden and CarnduďŹ&#x20AC; areas, as well as locations in Alberta. â&#x20AC;&#x153;In 1957, Tony bought a 1955 Chevy water truck with a 50 barrel tank to haul fresh water to the rigs. â&#x20AC;&#x153;This was the beginning of Tonyâ&#x20AC;&#x2122;s business, Fast Trucking, which continues to this day. â&#x20AC;&#x153;Tony acquired trucks one by one, building his water hauling business gradually through the 1960s and 1970s. Then, in 1977, Fast Trucking, with the help of some other trucking companies, got into the business of moving oil rigs. â&#x20AC;&#x153;They began moving one or two rigs a day but built their capacity up to 13 rigs a day at their peak.

By 2008, Fast Trucking had been responsible for moving a total of 1,700 drilling rigs with a ďŹ&#x201A;eet now numbering 85 rig moving trucks. â&#x20AC;&#x153;Over that time, Tony has diversiďŹ ed his business to include an oil company, a service rig business, a construction company and a rig equipment refurbishing business. â&#x20AC;&#x153;He also has the distinction of having designed and built the ďŹ rst free-standing doubletriple service rig. â&#x20AC;&#x153;Outside of work, Tonyâ&#x20AC;&#x2122;s biggest hobby is attending auction sales.

He likes to say that he

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has usually found whatever equipment he needed at Ritchie Brothers auctions. â&#x20AC;&#x153;Tony married Vi Bayliss in 1960. Their ďŹ rst home was in a small house trailer at the rig site. They have two girls, Linda and Teresa and two boys, Dennis and Larry. â&#x20AC;&#x153;In 1999, Tony was honoured as the southeast oilman of the year at the Weyburn Oil Show. He has also been active as a fundraiser in his home community of CarnduďŹ&#x20AC;, where the school library has been named the Tony and Vi Day Resource Centre in his honour. â&#x20AC;&#x153;Tony cites the secrets of his success as being his wife and children and the support of his many friends and colleagues. â&#x20AC;&#x153;Tony, you have always been known for your hard work, reliability and integrity. We are pleased to welcome you as a member of the Saskatchewan Oil Industry Hall of Fame.â&#x20AC;? *** In response, Tonyâ&#x20AC;&#x2122;s son Dennis spoke of dedication, noting, â&#x20AC;&#x153;[This is] one of the ďŹ rst times weâ&#x20AC;&#x2122;ve actually sat together and ate dinner. This is the third time our family has left our business together. [The] last time was when Tony won oilman of the year in 1999.

The second time was when his mom died, and today. So usually one of us always stays at home and mans the fort, and one of the other ones goes to work.â&#x20AC;?

Dennis said Tony joked about trying to corner the premier to get more money for their wind generator. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a great honour for him, and for the family,â&#x20AC;? Dennis said. â&#x20AC;&#x153;He would like to thank all of our employees,â&#x20AC;? Dennis said, noting that in the oilpatch, something can always come up, and it did that day. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve got third generation employees working at our place now,â&#x20AC;? Dennis said, extending thanks on behalf of Tony to the committee, customers, friends, and family for coming, ending with a thank you to Vi, Tonyâ&#x20AC;&#x2122;s wife.

PIPELINE NEWS August 2009

B11

Every job in the company was built. He has been in the oil business ever since.

“He started his career with Paul Gauthrie Development, where he rose steadily through the ranks, eventually becoming field superintendent. In 1978, after a number of acquisitions and transfers among the companies he worked for, he became vice president and general manager Atco Drilling Ltd.’s Rocky Mountain Division, headquartered in Denver.

“By the next year, he had moved up to Calgary to become vice president of operations for all the divisions of Atco Premier Brad Wall, left, and Al Schreiner, right, present John Hlavka with his plaque commemorating his induction into the Saskatchewan Oil Industry Hall of Fame.

Photo by Brian Zinchuk

Hall of Fame Inductee Weyburn - John Hlavka was recognized as one of the true pioneers of the Saskatchewan oil industry on June 3, when he was inducted into the Saskatchewan Oil Industry Hall of Fame.

“You have shown how far someone can climb in this industry starting from the ground up. It is our pleasure to welcome you to the Saskatchewan oil industry hall of fame,” noted Al Schreiner, master of ceremonies.

Here is the official induction, as read by Schreiner:

“Our next hall of fame inductee likes to remind employees at Akita Drilling that he has done every job in the company, and he’s not far wrong.

Over his 55 years in the industry, John Hlavka has worked as a floor hand on a drilling rig up to being the company CEO, and almost everything in between.

“Born in Minton, Saskatchewan, John went to a little one room country school where he took his grade one to grade eight education.

“After school, he tried his luck at farming for a while. Then one day in 1954, an oilfield surveyor came into his yard looking for workers. He and his brother helped with that and then signed on as roughneck when the rig

drilling. In 1985, became president of all the Atco drilling companies. In 1993, Atco spun out Akita Drilling, with John as president and CEO. He remains in that position to this day.

“John has built his career and reputation in the industry through attention to detail, commitment to excellence and lots of hard work.

“John and his wife Merlene have a blended family with 7 girls and two boys. When he isn’t working, John enjoys travel. He has toured extensively in Europe, especially in his father’s homeland of Austria.

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B12

PIPELINE NEWS August 2009

From one stripper well to Hall of Fame

Hall of Fame Inductee Weyburn - Cited as an inspiration to many

in the industry, Norm “Pierre” Mondor was

honoured on June 3 with an induction into the Saskatchewan Oil Industry Hall of Fame. Here is the official induction, as read during the Saskatchewan Oil and Gas Show in Weyburn:

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“Norm ‘Pierre’ Mondor, president of Aldon Oils Ltd., was born and raised in Hudson Bay, Sask., in 1937.

“Norm spent his early career in the lumber industry. When the forestry industry took a downturn in 1957, norm followed rumours of good jobs in the oil industry and headed south, first to Estevan and then to Weyburn.

“He started working on service rigs and eventually became the general manager of Addison and Leyen, an international service rig company with operations in Weyburn, Olds, Virden and Williston. At the time that Norm was managing the company, it’s operations involved 11 rigs and 50 men.

“In 1972, Norm bought Aldon Oils Ltd., which had a single, low-

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Norm “Pierre” Mondor, was inducted into the Saskatchewan Oil Industry Hall of Fame on June 3. The head of a family business at Weyburn, Mondor started with one stripper well.

Photo by Brian Zinchuk

producing stripper well at the time. As one of the few one-man operations at the time, Norm faced many cheers and jeers from people in the industry, but he persevered.

“He followed a strict business plan of picking up “fixer-uppers,” lowerproducing wells that he could make better with his own skill and time.

He followed a philosophy of expanding gradually and carefully, taking the time to do his homework to look for good opportunities.

“Aldon Oils has grown steadily over the years and is now involved in drilling as well.

Since their first horizontal drill in 1995, Aldon has grown to over 150 wells, with operations in the Midale, Frobisher and Bakken areas, as well

as gas plays in Alberta.

“Aldon supports many community events and projects in and around Weyburn, as well as providing a living for its local employees and contractors.

“Norm’s family maintains 100 per cent ownership of his company. Norm’s career has spanned six decades, almost as long as his marriage to his wife Shirley.

He has five children, all of whom have been involved in the business in one way or another.

Today, he works with his two sons who do the day-to-day management of the business.” *** Mondor thanked the board of directors and his family. He said his wife Shirley was, “the best investment I ever made.”

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PIPELINE NEWS August 2009

B13

Geologist joins Hall of Fame

Hall of Fame Inductee

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By Brian Zinchuk Weyburn - From early days in a canoe to a senior geologist with one of the majors, Jack Porter has made his mark in the world of geology. On June 3, he was inducted into the Saskatchewan Oil Industry Hall of Fame, during the Saskatchewan Oil and Gas Show in Weyburn. Here is his biography, as read during the induction ceremony: “Jack Porter, professional geologist, is one of the founding members of the Saskatchewan geological society and, even in retirement, continues to serve as one of the Sas-

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“Born and raised in Saskatoon, he studied geology at the University of Saskatchewan at a time when only a hard rock course was offered. Nonetheless, when he graduated in 1946, he soon found himself in the midst of Western Canada’s emerging oil industry.

“Straight out of college, his first job was with the Geological Survey of Canada in the Jasper area before taking on survey work for Imperial Oil. “Soon after that job, he found himself back in university, this time as an instructor. As the veterans began returning from World War II, there was a sudden influx at Canada’s universities. Jack helped train Saskatchewan’s next generation of geoscientists by serving as a lab instructor at the U of S. “In his next job with the provincial Department of Mineral Resources (as it was called at that time), Jack travelled by canoe to northern Saskatchewan to do some of the early field work exploring for tarsands.

“From 1947-48, in the days before environmental panels, he worked for the provincial government alongside an engineer policing the clean-up of wells and pipelines.

“He then moved on to the private sector, serving as a geologist for Rio Bravo and all of its successor companies, including Canadian Superior Oil Ltd. and Mobil Oil of Canada.

“He worked for the company for 38 years. He prides himself, early in his career with Rio Bravo, with having convinced the company’s exploration manager to have a second look at Saskatchewan’s sites at a time when all the industry’s attention was focused on Leduc.

“Before retiring, he ultimately served as the senior geological advisor to the vice president of exploration of Mobil Canada.

Porter was unable to attend the induction ceremony.

B14

PIPELINE NEWS August 2009

Terra Nova pioneer honoured

Hall of Fame Inductee

Executive Bill Kaufmann, thanked his high school teacher for giving him a “kick in the butt” and keeping him on the straight and narrow. Kaufmann was inducted into the Saskatchewan Oil Industry Hall of Fame on June 3.

Photo by Brian Zinchuk

Weyburn – Danny Williams might want to thank this inductee to the Saskatchewan Oil Industry Hall of Fame. He was involved with the discovery of the Terra Nova Field off Newfoundland.

Bill Kaufmann was one of six people inducted into the Hall of Fame during the Saskatchewan Oil and Gas Show on June 3. Here is his biography, as read out during the induction: “Bill Kaufmann was born and raised on a farm near Pangman, Sask., where he went to school in a one-room schoolhouse.

“In 1955 he entered the University of Saskatchewan in Saskatoon to study geology. He earned both his bachelors and masters in geology at the U of S. “Bill lives by the motto ‘mediocrity won’t get you anywhere’ and his career has certainly been anything but mediocre. From 1961 to 1976, bill worked for Tenneco Oil in Calgary, first as a junior geologist, working his way up to exploration manager. The company was then sold to CDC Oil and Gas Limited. Bill eventually became senior vice-president at that company.

“After further mergers and acquisitions, CDC became Canterra Energy Limited. Bill served first as senior vice-president of exploration and production, Frontier and president of Canterra Petroleum, the company’s Denver-based subsidiary.

“In addition, he served as chairman of the board of

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“In 1982, while working at Canterra, Bill had the privilege to be the executive leader of the team that discovered the Terra Nova field off the shore of Newfoundland.

“In 1988, Bill’s career took him in a different direction as he served as the COO and general manager of the Calgary Chamber of Commerce, one of Canada’s largest and most active.

“He has served on the boards of the Alberta Children’s Hospital, the Calgary Convention and Visitor’s Bureau, the Rotary Club of Calgary, University Technology International, and the McMahon Stadium Society.

“He also currently serves on the boards of several oil and gas firms including Heritage Oil Corporation.

“Bill is dedicated to the advancement of post-secondary education. He sat on the University of Calgary senate as well as its board of governors and served as a MBA student mentor for their faculty of business.

He recently completed a six year term on the board of directors of Bow Valley College.

“He is a Paul Harris fellow of the Rotary Club and a recipient of the Alberta Centennial Medal and the Commemorative Medal for the 125th anniversary of the confederation of Canada.

“Outside of work, Bill enjoys antique car restoration, woodworking, golf, travel and financial planning.

“Bill’s wife Gloria is also from Pangman. In fact, the same doctor delivered them. They have three children, Michael, Bill junior and daughter Kennen.

“Bill, tonight we would like to recognize all of your contributions to the industry, to society and to education. We are happy to welcome you to the Saskatchewan Oil Industry Hall of Fame.” *** Kaufmann thanked the board of governors for the privilege.

He also thanked his high school teacher, who kicked him in the butt and kept him “on the straight and narrow” 55 years ago.

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PIPELINE NEWS August 2009

B15

Not your brother-in-lawâ&#x20AC;&#x2122;s hybrid

Peterbilt has brought its Ă&#x20AC;rst medium duty hybrid to market in the form of the 335.

speeds, puttering about in urban environments where there is a lot of stopping and starting. â&#x20AC;&#x153;You canâ&#x20AC;&#x2122;t tell when it switches from diesel to electic,â&#x20AC;? Haselhan says as he drives through Estevan.

They will be watching the SaskPower unit, to see how it handles. A lot of customers want to see how it will handle the Canadian environment, he notes.

As for oilďŹ eld applications, Haselhan says there may be some beneďŹ ts in knuckle picker applications, or for welders.

One thing is for sure â&#x20AC;&#x201C; hybrids are working their way into the industry, and soon there will be heavy-duty hybrid trucks. Itâ&#x20AC;&#x2122;s just a matter of time.

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Car-type hybrids like the Prius will start and stop the fuel-driven engine as needed. That doesnâ&#x20AC;&#x2122;t occur with this truck while driving. Indeed, you run on electric power only up until about 40 km/hour. Above that speed, itâ&#x20AC;&#x2122;s diesel power only.

When you are running on batteries, the diesel keeps running at low RPM. The battery pack, full of lithium batteries expected to last 10 years, is on the frame on driverâ&#x20AC;&#x2122;s side, in front of the drive axle.

The system is tied to an Eaton Fuller transmission speciďŹ cally designed for hybrids.

The breaking is a typical air brake system, but it does convert braking power into charging the battery, a process known as regenerative braking.

A dashboard screen monitors the vehicleâ&#x20AC;&#x2122;s performance. When the indicator bar is in the green, your fuel economy is maximized. However, it doesnâ&#x20AC;&#x2122;t show actual miles to the gallon or kilometres per litre.

The system gets the best performance at low

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Â&#x201E; By Brian Zinchuk Estevan â&#x20AC;&#x201C; When people talk about automotive hybrids, vehicles like the Toyota Prius come to mind.

This is not your brother-in-lawâ&#x20AC;&#x2122;s Prius.

The white Peterbilt 335 medium duty truck makes a Prius look like a Matchbox toy. â&#x20AC;&#x153;This would work well for vocational [purposes] says Karl Haselham, a sales rep with Frontier Peterbilt in Estevan, as he ďŹ res up the engine. Those vocational purposes would include uses for crane operation, man-buckets, and service bodies, he explains.

SaskPower bought one, as an example. â&#x20AC;&#x153;Any application where you have to idle a lot of hours,â&#x20AC;? he adds.

When youâ&#x20AC;&#x2122;re sitting, youâ&#x20AC;&#x2122;re getting zero miles to the gallon, using diesel, creating pollution, and putting wear on the engine. â&#x20AC;&#x153;Noise level is a big thing when youâ&#x20AC;&#x2122;re working in neighbourhood,â&#x20AC;? he says.

The hybrid system includes a battery system that will provide power at lower speeds and when parked. â&#x20AC;&#x153;Your diesel will kick in when your batter-

Peterbilt is bringing hybrid diesel/electric power to medium duty trucks.

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B16

PIPELINE NEWS August 2009

A pipeliner? Odds are, you’ve stayed here

By Brian Zinchuk Moosomin – Mainline pipeliners are paid a sizeable daily, nontaxable living allowance.

If you’ve been pipelining long enough, you soon come to the realization that it’s an awful lot cheaper to own your own travel trailer or fifth

wheel, stay at a campground, and pocket most of that living allowance.

That’s why most career pipeliners have their own campers.

And if pipelining is your career, it’s almost certain at some point you would have worked out of Moosomin. That’s

because both the Enbridge and TransCanada mainlines run by it, and Moosomin is one of the few centres that can support a sizeable crew on an interim basis in that neck of the woods.

That means, at some point, you’ve likely stayed at Fieldstone Camp-

ground & RV Resort, just north of Moosomin.

Fieldstone was built as a provincial campground in the late ‘60s, one of a series built along the Trans Canada Highway. Other campgrounds in the chain included McLean, Maple Creek and Moose Jaw. Most are

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Once a provincial campground, Moosomin’s Fieldstone Campground has been home to transient pipeliners for decades.

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still in operation, except the one at McLean. They were eventually all privatized.

With its government-financed heritage, it’s substantially different than a private campground. The layout is similar to provincial park campgrounds. There are substantially more fullyserviced washroom facilities spread throughout the facility compared to what you would see at a privately-built campground.

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But what stands out the most is that those outbuildings are built of stone – that’s right – stone. Everywhere you go, you find stone and mortar buildings. Thus the name Fieldstone is rather fitting.

Barry and Lena Pavone bought the campground seven years ago. They were originally from Montreal.

“We were looking for a campground to buy.

We had to choose. This one was just beautiful,” says Barry Pavone.

They’ve been busy this season pretty much since opening. On July 15, they weren’t full, but close, especially with regards to serviced sites.

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PIPELINE NEWS August 2009

Look familiar? ɺ Page B16 They have 26 full service sites, but can offer pump-out septic service with their own vac truck. That allows a form of full service at sites that just have electricity and water.

In total, they have 96 sites, and added electricity to additional ones to accommodate the influx.

A large number of their current clients are pipeliners, with a substantial contingent of workers for Waschuk Pipe Line Construction in town, working on the Enbridge Alberta Clipper project.

“We have TransCanada people in, the expansion at the mine, SaskPower workers,” he says.

Oh yeah, they get a lot of tourists, too.

However, the number of Americans heading to Alaska has dropped.

Transient workers are a piece of the bread and butter, but not all of it, he explains.

“We’re definitely for-

tunate to have the pipeline. They’re more than welcome.”

The camp site has a small pond and sand beach, and draws local recreational users.

Lena Pavone spends most of her time in the office, which has a small store typical of most campgrounds. For her, 5 to 7 p.m. are her busiest time. “They need something in the store, a quart of milk, change,” she says.

“They come in just to chat, and they’re lonesome.”

“Some of them, their families do come.”

Some come for a week, some wives stay with them all the time, she says.

Just then, Joyce Boyd walks in. Her husband Ralph is a utility operator for Waschuk Pipe Line, and has been pipelining since he was 15.

He’s 72. That would mean Ralph Boyd has been pipelining practically since the first mainlines

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“We went with his father, and they lived in a makeshift truck camper,” she says.

A talkative type, Joyce says her husband was once asked when he was going to give it up.

“You ain’t going to quit,” she says, adding in all seriousness, “Too many die after they quit.”

They’ve been married for 45 years, and she spent a lot of that time in a camper, and in campgrounds, except when raising their kids.

What does she do to occupy her time?

“I knit. I crochet. I visit with people in town,” she says. Sometimes she’ll help elderly people clean up their yard. She likes to look at houses and drive around.

One last thing, her rig, her home on wheels, is not a camper. It’s a motorhome, she points out.

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

C-Section August 2009

TransCanada’s Keystone pipeline terminal in the ¿nishing stages

Area manager Bob McEwen checks the Áoor of a storage tank following a hydro test.

Story and photos by Geoff Lee Hardisty – TransCanada’s Keystone pipeline is expected to be commissioned in November and crews are busy on a number of fronts to complete facilities at the Hardisty Terminal where oil will begin to flow south to U.S. customers.

“Once they bring the line into Hardisty and connect it to the Hardisty Terminal and test the line, they will turn on the valves and start flowing oil,” said Keystone spokesperson Darren Paquin, on a media tour of the site in mid-July.

Construction of the 3,456 kilometre pipeline began in May 2008 and will allow TransCanada to transport crude oil from its Hardisty Terminal facilities to U.S. Midwest markets at Wood River and Patoka, Illinois.

The Canadian portion of the Keystone pipeline involves the conversion of 864-km of TransCanada’s mainline in Saskatchewan and Manitoba from natural gas to crude oil transmission. There is also 373-km of new pipeline being constructed in Manitoba and Alberta that will connect to the Hardisty Terminal.

“We have most of the main pieces put together and the final work will be going on through the summer to get things ready for when the Keystone Pipeline is commissioned,” said Paquin.

Crews from a variety of contractors are working simultaneously on three operational storage tanks, an initiating pump station and interconnections with existing pipeline systems.

“It’s been quite remarkable to see what we’ve been able to construct over the last year,” said Paquin.

“It has evolved from where they had the foundation pads for the tanks last May to now where you see the tanks are constructed.

“They are starting to build the interconnect pipelines and the other infrastructure that makes this work.”

The visual focal point of the Hardisty project is the cluster of three 350,000 barrel tanks that will manage the flow of oil fed to the site by four pipelines. These pipelines will interconnect with Enbridge, Husky and Gibson oil terminals in Hardisty for shipment of their product on the Keystone.

There are two pipelines from Gibson and from each from Husky and Enbridge in various stages of construction.

“They will be ready before the pipeline needs to be commissioned in November,” said Paquin.

All of the pipes connect to a metering system that determines what is flowing into the storage tanks and what’s flowing out and being sent down the Keystone pipeline.

“When it’s shipped out it goes through the metering system again to determine what’s going down the pipeline,” noted Paquin.

“The oil can come through the metering system be measured and flow out without going into the tanks as well. We have the capability of doing either.”

Some of the main active contractors are Monad Industrial Constructors Inc., Greg’s Contracting Services, Altus Energy Services and Ledcor Pipeline Ltd. who all work under the direction of area manager Bob McEwen on contract from Bechtel Oil Gas and Chemicals Ltd. ɸ Page C2

C2

PIPELINE NEWS August 2009

Pipeline terminal almost complete

One of the key components of the terminal is the metering system used to measure incoming and outgoing oil.

ɺ Page C1 At a tour stop of the power station, a crew from Fortis Inc. was hard at work on the substation that will supply power to the pumping station, “to move the product down the line.”

There are six initiating pumps being installed on site to start the flow of oil down the Keystone pipeline toward American markets.

“This is where the Keystone begins,” said Paquin who counted a total of 23 pump stations on the pipeline system map.

The project plan also calls for the installation of booster pumps to boost the oil between the tanks and the mainline pumps to initiate its journey down the pipeline.

“Those pumps are essentially to help facilitate the oil coming in and out and enable the oil to be tubed in two directions,” said Paquin.

Further along the site tour, workers from Monad were busy building an extension of the header system.

“The header system is so we can either have the oil either coming into the tanks or leaving the tanks from the main part of the plant,” explained Paquin.

On the day of the tour, crews were wrapping up their hydro test of the tanks to make sure they are operating properly and are ready to store product.

Painting of the exterior was also underway.

“Once the main line is tied in, the whole facility is going to be ready to go,” said Paquin.

A fire water system and some new concrete containment walls surrounding the tanks are on the project to-do list.

“This is a very important project for TransCanada,” said Paquin. “It gets them into the oil transportation side of the business.

“The Keystone Pipeline will be in service and commissioned in the fall and have product flowing to customers a couple of months after that.”

Additional facilities will be built in Hardisty when TransCanada get the regulatory approvals from the Canadian and U.S. governments to start work on the Keystone XL expansion pipeline.

The Keystone XL is a planned 3,200-km pipeline that will transport crude from Hardisty to the Gulf Coast of the United States.

“We have shipper commitments for about 900,000 barrels a day,” said Paquin. “That’s about 83 per cent of our system capacity. The shippers have had a strong interest in this project and have supported it.”

That XL project should give another boost to local economies considering 525-km of new pipelines will be constructed in Canada from Hardisty to Monchy, Saskatchewan, on the U.S. border.

“We have about 300 people working on the terminal,” said Paquin. “These people are living around the area and using the local services.

“TransCanada tries to give back to the community as much as we can. We have sponsored events such as the local rodeo and we’ve been involved with the refurbishing of the local arena.

“TransCanada put a donation towards that. We try to be part of the communities in which we operate.”

CE Franklin adds links to its oil¿eld supply chain with BMW takeover

By Geoff Lee Calgary – CE Franklin Ltd., has strengthened its hand as a leading distributor of pipe, valves, flanges and fittings to the energy industry with its acquisition of Weatherford Canada’s distribution network known as BMW supply.

The purchase was announced July 1, and in a letter to customers, Michael West, president and CEO of CE Franklin notes the transaction “particularly improves CE Franklin’s presence in the heavy oil region of Alberta and Saskatchewan.

“This acquisition enhances stability and certainty in the supply of pipe, valves and fittings for our current and future customers in the region.”

The purchase includes BMW’s 22 oilfield equipment supply stores across western Canada.

Of that total, 17 locations close to existing CE Franklin supply stores will be merged.

The remaining five locations will extend the market reach of CE Franklin’s distribution network to 49 locations in western Canada.

In his letter to customers, West notes in some locations, both companies will share a common roof line and front counter.

He also said, the acquisition “creates an opportunity for CE Franklin to take advantage for a newly combined talent pool and the sharing of best practices from both organizations.”

With the purchase, CE Franklin will focus on the distribution business and Weatherford will focus its attention on artificial lifts.

“This concept combines the strengths of both organizations and allows our customers to leverage the core competencies of each company in one location,” said West.

The transaction is financed from existing bank credit facilities and is expected to increase CE Franklin’s annual revenue by more than 10 per cent from current levels.

“This acquisition will strengthen CE Franklin’s existing store operations and expand its market reach while improving our service capability, operating efficiencies and customer base,” stated West.

PIPELINE NEWS August 2009

C3

24/7 custodian of diesel fuel

By Geoff Lee Langley, BC – Hiring a man wearing nice gloves to fill your company vehicles with diesel fuel may seem extravagant these days, but the service is part of a total fuel management system that can save time and money and prevent fuel theft.

The system is available from 4Refuel, Canada’s largest fuel management organization specializing in onsite delivery, fuel logistics, automated fleet management with a head office in Toronto.

“We have a phrase in our office that reads, ‘you can’t manage what you can’t measure,’ ” said Bill Bishop, vice-president of marketing and sales from his Langley, B.C. regional office.

“That’s really the attitude towards fuel that’s been around forever. Fuel is the second highest cost behind labour. Companies have all sorts of managers but they’ve never had a fuel manager.

“Think of the significant cost of fuel that goes unmanaged. It’s because no one has been able to measure it. We provide the measuring tools.”

The main measuring tool is a web-based fuel management online (FMO) system that creates a database of all the fuel consumed along with the price, the date and location and matches the data to vehicle numbers.

“You can determine which vehicle is using the most fuel and from there determine why that vehicle is using the most,” said Bishop. “Is the driver travelling the furthest or is his truck out of date or needing maintenance?

4Refuel has a wide range of diesel fuel delivery and fuel management systems that are helping companies to cut their fuel costs and lock out theft from employees and professional thieves.

Photos courtesy 4Refuel Ltd.

“You can make corrective action to reduce your consumption and bring down your bill.

Our system saves money.

We really help clients cut their fuel costs. They cut their emissions and their labour costs. It’s a really powerful tool.”

This year, the Refuel which also operates in the United States, will manage over 700 million litres of diesel and biodiesel to its fleet, construction, municipal, marine, airport and oil and gas industry clients in 2009.

“The old way of using fuel is burning fuel and paying bills,” said Bishop.

“We began with an onsite fueling business – bringing fuel to vehicles and fueling them during idle hours – at a construction site when the guys are on their lunch break or a fleet at night.

“This created tremendous time and labour savings and it also increased productivity so each truck could do more in a day because it didn’t spend 20 minutes refueling.

“Our clients starting asking us if there any way they could see more data.

From their ideas and from our own research, we built the fuel management online system.”

4Refuel also hauls bulk diesel fuel to diesel fuel storage tanks used by oil and gas companies in the Fort McMurray where the concerns are environmental and safety.

“By improving the way fuel is handled, we are able to lock down those two concerns and again lock out theft,” said Bishop.

“Once you have a third party handling fuel, nobody else gets involved.

It’s all tracked down to a fraction of a litre and anything that goes missing is safe. Our certified fueling professionals put the gas in.”

4Refuel also equips fuel storage tanks with remote monitoring equipment. The tanks are equipped with digital software that is activated each time the tank is open.

It sends a text mes-

sage or e-mail to the customer when refueling occurs and each tank can have an alarm or warning beacon that activates during after-hours or unauthorized fill ups.

The tank fuel dispensing equipment can be hooked into a remote monitor system called positive ID. “Positive ID prevents fuel from being pumped

except to the right vehicle,” said Bishop. “It requires a chip on the truck and a chip on the ID card which is read by the dispenser. These things have to line up.

“It has to be an employee and a truck that belongs to the company and only then will the fuel flow. The fuel management record can be viewed online.”

In a news release company president Jack Lee says when it comes to theft, 4Refuels total management system, “streamlines logistics and automates tracking, so you can actually see where every drop of fuel goes and you know where and when your equipment is being refuelled. It locks out theft, simple as that.”

4Refuel is one of the fastest growing diesel and biodiesel management companies in Canada as potential customers look for ways to cut their fuel costs and theft.

“When fuel prices soared, the phone was

ringing off the hook.

When the economy crashed and people needed to conserve cost, the phone was ringing off the hook and now that things are picking up the phone is ringing off the hook,” said Bishop.

“It’s a solution for all seasons I guess. The total management system saves clients money.”

Bishop says when 4Refuel pitches the product and services to customers, “we talk about the true cost of fuel.

“It’s not just the cost you pay at the pump. It’s the time it takes to go and get the fuel and the labour, administration and the overhead. It’s also tracking the data to manage it better.

“When you add up all the tiny costs that you never really consider, you realize you are paying a lot more for fuel than just the cents per litre,” he said.

“Our system cuts down of the hidden costs but it also improves productivity and efficiency.”

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C4

PIPELINE NEWS August 2009

Enbridge’s Hardisty tank farm Story and photos

by Geoff Lee

Lyle Welder stands in front of one of 18 new crude oil storage tanks at the Hardisty Contract Terminal project.

Hardisty – Lyle Welder, Enbridge Inc.’s supervisor of area operations at the Hardisty Terminal acts like a proud new papa when he talks about the newest addition to a growing family of crude oil storage and shipping facilities.

“Any expansion is great for growth and it’s great for the community. There are a lot of good spinoffs. It’s been a great project,” said Welder who is responsible for the welfare of the terminal and oversees some of the on-going construction.

The project focus in on the construction of 18 new tanks ranging in size from 360,000 to 530,000 barrels of oil and a standalone condensate tank for blending.

“At peak times during construction there was close to 650 men out here,” said Welder. “We are down to 250 now.”

The ongoing development includes all the associated piping, manifolds, and booster pumps to facilitate crude oil transfers to and from the new facility and Enbridge’s mainline system.

The system includes a se-

ries of transfer lines connected to other carriers and oil terminals in the complex such as those owned by Husky Energy, Flint Hills Resources and Gibson Energy.

“A lot of their product is small-piped into their facilities or trucked in and it gets blended. Once it meets pipeline specs they ship it to us,” said Welder.

“We custody it and ship it to customers on Enbridge pipelines. Basically, Enbridge is a transportation company.

These new tanks give us a lot more capacity.”

The Enbridge project is called the Hardisty Contract Terminal that began in 2007.

Tank construction is entering the final stages watched closely by Welder.

Enbridge is in the midst of a major construction phase, with work on the Alberta Clipper and Southern Lights pipeline also underway.

“My main role is to ensure that when this project becomes operational that all of the signoffs are done and that we are satisfied with the finished product,” said Welder.

“We’ve got all 19 tanks completed but only six are

operational to date. The other 13 tanks are awaiting commissioning.

“The rest of the tanks should be done by the end of September or October. We thoroughly check all the processes that are involved to make them operational.”

The commissioning includes painting each tank white to guard against corrosion and to help keep the stored product cool.

“We try to keep the temperature very constant with these tanks because it’s all part of a volume measurement process,” said Welder. “Temperature affects density and the viscosity of the oil for shipping purposes.”

The tanks are grouped into clusters of six and each tank lot is lined and surrounded by a concrete containment wall and a berm in the event of a leak.

“The environmental requirements for these facilities are very stringent,” said Welder. “There are a lot of guidelines and regulations to be met to make these operational. It’s all part of the process. It’s very well done.” ɸ Page C5

PIPELINE NEWS August 2009

takes on a ranch-like scale ɺ Page C4 The top of each tank is surrounded by white piping for a water and foam fire protection system.

The tanks are topped with a metal floating roof that rests on top of the oil and eliminates any vapour space underneath.

Oil flows into a tank through long slotted nozzles extending to the centre of the tank.

The slots allow oil to flow in and spread out smoothly to eliminate any static.

One line, called the suction line, goes to the centre and is utilized for taking oil out of the tank. An epoxy coating lines the floor and the interior walls to prevent corrosion.

Enbridge will use the new condensate tank for additional product blending before pumping customers’ products in order to meet their summer and winter specifications.

“The diluents system is used to blend the material to meet the pipeline specifications of a certain density and viscosity so the pumps can handle it very efficiently and use the least amount of power to ship the product to the customer,” said Welder.

“If there is a change in the viscosity or density or any of the commodity specifications, it can cost more to ship.”

One of the final unfinished pieces of the contract terminal is the manifold transfer site that is a subsidiary of Enbridge’s core pipeline system.

When the oil leaves the facility it goes through a series of manifolds and is directed to one of five Enbridge main lines.

One of those pipelines will be the Enbridge Alberta Clipper, a new 36-inch diameter, 1,607-kilometre crude oil pipeline from Hardisty, Alberta to Superior, Wisconsin.

Initial mainline construction activity started near Hardisty and Provost, Alberta and near Bethune, Saskatchewan. The Clipper is scheduled to be in service in 2010.

The pipeline will have an initial capacity of 450,000 barrels-perday (bpd) and allow for expansions to increase capacity up to 800,000 bpd.

Welder says a grand opening is in the works once the tank farm is fully operational and he says future site expansion is a possibility.

“We have expanded here quite a bit,” he said.

“The footprint is built on a couple of quarters of land and we have more land for future expansion.

“The economic spinoff of this project has been huge. It’s brought in a lot of people. The crews stay in the camp and in some of the surrounding areas where they rent houses.

People have been quite open to the construction workers here.

“The project is welcome in a small community. It will help create more funding for some infrastructure for Hardisty.”

Construction continues at the manifold transfer site.

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PIPELINE NEWS August 2009

Community of Hardisty plans to hitch

Mayor Anita Miller poses at a gazebo built by the men of Hardisty as a project for the CBC TV show, The Week The Women Went, set in Hardisty.

By Geoff Lee Hardisty – Hardisty used to be a thriving agricultural community but now it’s sitting next to a productive, yet fickle cash cow known to produce high grade cream and sour milk on alternate boom and bust years.

Starting in mid 2007 and continuing for the next one to two years from 2009, that familiar ole cow called the Hardisty Oil Terminal or “the hill” as locals call the project, is in a cream cycle.

Hundreds of crews have come to town to work on terminal expansion

and pipeline projects and business is booming for local retail and commercial establishments.

Some investors and developers though seemed scared off by memories of milk gone bad but steadier economic growth may be just around the corner.

Welcome to Hardisty’s healthier cream cheese future.

“We are in the midst of doing an economic sustainability plan,” said Sandy Otto acting CAO. “We are looking at hiring a firm from Toronto to come in and do a study and help us attract an industry that will complement our current oil and gas providers and bring in an industry that isn’t mainly driven by them. That’s a big challenge for that company.

“Hardisty is definitely an oil and gas driven community. I am a farmer in the area. As much as I would like to say it is agriculture driven, it’s not.”

Companies including Enbridge Inc., Kinder Morgan, Husky Energy, Flint Hills Resources and Gibson Energy Ltd. are pumping millions of dollars into storage tank expansion at the terminal six kilometers east of town on Highway 13.

TransCanada is the latest player and one of the busiest with three new tanks and their Keystone Pipeline projects under construction.

“The terminal has had a huge impact on work here,” said Mayor Anita Miller who works as an administrator for Gibson Energy at the terminal site.

“Because of that we have a 350-person work camp in town. Most of the crews are living there because they aren’t not enough living accommodations in town.”

The Hardisty Inn Hotel and the Hardisty Motel have been full for months.

“They are loving it,” said Otto.

“Many of our businesses are definitely benefiting from this. If you go to the grocery store at five o’clock, it’s lined up.”

“Our downtown is definitely starting to see the benefits of it. When you have that many transient workers it helps.”

A new 12-room modular motel opened in July and there is a need for more.

“We have had people banging on our doors to build a new hotel but no one has actually going as far as pulling out a development permit,” said Miller.

The latest oil terminal projects have required up to 1,500 workers but once the work is done, only a handful of employees is needed to operate the facilities.

“It’s hard to plan like that,” said Miller. “That’s what scares of motel developers. They can build today and make money today but what happens 10 years from now? Is there enough work in the area to keep that motel viable?”

That upcoming sustainability plan

Acting CAO Sandy Otto enjoys a swing at the Hardisty Lake beach and campground where some oilÀeld workers stay.

could provide some answers but the oil and gas industry has been in the Hardisty area for over 50 years and isn’t going away soon.

“We have survived a 100 years but we want to know what’s going to makes us sustainable for the next 100 years,” said Miller.

“The terminal will be part of it but we still need the agriculture people who have sustained us to this point. We also have to have water and sewer to make residents’ homes sustainable.”

Last summer, the town serviced 11 more residential lots to meet the demand for new housing. ɸ Page C7

PIPELINE NEWS August 2009

C7

its wagon to more economic drivers

Town worker Richard Timms does some raking on a downtown beautiÀcation project.

ɺ Page C6 “The housing market was very active from mid ’07 to mid ’08,” said Otto.

“Now it’s more price oriented that determines how long a house stays on the market.

“We are finding homes under $200,000 are hot commodities. I think that’s because of the workforce that’s in play right now.”

The town has also created a new 10acre industrial subdivision near Highways 13 and 881 that runs through Hardisty. This is an ideal location new businesses such as a hotel and oil and gas service companies to service the oil

terminal.

“The only thing we are lacking is the funds to develop the infrastructure required in our industrial area to bring the people in charge of maintenance of those facilities to locate their business here,” said deputy Mayor John Pioker, who retired from Husky in 2008.

“We have a grant application to the Building Canada Fund that would assist us with the funds to develop that industrial area. It’s very expensive.

“We would like to see the establishment of businesses in our community that are long term.”

The Fyre Ho’z fire & safety training center is the newest oilfield related business to set up shop in town.

“That’s helping and that’s what we want to continue to attract,” said Otto.

“We have to be proactive and we have to be ready. That’s why we developed the industrial area.”

Otto thinks Hardisty’s location, two hours from Edmonton, could be an issue for business investment but residents and tourists are call Hardisty a recreation paradise.

Hardisty Lake is a great place for swimming camping with over 50 serviced sites where many oilfield workers stay for the summer. Next door is the 9-hole Hardisty Lakeview Golf Course.

Work is underway on an initial $1 million upgrade of the Hardisty arena and curling complex funded with a $500,000 grant and donations from the

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“Those corporate citizens stepped up to the plate to make that happen,” said Otto. “We have rodeo every summer at the campsite too. The oil industry helps with sponsorship or whatever is required.”

Tourism is on the increase as Hardisty continues to bask in the glory of being featured in the CBC TV series, The Week The Women Went. An estimated 1.2 million viewers watched the first of eight episodes that aired nationally in 2008.

These shrubs planted on the main street were another community project spun from the CBC TV series, The Week The Women Went, set mainly in Hardisty.

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PIPELINE NEWS August 2009

Agenda set for heavy oil symposium in Lloydminster

This was the opening banquet for the 2008 Lloydminster Heavy Oil Show and Symposium. The 16th annual Heavy Oil Symposium, to be held this year, will focus on new technology.

File photo

By Geoff Lee Lloydminster – Heavy oil and light entertainment should form a winning program mix for the 16th annual Heavy Oil Symposium to be held at the Stockade Convention Centre in Lloydminster September 16-17.

The symposium is hosted by the Lloydminster Petroleum Society with the theme, New Technologies Stimulating Innovation that symposium chair Mike McIntosh says fits the current economic times.

“When you are involved in looking at picking a theme you look at what’s happening in the world at the time and 2009 has definitely been a challenging year for the industry,” he said.

“In harder times, people start to look at new ways to do things that can either improve profitability or run times or come up with a fresh approach to an old way of doing things.”

The symposium focus is on heavy oil and McIntosh notes it will draw “quite a cross section of people. We get people from all over Canada.”

The lighter side of the two-day symposium will be provided by banquet speaker and former world curling champion and Olympic silver medalist, Kevin Martin.

“The curlers in town who have heard he is coming are really interested,” said McIntosh who expects Martin will answer why he threw away his second last rock on route to a 10th end 8-6 loss to Scotland at the 2009 worlds held in Calgary.

“We will leave the topic up to him but I would think he’s been asked why he threw his rock away so much that it’s probably part of his talk,” speculated McIntosh.

The banquet will be held at the Wayside Inn Sept.

16 beginning at 6 p.m. and some seats could be open to the public since the symposium fee of $200 does not

include the banquet.

“Closer to the date, we will know how many people are attending the banquet,” said McIntosh. “Any additional capacity that is available could be open to people who aren’t attending the symposium, but I would imagine the symposium attendees get first opportunity.”

McIntosh says Martin was selected as a speaker because he was available and he fits the bill for a celebrity who is informative and entertaining for symposium goers looking for a social outing.

The symposium agenda, posted on the petroleum society web site, includes presentation topics ranging from Natural Gas Engines Technologies and Sand Screens for Thermal Heavy Oil Recovery to Cost-Effective Production Enhancement Solutions for Heavy Oil. “People attending the conference should expect to hear presentations that are looking at newer emerging technologies and new ideas and approaches,” said McIntosh.

“I would say there are some very interesting things that are going to come about for participants. They are going to hear a lot of new ideas and ways to increase productivity and profitability and help them with issues they see currently.

“There is quite a broad spectrum of presentations.

Some of them are going to be on newer technologies.

Some will be on new approaches.”

A representative from the Saskatchewan Ministry of Energy and Resources will deliver an update on changes to oil and gas conservation regulations that the energy industry will have to adapt to.

Not included on the agenda is a presentation on how the event was put together but as McIntosh explains it, the job of soliciting, reviewing and selecting the abstracts was shared between committee members Mahesh Makkar, Christin Taylor and himself.

“All of the committee members have a role to play,” he added noting Murray Tluchak, Ryan Roen, Ryan Rowan and Dale Luedtke will share duties as symposium masters of ceremonies and introduce speakers.

The symposium is limited to the first 200 participants to register due to limited seating at the stockade.

Included on the agenda is a bus tour of the Husky Upgrader.

(780) 875-0203 LloydMall Lloydminster

PIPELINE NEWS August 2009

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Deloro testing direct current stimulation

By Geoff Lee Wilkie –Deloro Resources Ltd. expects to get a lot of wattage working with Electro-Petroleum Inc. and its Electrically Enhanced Oil Recovery (EEOR) technology to stimulate a heavy oil reservoir in the Wilkie area.

A service rig was moved on site June 1st to begin production testing on an existing horizontal well using EPI’s direct current technology.

Deloro has recently applied to extend the testing to some of the six other wells on the Deloro-owned lands.

The company has also applied to drill a new horizontal well on the property that covers 3,765 leased acres of petroleum and natural gas rights.

The government of Saskatchewan leases cover a channel in the deep McLaren zone one-half to threequarters of a mile wide and approximately five miles long.

“We got that acreage directly from the government in a land sale and those wells were already on the lease,” said Deloro president and CEO Louis Lees from Vancouver. “There were some vertical wells as well as horizontal wells.”

Once the pilot test is deemed successful, the project will proceed to full development and EPI will earn a 10 per cent working interest in the Wilkie project for the use of its technology.

“The service rig is moving some of the underground stuff in the elbow of the horizontal leg,” said Lees.

“We are still installing production equipment.

We are not drilling. We are using a horizontal well that was already there.

“It’s really heavy gravity oil. You can just barely pump it, but it’s not something that works without using EPI’s stuff on it. All we need is a service rig to

Deloro Resources crews spent last spring preparing the groundwork near Wilkie for heavy oil production testing using direct current electricity.

Photo submitted

put the equipment in there.

“We are using direct current electricity to heat up the formation down below. That takes a certain amount of time. That will take another two months of heating and then we will have our optimum.”

EEOR involves passing direct current electricity between cathodes (negative electrodes) in the producing well and anodes (positive electrodes) either at the surface or at depth.

The EEOR patented technology uses direct current electricity for both in-situ heating and electrochemical reactions to upgrade and recover oil.

“Even though you have extremely [heavy] oil there, it will almost have the consistency of water when it gets heated up,” explained Lees. “We have al-

ready had a show of it so we know that it’s working.

“It was close to the pipe on the horizontal well and we need to do a little more work before we get it circulating properly.”

The original discovered resources underneath Delora land were estimated to contain 63 million barrels in a 30 to 50-foot thick heavy oil pay zone at a depth of 2,035 feet.

“That’s a really thick zone. It’s a one of a kind you might say,” said Lees. “It is very heavy oil and it needs special treatment to get it out economically and that’s what we are doing with it.

“The warming up process takes place underground. It’s a green process with no damage to the surface whatsoever. The heat down below does a cracking process similar to what a refinery would do.”

Current steam based heavy oil recovery methods are effective to about 2,500 feet but EEOR has no depth limitation.

“We only have one horizontal well there and we probably wouldn’t use over 100 acres,” said Lees. “If we find that if it’s working well, we will keep right on and add more to it.

“If we find the system works there are three more wells that are equally promising and could change things fantastically.

“These are things we have concentrated on for the past two years. We have been reviewing this type of recovery for oil.”

The technology was developed by General Electric and purchased, enhanced and field tested by EPI in California. EEOR requires no significant amounts of water, does not use a working fluid, and emits no greenhouse gas.

EPI’s technology was presented at the World Heavy Oil Congress held in 2008 Edmonton, Alberta.

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PIPELINE NEWS August 2009

PIPELINE NEWS August 2009

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All systems are go for launch of patented Newco tank

By Geoff Lee

flame arrester burner system in it so we are elimiLloydminster – It’s nating 75 per cent of the been tweaked, engi- CO2 emissions at a well neered to code, stamped site. The only thing that for use in Saskatchewan is running is the engine.”

Estimated propane and Alberta and patented in Canada. After savings with the Newco six years in the making, tank run between $3000 the 1,000 barrel Newco to $4,000 a month in the heating tank is ready to summer time and a lot more during the winter. go to market.

The working unit That’s the word from developer Kevin Clarke leased to Nordic sports a from his Newco Tank fully automated exhaust Corp launch pad in system that the protoLloydminster, where his type lacked, causing the new mission is all about engine to overheat if not marketing and saving watched closely.

“Once you get the the planet – one tank at fluid up to 80 C, the sysa time.

Following the suc- tem automatically closes cessful summer and win- the exhaust coil and ter trial of a prototype opens the bypass, which tank used by Brahma in turn, eliminates half Resources since July the heat going into the 2008, Clarke has made tank,” said Clarke.

The engine, designed some modifications and by CE Franklin Ltd/Full leased his first production model to Nordic Oil Tilt Field Services has and Gas operating in the no radiator and is cooled by glycol in the tank, and Lloydminster area.

“We are at the verge runs about at 170 F. The where we are doing sales engine compartment reand marketing now,” said duces the tank capacity Clarke. “We took the to 940 barrels.

With the built-in bugs out of the second one and it’s been work- engine, noise pollution is ing about a month now cut by a reported 75 per and it’s working awe- cent since the exhaust system runs through the some.”

The tank is designed fluid.

A recent published with a built-in engine compartment that en- third-party engineering ables it to harness the review by R&D Process engine heat to heat the Management Inc., in fluid utilizing exhaust, Saskatoon showed that glycol, hydraulic, and one Newco tank reduces CO2 emissions by the compartment heat.

“We are trying to go equivalent of 200 to 300 green with this product,” vehicles a year – one of said Clarke. “With the its major selling points.

Newco’s web site Newco tank there is no

Matthew Barnard leased a Newco tank for a Lloydminster well to offset start up costs and cut emissions.

outlines prototype results along with a list of tank benefits such as reduced noise pollution, reduced operating costs, reduced greenhouse gas emissions and no need for a shack.

The Newco tank comes with a lease site set up cost of $110,000.

That is considerably more than a conventional tank but with virtually no propane costs or harmful emissions over-

all operating costs are much lower.

“Some people are comparing it with a conventional tank but it’s

not,” said Clarke. “I call it a heating vessel because we are harnessing all of the heat from the engine and it’s creating free heat for the tank. You no longer have to worry about a flame burner system.

“With the price of oil at $60 per barrel, this is when companies should be buying it,” said Clarke. “The payback is less than six months and the lifetime of these tanks is 18 to 20 years.”

“Right now with guys in the recession mode, a lot of companies are saying they are cash poor so we created a lease program with one, three, five and 10 year options.”

The lease option is what makes its attractive to junior explorers such as Nordic Oil that Clarke says wants to be a company “that steps up to the plate and goes green as far as the technology allows them.”

Clarke has invested more than $1.5 million of his own money and six years of research to develop and fine tune his tank.

“I have been doing this full-time for the past two years,” said

Clarke. “I have been an entrepreneur for quite a while. I grew up in Lloydminster and worked on service rigs for 16 years and consulting for the last few years.”

The idea for the tank came from his thinking about how to heat that tank for free and clean up the footprint of the lease and eliminate noise.

Eureka!

The Newco tank will be manufactured locally

by Universal Industries that worked with Clarke for a short period of time on his first prototype in 2004.

“You become an expert on everything because you wear so many hats,” said Clark. “I have had to learn the whole process from fabricating to the engineering side and dealing with patent lawyers and examiners.

We had many hurdles to jump to get to where we are today.

“It’s been a good project now that we are doing sales and marketing. I am wearing many different hats right now.”

Clarke’s next challenge is to design a prototype for a 2,000 barrel tank.

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PIPELINE NEWS August 2009

Nordic cuts operating costs with Story and photos by Geoff Lee

The engine compartment built in to the Newco tank allows Matthew Barnard easy access for repairs.

Lloydminster – Nordic Oil and Gas Ltd. is confident it has found a way to cut costs and emissions at one of its heavy oil wells near Lloydminster using a new energy-efficient battery with a built-in engine.

The tank is made in Lloydminster by Newco Tank Corp. and uses heat generated from the engine to heat the tank fluid utilizing the exhaust, glycol, hydraulic and engine compartment heat to do the job.

This eliminates the need for the usual propane-powered flame arrestor/burner tube that helps to maintain the

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tank temperature at about 80 C. Heat separates water from the oil and improves the quality when Nordic sells it to Husky in Lloydminster.

With a potential fuel savings of $3,000 to $4,000 a month in the summer time with the Newco tank, Nordic jumped at the chance to use it on a re-entry well located a few minutes north and west of the city.

Nordic has nine heavy wellbores and seven producing wells in the area with conventional batteries heated with propane burners.

“You need a fair amount of production to pay for all those propane costs,” said Matthew Barnard, Nordic’s director of operations.

“We want to be the most cost-efficient and energy efficient from the field perspective since that is where you spend a lot of your money.

“When we decided to produce the well again, we were thinking about

cost-saving initiatives.

The Newco tank does not require any propane and we thought it was a no-brainer to harness the engine’s energy.

“The tank was one thing that we thought would save us a fair amount of money over a monthly term and thinking into the future, we are going to be using a lot more propane to heat our tanks.

With the Newco tank, Nordic’s emissions are lower since there is no exposed flame on the new tank. Fluid in the tank is heated from the heat given off from the engine compartment and the exhaust coils in the tank.

“When we combined everything about how well the well was going to do with production, and what we would save for our heating bills and our start up costs, we thought with all of those variables this would be a viable well, which it is,” said Barnard.

The well, along

with the Newco tank, were brought online in the second week of July with initial production at about 15 cubic metres of oil per day.

“It’s been excellent so far,” said Barnard. “The well has not gone down as of yet. We’ve had some torque issues but everything has worked itself out really well.

“All of the lines were installed by C’s Oilfield Services. They do really good work. I am very glad how they plumbed in the tank because that’s a big part of how well the tank actually works.

“My glycol lines run along the flow lines. We will wrap all those lines with insulation.”

In the winter, the glycol line will keep the flow line and the gas line from freezing and keep the condensation down.

C’s field foreman, John Scully dropped by the site during the making of this story and he thinks the Newco tank is a great idea. ɸ Page C13

PIPELINE NEWS August 2009

C13

the leased “green” Newco tank ɺ Page C12 “It is environmentally friendly and you are using a lot less gas,” he commented. “The gas you are using for the skid, you are using as muffler heat and the glycol heat to heat the fluid. It’s a really good idea.

“It is easy to set up.

This is the second one we’ve done and it was a lot easier with the second one. It’s just running your flow line into it and other than that, Newco takes care of the fitting of the skids and stuff like that. It’s really simple for us.”

The engine is a standard V-8 Chevrolet engine converted to propane but the engine uses little propane since only eight ounces of pressure are needed to run it at 1,600 rpm.

“The engine is giving off a lot of radiant heat, and in turn, the engine compartment is giving off all that radiant heat into the fluid in the tank, heating up the oil and the water,” said Barnard.

On a Newco tank, the exhaust goes right through the tank and that also heats up the tank. The exhaust coils are controlled automatically so if the tank temperature goes up, it will automatically vent the excess heat from the back of the tank.

“The tank will be here as long as we are making oil and it’s saving us money,” said Barnard. “The well has been pumping for a week and a half and our propane gauge hasn’t moved at all.

“If I had a burner here I would have had to fill up these tanks already,” said Barnard.

“Those gauges are the same as when the propane was delivered.”

Nordic chose to lease-to-own the Newco tank to avoid big start up costs. A new 1,000 barrel tank with a conventional skid shack can cost between $60,000 and $65,000.

“We eliminated that startup cost and we are

just making lease payments over five years,” said Barnard.

The tank comes with everything required to heat the tank and the engine.

Barnard likes the fact CE Franklin/Full Tilt Field Services worked with tank developer Kevin Clarke to fabricate the inside engine compartment so it can be worked on easily.

“It is also very service friendly,” he said.

“They have thought of everything from a service aspect. They have made it workable for someone like me who is out here on a daily basis checking the wells.”

The well site is situated just 200-metres from a new acreage, and one of the first things a first time visitor notices is the low noise emitting from the engine compartment.

“If you were 50-metres from the site, you wouldn’t hear anything,” said Barnard. “The owners of the acreage will ap-

preciate the noise reduction.”

Newco plans to drill one or two more wells in the area before the end of the fourth quarter but Barnard cautions Nordic is, “anxiously waiting for the price of oil to go up.

“We will consider the Newco tank for those wellbores as well. Right now, we want to keep monitoring the tank and if it keeps on performing like it is, we would be looking at that cost saving initiative.”

Matthew Barnard, with Nordic Oil and Gas leased a Newco tank to save money on fuel costs at a heavy oil reentry well west of Lloydminster.

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C14

PIPELINE NEWS August 2009

Fyre Hoâ&#x20AC;&#x2122;z hopes to catch Âżre with Hardisty oilÂżeld customers Â&#x201E; By GeoďŹ&#x20AC; Lee

Hoberg sprays this Ă&#x20AC;re extinguisher with water to check for leaks.

Provost â&#x20AC;&#x201C; John Hoberg launched his Fyre Hoâ&#x20AC;&#x2122;z Fire and Safety company in Provost a little more than a year ago as a get enriched quick opportunity. â&#x20AC;&#x153;I am trained to do this kind of work and I enjoy it,â&#x20AC;? he said. â&#x20AC;&#x153;Money is not the driver. I like the people. The people are super. Itâ&#x20AC;&#x2122;s a self conďŹ dence booster. â&#x20AC;&#x153;The money doesnâ&#x20AC;&#x2122;t seem to match the work but itâ&#x20AC;&#x2122;s steady. I do it because I like it and I only think of getting the customer what he needs.â&#x20AC;?

At the Provost shop, Hoberg sells and services a full range of ďŹ re and safety products from ďŹ re extinguishers and gas monitors to breathing air equipment and a variety of supplies such as safety signs, eye wash, hearing protection products and ďŹ rst aid kits.

He also evaluates safety and ďŹ re plans and conduct on site safety consultations but his favourite part of the business is customer service. â&#x20AC;&#x153;We do some retail, but I like the service part where you go to a facility and do ďŹ re extinguisher inspections or some safety work,â&#x20AC;? he said. â&#x20AC;&#x153;I do quite a bit of product servicing in the shop too.

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guisher repairs and parts. I do the full recharges. â&#x20AC;&#x153;I do some of the repair work on breathing air equipment and send out the complicated stuďŹ&#x20AC; and make sure itâ&#x20AC;&#x2122;s done right. I prefer itâ&#x20AC;&#x2122;s done right since it involves safety. â&#x20AC;&#x153;The biggest demand is for so far is for ďŹ re extinguishers and I am getting a lot more demand from air customers.â&#x20AC;?

Hoberg does some contract work for Muirheadâ&#x20AC;&#x2122;s Ltd. Safety First breathing air trailer business. Muirheadâ&#x20AC;&#x2122;s rented the building to Hoberg who agreed to keep their sign on the building next to his.

With customer service top of mind, Hoberg launched a training centre in Hardisty last December to deliver a full range of safety courses to oil workers in need of H2S, conďŹ ned space, ďŹ rst aid and basic ďŹ re courses.

His wife Tammy is the director of training and she can book forklift driver training courses and other courses on request.

Hoberg based his decision to expand to Hardisty on that fact Provost had two training centres but Hardisty had none. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s not a bad drive either. I can commute within 50 minutes,â&#x20AC;? he said.

Hoberg is qualiďŹ ed to teach the basic ďŹ re safety and conďŹ ned space courses but he has chosen to contract out instruction for H2S Alive, global ground disturbance and St. Johnâ&#x20AC;&#x2122;s Standard First Aid and forklift operation.

So howâ&#x20AC;&#x2122;s business at the training centre? â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s slowly picking up,â&#x20AC;? he said. â&#x20AC;&#x153;It was disappointing at ďŹ rst but we are making progress. Most of the guys in the courses are renewing their tickets. There is usually only one person in every class who is a new recruit. â&#x20AC;&#x153;We havenâ&#x20AC;&#x2122;t gotten into selling supplies from our shop in Hardisty yet but thatâ&#x20AC;&#x2122;s something we would like to get into and oďŹ&#x20AC;er more products such as coveralls than he have in Provost. â&#x20AC;&#x153;I still have big ideas for Hardisty as well as Provost but they will come in time.â&#x20AC;?

Hoberg farmed in Provost for years and got a taste for safety working seasonally for Astec Inc. and decided it was time to take a break from farming and working for someone else.

He also had knowledge of the market having driven a steam truck for six years for Winterhawk Enterprises. â&#x20AC;&#x153;I started by buying a bunch of equipment from our ďŹ re chief who had a ďŹ re service,â&#x20AC;? he said. â&#x20AC;&#x153;When he retired I bought his equipment. Basically I started at home. â&#x20AC;&#x153;I needed a trailer to go to locations so I phoned Muirheadâ&#x20AC;&#x2122;s about their trailer. They said they couldnâ&#x20AC;&#x2122;t sell me the trailer but they would oďŹ&#x20AC;er their air breathing trailer and ďŹ re extinguisher business and the place to run the business.â&#x20AC;?

Hoberg moved into Muirheadâ&#x20AC;&#x2122;s building May 1, 2008 and he hasnâ&#x20AC;&#x2122;t looked back.

As for marketing Hoberg says, â&#x20AC;&#x153;A lot of people around Provost know me and I think we have a pretty catchy logo. â&#x20AC;&#x153;I just saw the name somewhere and I thought it would be a cool name if I ever did have a ďŹ re extinguisher business,â&#x20AC;? he said. â&#x20AC;&#x153;I used to call myself hot hose and I ran steamer so this name ďŹ t in.â&#x20AC;?

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PIPELINE NEWS August 2009

C15

Recon focuses on unearthing buried pipelines

By Geoff Lee Hardisty – The practice of call before you dig keeps the phones ringing at Recon Utility Search N.A. Inc. in Hardisty where the demand for the company’s non-destructive hydrovac pipeline and utility locating service keeps growing.

“In the last year or so, we have doubled our sales from the prior year,” said Trevor Remple the chief financial officer.

“A good part of that growth was from the Hardisty Terminal and we also sent a truck to the Edmonton oil terminal. Our big customers locally are Greg’s Contracting, Gibson Energy, Enbridge Inc., Husky Energy and Kinder Morgan. The Edmonton work has come from a customer requesting that we send trucks up there.

“As the Hardisty terminal grows we will be that much busier. The tough thing for us is to balance just how many trucks we need to continue to service it.

We will determine what the right balance is once the construction is done.”

A camp of 370 workers has been set up in Hardisty for crews working on the tie-in for TransCanada’s Keystone Pipeline and a variety of on-going tank farm expansions and improvements by companies such as Gibson Energy and Enbridge Inc. Recon currently has seven hydrovac trucks, two vacuum trucks, a water/pressure truck and a steam truck and two more vehicles are on order to keep up with the demand.

In Hardisty, they have an office building and 10bay shop with a truck wash and a full time mechanic.

There is also a small shop in Edmonton.

“It’s just hopping around here,” said Remple.

“There is no economic downturn for us. It slowed right after Easter but it was spring thaw and that was expected although we were doing a lot of pressure testing on some of the new lines then.

Recon’s operations manager, Brad McClements gets ready to drive this hydrovac to a job site.

“Our steam truck is really busy in the spring and fall cleaning stuff that has gotten dirty over winter or summer.”

Safety and environmental issues have also been a boon to Recon as hydrovac excavation using hot or cold pressurized water reduces the risk of damaging electric facilities, pipelines and fibre optic cables.

“In the good old days, you just took a backhoe until you found metal,” said Remple. “Now you actually use water and a vacuum to suck the soil up and expose whatever is buried whether it’s electrical or pipeline.

“Any time someone needs a hole dug, it’s much safer and cleaner to do it with a hydrovac than a backhoe. If you are doing a small dig it is very efficient.

“The water loosens up the soil. With water and the suction – when you find the utility you don’t end up damaging it. It’s the safe way of exposing underground pipelines and utilities. “ Recon Utility was started in 2000 by Dean Ness and Brad McClements with one truck apiece and has grown in lockstep with the expansion of the Hardisty tank farm to 20 employees including a safety coordinator.

“We chose to set up in Hardisty because of the tank farm and the land was available to us to build on,” said McClements. “Nobody was really servicing the tank farm and we saw a need. We just kind of stepped in and went for it.

“We’ve grown a fair bit from one truck to 11 pieces of equipment but we don’t want to grow the company to the point where it’s unmanageable. If we maintain what we’ve got now, that’s where we’ll be.

“The terminal is the biggest part of our business but we also work on gas lines and communication lines in the outlying areas for the oil and gas sector outside the tank farm and we do some work moving fluid and pressure testing.

“We get called out all the time in this area. It’s a 24-hour service.

“The hydrovac is for safe excavation. It eliminates the hole work to make sure there are no pipeline ruptures and for safe exposure of utility cables. For any new facility or line caution, you expose it and dig it out for safe exposure with hand digging or water washing.”

One of Recon’s competitive advantages is that owners Ness and McClements spend a lot of their time in the field working with staff and customers and the operating the equipment themselves.

“It’s a personable business and it runs a better service,” said McClements. “You get a feeling for what the customer wants and that makes a big difference.”

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C16

PIPELINE NEWS August 2009

Sun, fun and prizes top off the Lloyd golf tourney Story and photos by Geoff Lee

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of the national Kidsport charity sponsored locally

by Noralta Controls Ltd. “We are teamed up with Kidsport and it’s an awesome place at the oilmen’s to introduce Kidsport and keep it going,” said Cam Zarowny from Noralta.

“Each year, we have gotten a bigger donation.

Kidsport is to help under privileged families who don’t can’t get the same access to funds to engage in sports that some other families can. It’s a good feeling for us to be part of that experience for them.”

The two-day tournament included a million dollar chip-off that went unclaimed save for those who reaped a share of Calcutta cash. There was also a variety of sponsored hole-in-one and hidden hole prizes and a plethora of draw prizes. Nobody went home empty-handed.

Al Gramlich was ready to pack his bags the morning after winning

the grand draw prize trip to Las Vegas but the lucky bachelor couldn’t say who he’s taking with him.

“It was sheer luck and chance. All of the golfers had a chance to win,” he said.

Despite the downturn in the economy, support for the tournament from players and local business was just about as strong as ever according to tournament spokesman Kevin Simard.

“A couple of sponsors had to back out of some of the bigger prizes but the rest of the sponsors have been good,” said Simard on the opening day of play. “Compared to last year, we are down two flights of players or 16 golfers but it’s still good.”

Simard says what helped organizers this year was moving the tournament from mid July to June 19-20 to avoid conflicts with other local events and lucking out with sunny weather to start things off. ɸ Page C17

Lloydminster – Many of the 240 golfers who played in the 31st annual Lloydminster Oilmen’s Golf Tournament on Fathers’ Day weekend did their best to prove you have to be good to be lucky and lucky to be good.

Take Dave Addie for instance. He pocketed $7,452 in gross proceeds for driving closest-to-thepin in the million dollar hole-in-one challenge on the 9th hole. His ball landed on the 9th green, 25 feet shy of the cup to the roar of the crowd.

“I used a smooth 6-iron,” he explained seconds after leaping from his golf cart to exchange high fives and hugs from buddies galore.

Another luckster was Gary Reid who sported a wide smile beside his winning booty – a 42inch LCD TV – for having the closest putt to the hole on the practice green.

“I was just lucky,” explained Reid who won a TV at a previous oilmen’s event. “It just happened that it got close and stopped. It was eight inches from the hole. I can’t believe it because I am the world’s worst putter.”

In order to putt for dough, golfers paid $5 for three putts and those who sunk their ball were Dave Addie leaps from his cart having the closentered into a draw for est drive in the million dollar hole-in- one. He 10 contest finalists in aid grossed $7,452.

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PIPELINE NEWS August 2009

C17

Lloydminster Oilmen’s golf tourney Jackson McGee dispatches his ball on target.

ɺ Page P C1 C16 C16 The U.S. Open also on that weekend helped to stoke players. The format included an eight player championship flight for golfers with low handicaps. The rest of players were grouped into 29 flights in match play competition.

Shawn Loney won the championship round and the lion’s share of over $16,000 in auction money with a 36-hole total of 149. In second place was Dave Walker, followed by Sean Lyon.

Each of the flight winners received a package of goods and $125 gift certificates. The first 12 flight winners were Mike Nicolson, Larry Fallscheer, Sheldon Moore, John Neff, Cory Bourassa, Dustin Fallscheer, Andy Hannah, Jason Clague, Tyson Mohrbutter, Richard Jory, Kevin Rudell and Jim Younger.

The rest of the flight winners were Steve Breen, Jeff Lepp, Grant Bexson, Leo Honish, Cam Zarowny, Bob Orbeck, Dale Liske, Frank

Lesch hi ki hinsk hi ki Rob Rob b Davis, Da is Leschinski, Rod McDonald, Jerry Christman, Chuck Dzuba, Lohnie Lomoureur, Corwin Block, Dwayne Roy and Dale Crossman.

For Jackson McGee, just being in the tourna-

ment was good enough.

However, when the Pipeline News caught up with him on the course, he was in the hunt for closest to the pin event on the 7th hole – where as luck would have it – Tom Fisher bagged a hole-inone on in the practice round.

“It’s the 31st annual Lloydminster oilmen’s and I wouldn’t miss it for anything,” said Jackson.

“The best of it is the fellowship with all the other guys. You get to meet new people and make new contacts. It’s a beautiful day today and that makes it nice too.”

Rod Swanky was laid off from his oilpatch job earlier this year but he’s played in the oilmen’s for the years and plans to keep his playing streak

Gary Reid won the 42-inch TV in this 10-man putt off for Kidsport charity.

alive.

“The oil patch slowed down for a while but I’ve been in the tournament the last 10 or 11 years,” he said. “I still associate with everyone in the oilfield so I thought I might as well come out. There are 240 guys I haven’t seen for a couple of months.

“If I get a chance,

I will get back into the oil patch. It’s treated me well.”

One guy who plans to be fixture at the 10th hole refreshment tent is Dennis Cole from Reliance Safety. He flips burgers there along with representatives from Champion Technologies and Ensign Energy Services.

“I am making sure everything’s all up to par and keeping everybody fed,” said Cole.

“I golf but this takes priority over golfing. It’s good to get out and meet everyone and see how everybody’s doing. Three of us get together and sponsor the burger hole and take care of it every year.”

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C18

PIPELINE NEWS August 2009

Noralta now to produce Provost

Barrett Roesch shows off the compact Exhaust Gas Recover System that Noralta will manufacture and distribute with inventor Warren Heisler.

By Geoff Lee Provost – If you like saving money and the environment, a product called the Exhaust Gas Recovery System or EGRS, now being manufactured and distributed

by Noralta Technologies Inc., scores well on both fronts.

The EGRS is a gathering system that connects to the exhaust port of chemical pumps used in methanol injection systems during winter months.

It captures 100 per cent of the exhaust gas that is normally vented from diaphragm pumps into the atmosphere and supplies it back to the fuel gas system to operate

catadyne heaters with no emissions or lost product.

The EGRS is the brainchild of Warren Heisler, an independent contractor who works on gas compressors and gas wells in the Provost area and wanted to do something good for the environment and the industry.

“I looked for a system to put on wells to try to see if it would work but there was nothing on the market,” he said.

“In the past, one gas supply operated the catadyne heater and a secondary gas supply operated the methanol pumps.

“With the Exhaust Gas Recovery System, we can now recover the gas that would normally be sent to the atmosphere

and put that back into the heaters.”

Almost from the getgo, Heisler worked with Noralta’s instrumentation manager Barrett Roesch, in Provost on controlled bench tests and fine-tuning a working prototype.

“Warren did the initial testing and then he came to us and we helped him out and did a lot of testing in the shop,” said Roesch.

“From there, we made a few tweaks and came up with the system we have now. It was 90 per cent complete when Warren came to us.”

Heisler says he chose to work with Noralta “based on the quality of work of they do. Everything that comes out of the shop is done right.

“They will go that extra mile for their customer and that’s what we need to get this product out on the market,” he said.

“Noralta has the full understanding of the marketplace and the capability of getting exposure we need for this product.”

The EGRS also creates a safer work site since there no more vented emissions. If the pump stops operating, the EGRS has a backup system that will allow the fuel gas to supply the heater until an operator fixes the methanol pump.

If the heater fails, the EGRS has a built-in

pressure release system that opens and allows the pump to keep operating.

If the release is activated, the exhaust gas from the pump is released into the

atmosphere until heater repairs are made. ɸ Page C19

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C19

inventor’s gas recovery system ɺ Page C18 Heisler worked with Noralta to design the EGRS to be small enough to be used in a Flo-Drip package, which is a small version of a gas well shack.

“Everything is very compact and tight in these FloDrip packages to make them affordable to move from well to well,” said Roesch. “We worked together to make the EGRS compact to fit into the limited space.”

Now that the product is ready for manufacturing and distribution, Roesch says, “It’s unbelievable that Warren would approach us with this opportunity.

“We have a good relationship with Warren in the past and we are looking at building that relationship. We see this growing in leaps and bounds. We are on board 100 per cent and we want to see this go forward.

“We are completing the process of making demo units to distribute to our Noralta locations and go forward,” added Roesch whose role will be to monitor quality control of the manufacturing and assembly in Provost and oversee marketing.

Noralta has locations in Bonnyville, Lloydminster, Calgary, Red Deer and Provost and Estevan.

“We are spread out through Alberta and Saskatchewan so that will help with the marketing aspect and get this product out,” said Roesch.

“By assembling the units in Provost, we can keep quality control under wraps and we will be able to handle high volumes when orders come through.”

Early adapters in-

clude Sonoma Resources that has installed some units north of Red Earth Alberta and Goodland Energy with five EGRS units installed in the Provost area.

“According to the people I have talked to the market is unlimited because of emission regulations and the fugitive gas changes that are coming into play,” said Heisler.

“There will be a lot of changes taking place at the end of 2009 and 2010 in Alberta. The Province of Saskatchewan will also start to make changes in 2010.

“We are hoping people will take a look at the product now and have a few decisions made by the fall. The sooner they get them in before the pumps get fired up, the sooner they will be saving money.”

Companies that install the EGRS will benefit from government

greenhouse gas credits which lead to a saving of $864.18 per well or $25,925.40 for 30 wells over six months of winter.

The EGRS is a universal unit that can be installed in most existing separator buildings with no modifications to the package site and at a cost of approximately $500 per unit plus installation.

“We decided to set the price very economical because we want it out there,” said Roesch. “We aren’t looking to make big dollars from it but we just want to get it out there and save money for companies.

“It’s an easy instrumentation install through tubing. Once everything is tubed in, you open up the valve and savings begin.”

Higher natural gas prices will help to drive future demand for the EGRS as well as the realization of how much natural gas companies are

losing to the environment from their pumps.

“To visualize how much gas you are saving, if you were to take a methanol pump that is operated off natural gas and connect a large garbage bag to it, on an average pump you will fill one of those large bags in about nine to 15 minutes per pump,” explained Heisler.

“With 1,000 wells, you are saving about 4,000 garbage bags of gas an hour. This accumulates to a lot of gas on a per day basis. That’s the easy way to visualize how much gas is being wasted every day.”

According to figures from the Canadian Alliance of Petroleum Producers, estimated gas savings on a 40 well EGRS installation amount to total dollar value of $34,567.20.

“With the manufacturing costs and meeting government requirements,

Warren Heisler has invented an Exhaust Gas Recovery System.

it is a very cost effective way to go,” said Roesch.

“We could be charging a lot more money, but I think now to help the industry out with troubled times –if they are willing

to step up and help the economy by purchasing some of these – and in return help meet govern regulations, I think everybody is going to be a winner.”

C20

PIPELINE NEWS August 2009

Kenilworth’s new burner helps (Editor’s note: Last month’s story on Kenilworth Combustion Ltd in Lloydminster contained typographical and factual errors. Pipeline News apologies to Kenilworth Combustion for the error.

This is the correct version.)

By Geoff Lee Lloydminster – Heine Westergaard, president of Kenilworth Combustion Ltd, hopes every customer he meets is as fired up about his company’s burners as he is.

The hot seller that Westergaard promoted at the Weyburn Oil and Gas show is a burner called a Process Heater Module that is CSA B149.3-07 compliant with efficiency and emissions in mind.

“We have the cleanest burning burner out there with the lowest emissions and the highest efficiency,” said Westergaard at his shop 30 minutes west of Lloydminster.

Heat produced from a one million BTU multipass demo burner at Kenilworth’s yard warms all of the buildings by burning with 88 per cent efficiency.

This compares with 50 to 60 per cent for old burner systems that Kenilworth has improved upon.

“We are 100 per cent CSA 149.3-07 compliant which means we meet or exceed all of the safety requirements that are set by governmental standards,” said Westergaard. “We can reduce your overall liability when it comes to safety and reduce your emissions.”

Kenilworth has sold between 500 and 750 of these burners in the past four years including 300 last year. More sales are pending once customers realize the burner performs as advertised with no parts to assemble.

“We’ve taken a different approach to the burner system,” says Westergaard. “We take and pre- assem-

Heine Westergaard, Kenilworth Combustion Ltd.

ble everything. The customer or the service company that installs the system in the field doesn’t get a box of parts. They get a system that’s completely put together.

“It’s engineer stamped. It’s been wired and fired before it leaves our facility so we know everything is working. It minimizes the installation time. A 500,000 BTU system can be installed in four hours or less.”

Burners are used in the oil and gas industry to provide heat to numerous processes in the oil and gas industry.

“The way that our burner works is quite unique because we have a recycle tube on the front of our burner which is pulling hot flu gas back into the mix-

ing chamber,” said Westergaard.

“If you are dealing with using wet casing gas on site, we can take that wet casing gas and run that through our burner and we don’t have freeze off problems in our burner systems. It’s absolutely wonderful for cold weather.”

Kenilworth also manufactures and sells burner components including the valve trains, burners, fire box flame arrestors and the FGI 351 burner management system made by Titan Logix Corporation.

In fact, Kenilworth shared booth space with Titan in Weyburn that enabled Westergaard to show customers how the complete system works from a working model towed in a demonstration trailer.

“The trade shows have been phenomenal this year,” said Westergaard. “We’ve covered the ISA show in Calgary and had a tremendous response there from different companies. We also went to the Williston Basin Petroleum Conference in Regina dealing with the Bakken formation. The contacts we made there were amazing.

“From there, we went to Grande Prairie. That was another great show. We had a good response there.”

Kenilworth has also been working with Kevin Moan a licensed gas fitter and O/O of CCR Combustion operating in the Bonnyville area for the past 6 yrs. Kenilworth is currently teaming up with instrumentation and electrical companies including Syntech Enerflex in Brooks and Nomad Electrical Contractors Ltd. in Peace River to provide local installation and servicing of the CSA compliant burners. They currently have instrumentation and electrical companies booked for training from Estevan, Medicine Hat, Brook and Grande Prairie. They also plan to train service specialists for other areas at the Kenilworth plant. ɸ Page C21

PIPELINE NEWS August 2009

to shrink carbon footprints ɺ Page C20 “We have started to train the electrical and instrumentation companies to do the installation for us,” said Westergaard. “It gives us the avenue of having these companies out there that are going to be doing the troubleshooting in a local area.

It supports local businesses and their employees and reduces costs for the client.

“Most of our systems we can troubleshoot over the phone if the person has a bit of a background on it.

“We’ve done all the work on the system here, it has been wired and fired prior to shipping, reducing start-up issues on site.

Kenilworth has sold more than 8,000 burners for applications from 100,000 to 20 million BTU since 1989. Kenilworth was founded in 1981 as a welding company, with their primary focus on repair/alteration of pressure vessels, piping and boilers under the Alberta Boilers Branch and ASME codes.

“It was getting into facilities and seeing the different processes and being on a lot of fire tube repairs that sparked us to get on to the burners,” said Westergaard.

“There was a need for something better in the combustion field. Our goal is to make it an easy to operate system for the guys out in the field.”

Heine Westergaard shows the valve train inside the Àrebox enclosure of Kenilworth’s demo burner.

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C21

The Kenilworth burner cuts noise by up to 50 per cent and NOx emissions by the same amount. The burner can also run off any kind of casing gas or solution gases available on site for fuel savings and reducing flaring or venting.

“Any small amount of produced gas coming off the annulus is basically a waste gas,” said Westergaard. “Traditionally it’s been flared or vented but what we are doing is bringing that low pressure casing gas back into the burners and using it.

“We can also run a dual fuel system. We can set up with casing gas as a primary fuel and we can have propane as a backup. If you lose your casing gas, propane will blend in and run the burner for the time that it’s needed without changing orifices or operator intervention. When the casing gas comes back with the appropriate pressure, it just overrides the propane supply and continues to burn utilizing the available casing gas.”

The system he says is “a win-win for everyone. We can reduce operating costs and service costs.”

C22

PIPELINE NEWS August 2009

Hardisty Lodge is home sweet Story and photos by Geoff Lee Hardisty – This is not roughing it in the woods. Hardisty Lodge is a temporary trailer camp in Hardisty with the comforts of home to accommodate oil patch crews working on a variety of construction projects in and around the Hardisty Terminal.

“I think they have it pretty good here,” said manager Neal McCaff rey of Fortier & Associates camp caterers. They’re from Sherwood Park, and manage camps with catering and complete housekeeping services.

Horizon North Logistics Inc., the parent company, provides camps and catering and executive lodges for oil and gas exploration and mining operations throughout western and northern Canada and Alaska.

McCaff rey has been managing Hardisty Lodge for just three months but he knows from his recent experience managing Fortier’s BlackSand camp near Fort McMurray that food, accommodation and great employees are the keys to a productive camp.

“We have top notch chefs,” said McCaff rey. “We have two red seals chefs and a full-time baker. We have about 13 staff in the kitchen. They do a good job. The variety [of ] food is exceptional.”

Breakfast is served from 5 a.m. to 7 a.m. and supper time runs from 5:30 p.m. to 7:30 p.m.

30HP, 3 cyl dsl, frt whl

Camp manager Neal McCaffrey looks after the comfort of 378 workers and 25 employees in Hardisty.

“The key to running the camp is having the right amount of staff all working as a unit and having people in the sales department getting the right numbers of clients to get the camp set up,” he explained.

The camp components were trucked in and assembled two years ago

by Fortier’s fleet management crews.

The camp was expanded last year with more trailers to accommodate up to 378 workers.

Most of the clients are Enbridge crews hired to construct 9 new storage tanks at the terminal. The camp also has rooms booked for contractors working for Husky Energy and Gibson Energy.

“Our contract with Enbridge is over but they continue to use the lodge

until their projects are finished,” said McCaff rey. There are another five to seven different contractors here.”

McCaff rey says camps like Hardisty Lodge are a cost-effective way to provide short term accommodation solutions in a boom and bust work cycle.

“I think the need is that the town of Hardisty can’t handle 300 to 400 people coming in at once so we provide a service to accommodate workers for a short period of time from a few months to a few years,” he said.

“If the town tried to build something to accommodate these crews, after the short term oilfield projects are done, there would be a lot of vacancies.

“Right now, there are over 300 peo-

ple working at the site but that might go down to just a handful of employees required to maintain it. The hotel here is doing well. They are full.

“We do try to give back to the town. One lady comes in and picks up all of the bottles and donates them to a kids’ camp charity. A lot of the staff and workers spend a lot of money in town. We try not to take any business from town and I think we add to it a little bit.”

McCaff rey says he’s not sure how long Hardisty Lodge will be needed or if it will be downsized once Enbridge wraps up their tank farm construction

by October.

He has heard that Plains Midstream Canada may be looking at permits from the town to build their own tank farm.

“If they [were] to use us, we could be here for the next year or two,” said McCaff rey. “What camps are all about is providing short term accommodation. You have your rig camps that you have to move out in just a few weeks.

The camps are necessary.”

Hardisty Lodge is made up of trailers connected to create nine wings or dorms as McCaff rey calls them.

Each dorm has about six to eight trailers with 41 to 50 rooms per dorm. All of the room are equipped with wireless Internet and a TV with satellite service. ɸ Page C23

PIPELINE NEWS August 2009

C23

home for 378 oil¿eld workers

Keeping the hallways clean is Bruce Rye who also helps out in the kitchen.

ɺ Page C22 “Everybody gets their own room,” said McCaff rey. “There are also some rooms with

private showers. We have air conditioners in all rooms and we are plugged into local water and water and sewage systems.”

The camp has a recreation room with exercise equipment, a pool table, a ping pong table and a group TV lounge.

“There is usually one staff person per dorm,” said McCaff rey. “We make the beds and clean the sheets. Some clients want staff to do laundry.

Up until the last couple of weeks, we did all of our own in-house laundry.”

McCaff rey likes the fact Hardisty Lodge is close to town and is just a two hour drive from Edmonton where he lives.

“The 10 days on and four days off is another nice thing,” he said. “You get every second weekend off.

He says managing the lodge and its 25 em-

ployees is the best job he’s ever had. He can also relate well to his oilfield clients since he used to run his own truck business hauling crude oil in Lloydminster and Peace River.

McCaff rey says the

from $6-billion last year to $3.7-billion this fiscal year and the government is predicting a possible $4.7-billion deficit in the current fiscal year.

The Stelmach government has blamed depressed energy prices and the global economic crisis for its financial problems

and is reviewing is overall competitiveness.

The review is expected to be complete this fall and will look at all components of conventional energy operations including regulatory efficiency, fiscal aspects, all aspects of taxation, availability of labour, and other costs.

These happy food caterers are Jackie Dyck, second cook with chefs Dwight Constable, Lynn Robinson and Dave Lesyshen.

Alberta extends royalty incentives to spur oil and gas drilling Edmonton – No drilling, no revenue. That prospect prompted the Alberta government to extend two drilling incentive programs, originally announced in March, by one year to March 2011.

Energy minister Mel Knight announced the extension in late June that will boost oil and gas drilling program incentives by $1.5 billion to $3 billion.

“Producers need to begin setting budgets for the upcoming drilling season, and we need to provide timely assurance that these programs will be extended,” said Knight.

“Additional drilling results in new, on-going royalty revenues for the province, keeps businesses going and people employed.”

The programs which were to expire in March

2010 include a five per cent royalty break from the first year of production from new oil or gas wells.

The other incentive provides a $200-per-metre-drilled royalty credit to companies on a sliding scale based on their production levels from 2008.

"In these tough economic times and low-price environment, government needs to ensure the industry remains healthy and robust," Knight added.

“When we introduced these programs we said that we would make adjustments if needed.

That is what we are doing today. This extension responds to market challenges facing oil and gas exploration in Alberta.”

Despite the incentive, natural gas royalties are expected to drop

s s s s

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Hardisty Lodge is second in size to Horizon’s BlackSand Craft Camp site north of Fort McMurray that he managed in 2008.

The Fort McMurray base includes a 500room BlackSand Executive Lodge and with 400 camp trailer rooms. That complex is currently housing a total of 500 Suncor employees.

The camp trailers set up by Fortier are manufactured by Horizon’s Shanco Camp Services and Northern Trailer business divisions.

Like all camps managed by Fortier & Associates, Hardisty Lodge clients sign a contract

pledging an alcohol and drug-free camp. Smoking is not permitted on the premises.

“We do have security from 6 p.m. to 6 a.m. and there is somebody on shift 24 hours a day,” said McCaff rey.

“We try to keep the dining area neat and tidy.

There are no hats or coveralls and no work boots or hoodies allowed in the cafeteria.

“If you keep on top of it from the start, the camp is easy to maintain.

We have a very good staff and everyone is pretty happy and friendly for the most part. Everything has been running quite smoothly here.”

C24

PIPELINE NEWS August 2009

Future Now giving rebates

By Geoff Lee Battleford –The cheques are in the mail.

Future Now Energy Inc., an independent natural gas retailer, is mailing rebate cheques to its customers in Saskatchewan.

The publicity including new lower rates is well-timed for the company to attract new subscribers who are only allowed to switch their gas supplier on Nov. 1st each year under Saskatchewan’s commodity competition rules.

Gas retailers can sign up customers throughout the year, but they must notify SaskEnergy of new customers by Sept.

1st in order for the gas to flow to them by Nov. 1st.

“We are giving thousands of dollars back to our customers in Sas-

katchewan this month,” said Tim Cimmer, president and CEO from his office in Calgary.

“Our pricing situation in the last seven months has been very good and we’ve been able to help to help the consumer out a lot.

“In Saskatchewan, we are only allowed to

change our rates a couple of times a year which is different than most other areas so our rates had to be a little bit higher.

“Now we are giving rebate cheques that will make the rate a lot lower than what they would have been charged by SaskEnergy.” ɸ Page C25

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Experience an asset but not required.

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PIPELINE NEWS August 2009

C25

Sask. gas subscribers Resources getting money back

Tim Cimmer, president and CEO of Future Now Energy

Éş Page C24 SaskEnergy lowered its rate of $8.51 per Gigagoule originally set in September 2008 to $5.96 GJ in March and sent rebate cheques to its customers.

Future Now has followed with a lower price of $5.89 and Cimmer says the average consumer rebate cheque will top the $23 per month of average savings that SaskEnergy announced for its customers last spring. One commercial customer will get a rebate of $17,000.

â&#x20AC;&#x153;Through our unique pricing and low overhead and playing the market, we can usually beat existing prices out there,â&#x20AC;? said Cimmer. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve been the lowest price in Saskatchewan since November, 2008, when we started. â&#x20AC;&#x153;We are a retail natural gas company. We actually get the gas from the wellhead and we are looking at doing our own drilling as well. By getting our own production of gas, I believe that we will always be able to give a great price. As a result of deregulation, wholesalers and suppliers like Future Now can purchase or produce natural gas at the wellhead and sell directly to consumers and businesses using the local utility such as SaskEnergy. â&#x20AC;&#x153;When things are competitive that leads to lower rates and that is good for consumers,â&#x20AC;? said Cimmer. â&#x20AC;&#x153;Our subscriptions have been strong. Iâ&#x20AC;&#x2122;ve got more

than I can handle. Subscriptions have grown by word of mouth and by people liking what they have.â&#x20AC;?

The companyâ&#x20AC;&#x2122;s core business is small business and commercial customers with no plans to supply industrial customers. â&#x20AC;&#x153;It is too much of risk and the billing is too complicated,â&#x20AC;? explained Cimmer. â&#x20AC;&#x153;They use a lot of gas. If a large company goes bankrupt, you lose all that money.â&#x20AC;?

Cimmer tapped into Saskatchewanâ&#x20AC;&#x2122;s deregulated marketplace in 2008 following his success marketing gas in the state of Ohio. â&#x20AC;&#x153;The reason I started in Ohio is because the rules and regulations are the best in North America.,â&#x20AC;? he said.

After a soured business arrangement with this ďŹ rst U.S. partner, Cimmer formed his Future Now Energy from scratch in Ohio before his startup in Saskatch-

ewan. â&#x20AC;&#x153;I have been a Saskatchewan boy all my life and wanted to come back,â&#x20AC;? he said. â&#x20AC;&#x153;We are growing in Saskatchewan and Ohio and we are opening up in New Jersey in the fall. Our sales are into the millions. â&#x20AC;&#x153;Because the price ďŹ&#x201A;uctuates, we take that to our advantage with our pricing strategies and the way we buy our gas,â&#x20AC;? he said. â&#x20AC;&#x153;Sometimes, we hedge our gas and buy futures.â&#x20AC;?

Future Now has an oďŹ&#x192;ce in Battleford where Cimmer grew up and learned about energy marketing and operations as a employee of Direct Energy, one of his competitors in Ohio.

The company has an administrative ofďŹ ce in Calgary but no subscribers in Alberta, where Cimmer says the rules and regulations â&#x20AC;&#x153;are among the most diďŹ&#x192;cult to enter the market.â&#x20AC;?

Guide

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C26

PIPELINE NEWS August 2009

Resources Guide

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PIPELINE NEWS August 2009

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PIPELINE NEWS August 2009