Pipeline News June 2011 by Pipeline News

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

June 2011

Canada Post Publication No. 40069240

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Volume 4 Issue 1

Jerry Mainil Ltd. of Weyburn celebrates its 50th anniversary on July 1. From left are Calvin Tracey, Dale Mainil, Dennis Mainil, Jerry Mainil and Michael Mainil.

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PIPELINE NEWS June 2011

News

Notes

Sask. permits up Operators licensed 945 new wells in April of which 590 were targeting production of oil or bitumen and a further 143 were oilsands evaluation wells. Only 167 licences were issued to drill for natural gas or coalbed methane. The 945 wells represent a drop of seven per cent from 1,017 licences approved in April 2010. The decline was all on the gas side as operators licensed 266 fewer gas or CBM permits than they did in April last year. Provincial regulators approved 6,424 new wells over the ﬁrst four months of 2011, a 22 per cent rise from last year and the most for the January-April period since 2008. Of the four month total, 1,026 were oilsands evaluation wells (up from 778 over the same period in 2010) and 3,832 were wells targeting oil or bitumen deposits (up 56 per cent from 2,457 last year). Gas and CBM permits fell 35 per cent to only 1,070 wells, about one-sixth the level experienced during the gas boom of the middle of the decade. Permitting in Saskatchewan continued to rise with 330 new licences issued in April, the most since 2005 and up from 224 a year earlier. Over the ﬁrst four months of 2011, operators licensed a record 1,831 new wells in the province, up 59 per cent from the same period a year ago.

Invicta drilling near Kindersley Invicta Energy Corp. has completed its previously announced public offering of common shares of the corporation for gross proceeds of approximately $3.66 million and gross proceeds of approximately $1.3 million from the issuance of common shares issued on a flow-through basis, resulting in aggregate gross proceeds of approximately $5 million. The corporation intends to use the proceeds from the offering to fund a portion of its 2011 capital program to drill 20 gross wells (11.2 net wells). Seventy per cent of the program will be focused on developing the Kindersley area. The remaining 30 per cent will be used to prove up the developing resource plays in Alberta, including, central and Redwater, Alberta. Briefs courtesy Nickle’s Daily Oil Bulletin

The trade show area was substantially larger for this year’s Williston Basin Petroleum Conference.

Williston Basin Petroleum Conference goes big By Brian Zinchuk Pipeline News Regina - The 19th Williston Basin Petroleum Conference in Regina May 2-3 had “Go Big!” as its theme, and it surely did. The conference, which had its origins in geology, has grown much larger, to include a wider variety of speakers, multiple sessions, and a large trade show. Presentations ranged from the detailed analysis of seismic surveys and geological formations to the basics of the industry. Trade show exhibits varied from rail companies seeking to haul crude to telemetry systems. Conference chair Melinda Yurkowski said there were high quality speakers, with “information you can use.” “We had a very successful exhibition ﬂoor.” As for the numerous sponsors, she said, “Simply put, we could not have done this without you. “There were 1887 total registered,” said Yurkowski. The actual turnout was just over 1,500, due in

large part to a major late-season snowstorm that hit the province in the two days prior to the event. It was the biggest Williston Basin Conference held in Regina, by far. The event alternates between Saskatchewan and North Dakota. While it did not hit the record high of 2,700 set in Bismarck, N.D., last year, it was substantially more than the 2009 Regina event. “We doubled our registration numbers,” she said. Moving to Evraz Place from downtown allowed for more exhibition space, including outdoor exhibitors. Some of the outdoor booths were moved indoors as space allowed. “We had a very positive feedback from everyone,” Yurkowski said. American attendees told her it’s so refreshing to have an oil minister that appreciates the ministry. Energy and Resources Minister Bill Boyd, in his presentation, thanked the industry, as he does in nearly all his speeches to such forums.

PIPELINE NEWS June 2011

Saskatchewan a go for carbon capture

News

Notes

Relentless drills Viking well In the third quarter, Relentless Resources Ltd. acquired a 100 per cent interest in petroleum and natural gas rights on 3,200 acres of contiguous lands in the Loverna area of southwest Saskatchewan for $550,000. Concurrently the company issued 5.5 million common shares for total proceeds of $1.1 million. Two sections of land include light oil Viking rights and directly offset an existing Viking light oil pool and 12 prospective horizontal locations are mapped on Relentless lands. To finance the drilling of the Viking prospect, the company issued 3.33 million flow-through common shares for total proceeds of $1 million at the end of last year. In the first quarter of 2011, Relentless drilled its first Viking well. It will be completed after the road bans are lifted and access to field locations resumes. Much of $1.24 billion will be spent in the area on the right, where Boundary Dam Unit 3 is.

Story and photos by Brian Zinchuk Estevan – Not able to wait any longer, SaskPower has decided to pull the trigger this spring on the long-awaited Boundary Dam Integrated Carbon Capture and Storage Demonstration Project. It’s a $1.24 billion foray into the world of greenhouse gas reductions, but one whose spinoffs will have substantial impacts in the southeast Saskatchewan oilpatch. That’s because, according to SaskPower CEO Robert Watson, while $1.24 billion will be spent on the power plant refurbishment and carbon capture system, a further $1 billion is expected to be spent by the oil industry its implementation of the other end of the pipeline, through enhanced oil recovery (EOR). The project will replace the four-decade old 150 megawatt Unit 3 at Boundary Dam Power Station with new one, complete with a special, first of its kind turbine designed to capture carbon dioxide. Anticipated to be in operation by the first quarter of 2014, the capture system should collect approximately 90 per cent of CO2 emissions from the unit. That will result in approximately 1 million tonnes of CO2 per year to be used in enhanced oil recovery. That CO2 is expected to be used in a manner similar to what Cenovus does at its Weyburn unit and Apache Canada incorporates at its Midale unit. Together, those two units current accept approxi-

mately 2.8 million tonnes of CO2 per year. Subsequent refurbishments of Boundary Dam Units 4, 5 and 6 over the coming years could produce even more CO2 for use in enhanced oil recovery. Minister responsible for SaskPower Rob Norris made the announcement to a packed lunchroom at Boundary Dam Power Station on April 26. “SaskPower and its private-sector partners are leading the world in the development of a technology that will help to address climate change while ensuring that we can continue to use coal as an energy source for many years to come,” Norris said. Norris also thanked the federal government for providing $240 million to assist in the development of the project. “Saskatchewan has been at the forefront of innovation in the energy sector for years,” Norris said. “Thanks to collaboration with Ottawa and privatesector partners, this SaskPower project builds upon our pioneering tradition.” “This project will forge an environmentally sustainable path for the production of coal-ﬁred electricity in Saskatchewan,” Norris said. “By proceeding with the carbon capture project at Boundary Dam, while continuing to add wind power and investigating other renewable energy options such as biomass, SaskPower is helping to build a greener future for Saskatchewan.” ɸ Page A6

Tuscanny plans on six wells at Evesham During 2011, Tuscany Energy Ltd. will continue to focus on developing its Dina oil property at Evesham, increasing the pace of investment and development with plans for six new wells. Initial drilling is planned to begin after spring breakup as conditions permit. If the proposed business combination with Sharon is completed, the pace of drilling will increase signiﬁcantly as the company plans to maximize its growth through development of this pool. In order to maximize the amount of investment available for reinvestment in exploration and development, Tuscany has agreed to share overhead expenditures with two related companies, in eﬀect, to manage the company within a joint venture group with common goals. Tuscany is operating jointly with Sharon and Diaz Resources Ltd. to identify and develop oil properties along similar trends in Alberta and Saskatchewan. Since the beginning of the year, Tuscany has participated in the acquisition of an additional 15,110 gross acres (4,530 net acres) and the drilling and completion of a vertical oil well in the Chambery, Saskatchewan area, through this joint venture. Briefs courtesy Nickle’s Daily Oil Bulletin

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EDITORIAL

PIPELINE NEWS June 2011

Pipeline News Publisher: Brant Kersey - Estevan Ph: 1.306.634.2654 Fax: 1.306.634.3934

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

Editorial Contributions: SOUTHEAST Brian Zinchuk - Estevan 1.306.461.5599 SOUTHWEST Swift Current 1.306.461.5599 NORTHWEST Geoﬀ Lee - Lloydminster 1.780.875.6685

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

Editorial Carbon capture to spur EOR in southeast On April 26, SaskPower and the provincial government announced a $1.24 billion investment in “clean coal.” Carbon dioxide will be captured at the tail end of the soon-to-be replaced Boundary Dam Unit 3, and then piped to underground storage. What didn’t catch a lot of headlines was the additional $1 billion SaskPower anticipates will be spent by the oil and gas industry to incorporate the enhanced oil recovery strategy that is key to the Boundary Dam project. It is anticipated to produce one million tonnes of carbon dioxide a year. And that’s just the beginning. SaskPower anticipates following up with Unit 4 a few years later, and Units 5 and 6 either in short order or possibly at the same time. With Units 4 and 5 similar in size to Unit 3, and Unit 6 about double in size, that’s going to mean a lot more carbon dioxide will be on the market in the coming 10 to 15 years. If all of this compressed, marketable carbon dioxide is to be used, industry is going to have to step up in a huge way. It’s going to eventually catch up to and surpass the amount being used in the WeyburnMidale project, where 2.8 million tonnes of new CO2 is injected each year. It is that project, operated by Cenovus and Apache Canada, which has given the province the confidence to go ahead with carbon capture and more importantly, CO2-based EOR. With first power expected from the new Unit 3 expected in 2014, oil producers are going to have to start getting their ducks in a row now if they want to be able to access the initial CO2. They will need to run pilot projects, drilling injector wells and trucking in CO2, to be certain it’s going to work in their fields before going full bore. We need to see those pilots start this summer to be ready in time. Then the infrastructure will need to be built – pipelines, injector wells, all the above-ground hardware. Carbon dioxide infrastructure requires a lot of stainless steel to inhibit the corrosion that comes along with it,

which in turn means specialized welding and welders. The good thing is SaskPower has already had expressions of interest from oil companies to purchase the CO2. As a province, we hope these companies sign on quickly, because we don’t want to use the backup plan. For several years now, the Petroleum Technology Research Centre has been working on Aquistore, a project which would see carbon dioxide pumped into deep saline aquifers, where it would be gone, essentially forever. That might keep CO2 out of the air, but no one is paying us for that, it does not produce more oil, and more oil-related royalties. It appears Aquistore will be incorporated to take any excess CO2 from Boundary Dam, and inject it nearby. We don’t want that to happen any more than absolutely necessary. It would be a debacle to spend all this money on CO2 capture, just to pump it underground and not get anything for it. Sure, there may be financial advantage by way of deferring cap and trade penalties, but it’s a false economy. It’s best to get real money for it, from paying clients, the oil companies. What is clear is the growth of southeast Saskatchewan is going to be tremendous. A billion dollars has been spent on land sales in the region in recent years, with each dollar expected to produce seven dollars in subsequent activity, something we’ve already been seeing. The expansion of enhanced oil recovery is going to rejuvenate oil fields like Steelman in the same way they did the Weyburn and Midale fields. The continued incorporation of CO2 capture at Boundary Dam and subsequent enhanced oil opportunities are going to lead to billions more in development in the area over the next ten years or more, on top of the already red-hot Bakken boom. All of this is going to fuel more money for the province in taxes and royalties, and thousands of more jobs are going to be created. Are we crazy to spend $1.2 billion on carbon capture? Yes. Crazy like a fox.

CORRECTION: Last month's editorial mistakenly said Crescent Point CEO Scott Saxberg received the 2009 Saskatchewan Oilman of the year award. It was actually Greg Smith, of Petrobank. Pipeline News apologizes for any confusion it may have caused.

PIPELINE NEWS June 2011

Opinion

Time to put growth at the top of the agenda From the top of the pile Brian Zinchuk

In March, the Saskatchewan government announced that for the first time in its history, the province had hit the 1,050,000 population mark. That’s about five per cent higher than our decades-long flirtation with a million people. There’s no sign it’s going to stop soon. We added 15,078 people in 2010, just under the size of Yorkton. If the current trend continues, we could quite possibly see 1.1 million people within three years. Saskatchewan needs to start thinking about what we need to do to accommodate a larger population. If we can hit 1.1 million within three years, what’s to stop us from going to 1.2 million in another half dozen years? Our economy is growing leaps and bounds. Enbridge is trying hard to expand pipeline capacity in southeast Saskatchewan to match growing oil production. Our drilling rig counts are going to be through the roof this year. BHP Billiton is building one of the biggest potash mines in the world near

Lanigan. Western Potash is now talking about a new solution potash mine near Milestone in the next few years. Potash Corp is in the midst of a multi-billion expansion at its mines. It looks like we’re finally seeing some serious action on diamond mining east of Prince Albert. All of these developments are going to add thousands of jobs in primary industry. They, in turn, are resulting in thousands more spin-off jobs. Saskjobs. ca had 7,713 jobs posted throughout the province on April 25. We need to start looking at the big picture: What do we need to accommodate one of the hottest economies in Canada, and a surge in population? SaskPower has already said they need to double power production in the coming years. That’s a huge investment, just to keep the lights on and the potash mines digging. Housing is in tight demand throughout the province. We need more people to build, and more of everything built – from beautiful, large single family dwellings to rental apartments and affordable housing. Our small cities, like Estevan and Swift Current, will need to get on the ball with housing, as the Bakken and Shaunavon oil plays continue their development. Our medical infrastructure will need to be beefed up. You need a lot more hospital beds for 1.2 million people than you do for one million. Perhaps we will need to revisit the idea of the former Plains Health Centre in Regina and build a replacement. Throughout the province, wards that were turned into offices

might need to revert to their original purpose. Then again, we’ll need to train and recruit more nurses, doctors, LPNs and support staﬀ to look after these hundreds of thousands of new people. That means even more expansions at our universities. Our post-secondary schools will need expansion. We’re going to need more tradespeople, but also professionals. As for primary education, the days of school closures, except in some rural areas, should be at an end. We’re going to have to start building schools, and lots of them, not close them. The people coming to Saskatchewan are for the most part younger, with families. They will need these schools for the children they will bring, or produce. Our cities are going to have to get used to rush hour. Debottlenecking will become the order of the day. Saskatoon’s south bridge will help tremendously, but they better start planning right away for a north bridge and perimeter road soon thereafter. Highways will need improvement and expansion, by way of twinning. That proposed potash mine for Milestone adds another reason to twin Highways 6 and 39, while the BHP mine is even more impetus to twin Highway 16 from Saskatoon to the Manitoba border. Yes, Saskatchewan has a lot to do in the coming years. We’ll soon have the same seasons as Toronto – winter, and construction. Brian Zinchuk is editor of Pipeline News. He can be reached at brian.zinchuk@sasktel.net.

Message to industry: Recruit or bust The current and projected labour shortfall in the oil and gas industry over the next decade needs to be addressed quickly if the industry expects to sustain growth, investment and proﬁts. Urgency is paramount in the wake of a report by the Petroleum Human Resources Council of Canada in March. That report called The Decade Ahead: Labour Market Projections and Analysis for Canada’s Oil and Gas Industry to 2020 projects over 30 per cent of the industry’s core workforce will retire over the next decade with the need to hire 39,000 new workers. In a growth oil/low gas scenario, industry will need to hire 53,000 people to ﬁll positions between 2010 and 2020. That number jumps to 130,000 workers if the industry continues to expand in a strong investment and growth scenario. In all scenarios, the labour report concludes that Alberta-based positions account for at least 75 per cent of the hiring within Canada’s petroleum industry over the next decade. Alberta’s greatest challenge will be attracting the workers it needs without driving up costs. Saskatchewan’s oil-weighted energy industry also faces challenges in attracting and retaining workers in hard-to-recruit locations. In the low growth scenario, net hiring for Saskatchewan-based employment is 1,500 positions

Lee Side of Lloyd Geoff Lee

over the next decade, driven by replacement demand. In the high growth scenario, net hiring is over 6,600 positions. The service sector is the largest employer in the petroleum industry in Canada with approximately 83,000 workers, and the sector that needs to hire the most workers in the next decade to sustain industry growth. The report says ﬁeld worker positions have turnover rates as high as 35 per cent. It also states that the labour supply is not unlike oil supply – the readily available sources are gone. The report urges the petroleum industry to take action to ensure recruitment and retention practices encourage participation from diverse labour supply pools while continuing to attract traditional labour pools such as new graduates.

Industry also needs to work with federal and provincial governments to ensure immigration policies and programs meet labour market needs. In addition, the industry will need to attract youth to pursue energy careers and hire from groups such as women, First Nations, immigrants and people with disabilities. The report recommends greater collaboration within the industry and other stakeholders on coming up with labour solutions. There is also competition for jobs with other sectors such as the construction industry in Alberta and Saskatchewan that needs 38,700 workers to ﬁll retirements and job growth projections to 2017. The second annual Try-A-Trade Career Expo held in Lloydminster May 3-4 attracted more than 1,900 area students who had the opportunity to experience various careers available to them ﬁrsthand. The petroleum industry needs to take similar steps to attract young people and provide them with the educational steps they need to build their careers in the oil and gas industry. Perhaps the Lloydminster Heavy Oil Show or the Weyburn Oil Show could include an event targeted to students and recruiting when most of the major employers are available in one location. The proactive approach is working for the construction trade and it can work for the petroleum industry too – that’s what the labour report states too.

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

PIPELINE NEWS June 2011

SaskPower approves $1.24 billion carbon capture project ɺ Page A3 The system will capture the equivalent of the greenhouse gas emissions of nearly 250,000 cars, according to Norris. “This is world class. We will be first in the world, and we will have all eyes in the world watching us for more than just our oil in the ground down in this area now,” said Watson. “You don’t go spend $1.2 billion on anything unless you make sure, darn sure, it’s economically viable for us to do that.” “This will be one of the largest construction projects in the province's history, creating hundreds of jobs and substantial business for companies in the province,” said Watson. “In particular, the continued operation of the Boundary Dam and Shand power stations, as well as related businesses servicing the coal industry, will provide long-term benefits to the Estevan region. The petroleum industry will also be a major beneficiary as it will use CO2 captured at Boundary Dam to extract oil from mature fields.” “We’re sitting on top of some of the best oil reserves in the world. If you can pump CO2 into the ground to get heavy oil out of the ground, that helps the economic development of this area.” SaskPower has chosen SNC Lavalin, one of the leading engineering and construction companies in the world, to oversee detailed engineering, procurement and construction activities at the Boundary Dam project. Cansolv, a wholly owned subsidiary of Shell Global Solutions, will supply the carbon capture process. Hitachi will supply a state-of-the-art steam turbine - the first in the world designed to fully integrate a coal-fired power plant with carbon capture technology. Construction on the project will begin immediately, with operations commencing in 2014. The new generating unit at Boundary Dam will have the capacity to generate a net 110 megawatts (MW) of electricity. The parasytic loss of power production due to the carbon capture system is 35 megawatts. In addition to capturing CO2 for enhanced oil recovery operations, the Boundary Dam project will also capture sulfur dioxide (SO2) to be used in the production of sulphuric acid. In time, SaskPower also anticipates it will be able to sell all its fly ash, as well. Coal is not going out Michael Monea, vice president of integrated carbon capture and sequestration projects with SaskPower, said, “People think coal is going out, and it’s not. Coal is going to be a strategic fuel for the future. It’s going to work very well, and we’re going to prove that.” Monea spoke highly of the technical team that put the package together. “Tell us what you need,” he quoted them as saying. “It’s going to be a very substantial project. This is really a game changer, one very important to our corporation and our province. “It takes courage to do what our government has done. The regulations aren’t posted yet. Our federal government is in election mode,” he said, stating it was a bold move taken by the provincial government. “We’ll show the world we can have coal as a fuel source. This province, this town, will be running with coal plants for hundreds of years in the future, not one year, or two years. SaskPower simply couldn’t wait any longer to go ahead with the project. Watson told reporters, “If we had to delay the project, quite specifically, the contractors would not have been able to close the building in before winter, and therefore we don’t know how long it would be delayed.” ɸ Page A7

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PIPELINE NEWS June 2011

CO2 sales makes project viable

Rob Norris, minister responsible for SaskPower, made the announcement the province would be going ahead with the Boundary Dam clean coal project.

Robert Watson, CEO of SaskPower, answer questions about the C02 project.

ɺ Page A6 “We worked really hard with our partners over the last two months to verify pricing, verify delays. It literally came down to we had to go now. Any delay into May would jeopardize closing the building. “The rates, unfortunately have to go up. Two things will cause rates to go up in the future: the sheer investment we have to put into power production in the future, and fuel costs. We know where coal is, we know where to get it, we know how much it costs to get, for the long term, so coal really helps our rates.” “We can aﬀord this project with our balance sheet, and the sale of the CO2 going forward.” The economics of selling CO2 was a major factor as well. Watson said, “With the sale of CO2, and comparing it to gas prices going forward, this project became the same as putting a gas plant in. “We’re in very serious discussions. We’ve had expressions of interest to buy CO2 from us.” Noting they are in negotiations, Watson wouldn’t say how much carbon dioxide is worth, but did say around the world it is going for anywhere from $15 to $30 per tonne. Other units Watson spoke of future carbon capture plans. “It should be operational the ﬁrst part of ’14. Then we want to have a good look at it, for at least a couple of years, to make sure it’s producing what we want it to produce. From that technology, we’d then take a serious look at what we do with Units 4, 5 and 6. Either we do one at a time or all three at a time. You look at the total project at that time.” The hope is technology advancements will reduce costs over time. A commercial pilot at Shand Power Station. It should be a lot less in the future, he said. “Because we can stage it, we are able to defer $1.7 billion in capital expenditures over the next ten years, and wait on what the next best technology will be.”

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“We express real conﬁdence in coal. It’s a responsible thing to do to move into coal. Asked why not put the investment into natural gas, Watson said, “Speculation on future natural gas prices is real speculation. It’s lower now, but it’s our belief it will go up in the future.” SaskPower wants to “de-risk” its strategy by going with a variety of sources – wind, gas, coal, water. As for nuclear, he said long term, you have to look at it. “SaskPower’s going to have a tough time keeping up with the demands for power in this province in the future.” “You can all the wind you want, but it’s not a base load. Coal is a base load. “We’re going to have to almost double our power production in the next ten years to keep up with demand.” Boundary Dam Power Station is SaskPower's largest generating facility, with six units and a combined generating capacity of 824 MW. The company's three coal-ﬁred power plants account for approximately 50 per cent of its generating capacity of 3,513 MW. SaskPower has a total available generating capacity of 3,982 MW when the production of independent power producers is taken into account.

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PIPELINE NEWS June 2011

North Dakota’s production Rarely do you see a hockey stick graph for production like North Dakota is currently experiencing. Graph courtesy the North Dakota Department of Mineral Resources

the last 60 years shoots almost straight up over the last four years, with production doubling in the last few years to 350,000 bpd. Projections show it could soon go as high as 450,000 bpd, with a 10 per cent prob-

ability it will hit 700,000 bpd within the next few years. In comparison, Saskatchewan’s production has hovered around the 425,000 bpd mark for much of the last 10 years. Ron Ness, presi-

dent of the North Dakota Petroleum Council, said, “Our production is incredible, the increase we are going to see. We have hundreds of wells that are not fracked. We had 175 drilling rigs operating. We’re going full tilt.” Asked about a typical well, he said, “We’re seeing the frac stages have increased, but we’re

mention all the private residences, buildings and shops. It’s probably the biggest construction phase in North America right now.” In a nation where states are looking anywhere possible to cut expenses, North Dakota just posted a billion dollar budget surplus, announced $500 million in tax relief and will invest a billion dollars in infrastructure in western North Dakota, Ness said. That infrastructure money will go to roads, and to provide rural water infrastructure for the people and for Bakken development. As for where they will lodge all the workers, he spoke of one “man-camp” that is currently at 1,000 beds and anticipated to grow to 3,000 by the end of summer. “That’s what we’re seeing, is a lot of mancamps. ɸ Page A9

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By Brian Zinchuk Regina – North Dakota’s oil industry is growing at such a rate, it’s hard to come up with adjectives that describe it. The graph of North Dakota’s production over

seeing IPs (initial production rates) vary all the way up the ladder. I think clearly in the 1,000 to 2,000 barrel a day wells. The decline rate is pretty signiﬁcant. You’re seeing some IPs into the 3,000 to 4,000 barrels, and others in the 500 to 700. It depends on where you’re at. “The typical payout at $110 oil is pretty quick if you’re getting 3,000 barrels a day. The wells are expensive; they’re $7 million wells.” There aren’t many duster wells, either, with a 97 per cent or greater success rate. “We’ve got a billion dollars of road infrastructure in the oilpatch that’s going to happen in the next two years. Three-and-a-half billion dollars in natural gas infrastructure. A billion dollars of oil pipeline, and we’re spending about $2 billion dollars a month on Bakken drilling activity, not to

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PIPELINE NEWS June 2011

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ɺ Page A8 “There’s been tremendous growth in the number of hotels, apartment buildings, individual homes. The communities are starting to get a long-term sense of the significance of the Bakken,” Ness said. “We’re looking at a three-to-five year very hectic pace here, to build the infractructure.” With the decline curves, he stressed you have to keep drilling and encouraging industry to expand the Bakken. North Dakota Agriculture Commissioner Doug Gordon said, “We’re experiencing challenges with infrastructure – roads, bridges, housing, law enforcement. North Dakota’s legislative session just wrapped up, and included a “landowner’s bill of rights,” designed to maximize the constitutional protection of landowners. It considers exploration and production impacts, and value not only for land lost, but lost production as well. Payments are on an annual basis, but can be an agreed-upon lump sum. Operations require a notice to landowners by registered mail unless waived by mutual agreement. It’s seven days for surveying and staking, and 20 days before site preparation. “Please don’t disregard these notices. They lead to punitive damages,” he said. Those notices must also include a financial offer, which may or may not be accepted by the landowner. “It doesn’t mean work as to stop, but at least an offer has to be made,” Gordon said. There was also a clarification in law on how royalties are evaluated. It will be when the oil is marketed, not produced. If not paid within the allotted 150 days, there is an 18 per cent interest charge on Day 151. “Enjoy this time. Enjoy this success,” he said.

Ron Ness, president of the North Dakota Petroleum Council, spoke of the incredible growth of North Dakota’s oil production. A few years ago, the state’s production was about half of Saskatchewan's. It will soon surpass this province, and may even double it.

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A10

PIPELINE NEWS June 2011

Estevan OTS golf tourney Àooded out, postponed

If you could tee off from a canoe, you might be have been able to golf at Estevan’s Woodlawn Golf & Country Club, the host course for the annual Estevan OTS Oilmen’s. This photo was taken May 12. Photo courtesy Michael Mainil

By Brian Zinchuk Estevan – A good golf course will have a small percent ofage its land base as water hazard. As of mid-May, Estevan’s Woodlawn Golf & Country Club had about 90 per cent water hazard and 10 per cent soggy land. As a result, the Estevan Oilﬁeld Technical Society decided on May 17 to postpone its 54th annual OTS Oilmen’s Golf Tournament. Originally planned for June 3-5, it will be pushed back, likely into July. A ﬁrm date was not available at press time. The event is typically the largest oilmen’s golf

tournament in the region, and as the oilpatch social event of the season, draws high participation rates. “It’s not good,” said Jeff Mosley, OTS president. “We’re officially postponing it. We don’t feel there’s any way it will be playable.” Woodlawn lies in the Souris River flood plain, which is normally kept dry by the Boundary and Rafferty Dams. However, the incredibly wet spring meant both dams had to release water in May, resulting in flooding downstream. An aerial photo taken by Michael Mainil on May 12 showed just the clubhouse, a few greens and rows of trees sticking out of

the water. “They will do what they can to ﬁt what works for us,” Mosley said of the golf club. As for registrations, he said they had a pretty good list. If anyone is unable to attend on the new dates, the OTS will refund their registration, he said. “We’ll be posting updates on our website once we know something,” Mosley said. “Anybody who has entered, your entry will be held.” The OTS website can be found at estevanots. com

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PIPELINE NEWS June 2011

A11

CO2 testing planned for June Regina – Field work will begin in June to determine what caused the events on the Kerr farm southeast of Weyburn, Saskatchewan, Canada, Carmen Dybwad, chief executive officer of IPAC-CO2 Research Inc., explained April 19. The environmental non-government organization announced in January it was assembling a team of international experts to conduct an independent study of the site. IPAC-CO2 was created to gain public and regulator confidence in the geologic storage of carbon dioxide (CO2) as a sustainable energy and environmental option by providing independent performance assessments of carbon capture and storage (CCS) storage projects. “The harsh and lengthy winter made it unwise and unfeasible to do any field work,” she said. “A team of international scientists will be on the Kerr property, soil conditions and weather permitting, in late June.” On May 11, IPAC-CO2 informed Pipeline News the testing is slated for the week of June 27, weather permitting. The scope of the independent study has been refined during the past three months. The scientific statement of purpose is to reduce uncertainty regarding the CO2 anomaly reported to exist on the property owned by Cameron and Jane Kerr. “In lay terms, we’re trying to determine what --if anything -- happened on the Kerr farm,” Dybwad explained. “We may have unintentionally left the impression with some of our initial communication that the scope of study was the entire Weyburn carbon capture and storage project. That’s not true. Our study is confined solely to the quarter section of Kerr farm.” Since announcing the independent study, Dybwad said IPAC-CO2 officials have had positive discussions with Cameron and Jane Kerr, EcoJustice and representatives of Cenovus Energy. Cenovus is the operator of the Weyburn field and its CO2 flood. The Kerrs and EcoJustice held a news conference on January 11, 2011, in Regina demanding a full public investigation of problems at their farm located near the Cenovus enhanced oil recovery operation. “The purpose of the independent study remains the same. This is a factbased review,” she said. “It is not to determine fault or point fingers,” she said. “We want to find out what happened.” Dr. Katherine Romanak of The University of Texas at Austin’s Bureau of Economic Geology is the principal investigator of the study. IPAC-CO2 stated Romanuk is an internationally-recognized expert who has conducted geochemical analyses of soil gas samples at a number of sites including a carbon sequestration project in Cranfield, Mississippi. She designed a field experiment to test a laser-based sensor for detecting carbon dioxide underground at the Brackenridge Field Laboratory in Austin. Carbon Management Canada (CMC), a network of 22 Canadian universities researching large-scale ways to reduce carbon emissions in the fossil fuel industry, will also provide specialists when their areas of expertise are required. In addition, CMC will assemble a group of scientists who will review the methodology for sampling before the field work begins on the Kerr farm. A double-blind analysis will be conducted on multiple gas, water and soil samples gathered during the June field work. A drilling rig will be contracted so samples up to 10 metres below ground level can be gathered. “A complete list of experts, their credentials and the organizations where they work will be posted on our website (www.ipac-co2.com) as they join this project,” Dybwad said.

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The Kerrs have said they had ﬁrst noticed changes in surface water and well water in addition to other events on their property in 2004, one year after carbon dioxide injection began near their farm. PanCanadian, the predecessor to Encana and Cenovus, began injecting CO2 at the Weyburn enhanced oil recovery operation in 2000. Prior to injection beginning, the IEA-GHG Weyburn-Midale CO2 Monitoring and Storage Project, coordinated by the Petroleum Technology Research Centre (PTRC) of Regina, started its research and monitoring. About 17 million tonnes of CO2 have been injected into the Weyburn oilﬁeld over the past decade. It is recognized as the largest commercial-scale CCS project in the world.

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A12

PIPELINE NEWS June 2011

Where will this captured CO2 go? Think “Mississippian”

By Brian Zinchuk Regina –Integral to the SaskPower Boundary Dam Unit 3 carbon capture project is the other end of the pipeline – what do you do with it after you’ve captured it. At the April 26 announcement, SaskPower indicated they were talking to several companies interested in using CO2 for enhanced oil recovery. But just where would that CO2 go? Pipeline News spoke to Steve Whittaker, senior project manager with the Petroleum Technology Research Centre in Regina. The PTRC coordinates the research component of the International Energy Agency Greenhouse Gas Weyburn Midale CO2 monitoring project, where 2.8 million tonnes a year of virgin CO2 is injected by Cenovus and Apache Canada. “The Mississippian units would be the

The Petroleum Technology Research Centre’s Aquistore deep saline storage solution is anticipated to be part of the Boundary Dam Unit 3 project. File photo

prime target,” he said of geological formation for new CO2 projects. That would include the Midale and Frobisher formations. “Alida would also be a pretty good target,” according to Whittaker, but the application could actually be much broader. “Any reservoir in southeast that has oil amiable to miscible

ﬂood would be a candidate. The potential is pretty broad. “Generally you need a larger ﬁeld,” he said. The area most likely would stretch from Weyburn towards Steelman, and include Tatagawa and Benson. “The whole trend that goes into the corner of southeast Saskatchewan,” he said. “It’s not restricted to

the Mississippian. There are lots of fields in North Dakota that would love that gas.” The Bakken field is in the research stage for CO2, he noted. Carbon dioxide is also seeing use in heavier oil fields. Husky has been doing pilot work in the Edam area. “It’s really pretty wide open. Any oilfield

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could potentially use CO2,” Whittaker said. However, in the Mississippian, he said, “We know it works.” Aquistore It takes time to implement a CO2 ﬂood, however, and Boundary Dam 3 is expected to start producing its full capacity of captured CO2 in the ﬁrst quarter of 2014. In the meantime, they will need somewhere to put the captured carbon dioxide until the enhanced oil projects are ready. Aquistore is a PTRC project designed to place carbon dioxide in deep geological units. The idea is to pump captured carbon dioxide into deep saline aquifers for permanent storage. Over time the CO2 dissolves in unusable water already in the rock formation and becomes securely trapped. The CO2 remains far below

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the surface, separated from usable groundwater by thick, impermeable barriers of dense rock, according to the PRTC website. While captured CO2 can be used for enhanced oil recovery in areas around the world where there are existing oilfields, much of the world does not have that option. But there are deep saline aquifers in a much broader area. The project is designed to show the utility of such CO2 storage as part of a greenhouse gas reduction strategy. “We will be able to take away any excess capacity and store it,” Whittaker said. Once that’s done, it’s essentially gone. “It probably can’t be recovered,” he said. The location of the Aquistore project would not be far from the power plant. “We’ve got several locations. We’ve got a number of options,” he said. Whittaker noted the whole carbon capture and storage idea is built around industry having a baseline of emissions and penalties at some time in the future. Asked about the market price of carbon dioxide, he said that $15 to $35 a tonne sounded reasonable. “A certain percentage of that is tied to the price of oil,” he said. Not only will SaskPower see revenues from selling the CO2, the province stands to gain financially from the enhanced oil recovery. “You’ll see a lot of increased royalties,” he said. The lives of the fields affected will also be extended for decades, as indicated by the positive response from the Weyburn field. Cenovus has noted in the past that the field, which began producing in the 1950s, is anticipated to produce for several more decades. Setting up a CO2 flood is not something just anyone can do. “Usually you need the big players to start with,” Whittaker said.

PIPELINE NEWS June 2011

A13

Weyburn tries to keep up with housing Weyburn – The City of Weyburn is trying hard to stay abreast of the strong demand for housing, but that demand is so strong, as soon as land is available, it is snapped up. It seems there is no end in sight, either, with much of the boom being driven by the oilpatch. A lack of housing has been identiﬁed as a universal limitation for growth by nearly all oilpatch businesses Pipeline News has spoken to in Southeast Saskatchewan over the last six months. A potash mine is also in the works for the Milestone area, to the west. This year Weyburn has put together a housing committee, according to Weyburn community services manager Doug Mulhall. “We’ve had our ﬁrst few inaugural meetings,”he said. The committee commissioned a report from the Saskatchewan Homebuilders Association on Weyburn’s housing issues. “They have reviewed the community, done their research, and made recommendations,” Mulhall said. While those recommendations are not yet public, “It raised some questions for us,” he said.

They have since asked for more detail. “They see a fair bit of growth for southeast Saskatchewan,” he said, with projections of signiﬁcant growth for Weyburn. Over the next 10 to 15 years, there could be potentially thousands of housing units. As it stands now, housing is extremely tight. “Our situation is a virtually zero vacancy rate and no residential lots at this time,” Mulhall said. That is in spite of 137 dweelling units built in 2007, 99 in 2008, 49 in 2009, 109 in 2010, and already 26 in 2011. When Pipeline News last spoke to Mulhall in January, the city was ﬁnishing up sales of 178 lots that initially went on the market in 2008. “We sold out in February,” he said. The next phase planned is for another 77 lots for this summer which they hope to bring on line this year. “It will probably take us until fall for servicing and curbs. We could have housing construction going on as well,” he said. The city will also start land levelling for the following phase, another 94 lots. “I think our housing starts are going to jump up to 35, and then we’ll hit a brick wall due to

land,” he said. The city also has a tax incentive to build inﬁll housing. In addition to cityowned lots, Mulhall said, “We’re also working with private developers to look at another chunk in the northeast, potentially another 70 lots.” Those lots could be developed concurrently with the city land. “We’re in serious discussions with a developer on that now,” he said. It’s tough to go from a farmer’s ﬁeld to developed land in a year, however, and he says two years is more likely before they can be occupied. In the meantime, multi-family units are shooting up on the northwest corner of town. Joe Remai of Prince Albert has built three apartment-style condo units in the city already, and is now building one 22unit, two-bedroom condo complex with plans for a second one adjacent to it. Another developer is putting up modular buildings next door. Each one is eight suites, and eight buildings are planned. Two are near completion, and the next two buildings are being assembled. Several parcels along the city’s north side are being seriously consid-

This is the fourth building of its type built in Weyburn by Joe Remai, and a Àfth is planned adjacent to it. Photo by Brian Zinchuk

ered for multi-family development. “I have several developers interested right now,” Mulhall said, hopeful those deals will

conclude soon. One developer is talking about a 54-unit project. All told, the city is looking another 700

housing units on the north side. “In a community the size of Weyburn, that’s signiﬁcant,” he concluded.

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A14

PIPELINE NEWS June 2011

Born out of necessity, Flyin E taking off

Carrie Englot picks up some oxygen bottles from her supplier’s truck while it stops in Alameda. Photo by Brian Zinchuk

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Alameda – It was a real rough day in May 2010, when the call came in. The Englots lost their pregnant mares’ urine contract, around which they had built their farm over the past several years. Now they were going to have to do something entirely different. That something different turned into Flyin E Medical. “We used to be in the PMU business. We did it for many years. We got shut down in May of last year. I had to find something else,” said Carrie Englot, owner. (PMU farms provide the basis of hormone replacement therapy drugs, a treatment that has been in decline in recent years.) With no prior medical training, she decided to get her emergency medical responder (EMR) training, and soon was working for a medical services firm in southeast Saskatchewan. She is now about halfway through her primary care paramedic (PCP) course. She also picks up shifts at the Lampman local ambulance. Since firing up operations in January, the company had swelled to 15 employees by early May. ɸ Page A15

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A15

Growing to 15 employees in ¿ve months ɺ Page A14 “We are a mobile medical unit company. We work for the oil and gas industry,” Englot said as she jumped in the truck and made a quick dash into Alameda to meet up with a truck from her oxygen supplier. “We also provide first aid training on site, and shower units in case of a spill of acid or something else.” The company already has six mobile treatment centres – pickups with fibreglass shells on the back, and two shower units. “I’ve been operating since January,” she said. Asked what has been fuelling the growth, she responded, “The quality of service everyone seems to be satisfied with it. They keep coming back.” “My staff is awesome,” she said, adding they have just begun incorporating regular education days with the staff. The company has grown so quickly, they skipped the small employer certificate of recognition (SECOR) stage for companies with 10 or fewer employees and have begun compiling their certificate of recognition (COR) program. The company is also registered with ISNetworld and ComplyWorks. The base of operations is the Flyin E ranch, located eight miles north of Frobisher and a similar distance west of Alameda. It’s a bit off the beaten path, “But we’re in the centre of it all,” she added. Of great help to Englot is her sister, Jennifer Elias, an advanced care paramedic who works in Weyburn with the local ambulance service. Elias helps out with much of the training for the staff. “Last week we taught the firefighters CPR,” she said of the local volunteer brigade. On top of working with running a new business, working with the local ambulance, and having a farm, she added, “I have three girls on top of that 15, 10 and two.” Englot is also involved in the Saskatchewan equestrian scene. Indeed, that’s how she came into owning her own business. Connections through horses led an operator to approach her. “The opportunity crossed my doorstep, with another lady up north,” Englot

Carmen Englot, left, is the informal mechanic for his wife Carrie’s business, Flyin E Medical. Photo by Brian Zinchuk

said. “She had three trucks and a consultant shack. She was ready to retire. It was way too sweet of a deal, and that’s how I started.” While staffing has been a major issue for nearly all businesses in southeast Saskatchewan Pipeline News has spoken to over the last several years, Flyin E has been able to attract new people. “They are coming from as far as North Battleford, Souris, Medicine Hat, The Pas, and quite a few from Saskatoon,” Englot said. As for pay, she said, “I do pay pretty good. I advertised in a few places, and they came to me. “I have quite a few PCPs working for me,” Englot said. Some are taking a break from working for ambulance services, others fill in slack time between shifts. Accommodations, the sticking point for many other business, is largely taken care of because their staff stay in the same places as the frac crews that they look after. While it’s up to Englot to arrange lodging, the oil company pays for it. Much of their initial work has been in the Waskada, Man., area, and they have made use of the camp nearby. However, she foresees accommodations as an issue in the future. Englot has been out there flogging her business during the spring slow period. While frac jobs are the bulk of the work, she’s also looking at drilling and pipelines. “Through breakup, I have seen plenty of consultants. I went to Calgary to meet people first hand. I’d rather talk to people in person.” The summer is looking to be a busy one. “I’ve had lots of interest and lots of calls. I actually have some tentatively booked.” Back at the farm, her husband Carmen came over to say hello. He’s the company’s informal mechanic, when he’s not farming. “We used to breed about 100 mares,” he said. They have 20 left. “I’m going to seed about 1,200 acres, and have 140 cows to calve.” There was no real warning about the loss of the PMU contract. “That was a bad phone call to take. That was our bread and butter,” Carrie said. “We had to sit down and rearrange our life.” As for future plans, Englot said, “I want to make sure that everyone that hires us is happy with us.” She wants to still be a part of the field operations, taking shifts as possible. “We’re doing really good, and I love what I do. I love the company and have no regrets,” she said.

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A16

PIPELINE NEWS June 2011

Minister thanks industry Regina – “You can expect one thing from the Saskatchewan government – royalty stability.” That was the key message Energy and Resources Minister Bill Boyd had for the oil and gas industry gathered at the Williston Basin Petroleum Conference on May 3 in Regina. The industry is appreciated and understood in Saskatchewan, he said. As he often does, Boyd thanked the industry. “We are overjoyed to see what is happening in this province. We want to say thank you. Thank you for your hard work. Thank you for your conﬁdence in Saskatchewan. Thank you for the people that you employ in Saskatchewan. Thank you for the investment in our province. “We appreciate the theme of the conference: ‘Go Big!’” Before, Saskatchewan going big may have been a misnomer, he said. “Now, it’s very accurate.” “A tremendous success story is unfolding here in Saskatchewan.” People, including ex-patriots, are moving back to Saskatchewan. Employment numbers are strong, as are investment numbers. The Conference Board of Canada predicts a 4.4 per cent growth rate, he said. “Our energy mix is growing and growing rapidly,” he said. The province expects a 10 per cent increase in drilling in 2011. Capital investment in the industry was $3.8 billion last year, and is anticipated to be $4.3 billion this year. ɸ Page A17

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PIPELINE NEWS June 2011

A17

More may need to be done for natural gas ɺ Page A16 Oil production grew six per cent last year. Most of the growth is coming from the Bakken, he said. In 2004, it produced 750 bpd from approximately 100 wells to 60,000 bpd from approximately 2,400 wells now. The province is now seeing technology used in the Bakken in the lower Shaunavon and Birdbear formations. Boyd said in cabinet meetings, Premier Brad Wall “asked us speciﬁcally, are there any other measures we can implement in Saskatchewan in your area of responsibility to make our province even more competitive with other jurisdictions.” “We understand capital can move. Capital has choices. “We are constantly reviewing, constantly looking at how we can make our province more competitive.” Boyd pointed to tax cuts in the provincial budget to create an atmosphere where businesses can ﬂourish. After his presentation, Boyd spoke to reporters about the impact of the federal election held the day before. “It’s very good results for Saskatchewan. We have now, at the federal level, a period of stability four years of majority government I think will be friendly to Saskatchewan in a lot of ways. The policies they had relative to energy and resources were much more compatible to the views we would have in Saskatchewan than the other parties. “I think it will be much easier working with the

federal government,” he said, with the threat of a minority government falling now gone. Boyd predicted easier and more frequent discussions with the Feds. As for greenhouse gas cap and trade schemes, he said, “We’re certainly working with the federal government. We’re interested in their thoughts in this area. In terms of clean coal, we’ll be certainly waiting and working with the federal government with re-

spect to the regulations. We’ve made decisions going forward in terms of our capture programs down in the southeast part of Saskatchewan. On natural gas, he said the fundamentals of the industry have changed. “We may need to look at additional steps to encourage further development here in Saskatchewan. That’s an area we’re prepared to look at.”

Trojan safety Trojan Safety’s mobile treatment centres could be found lined up at their Weyburn location on May 11. A long spring breakup has meant the crews they look after were delayed in getting back to work. Photo by Brian Zinchuk

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A18

PIPELINE NEWS June 2011

Prairie Gold in black gold country Frobisher – A band of brothers, plus one friend, have launched their own pumpjack service business based in Frobisher, and have already seen substantial growth. Prairie Gold Pumpjack Service is owned by Devon Brandon and his brother Nathan. Another brother, Jason, also works with the company, and Devon’s wife, Sharon, handles the admin portion. Dan Schmidt, a friend, is also involved, and will likely be joining the partnership in the future. Dan’s wife also comes in twice a week to assist, as do other family members. It helps to be where the family grew up. This spring marks a year in business for the service company, one which had an interesting start. Sharon was

nine months pregnant when they fired up. “On her due date, I went to Red Deer to buy the trucks. I made it back in time,” Devon said. Devon and Sharon had bought a house and shop in Frobisher in 2009. The men all worked together with an Estevan-based oilfield maintenance firm for many years. Three of them were there for 15 years or more, while Nathan had been there for nine. They decided to strike out on their own. Between them, they have over 55 years of maintenance experience. “Now we’re one big family again,” Jason said. “People out in the field were asking for us all the time. ‘Why don’t you start your own?’

Prairie Gold Pumpjack Service of Frobisher has grown to four trucks, plus additional equipment, in just one year. From left are Dan Schmidt, Sharon Brandon, Kayla Brandon, Devon Brandon and Jason Brandon. Missing from photo is Nathan Brandon.

they kept asking,” Devon said. Getting all the money together was

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the biggest hurdle. It’s all private equity, they explained. Their work, as the name implies, centres around pumpjacks, be it setting them, maintenance or repairs. Dan said, “We lube and inspect them once a year. We get everyone on a routine for oil changes every three years. We follow up on the repairs arising from the inspec-

tions.” Items like wrist pins, bearings and bridle cables are common repairs. “With all the water this year, they’re starting to fall over. The last two weeks, that’s all we’ve been doing jacking them up until we can get in and reset them,” Devon said. “We look after about 2,000 pumpjacks. The majority are HG,” he said. “We started

with Crescent Point, and now we work with 18 different companies.” “That’s pretty good for a year,” Jason said. The company started with two three-ton trucks, one new, one used, each equipped with eight-ton knuckle booms. They have since added two more last fall. All are Kenworths. ɸ Page 19

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A19

Like many, ¿nding staff has proven to be dif¿cult ɺ Page A18 Like nearly all businesses in the southeast Pipeline News has spoken to in recent months, Prairie Gold has discovered finding staff can be difficult. They’ve had some turnover. “Trying to find a guy to stay is tough,” Devon noted. “There are lots of resumes, but no one’s local, and then there’s no where for them to live.” Sharon said, “I had one from Uzbekistan, and one was from Ontario.”

“We’re in the process of getting our SECOR (Small Employer Certificate of Recognition),” said Sharon. SECOR, or the more intense standard, Certificate of Recognition (COR), is required by many operators. However, SECOR is limiting in that you can only have 10 employees. “Right now, we want to stick to under 10,” Devon said. “We’ll see how the year goes.” One of the benefits of maintenance work is that it is ongoing. “You

don’t slow down too much for pumpjacks,” Devon said. Since their trucks are under the weight threshold, they can work through road bans. And if they can’t get in with their larger vehicles, they have pickups and a utility vehicle to get into tough spots. However, installations of new pumpjacks, and their subsequent maintenance, is dependent on new drilling. “The more drilling, the more sets we do, then there’s another pump-

jack to maintain,” Devon said. As an additional service, Jason has set up a radiator shop in their Frobisher location. He had operated a rad shop at their previous employer. “I started one here,” he said. “I do a lot of service

rigs, drilling rigs, a lot of trucking outfits.” “Right now there are no rad shops around here,” he said, noting Regina is the other option. “That’s pretty new this year,” Jason said of the rad shop, adding it’s a diversification to fill

in during road ban season when everyone else is doing their maintenance. They also have two skid steer loaders and trailers, plus tamping equipment for gravel work for setting pumpjacks.

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A20

PIPELINE NEWS June 2011

"Of¿ces To GO"

Weyburn – When the company that manufactured the heavy duty consultant trailers Minard’s Liesure World of Weyburn carried went out of business, they decided to commission and sell their own design. “We’ve been selling and had a line of mobile offices for eight years. The company we were buying them from went broke,” said Susan Minard. “We found a new supplier, and completely redesigned them.” Travelaire of Red Deer, Alta., went bankrupt in January of 2010. “We started working on it right there,” Minard said. They were up and running with new units in November. She noted it took time to find a manufacturer that fit for them. The Canadian recreational vehicle manufacturing sector has been devastated by the high Canadian dollar, with numerous manufacturers shutting down. When asked why they didn’t go with another Canadian manufacturer, Minard explained they did not want to start again should another Canadian manufacturer go belly up, which necessitated an American manufacturer. The new units were launched under a subsidiary of Minard’s Liesure World, known as “Offices To Go.” “We went with an exclusive manufacturer. They only do specialty work,” she said. “They’re a specialty item. They’re not easy to find, and not easy to make.” Offices to Go seeks to fill a void in the market. While some of these specialty trailers may be used in construction or highways work, the vast majority will be used near service rigs. “It’s for consultants, primarily service rigs,” Minard said. “They are an office to go. They can be used anywhere,” she said.

In designing the new service rig consultant trailers, features like twist locks on the drawers, and additional desk area, and residential-quality windows are some of the features Susan Minard said they included. OfÀces To Go, a new subsidiary of Weyburn’s Minard’s Liesure World, is now offering service rig consultant trailers.

On the exterior, the first thing one notices is the V-nose, which makes a pointy, more-aerodynamic front for the trailer. “The V-nose is a big deal,” she said. It makes the trailer easier to pull, and translates into better fuel economy. The additional space provide extra storage room, plus storage for the power cord and spare tire. On flat-nosed trailers, rocks from gravel roads kicked up by the truck’s tires can bounce off the

front of the trailer and back towards the tailgate of the truck. The V-nose deﬂects those stones away, according to Minard. There are two models. The 24-foot version is 6,400 pounds, while the less common 21-foot is 5,500 pounds. The longer one makes up 90 per cent of their orders. The 21-foot has a shorter front end, and is equipped with propane. ɸ Page A21

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A21

The rigors of the oilpatch ɺ Page A20 The frame is heavy-duty, as are the axles. The wheels are 16-inches. It’s all meant to stand up to the rigours of the oilpatch, where daily use on leases is much more arduous than a weekend trip to the park. The exterior is fibreglass. The entry room has a rubber floor for easy cleaning, and coat hooks for coveralls. That’s also where you find the waterless washroom, which uses an incinerator toilet known as an Incinolet. It uses electric heat to reduce human waste to a small amount of clean ash. That’s important, because these units don’t have the water plumbing you would see in a recreational vehicle, and the more common 24-foot version does not have propane, either. “This contains no water, period. No grief, no freeze-up works, no ‘where do I get water,’ nothing,” she explained. “Most of these guys don’t want propane, because they can plug into electricity.” There’s a split door with an eight-inch wide platform on top, useful for writing on. In the main area of the trailer, there are cabinets and counters on both sides. “If I had cupboards of this quality in my house, that would be awesome,” Minard said. To the left is the electric furnace, microwave and fridge, plus a higher counter that allows you to write on it without sitting down. This side also has two windows, instead of the more typical one. That allows for a brighter work environment, according to Minard. Minard described the windows as “true double-pane windows with a vapour barrier, like residential windows, not RV.” On the right side of the trailer is a large window that is orientated to the work outside. The cabinets include a 26-inch flat-screen TV, radio, DVD and VCR. The television has a self-seeking satellite disk that can have a lock in moments. Its desk area has two positions instead of one, and two leather chairs. “We have twist locks on every single drawer,” Minard said, “so things don’t The V-nose allows for additional storage space. bounce out in travel.” At the front end of the trailer is the leather sofa/hide-a-bed, useful when it Offices To Go has had a “fantastic response” she said. “We can’t keep them in just doesn’t make sense to drive home that night. stock. In breakup, we’re still selling.” The trailer is also equipped with air conditioning. “They use them all year The first units went out in November last year, and the feedback has been long,” she noted, and the users want to be comfortable. good, too, Minard said, calling it, “Amazing.” The top and bottom of the trailer are R38-insulated. A form of foil insulation Minard calls “radiant technology” adds an extra insulation factor around the trailer. “It’s a foil insulation that reflects heat. It’s quite amazing,” she said. “The new (trailers) are 40 per cent more energy efficient than the old ones,” she said, noting they had it tested. “They can’t be hot. They can’t be cold,” Minard said.

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A22

PIPELINE NEWS June 2011

Seasonal work for all seasons By Brian Zinchuk Weyburn – Albert Anderson has done all sorts of things in the oilpatch over the years, from working on service rigs and drilling rigs, to more recently working in maintenance for a bulk fuel dealer. Nearly three years ago, he decided to go on his own. Now Anderson, 49, runs Alwei Steaming. Alwei, pronounced “alway” does three different forms of work, all seasonal, rotating throughout the year. In the wintertime Anderson focuses on steaming, thawing out well heads, flow lines, load lines and the like. “Sometimes it’s valves on tanks,” he said, “or sitting on the service rigs for whatever they need.” In the spring and fall, it’s pressure washing, doing things like cleaning up buildings and washing pumpjacks. The summertime is spent spraying oilfield leases for weeds. He started using a quad with a sprayer, but has since added a side-by-side utility vehicle with a larger sprayer. It’s faster, can carry more, and has booms that can be positioned to spray berms around leases. The electronic controls are easier to work with, compared to the quad’s sprayer. Last year, he sprayed mostly single well batteries. This year, many of his leases have banks, and will take a lot longer. “It’ll make things a lot quicker,” he said of the new utility vehicle. “I got into that last summer. I was over to Antler and south of Weyburn,” he said of the area he covered. “I’m just getting busy enough that I should have a second guy,” he said. ɸ Page A23

Albert Anderson is willing to work all hours of the day, or night, when the clients call.

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PIPELINE NEWS June 2011

A23

Should Alwei expand? The owner wonders ɺ Page A22 Indeed, adding another person is high on his mind, as Anderson mentioned it several times during the interview. He’s debating if he should expand, or just stay with what he can handle himself. “I could expand quite easily, with some backup from the bank and if I had the people. It’s hard to ﬁnd people that aren’t hard on equipment. I’ve been in the oilﬁeld for a lot of years. Unless it’s theirs, they don’t care. “It’s going to keep me busy, as long as the weather co-operates.” Anderson’s start-up year, 2008, was a bit rough. His potential partner ended up short on cash, so he went out on his own. It took three months to set up the steamer truck, and during that time, oil prices were falling. The next summer he set up the pressure washer, but by that time, the oil business had crashed. Pressure washing became a spring and fall thing, but so far, this spring has been too wet to do much. “I never had no contacts or nothing. Just went to work,” he said of when he gave his notice to the bulk dealer. “I’ve done that several times jumped in, taken chances. I gave up the best job I ever had, the best boss I ever had.” Asked about his current boss, he smiled and said, “He’s a good guy. “I enjoy it. I like being on my own, working outside. I’m not a desk person. Sitting behind a desk would drive me nuts. You’re always seeing something

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diﬀerent.” One thing Anderson is not afraid of is long days, be it for steaming or spraying. “Sometimes I’m up at four in the morning, to try to be out just after the sun is up,” he said. Spraying needs to be done with no or minimal wind, so it is typically done in the morning or evening. That can mean a large portion of the day is dead time, spent waiting. Rain can also cause delays. “Sometimes you don’t know. It could rain all day. It all depends on the weather.” The hours can be long while steaming, too. “The biggest thing is service. That’s why I get a lot of guys calling me. It doesn’t matter if it’s 3 at night. I just charge the one rate for me and the truck. It’s pretty straightforward.” “I got pretty good out there. People would call, I’d go, day or night.” Before coming to Weyburn in 2008, Anderson spent 14 years in Carlyle. Most of his career has been in the Saskatchewan oilpatch, but some time was spent in Alberta, including a winter during which he worked as a sandblaster. On the service rigs, he spent time around Edam, Lashburn, Neilberg and Shaunavon, for example. “I worked all over with the service rigs.” His wife, who he met on the Internet, is from China. She liked Weyburn, he said, as a somewhat larger centre. Ideally, she’d like one of the much larger centres, like Edmonton or Vancouver, but the

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A24

PIPELINE NEWS June 2011

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A25

Higher coiled tubing work increases revenue for Calfrac Well Services (Nickle’s Daily Oil Bulletin) Calfrac Well Services Ltd.’s Canadian operations benefited from the swing towards liquids-rich gas and oil opportunities, which helped push revenue up 51 per cent. Canadian revenue during the first quarter of 2011 climbed to $201.5 million from $133.6 million in the comparable three-month period of 2010. The 51 per cent increase was primarily due to improved pricing, completion of a higher percentage of call-out work and more and larger fracturing jobs in the unconventional natural gas resource plays of northern Alberta and northeast British Columbia, combined with an increase in oilrelated fracturing in the resource plays of Saskatchewan and west-central Alberta. Higher coiled tubing activity in Western Canada also contributed to the increase in revenue. These factors were partially offset by a higher number of shallow coiled tubing jobs in southern Alberta, which typically have a lower average revenue per job. “We certainly have had huge development in our oil side of the business [in] the Cardium, the Bakken, the Viking,” said Douglas Ramsay, president and chief executive officer during a first quarter conference call. The company announced a $43 million increase to its 2011 capital program in conjunction with its first quarter report. “We’re levering the technologies we have with these different types of base fluids and the chemistries required and the technologies that we’re applying to these areas,” he added. “We still believe there’s opportunity for pricing and margin improvement because of the leverage of the complete package we bring to our customers in regards to pressure pumping.” Company officials were questioned about possible labour shortages and employee retention. Bruce Payne, president of Canadian operations, said the company has been proactive in terms of training and retaining staff. In the Grande Prairie area, for example, the company has developed a training centre. “We’re running about 30 people through there every 16 to 20 days in

a classroom environment and hands-on training with equipment,” he said. “We’re seeing better and better retention developing out of this and we’re really feeling a lot more comfortable as we move forward in 2011 that our retention is going to be significantly better.” The company has adopted similar training and retention programs south of the border as well, Ramsay added. Calfrac also said during its first quarter report that it participated in some of the early stage development of new oil and liquids-rich plays in Western Canada. “I think it’s common knowledge that people are talking about the Exshaw or Bakken in southern Alberta, they’re talking about some of the other opportunities,” he said. “These are very, very confidential operations right now and we’re going to respect that.” Operating income in Canada rose by 74 per cent to $68.4 million during the first quarter from $39.4 million in the same period of 2010. The increase was mainly due to higher overall fracturing and coiled tubing activity levels, improved pricing, completion of larger fracturing jobs in the unconventional oil and natural gas resource plays of Western Canada and strong management of operating and selling, general and administrative expenses. The shift towards oil and liquids-rich gas completions activity became prominent in North America during the latter half of 2010 due to strong oil and natural gas liquids prices combined with the high success rates delivered by this approach to drilling and completing wells. The trend is expected to drive strong levels of equipment utilization in the pressure pumping industry for the remainder of 2011. Calfrac also expects the industry trend towards multi-well pads and 24-hour operations to increase as customers remain committed to improving the efficiencies of these plays. Overall, as the price of crude oil and natural gas liquids is anticipated to remain strong, the company expects that capital spending by many of its customers will increase throughout the remainder of 2011.

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A26

PIPELINE NEWS June 2011

WaterÀooding and CO2 go hand-in-hand Estevan – If carbon dioxide captured from Boundary Dam Power Station is to be used in enhanced oil recovery, it will likely follow the model used in the Weyburn-Midale field. As a miscible flood, the carbon dioxide is used in combination with a water flood to sweep the oil from the formation. Some of the carbon dioxide comes back up with the produced oil, and is recycled for further flooding use. “We have worked on pumps and compressors that inject CO2,” said David Heier, general manager of Waterflood Service and Sales Ltd. in Estevan. The company builds skid packages, including some of those that are used in the Weyburn-Midale field. Asked if he foresees any spinoff from the implementation of more CO2 floods in the area, he said, “It’s too early to tell. It depends on the scale of the thing.” Heier noted some things have to fall into place before it can be implemented. “First, it has to be a unitized property. Before you can waterflood, you have to have a unit.” “Waterflooding is pretty much everywhere, but it’s predominantly in older fields. Potentially, most of southeast Saskatchewan and southwest Manitoba could be waterflooded and have some form of CO2 injection. The barriers are all tied to cash and the formation.” He pointed out the companies doing this sort of enhanced oil recovery have to have substantial financial resources. The hardware itself used in a CO2 flood is pricey. Everything is either stainless steel or has to be coated casing, flow lines, well heads. If not, it won’t last long. “CO2 mixed with H2S forms hydrochloric acid. You have wet gas, add CO2 and H2S, and it become very corrosive,” Heier said.

Stainless steel can be three to 10 times more expensive than carbon steel, he said. “They’ll need pilot (projects), but a lot of formations are similar. The process can be applied to wide and varied ﬁelds,” he said. “I think there is going to be opportunity for every service industry in southeast Saskatchewan. Hopefully we see some fabrication, packaging and servicing,” Heier said.

David Heier expects the enhanced oil recovery projects that will be part of the Boundary Dam carbon capture project will have spinoffs for all oilÀeld service industries in southeast Saskatchewan. His company, WaterÁood Service and Sales Ltd., builds skids packages, including the type used for CO2 applications.

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PIPELINE NEWS June 2011

A27

Hawk plans to drill Duperow formation (Nickle’s Daily Oil Bulletin) During 2010, Hawk Exploration Ltd. said it added a significant core area at Seagram Lake in west central Saskatchewan through Crown land sales and a farm-in agreement encompassing 12 (six net) sections of land and it commenced the first commercial production from the Duperow formation (Leduc formation equivalent) in western Saskatchewan. The company said it has identified 50 (25 net) additional dual leg horizontal locations on its existing land base at Seagram Lake based on geological mapping. Last year it drilled 21 (18.9 net) wells, of which 17 (14.9 net) were exploratory locations, resulting in 11 (8.9 net) oil wells, two (two net) standing wells and eight (eight net) dry holes. In 2010, Hawk said it focused almost entirely on exploration activities in order to satisfy its $12 million flow-through spending commitment. The most significant exploration discovery for Hawk during the year occurred at Seagram Lake in western Saskatchewan where it participated in the drilling of an exploratory horizontal well in the Duperow formation. Additional exploration discoveries were also made by Hawk at Hoosier and Silverdale in western Saskatchewan. At Seagram Lake, Hawk participated in the drilling of an exploratory horizontal oil well at a 50 per cent working interest targeting heavy oil in the Duperow formation. The well was drilled and completed in September 2010 and placed on production in October. As a result of poor initial inflow rates, a foam acid stimulation was performed which dramatically improved the inflow into the wellbore. Subsequent to the stimulation, production from the single leg horizontal well averaged over 80 (40 net) bpd of heavy oil over the first month with an associated water cut of 45 per cent. The well is currently producing at 45 (22.5 net) bpd of heavy oil with a 60 per cent water cut. To date, the corporation has assembled 12 (six net) sections of land in the area through Crown land sales and by way of a farm-in agreement. Based on its geological mapping and acquired seismic data, Hawk said it has identified 50 (25 net) additional dual leg horizontal locations on its existing land base. Hawk has received licences to drill three (1.5 net) dual leg horizontal wells which are anticipated to be drilled in the second quarter following spring break-up. The company’s board of directors has approved a capital budget of approximately $9 million for 2011

which will facilitate the drilling of six (three net) dual leg horizontal oil wells at Seagram Lake and five (4.2 net) vertical development oil wells in the Edam, Hoosier and Silverdale areas of western Saskatchewan. Hawk's 2011 capital budget is expected to be funded by way of funds flow generated from operations and its existing line of credit. During the year ended Dec. 31, 2010, Hawk increased annual sales revenue 252 per cent to $7.2 million and generated cash flow of $3.2 million, a 272 per cent increase from 2009. The junior producer booked a net loss of $429,000 for the year compared to a loss of $78,000 in 2009 when revenues were $2.06 million. Production averaged 332 boepd in 2010, up from production of 105 boepd the previous year. Hawk noted that its focus on oil production allowed

it to generate strong operating netbacks of $31.17 per boe and funds flow from operations for 2010 of $3.2 million, a significant increase from the $0.9 million of funds flow in 2009. Hawk's net loss for 2010 widened mainly as a result of higher depletion charges per boe and higher operating costs per boe in 2010. In late April, Hawk announced that it has entered into an agreement, on a bought deal private placement basis, with a syndicate of underwriters led by National Bank Financial Inc. and including Fraser Mackenzie Limited and Haywood Securities Inc., for an offering of 12.5 million subscription receipts at an issue price of 80 cents per receipt for aggregate gross proceeds of approximately $10 million. The net proceeds will be used to fund further development at Seagram Lake, to fund other exploration and development prospects, and for general corporate purposes.

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A28

PIPELINE NEWS June 2011

Wild Stream announces Saskatchewan acquisition

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(Nickle’s Daily Oil Bulletin) Calgary - Wild Stream Exploration Inc. announced on April 25 it had entered into an agreement to acquire focused, high working interest, operated producing oil and gas assets in southwest Saskatchewan for approximately $175 million in a cash and share deal. The company will acquire 1,800 boepd day (75 per cent oil), adding material production, reserves and undeveloped land in its core Shaunavon and Dodsland oil plays. Total consideration is approximately $175 million (subject to customary closing adjustments and approvals) consisting of $160 million of cash and the issuance of 1.3 million common shares of Wild Stream. To fund the acquisition of the properties,

Wild Stream has entered into an agreement, on a bought deal basis, with a syndicate of underwriters, led by National Bank Financial Inc. and including Peters & Co. Limited, FirstEnergy Capital Corp., Paradigm Capital Inc., CIBC World Markets Inc., GMP Securities L.P., Scotia Capital Inc. and Desjardins Securities Inc. for gross proceeds of $88.9 million. The properties to be acquired have a 75 per cent average working interest and are 90 per cent operated with extensive associated infrastructure. Substantially all of the existing production is connected to underutilized oil and gas processing facilities that will allow further development with minimal related infrastructure expenditures. Wild Stream will

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acquire 1,300 bpd (100 per cent 23 degree API oil) of production in the Shaunavon area, 50 bpd of 36 degree API oil in the Dodsland area and other Saskatchewan assets producing 2.7 mmcf per day of natural gas. The acquisition includes seven million boe (86 per cent oil) of gross company proved plus probable producing reserves. The internal estimate effective April 1, 2011 was prepared in accordance with National Instrument 51-101 by a member of management who is a qualified reserves evaluator. In addition, the company will acquire a total of 137,000 net acres of land including 53,000 net acres in the Shaunavon area, 25,000 net acres in the Dodsland area and 60,000 net acres in other parts of southwest Saskatchewan. Net of the internally estimated land value of $30 million, Wild Stream will pay $80,500 per producing boe for production and $20.70 per boe for proved plus probable producing reserves. The acquisition allows Wild Stream to continue the exploitation of underdeveloped Upper Shaunavon pools and to extend the boundaries of its Lower Shaunavon and Dodsland Viking oil fairways. It adds in excess of 50 potential drilling locations in the Upper Shaunavon formation. Based on internal estimates, the property acquisition has defined Upper Shaunavon oil pools with discovered petroleum initially in place (DPIIP) in excess of 150 million bbl. To date these pools have recovered less than 10 per cent of the DPIIP. Through the implementation of horizontal multi-frac technology and waterflood optimization, similar to Wild Stream's existing success in the Upper Shaunavon, it is feasible that recovery factors in excess of 20 per cent can be achieved, the company said. The company’s unbooked inventory in the Upper Shaunavon formation has now increased to 130 net wells. ɸ Page A29

A29

PIPELINE NEWS June 2011

Shaunavon and Dodsland lands acquired ɺ Page A28 Recent drilling in close proximity to the property acquisition has indicated an extension of the Lower Shaunavon oil fairway onto a signiﬁcant portion of these lands and Wild Stream has identiﬁed the potential for in excess of 60 Lower Shaunavon horizontal locations for a total of 130 net wells The property acquisition lands adjoin the 15,000 net acres that Wild Stream acquired at the April 11 Saskatchewan Crown land sale. Cumulatively, Wild Stream's net unbooked drilling inventory in the Lower Shaunavon has now increased to 205 net wells. In the Dodsland area, the property acquisition includes an estimated 50 net drilling locations. The lands complement the 20,000 net acres acquired at the April 11 Saskatchewan Crown land sale and the recent exploration success in the vicinity of those lands. Wild Stream currently has a net unbooked drilling inventory in excess of 250 wells in the area. Pro forma the acquisition, Wild Stream is fore-

casting exit 2011 production of 6,800 boe per day (90 per cent oil) and proved plus probable reserves of 24 million boe (93 per cent oil). The company also will have 150,000 net acres of land in the Shaunavon area and another 73,000 net acres in the Dodsland area. The underwriters have agreed to purchase for resale to the public, 7.7 million subscription receipts of Wild Stream at price of $11.55 per subscription receipt for gross proceeds of $88.9 million. In addition, the underwriters have been granted an overallotment option, exercisable for a period of 30 days following closing of the ﬁnancing, to purchase a further 770,000 subscription receipts, at a price of $11.55 per subscription receipt for additional gross proceeds of $8.9 million. The entire gross proceeds of the ﬁnancing will be held in escrow pending completion of the property acquisition. Upon closing of the acquisition, each holder of a subscription receipt will receive one common share without any further action or

payment of any additional funds, and the escrowed funds will be released to Wild Stream. If the property acquisition is not completed by June 30, the escrowed funds and any interest earned on it will be returned to the holders of the receipts.

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A30

PIPELINE NEWS June 2011

P S Electric was quite busy with the Shand Power Station, and hopes to get a portion of the work on the upcoming Boundary Dam Unit 3 project.

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Exciting future for PS Electric Estevan – One of the local contractors with a track record with SaskPower that stands to beneﬁt from its $1.24 billion Boundary Dam Unit 3 project is P S Electric of Estevan. The company had a hand in building the Shand Power Station, and is a regular contractor on plant work. Harvey King, owner of P S Electric, said they did about one per cent of the overall job on Shand, on the basis of money spent. It was an amount he was quite happy with, for “a small little local guy.” As for the Boundary Dam project, he anticipates SNC-Lavalin, the general contractor, will tackle most of the carbon capture work. Peak electrical staﬀ will be around 200 at some point, he forecast. “It’s going to be a competition thing. Because of that scale, there’s going to be people coming in from out of province,” King said. But there’s still lots of work for SaskPower as part of the project. “We’ll be plenty busy enough with the Unit 3 rebuild,” King said. With the subsequent Units 4, 5 and 6 needing replacement in the coming years, he noted it could lead into a decade of work. As it stands now, they have enough jobs bid out there but not

yet awarded to keep P S Electric really busy until November. “I think it’s going to be a fair challenge for the area for housing a lot of people, but it’s also an opportunity,” King said. “We’re going to look at it as opportunity. Hopefully we can fill some of the bill. The biggest challenge will be staffing the projects, definitely.”

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PIPELINE NEWS June 2011

A31

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A32

PIPELINE NEWS June 2011

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

B-Section June 2011

A swirl of activity as Vortex launches Story and photos by Brian Zinchuk

Jason Geysen, left, and Harvey Turcotte have spent the last several months assembling Vortex Drilling Rig 1, their new venture.

Estevan – A new drilling company is in the process of launching in southeast Saskatchewan, with its first rig ready by late May and the second rig planned for September. Vortex Drilling Ltd. is headed up by Harvey Turcotte and Jason Geysen. The pair, who have worked together for the last five years with former drilling company Eagle Drilling Services, decided to start this new venture late last fall. Turcotte, 50, and Geysen, 33, collectively have 45 years combined experience in the industry. The pair have spent a fair bit of time on the design and commissioning new rigs with former companies. The construction of Vortex rig 1 started late last fall, and in early May, they were finishing the first of their own at Estevan’s Do-All Metal Fabricating. “I figured the time is right, the work is there, it’s a good investment, and a chance to work with a bunch of good people,” Turcotte said. Vortex has been financed by private capital with a small number of investors. They are primarily Saskatchewan people, with some from Alberta. Turcotte is the president, while Geysen fills the role of vicepresident.

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They chose Do-All due to a good relationship, good quality, and the fact they are easy people to work with, Turcotte said. It also makes it easier because it is close to their homes, as opposed to an Alberta-based manufacturer. So far a base of operations for Vortex has not been established. Turcotte is from Radville, while Geysen calls White City home. Their work for Rig 1 will largely be southwest of Estevan to start. “We haven’t committed to anything yet. We’re looking at Weyburn,” Turcotte said. Right now they are focused on getting out in the ﬁeld. Both could be found turning wrenches in early May as Rig 1 neared completion in Do-All Metal Fabricating’s Estevan yard. Rig design The rig is a telescopic double, with a 3,500 metre rating. It can rack up to 4,400 metres of four-inch pipe. The draw works has 780 horsepower, coming from a 19-litre Cummins engine provided by Weyburn’s Southern Industrial and Truck. The pump is powered by a 1,000 horsepower 23-litre Cummins. Vortex’s rigs will incorporate many of the innovations Turcotte has incorporated into previous rig designs, plus a few more. ɸ Page B2

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PIPELINE NEWS June 2011

Water truck, tanks, phone system part of package

Dennis Day, seen here drilling holes for the pre-fabricated winter shelter panels, is a driller and relief tool push with Vortex Drilling.

ɺ Page B1 There is a large slideout for both the driller and motorman to work in. The slide-out is similar in concept to those seen on recreational vehicles. It enlarges the doghouse, but also allows the driller and motorman to work in climatecontrolled comfort. A port in the slideout allows it to basically envelop the driller’s station. However, the station can still be operated outdoors in the unlikely event an issue should arise with the slide-out. The motorman can

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control his station controlling the hydraulic catwalk using a wireless control box, operated from the doghouse. The slide-out design provides a window to the catwalk to allow visibility even in winter, when pre-fabricated winter enclosures on other rigs might other obstruct that view. The rig will also have two video cameras, one on the shaker, another on the pumps, allowing the driller to have eyes on both. “It’s good for the driller, especially in winter,” Turcotte said. The system can be expanded by another two cameras, if desired. Asked about their choice to not go with an iron roughneck, Turcotte said they don’t feel it is cost-eﬃcient. The derrick stays attached to draw works for transport, saving one load. In the pump house, piping has been routed

overhead, off the floor, to reduce tripping hazards. “We’ve changed our mixing pump system, with vertical mixers,” Turcotte said. They are 5x6 with 14-inch impellers and a 60 horsepower motor, he explained. Making them vertical again reduces tripping hazards. It also provides more space. “We’ve changed the electrical system. We added four transformers and cut down seven cords,” he said. The generator is a 15-litre Cummins 512 kilowatt setup running 480 volt power. For accessory equipment, they’ve decided to go with a larger loader, as well as their own water truck, a new one. Geysen noted they prefer to have their own water truck, as opposed to one that is contracted. They also have their own floc tanks, shale tank and wireless phone system. ɸ Page B3

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PIPELINE NEWS June 2011

Vortex’s ¿rst rig will be soon followed by a second ɺ Page B2 “A lot of companies like that, because at the end of the day, it’s one invoice,” he said. The doghouse includes a large slide-out that Construction has gone well. “We basically con- enables both the driller and motorman to work structed the rig in with four to five men,” Turcotte indoors in all weather. said. Three of them did about 85 per cent of the work. The ocean blue colour was something Geyson spotted on a floc tank and liked. The name of the company came from Turcotte’s oldest son, Zach. He had been on his computer one day and said, “I’ve got a name for you.” Plans Rig 1 will be going to work for Torquay Oil and Gas. “They’ve booked for a year,” Turcotte said, until breakup of 2012. The work will primarily be in the Lake Alma and Oungre area. Wells in that area tend to be deeper, he said. Exploratory wells can take awhile. As for Rig 2, “We’re still in the planning stages,” Turcotte said. Geysen added there’s lots of interest. With regard to finding a crew, Geysen said, “They came to us. I worked with most of these guys Vortex Rig 1 was scheduled for completion in since Eagle 2. It’s more of a relationship.” late May and will be going to work for Torquay Turcotte added, “We’re not above taking some Oil and Gas. green men,” noting that they have hired a summer student, too. He said they were looking for management staff, too, in particular, for someone to run Rig 2. “We want the rig to sell itself, the people to be happy, and the customers to be happy. The work is there. We’ll have to find the people, but I know a lot of people, and have treated people fairly well. One of our bigger features will be our men,” he said.

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PIPELINE NEWS June 2011

Rotex buys Plains Environmental

This is a graphical representation of the Plains Environmental salt caverns used for waste disposal. File graphic

Kevin Anderson/Darwin Krall

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By Brian Zinchuk Melville – A recent startup in southeast Saskatchewan’s waste disposal business has purchased one of the long standing players. On April 20, Rotex Energy Ltd. announced it had acquired Plains Environmental Inc. With headquarters in Red Deer, Rotex’s operations are in Saskatchewan. They established a disposal well facility at

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Willmar, east of Lampman, in early 2010. Plains specializes in deep well cavern injection of oilfield and industrial waste. The deal was backed, in part, by Regina-based PFM Captial Inc. PFM’s SaskWorks Venture Fund web page portfolio lists a $3.2 million investment in Rotex. Rotex did not disclose the value of the deal, however, Rotex founder Kevin Bauman did call it “a sizeable investment.” “In our opinion, it was a strategic fit,” said Bauman. “We’ve been working at this for over a year. We have a lot of comfort that, in our opinion, carvern disposal is the most secure form of disposal, for liquids and solids.” The Melville facility is the only waste disposal cavern in the region. The location was driven by geology, in the same way that geology drives the location of the oilpatch. “You need unique geological components. It doesn’t happen just anywhere,” Brian Hilliar of Plains told Pipeline News in a September 2010 profile. ɸ Page B5

PIPELINE NEWS June 2011

This hardware at Plains Environmental Inc., will now be part of Rotex.

File photo

Merged company will run under Plains' name Éş Page B4 â&#x20AC;&#x153;The plan is to amalgamate the companies soon, and use the Plains name. Theyâ&#x20AC;&#x2122;ve been around a long, long time,â&#x20AC;? Bauman said, noting the name recognition factor. â&#x20AC;&#x153;We welcome to Rotex the employee group that were key to the growth and successful operation of Plains, and we look forward to the integration of these two companies,â&#x20AC;? Baumann added. Plains Environmental fired up in the late 1990s. The facility makes use of two former SaskEnergy liquid natural gas storage caverns, constructed several decades ago, originally engineered for liquid natural gas. As pipeline systems increased, the caverns were no longer needed for that purpose, and Plains Environmental took them over. They have over one million barrels of capacity between the two caverns. Their primary focus is drilling muds. However, they accept more than that, including natural occurring radioactive materials (NORMs), and some industrial wastes. The bulk of their business still comes from the oilfield. NORMs are common in oilfield, fertilizer, and propane operations. However, there are few places that can handle it. Industrial wastes accepted include glycols and solvents, things that arenâ&#x20AC;&#x2122;t generated from drilling for oil. Provincial regulations specify which disposal options are appropriate for differing wastes. For example, they limit the amount of hydrocarbons can be present in material before it is ruled out for a landfill. The Melville facility has rail capability, and is close to the major rail yard. Theyâ&#x20AC;&#x2122;ve seen drilling muds come by rail car from as far as off-shore Newfoundland. However, most of their material comes from southeast Saskatchewan. The facility can take a range of waste prod-

ucts from pure liquid to straight dirt. Loads are turned into a slurry with salt water before being pumped into the caverns. The product goes into a trammel to mix the solids, then is pumped into a slurry tank. The saltwater in the cavern is displaced, recovered and re-used. Waste oil collects at the top of the cavern. It is recovered and sold. Concurrent with this acquisition, Rotex announced that George Flemming will assume the role of president and CEO of Rotex. Baumann will remain as vice president, business development and Greg Beddoes will become chief operating officer. â&#x20AC;&#x153;I believe everyone should do what their strengths are. Iâ&#x20AC;&#x2122;m good at building businesses. Weâ&#x20AC;&#x2122;re not stuck on titles,â&#x20AC;? Bauman said.

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The real hot shot of the highway “Hey Hot Shot!” he called. I turned to look. It was the mayor coming out of his oﬃce. I was at City Hall paying water bills. “I can call you Hot Shot, can’t I?” he continued. “Mr. Mayor, you can call me anything you like!” I responded with a laugh. We had served together on the city’s Board of Tourism, Trade and Commerce for a year. He was still serving but I had resigned due to my unpredictable hours. He may not be calling me Hot Shot any longer when he hears of the big chrome and black-painted metal speed machine sitting in my garage. It’s my husband’s new motorcycle. Bruce picked up this new motorcycle on April 1. It was snowing and it was April Fool’s Day but it was no joke. It had been nine long months since he and his beloved

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Harley Davidson Road King had been rear-ended on July 1 of last year. It had happened at 9 a.m. of the second day of the annual guysonly road trip. Bruce was bringing up the rear of the motorcycle entourage, and slowing down for a semi-truck that was stopped ahead. He had geared down to ﬁrst, when he heard the squeal of tires. Glancing in his mirrors, he saw a half-ton truck bearing down on him. He hit the throttle, cranked the wheel towards the ditch and held his breath. No need to pray. He had done that earlier as a matter of habit. He doesn’t remember much about the impact but his friends do. The trailer and bike separated and Bruce was thrown. The Harley went end over end before barrel rolling down the highway. Bruce got up after the accident. The Road King did not. Bruce had arranged the summer oﬀ, a combination of holidays and banked time from his work. But now his motorcycle was fatally injured, ending plans of long summer rides. I let

him heal for a time while he mourned the loss of his Harley. Then I had enough. “We need help,” I told him, referring to the hot shot business that I sub-contracted to. “You’ve now got time so could you get your 1G licence, please? We need help,” I repeated. “You can start a new bike fund.” That is how the biker dude became the hot shot dude for part of the summer of 2010, exchanging his now badlyscuffed leather jacket and chaps for fire resistant (FR) coveralls. He still heard the call of the open road, but instead of answering the call on his Harley going to Sturgis, he answered the call in the hot shot truck going to area leases. It was a win-win situation. I got some badly needed days off, the boss got some extra help and Bruce got a new motorcycle fund started. Bruce really enjoyed meeting all the new people in the oilpatch. Working outside, instead of inside at a hot and stuffy power plant, was the added bonus. ɸ Page B7

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PIPELINE NEWS June 2011

In or out

Secondary containment is designed to keep Áuids from spilling out. The question is, will it keep them from spilling in? Photo by Brian Zinchuk

A triumphant return to the road ɺ Page B6

“Oh sure,” Bruce He went on enthu- lem this summer as far laughed. “Or if not, I’ll siastically, “The speed- as I can tell. He’ll have When Bruce re- wait for them in the ometer on my Harley to go the speed limit! turned to his “real job” next town,” referring to went to 180 km/h, and That’s no joke! last fall, the motorcycle the 2300cc liquid cooled the speedometer on this fund and dreams of a engine that he told me Rocket 3 goes to 230 Nadine lives in Esnew bike sustained him was bigger than the km/h. That’s fast!” tevan, Sask,. with her over the long winter. motor in his Sonoma “It goes 230 km/h?” husband and family, and But by April 1, it had truck. I repeated in disbelief. works as a hot shot driver been nine long months Fast, indeed! For in the oil patch regularly “How fast does it without a motorcycle for go?” I asked when he sheer speed, the Rocket delivering goods in and him, and nine really long took the Rocket 3 out 3 is the real hot shot of around Estevan and months for me, listening for a ride the week after the highway. Shaunavon, Sask., and to the pros and cons of he brought it home. Bruce is back to be- Sinclair and Waskada, all the possible replace“Fast!” he replied. ing a biker dude, trading Man., and on occasion, ment motorcycles. “Let’s put it this way. I in his FR coveralls for longer runs to Alberta. In the end, the won’t be adding a Stage new bike leathers. He Her mission, beyond deRocket 3 triumphed. One kit to this bike.” will have only one prob- livering the goods quickly, That’s right. After 14 years of owning Harley Davidson cycles, Bruce, tired of air cooled hot engines, decided that liquid cooled was the way to go. Hot should * Formerly “Three Star Environmental” be reserved for wives, * Environmental Protection Plans * Impact Assessments vacations, and coﬀee he * Pre-Site Assessments * Environmental Audits & Assessments said, not the engine of * Well Site & Battery Abandonments * Drilling Waste Management * Pre/Post Water Well Testing * EM Surveying * GPS Mapping your Harley. “Will your Harley friends still let you ride with them?” the Triumph motorcycle salesFAX: 306-453-4476 BOX 40, CARLYLE, SASK. S0C 0R0 man asked as he wrote www.evergreenenviro.ca up the contract.

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PIPELINE NEWS June 2011

Safely exposing underground utilities: Badger Daylighting Hydrovacing is considered a safe way to expose underground utilities without damaging them. This crew was working at Enbridge’s Steelman station last summer. File photo

Carlyle – It’s been one year since Badger Daylighting moved into its new shop south of Carlyle on Highway 9. The location, plus another shop in Oxbow, provides hydrovac services to southeast Saskatchewan. Badger Daylighting had been the focus of a takeover bid by Clean Harbors, but a handful of shareholders rejected the bid and it fell through (see sidebar). Locally, Clean Harbors had recently set up an operation in Arcola, the neighbouring community to Carlyle, where Badger has been for several years. “We build our own trucks and can add more,” said Mark Lyle, regional manager, while visiting the Carlyle location. The company uses its own designs, and does not sell it to other companies. “We’ve built over 500 trucks, with over 400 on the road throughout North America today,” he said. A hydrovac truck derives its name from two elements – hydro, for the high pressure water used to break up dirt, and vac, for the high powered

vacuum that sucks it up. They allow underground utilities to be exposed without the danger of an excavator bucket tooth severing or damaging the line. Hydrovac exposure of line is considered an industry safe practice for daylighting (uncovering and exposing buried utilities to daylight). Badger’s hydrovac sizes range from smaller single axle units to larger tri-drives that can handle more substantial volumes. Bigger trucks with bigger blowers are able to provide more capacity to the customer, according to Lyle. In Saskatchewan, Badger also has locations in Weyburn and Swift Current, the bulk of whose operations are largely oilﬁeld-related, as well as Regina and Saskatoon bases. The larger centres’ bases focus more on commercial work. However, the need for hydrovac services is widespread, according to Lyle. “It’s not just oilﬁeld. It’s mining, utilities, transportation, construction. When you put it all together, it keeps you busy. ɸ Page B9

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PIPELINE NEWS June 2011

Working safely exposing energized underground cables

A Badger Daylighting truck works on an Enbridge facility last summer. File photo

ɺ Page B8 In Carlyle and Oxbow, they have approximately 20 people working, with a total of over 50 throughout the province. “We have provincial coverage and Western Canadian coverage,” Lyle said. Badger has been operating in Saskatchewan since 1994. Trina Randall recently became the area manager out of Carlyle. The last time Pipeline News encountered her, she was operating a hydrovac. With four years of experience as a hydrovac operator, she’s now moved into the office. “Any excavation has the potential of being a client,” she said. Rick Sorenson handles business development with Badger. He sits on the executive of the Saskatchewan Common Ground Alliance. Its purpose is to enhance public and worker safety while reducing damage to buried facilities. He spoke of recent trends in hydrovac excavation, where the operator with the wand stands on a mat which is connected to the truck. It’s purpose is to provide “equipotential bonding,” around energized cables. If a power line is damaged, the ground itself can become electrified, and it’s electric potential varies with distance. By using the mats, operators lessen the danger of electrocution. The mat is similar in concept to the antistatic mats sometimes used under keyboards. “It’s like the bird on a wire philosophy,” he said. “It’s been coming into play in the last three to five years.” All of Badger’s trucks are equipped with these mats now. More importantly, their operators are trained in their usage. “Safety, it’s what we do,” is written on their business cards, Lyle pointed out, adding, “the whole concept of hydrovacing is safety.” As a sideline, Badger also sells and rents shoring for usage in trenching. “There’s not a lot of shoring available for rent in Saskatchewan,” Lyle said. “It can really limit the size of the excavation.” Not only does using shoring reduce the size of the hole, and minimize ground disturbance, but it also reduces excavation time and the amount of restoration needed. “It compliments what we do,” Lyle said.

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B10

PIPELINE NEWS June 2011

Badger shareholders reject Clean Harbors bid

Rick Sorenson, left, Mark Lyle and Trina Randal stand before a Badger Daylighting truck at the Carlyle shop, which was built a year ago.

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(Nickle’s Daily Oil Bulletin) Clean Harbors, Inc. reported April 26 that the shareholders of Badger Daylighting Ltd. have failed to provide the percentage of votes necessary to approve a plan of arrangement under which Clean Harbors would have acquired 100 per cent of Badger’s outstanding common shares for US$20.50 per share. “We are disappointed in the outcome of the vote, as we proposed what we considered a fair and equitable offer to acquire Badger,” said Alan McKim, chairman and chief executive officer of Clean Harbors, in a news release. “Our proposal received the recommendation not only of the board of directors and management of Badger, but also two independent international corporate governance analysis and proxy voting firms – Institutional Shareholder Services Inc. and Glass Lewis & Co.” The proposed transaction, which required approval of not less than 66 2/3 per cent of the votes cast by Badger’s shareholders and option holders, was defeated at a special meeting of shareholders held in Calgary. Badger, which is based in Calgary, is North America’s largest provider of hydrovac services. “The decision by Badger shareholders neither disrupts our strategic focus on further expanding our Energy and Industrial Services business in North America, nor diminishes the strong footprint we have established across Canada through acquisitions including our 2009 acquisition of Eveready Inc.,” McKim said. “Badger has built an excellent reputation in its core markets. However, with its shareholders having voted to remain an independent company, we will move on to the next opportunity in what is an active acquisition pipeline.” Earlier in April, Clean Harbors announced the signing of a definitive agreement to acquire Peak Energy Services Ltd. for approximately C$196 million consisting of a combination of cash and assumed debt. The acquisition is subject to approval by regulators and Peak shareholders, as well as other customary closing conditions, and is expected to be completed during the second quarter of 2011. Each of the directors and officers of Peak and Deans Knight Capital Management Ltd., collectively holding 53.6 per cent of the issued and outstanding Peak shares, have entered into agreements with Clean Harbors pursuant to which they have agreed to vote their shares in favor of the acquisition at the Peak shareholders’ meeting, expected to be held on May 25.

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B11

MB May land sale - just under $6 Million (Nickle’s Daily Oil Bulletin) - The Manitoba government’s second land sale of 2011 generated $5.99 million in bonus bids in early May. A total of 9,466 hectares exchanged hands at an average of $632.26 per hectare. Last year’s May sale drew bids of $5.98 million on 8,166 hectares at an average of $732.60. Year-to date, $7.3 million has rolled into provincial coﬀers on 15,846 hectares at an average price of $458.82. To the same point last year, Manitoba had collected $6.9 million for 9,558 hectares at an average of $717.69. Highlights of this week’s sale included seven lease parcels in the Waskada area at 1-26WP combining for total bonus bids of roughly $2.4 million. Broker Plunkett Resources Ltd. produced the per

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hectare high of $6,501 for four separate 64-hectare parcels in the area, tendering a bonus of $416,096 for each. The leases included the rights to the southwest quarter of Section two, southwest quarter of Section 11, northwest quarter of Section 11 and the northwest quarter of section 14. Bulletin records show that Penn West Petroleum Ltd. is a busy producer in the area. On March 10, the company licensed a horizontal development oil well at surface location 08-26-1-26W1 in the Waskada area. The well has a planned depth of 1,761 metres with the Triassic System listed as the total depth zone. Plunkett also tendered the bonus high of $552,673 for a 256-hectare lease, which included Section 11 at 2-27WP. The parcel produced a per-

hectare average of $2,158. There are two more sales left this calendar year in Manitoba. The next sale will be held on Aug. 10 and the deadline for posting requests was May 16. Two rigs could be found drilling side by side near Waskada Jan. 21. Waskada land parcels were highlights in this month’s land sale. File photo

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B12

PIPELINE NEWS June 2011

A&B Pipeliners launches Regina location

This line is being lowered in by A&B Pipeliners. Photo submitted

A&B Pipeliners has been around for 54 years. Its founders are originally from Saskatchewan. Photo submitted

By Brian Zinchuk Regina – A 54-yearold family company with long ties to Saskatchewan is establishing a presence in Regina. Arnett & Burgess Oilﬁeld Construction Ltd., also known as A&B Pipeliners, is in the process of setting up a Regina base for their pipeline integrity division. The move comes at a time when the industry has been rocked by headline-grabbing pipeline failures in Michigan and northern Alberta. The company has been working in Saskatchewan for many years, according to Carey Arnett, director of corporate development. Pipeline News met with Arnett at the Williston Basin Petroleum Conference in Regina on May 2, where A&B had a booth. “There’s a lot of people there. There’s a diversiﬁed crowd,” she said of the conference. “There’s a lot of suppliers here.

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It’s a great industry sector show. “I’m the boss’s right hand man,” Arnett said. “I’ve got the grease gun to get the tracks moving. One of my primary responsibilities has been developing our heavy oil business.” That includes the Lloydminster region and the North. The company services the North Battleford and Kindersley areas quite a lot, she said. The company has seen a substantial shift in recent years. “In 2006, 80 per cent of our business was gas. Today, it’s 80-90 per cent oil,” Arnett said. “We’ve shifted. We’ve got a diversiﬁed labour force that has allowed us to easily shift the skill sets. “It’s a multi-generational business for many families. Our vice-president of operations has 30 years in. Several supervisors have 20 years plus. There are third and fourth generation staff working with us,” she said. The nature of work has also changed, particularly in the scale of projects. “Fifty years ago, our

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normal job was 100 km, because there was no infrastructure around. Five years ago, it was massive gathering systems. Jobs have shrunk in size, but there is a shift back to longer infrastructure.” With tertiary production technologies, water and CO2 injection, as well as condensate return lines, Arnett feels the up and coming market is going to be handling water, with the long term challenge being fresh water. “Water treatment technology is the hot thing. “We’re a pipeline and facility construction company,” Arnett said. “A large component of our business is pipeline integrity work maintenance and repair, hydrotesting, turnkey integrity management programs. We’ll go in and manage the tool runs and be there for correlation and repair dig support. We’re not a tool vendor, but we’ll assist the tool company. “When I’m talking tools, I’m talking inline inspection technology,” she said. ɸ Page B13

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B13

Expanding their pipeline integrity services ɺ Page B12 The “tools” she refers to are commonly known as “smart pigs,” robotic diagnostic hardware designed to test the integrity of pipelines from the inside. “A lot of lines weren’t designed with pig launching and receiving in mind,” she said. “You run into all sorts of things out there – casings, risers made of different materials or thicknesses, poor transitions from heavy wall to light wall.” They have the ability to make some “unpiggable lines piggable,” Arnett said. They have done this form of integrity work for lines ranging in size from three-inch to 48inch. “We manage dig programs for TransCanada all over Alberta,”she said.“You do need the quality control and safety management backing those integrity programs. “The people are the important part. The skill sets are transferable, but the mind set you can’t rush integrity. The operator you put in that seat is critical.” The peak season for A&B is winter, when their staff will grow in number to about 500. “We’re growing capacity all the time. We do a lot of winter work. “The downturn has been good to us. We were able to find people. We’ve been lucky, because we’re a long term, stable employer. We’ve been able to add some great additions to our management team. “Our sector has been rocked fairly hard since 2007 with commodity prices. The royalty trust really affected the exit strategies for a lot of the juniors that are our clients. The royalty regime in Alberta changing created a lot of uncertainty,” Arnett said. “My father’s been in the business for the last 43 years, and the last five years have been unique, and not the norm. I think it’s been great for us. We

kept strong, inherited a lot of clients, and grown our people.” Some people think a pipeline labourer is a pretty easy job that anyone can do. Arnett said, “The hardest thing for us to ﬁll is a general pipeline labourer. It’s a skilled job for us. “We’ve grown successfully with our clients in that we can build a crew for them based on long time work. It’s not enough to be a ticketed and qualiﬁed guy anymore. There are OH&S standards, clients’ requirements. We operate

more as a service company. Most of our work has been long term.” They want a comfort level with the people they send out, Arnett said. “With construction, there’s enough uncertainty. You don’t want uncertainty with the guys out in the ﬁeld.” As for their Saskatchewan strategy, she said, “We’re here to service our pipeline integrity clients, to provide the skilled support services for out integrity clients.” They’ve taken possession of an oﬃce in Regina and were doing

interviews in early May to hire an area manager. A&B has locations in Calgary, Sedgewick, Athabasca and Bashaw, Alberta. Sedgewick is the main field office. Asked why they chose Regina, she said, “We look for places our boys can have a decent life, have a family life, buy a house. Transmission lines sprawl across the province.” “I do think a good part of what makes us different is our people a lot of unique longevity in a very difficult business sector,” Arnett concluded.

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B14

PIPELINE NEWS June 2011

B15

ATCO in preparing for inÀux Estevan– When SaskPower made the announcement that it would be following through with the $1.24 billion Boundary Dam Unit 3 refurbishment and carbon capture project, another number stood out: the 600 workers needed at the peak of construction. Pipeline News asked SaskPower CEO Robert Watson, “Where are you going to put them?” He replied that SNC-Lavalin, the general contractor for the project, has experience building projects around the world, and they would likely use temporary trailer-style accommodations. In other words, camps. Established in early 2010, ATCO Structures & Logistics is in prime position to address some of that need. “We’ve been talking to SNC-Lavalin for some time,” said Carolyn Best, ATCO Structures & Logistics’ manager of business development and marketing. She spoke to Pipeline News at the ATCO Lodge Estevan shortly after the Boundary Dam 3 announcement. She noted the project has been in the works for awhile. “It was one of the reasons we wanted to come to Estevan.” However, the existing 200-room camp was running at near capacity before spring breakup, and that’s before the Boundary Dam project got the goahead. “We haven’t seen what the numbers are, if it’s a longer span of a peak,” Best said, adding, “It’s really the shape of the curve and how they distribute it. “They’re talking about two humps for construction.” Asked if they would be setting up additional units soon, she said, “Not yet. Not in the next two months.” As for the summer, she said, “Potentially. It’s all based on what this curve looks like, and what the rest of the market looks like. “We are in discussions with landlords. If you are going to expand, you need to expand everything,” she said. That would eventually mean needing another kitchen and other amenities. There are also nearly 800 jobs posted for the Estevan area on SaskJobs.ca, she said in late April. By May 17, that number grew to 1,039. “Those will have to compete for the labour,” Best

said. She pointed to new hotels in Estevan, one that recently opened, and another that is under construction. It will also depend on what the shifts look like. “If you can’t provide an equivalent basis of the comforts of home what they eat, and how much you’re paying them, they’re going to check out and go elsewhere,” she said of the expected workforce. “This is our business. We can put up a camp fast.” Best said recently they had met with a client on a Friday, and in 10 days, they had 240 beds mobilized and open for business. “I almost had heart failure, but we did it.” ATCO has manufacturing plants in Calgary and Texas. And while southeast Saskatchewan may be very businy, it doesn’t hold a candle to North Dakota. “The activity level in North Dakota is through the moon,” Best said. “We opened a 150-man camp in Williston Dec. 8, and we were full before we opened.” They expanded in March, adding another 50. “There isn’t a bed to be had in Williston,” she said.

But back in Saskatchewan, she noted potash, combined with new opportunities for enhanced oil recovery from the Boundary Dam CO2, added with the activity in the Bakken ﬁeld and the carbon capture project itself, means there’s a lot of opportunity. “They need a lot of bodies and smart people in this area,” Best said. “There will be a large requirement for skilled labour. “Saskatchewan’s back on track. North Dakota’s going crazy. Saskatchewan’s going crazy. It’s all good. What recession?”

Carolyn Best, ATCO Structures & Logistics’ manager of business development and marketing, said the Boundary Dam Unit 3 project was one of the reasons they established a camp in Estevan.

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B16

PIPELINE NEWS June 2011

Jeannette Betteridge is the new manager for ATCO Lodge Estevan.

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Estevan– ATCO Lodge Estevan has a new manager, and she’s from Estevan. “I’ve been here since the construction phase. They were still working on putting it together,” said Jeannette Betteridge. Betteridge started as the head of housekeeping, and also looked after health and safety and was the first aid attendant. Soon she was assistant manager. “I spent 16 years in health care,” she said.

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“I was a special care aid. I worked at the nursing home for 15 years. I just wanted to try something different.” Betteridge then made a total change in direction in her life, and went to work for a year in shipping and receiving in Fort McMurray. The next three years were spent there in security services. “I drove the ambulance for the fire hall at the Suncor fire department,” Betteridge said. She moved up to emergency services dispatcher and supervisor, where she also operated weigh scales. “I’m originally from Estevan. I had left just about five years ago and came back,” she said. Her two sons work in the plumbing business in Regina, and her parents and and sister are in Estevan. She has been groomed for the manager position, noting, “I’ve been training for a year.” She took over April 18. The previous manager went to work in the Fort McMurray area, where he had been before coming to launch the Estevan location. “I expect things to really pick up around here,” she said.

PIPELINE NEWS June 2011

B17

Communities need to take action on housing Estevan – The Saskatchewan South East Enterprise Region is trying to address the region’s oil-fuelled housing shortage, but action needs to occur at the municipal level in order to have an impact. “I can’t move any faster than what the communities are willing to move. I can support them, but they have to lead it,” said Edie Spagrud, CEO of Saskatchewan South East Enterprise Region, or SSEER. She’s been meeting with municipal offi-

cials, offering SSEER’s services. It can cost $10,000 to $20,000 to do a housing needs assessment for a community, she said, but SSEER can do it for much, much less. A community needs to have a needs assessment done and an action plan in place if it is looking for help from the province, she explained. “The days are gone when the government will lead housing initiatives. Government will partner, but the community has to be the

leader,” Spagrud said. The organization has funding from the federal and provincial governments to hire a housing co-ordinator. It’s a two year project, she noted. That person will work with individual community’s housing committee to develop their own demand and needs assessments of housing. The process involves taking an inventory of what the community has for housing, its age and condition. Then demographics need to be analyzed,

along with five and 10 year projections based on industry in the region. Will the seniors population double, for instance? Will the community need eight more dwellings for each of the next five years? Finally are the recommendations based on the needs. Out of those recommendations arises the action plan. It may include zoning, or even annexing land. “Most of them don’t have a land base anymore. It’s sold out,” Spagrud said. “Most are

landlocked and have little room left for development or suitable development.” The action plan includes updates to municipal planning. Going through a professional planner can take a year alone, she said. SSEER is looking to find a way for communities to band together and use a common planner, saving money. SSEER will match some of that money, she said. There is a need for sound municipal planning, she stressed. “Don’t just hope

for the best. It’s not going to happen,” Spagrud said. Asked about the April 26 announcement that up to 600 workers will be needed at peak times for SaskPower’s Boundary Dam Unit 3 carbon capture project, she said, “I’m certainly excited about it. I think it’s great for the region. “Whether we’re ready for the magnitude of the project, that’s still in question. “Communities’ comfort speed may not be the speed of business,” she said.

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B18

PIPELINE NEWS June 2011

Midale gains new motel, possibly more

The Come On Inn & Suites held its grand opening in Midale on April 29.

Â&#x201E; By Brian Zinchuk Midale â&#x20AC;&#x201C; Midale has gained a new motel, fuelled by the local oilpatch. Come On Inn & Suites held its grand opening on April 29. Over 100 people attended. Some were suppliers, some were family and friends, but most were from the community. â&#x20AC;&#x153;Everyone in town seems pretty happy with it,â&#x20AC;? said Irvan Berg, who acted as contractor for the build and is one of the partners in the ownership. One is from Nanaimo, B.C., the other ďŹ ve are from Moose Jaw. Berg is the president, and runs the crews for

their construction projects. The total cost for the project was $1.4 million, including the land. â&#x20AC;&#x153;The fact we built it ourselves was huge, too. If we had to get a contractor to build it, it would have added 25 to 30 per cent. All of our subtrades came from Moose Jaw, too.â&#x20AC;? There are 18 rooms in the motel. Ten are single rooms, while eight are larger, with two beds and a kitchenette. It was a bit slow after breakup, as is expected. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve had a few stay already. Weâ&#x20AC;&#x2122;ve got two crews

working in Weyburn staying here.â&#x20AC;? A few weekends in July are already booked solid. They also have bookings for the Weyburn Oil Show. The initial plan was to be open earlier in the year, but Berg said the winter was a bad one, with lots of cold, snow and storms, making it tough for building. As well, there was a shortage of labour. The motel is on the north side of Highway 39, where they own 23 acres of land. Thereâ&#x20AC;&#x2122;s plenty of room for future development. É¸ Page B19

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B19

Waiting for Ă agman The Highway 18 east of Bienfait has taken a serious beating this spring. Here, Samâ&#x20AC;&#x2122;s Trucking rigs wait for a Ă agperson while westbound on May 5. Photo by Brian Zinchuk

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The larger rooms feature two beds and a kitchenette.

Éş Page B18 â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re kicking around the idea of building some fourplexes behind here this summer. Weâ&#x20AC;&#x2122;ll see.â&#x20AC;? With the April announcement by SaskPower that Boundary Dam Unit 3 will require up to 600 workers at peak times, any accommodations near Estevan will be needed. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re hoping she ďŹ lls up,â&#x20AC;? Berg said. â&#x20AC;&#x153;Our plan was to build three motels, but weâ&#x20AC;&#x2122;ve got the land here.

We may do an expansion here ďŹ rst.â&#x20AC;? An expansion was planned with the initial build. Phase 2 would be a lounge, cold beer and wine store, plus a wing with another 20 rooms. It would be added near the continental breakfast area. The current single rooms are on the small side. â&#x20AC;&#x153;The next phase, theyâ&#x20AC;&#x2122;ll be a little bigger.â&#x20AC;? The hotel features a private managerâ&#x20AC;&#x2122;s suite, and the manager will come in from Gravelbourg.

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B20

PIPELINE NEWS June 2011

B21

Educating young people and each other Estevan – The Desk and Derrick Club of Southeast Saskatchewan hosted a Region 7 meeting in Estevan from May 4-8. “People have travelled from Houston, Texas, Denver, Edmonton, Calgary and Grande Prairie to be with us this week,” said Kelly McConnell, one of the local organizers. Judi Adams, president-elect for the international organization, said it was her ﬁrst time to Saskatchewan and Estevan. She works with Shell. “It’s just been wonderful,” she said. Adams worked here way up through several levels of the organization, including most of the positions in the executive. “What I’m seeing here today is an outstanding group of 51 women and one man representing Region 7, that have come together today. It’s a culmination of our event this week to hold the business meeting. We’ve elected the 2012 region director for Region 7.” That person is from Denver, which will host the next region meeting. Desk and Derrick clubs are active in two prov-

inces and 20 states. “This organization has been around for 60 years. It started in New Orleans in 1949, and it has grown tremendously. In the 1960s and 1970s, it had over 12,000 members at one point, but that has since declined to about 2,000 members. “It’s been very hard to recruit,” Adams said. “We are an energy education group. We are here to educate our members and the general public. We start with children 6, 7 , 8-year-olds, and talk to them about where power comes from, where oil comes from, what do you do with it, how do you handle it and the importance of it.” “We have speakers come in and talk to us about the various aspects of the energy industry, so we can be better educated and go back to our jobs and be better employees. Our motto says, “Greater knowledge, better service.” The networking can help from everything from ﬁnding speakers to help with computer software to ﬁnding the best cookies for the landmen to take out.

From left, Lynne Dunstan, Judi Adams and Barb Schaefer were part of the Region 7 Desk and Derrick meetings in Estevan in early May. Dunstan is from Leduc, while president-elect Adams is from Houston. Schaefer is from Estevan.

Over 50 people attended the Region 7 Desk and Derrick meetings in Estevan.

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B22

PIPELINE NEWS June 2011

This pumpjack near Forget was surrounded by water on May 5. Crescent Point planned for a three month break-up, and it looks like they were on the money. Photo by Brian Zinchuk

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Crescent Point sees record cash Àow (Nickle’s Daily Oil Bulletin) Crescent Point Energy Corp. increased cash flow by 45 per cent in the first quarter and grew production by 15 per cent, exceeding expectations. Cash flow for the three months ended March 31, 2011 soared to a record $296.53 million ($1.10 per diluted share) from $204.08 million (96 cents per share) in the comparable 2010 quarter. The net loss of $102.22 million (38 cents per share) for the period includes unrealized net derivative losses of $194.9 million and compares to a profit of $38 million (18 cents per share) in 2010 which included unrealized derivative gains of $12.3 million. Crescent Point produced an average of 75,574 bbls of oil equivalent in the quarter, 90 per cent weighted to light and medium crude oil, up from 56,061 boe per day in the first quarter of 2010. Year-to-date benchmark oil prices have surpassed guidance expectations. Differentials for Canadian crude streams were wider than expected in first quarter, partially offsetting higher benchmark oil prices. However, differentials in the second quarter have tightened considerably, with southeast Saskatchewan light crude oil trading at a premium to WTI. If prices continue above guidance, Crescent Point said it will consider increasing its 2011 capital expenditures budget, which is currently set at $800 million, to accelerate projects including drilling, land and facilities in its core areas. In the first quarter, the company spent a record $247.6 million on drilling and completions, drilling 146 (111.5 net) wells with a 100 per cent success rate. It spent an additional $73.8 million on land and facilities. In first quarter, Crescent Point participated in the drilling of 98 (81.9 net) oil wells in southeast Saskatchewan and Manitoba, achieving a 100 per cent success rate. Of the wells drilled, 84 (75.7 net) were horizontal wells in the Bakken light oil resource play. The majority of the Bakken wells drilled in the quarter were completed using cemented liner fracture stimulations, while the remainder were completed using mechanical packer fracture stimulations. ɸ Page B23

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PIPELINE NEWS June 2011

B23

View¿eld waterÀood exceeds expectations ɺ Page B22 Production performance from water injection patterns in the Viewfield Bakken resource play continues to exceed expectations and has demonstrated the applicability of waterflood to the play. During the quarter, Crescent Point converted an additional six horizontal Bakken wells to water injection wells. Approximately 400 boe per day of Bakken production was shut in to facilitate the conversions. Water injection into three of the injection wells began during the quarter, with the remaining three expected to start in second quarter following spring break-up. The company expects to convert an additional 19 wells during the remainder of this year for a total of 36 Bakken water injection wells by year-end. Based on promising results from more than 2 ½ years of production in the company's first Bakken waterflood pilot, Crescent Point believes that waterflood implementation could increase ultimate recovery factors to greater than 30 per cent from an expected 19 per cent on primary recovery. Crescent Point continued construction to expand compression and processing at the Viewfield gas plant in the quarter. The project is expected to raise inlet capacity to 30 mmcf per day from 21 mmcf per day and is on track to be completed by the fourth quarter. In addition, the company began construction of an additional 100,000 bbls of field storage capacity to increase operational flexibility that should be operational in the third quarter. Crescent Point also participated in the drilling of 14 (6.2 net) conventional horizontal oil wells in southeast Saskatchewan, of which four

Year-to-date benchmark oil prices have surpassed guidance expectations. Differentials for Canadian crude streams were wider than expected in first quarter, partially offsetting higher benchmark oil prices. However, differentials in the second quarter have tightened considerably, with southeast Saskatchewan light crude oil trading at a premium to WTI. (four net) were operated. Of the wells drilled, three (0.6 net) were in Manitoba, along the Saskatchewan border, and one (one net) was in the Viewfield Frobisher zone. With higher than normal precipitation levels in southeast Saskatchewan during most of 2010 and into 2011, Crescent Point budgeted for a more severe spring break-up period than in previous years (three months as opposed to its traditional budget of six weeks). To mitigate the impact, it planned for and executed a number of projects in first quarter. Several pipeline crews were added to tie in additional wells and reduce the impact of road bans. In all, the company completed the construction of 122 kilometres of pipeline-gathering systems in the Viewfield Bakken area, tying in approximately 75 oil wells. In preparation for the severe weather conditions, the company installed rig matting on particularly soft access roads to enable continued trucking of oil emulsion fluid and added several roadside pipeline tie-in points to provide additional access to singlewell batteries. It also added oil storage tanks and contracted additional service rigs to ensure the maximum number of tied-in wells were online prior to

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break-up, adding approximately $8.1 million ($1.19 per boe) to operating costs during the quarter. Crescent Point plans to spend approximately 62 per cent of its 2011 capital program, an investment of nearly $500 million, in the Viewﬁeld Bakken resource play, drilling approximately 200 net wells and expanding its existing gas- and ﬂuid-handling capabilities. In southwest Saskatchewan, the company participated in the drilling

of 25 (22.6 net) Lower Shaunavon horizontal oil wells, 10 (2.6 net) Upper Shaunavon horizontal oil wells and one (0.2 net) non-operated oil well, achieving a 100 per cent success rate. Recent company and competitor drilling has proven up a connection between the north and south pods of the Lower Shaunavon ﬁeld. In addition, continued drilling of the Upper Shaunavon has increased Crescent Point's internal estimate of discovered petroleum initially in place to more than 700 million bbls in place on company interest lands from an estimated 350 million bbls in place. Crescent Point plans to drill up to 36 (nine net) Upper Shaunavon wells in 2011, of which seven (seven net) are operated. As part of its focus on adding infrastructure in the Shaunavon area this year, the company completed the construction of 39 kilometres of pipelinegathering systems and tied in approximately 65 oil wells. ɸ Page B24

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PIPELINE NEWS June 2011

Extended stay With up to 600 workers needed for the SaskPower Boundary Dam Unit 3 project at its peak, plus the spinoff enhanced oil recovery project and, at some point, a truck bypass project, all anticipated over the next several years, every bed in Estevan is going to be needed. The Suburban Extended Stay Hotel in Estevan is nearing completion, and will likely see brisk business. Photo by Brian Zinchuk

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If prices stay high, capital budget may expand ɺ Page B23 The company expects to drill 44 net wells in the Shaunavon area in 2011. In total, approximately 16 per cent of this year's capital budget is allocated to

the area and it expects to signiﬁcantly increase drilling and production next year following the completion of this year's infrastructure projects. In Alberta, seven (3.5 net) oil wells were drilled in the ﬁrst quar-

ter, including one net well in an unconventional zone. Crescent Point expects to spend $31 million in southern Alberta in 2011, drilling 14 net wells. South of the border, the company partici-

pated in the drilling of five (0.7 net) successful non-operated Bakken wells in North Dakota where it plans to drill up to five net wells this year. Crescent Point has also initiated negotiations to open an office in Denver, Colorado, to co-ordinate expansion of its presence in North Dakota and Montana. Crescent Point has ordered equipment and begun preliminary site preparation to build a six mmcf per day gas plant in the Shaunavon area. The plant, which is designed to be expandable to 12 mmcf per day, is expected to be operational before the end of this year. The company is currently injecting water into three horizontal injection wells in three pressure maintenance programs in the Lower Shaunavon and plans to convert up to three more wells in a fourth program this year. Oil and fluid production in offset wells has reacted favourably to water injection in the first program. As injection in the second and third programs began in late 2010, Crescent Point does not anticipate seeing response until later in 2011. These programs are expected to provide pressure support in the field and may provide insight into the longterm applicability of waterflood to the field.

PIPELINE NEWS June 2011

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CCS acquires Arcola disposal facility Arcola - Calgary-based CCS Midstream Services recently acquired the T-45 Bakken Salt Water Disposal Facility located near Arcola, Saskatchewan. Initially, CCS said it will operate the facility as usual, with plans to develop a sophisticated treatment, recovery and disposal facility (TRD) serving the upstream petroleum industry. Recognizing a shortage of disposal facilities for southeast Saskatchewan oil producers, a local group led by Terry Johnston established the facility in 2009. The facility is licensed by the Saskatchewan Ministry of Energy and Resources, and currently accepts produced water and frac water, which is used to fracture the well bore after drilling. CCS’ planned expansion for the facility will mean that it can accept the full range of upstream oilﬁeld waste, including ﬂuids with high solids content. CCS was selected among several candidates to by the facility. “We hand-picked CCS for their business reputation, and their reputation as good corporate citizens,” said Johnston.

With that, CCS is donating $15,000 to the Arcola Community Health Clinic to help build two additional offices for doctors who serve the local population. With its network of over 50 facilities in Western Canada, this acquisition is considered a good fit for CCS, providing waste management services to clients operating in the Bakken play. CCS’ Saskatchewan Industrial landfill, located in the RM of Lomond, near Colgate, will share a mutually beneficial relationship with the Arcola plant – the plant will have a home for its produced solids, and the landfill will have a home for its leachate. Last summer when Pipeline News visited the Lamond facility, they noted they were shipping leachate by truck to northwest Saskatchewan. Johnston said on May 18, “We got an offer we just couldn’t refuse.” They had received lots of offers before, but most weren’t serious offers. “They were willing to pay what I wanted, so the deal was done.” In February Pipeline News profiled T-45. At the

Terry Johnston

time, Johnston spoke of plans to add a second facility, south of Stoughton which would target the Deadwood formation via an existing well. “We re-entered it and deepened it. It looked quite promising,” he said. The new well was part of the package CCS acquired, and Johnston has signed a non-compete agreement. “Timing is everything and it came together nicely. We just ﬁnished the Stoughton re-entry,” he said. T45 got its start from drilling a Bakken well that didn’t turn out nearly as well as they had hoped. Now, they might be looking at more drilling in the future. “We are going to look at more opportunities,” Johnston said.

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PIPELINE NEWS June 2011

Saskatchewan renews EnerGuide for Houses Regina - The Saskatchewan EnerGuide for Houses Program has been renewed by the government of Saskatchewan to continue encouraging Saskatchewan homeown-

ers to make energy eﬃcient home upgrades at a more aﬀordable cost. SaskEnergy will continue to administer the government-funded program by providing grants

to qualifying homeowners up to a maximum of $5,000 and subsidizing pre-retroﬁt and post-retroﬁt evaluations. “Our government is committed to energy

conservation and we want to continue oﬀering a program that works for Saskatchewan people.” Minister responsible for SaskEnergy Dustin Duncan said. “I’m encouraged

that over 38,000 homeowners have used this program and removed over 112,000 greenhouse gas emissions from our environment. That is the equivalent of taking over

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20,000 cars off the road.” The EnerGuide program was set to expire on March 31st, but with an uptake by Saskatchewan homeowners that reached the highest per capita participation rate of all provinces and territories in Canada, the popular program has since been renewed until October 31, 2013. Grants provided through the EnerGuide Program are linked to beneficial economic spinoffs for Saskatchewan distributors, retailers and contractors that sell and install the energy efficient products. Natural Resources Canada studies indicate, on average, with every provincial dollar invested into home retrofit programs, a homeowner invests another $7 to $10 dollars in upgrades. “Renewing the EnerGuide Program really offers a win-win scenario for everyone involved,” Regina-based Arrow Plumbing & Heating Dave Carruthers said. “Homeowners will continue to receive financial incentives to make energy-efficient improvements, and the investments they make support businesses, like plumbing and heating contractors, and the job opportunities we create for Saskatchewan people.” The estimated annual cost of the EnerGuide Program grants are expected to be between $4 million and $8 million. The continuation of the program could potentially reduce greenhouse gas emissions in the province by up to 34,000 tonnes over that time period.

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PIPELINE NEWS June 2011

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Zargon boosts oil-focused budget (Nickle’s Daily Oil Bulletin) Zargon Oil & Gas Ltd saw production dip five per cent in the first quarter as a result of lower natural gas volumes in the period. Hedging losses of $3.1 million contributed to a net loss in the first quarter, while revenue was slightly lower than in last year’s period, partly due to natural gas prices that were 26 per cent lower in the quarter. Zargon’s oil and natural gas liquids (NGL) volumes rose six per cent in the first quarter, to 5,893 boepd from 5,554 boepd, while gas volumes fell 19 per cent. Declining gas production reflects the company’s shift to oil exploitation, as well as naturally-occurring production declines, management said. Zargon reported an active, oil-focused winter horizontal drilling program in the Williston Basin and in the company’s Alberta Plains South core areas. The junior increased its oil and liquids weighting in the quarter, to 62 per cent, from 55 per cent previously.

Reflecting active winter drilling, completions and tie-ins, Zargon’s first-quarter capital spending reached $22.25 million, a 29 and 53 per cent increase from the respective fourth-quarter, and firstquarter, 2010 periods. During this year’s quarter, the company drilled eight (7.5 net oil) wells, including four horizontal, oil exploitation wells (Steelman, Elswick and Manor) in the Williston Basin core area, three Taber horizontal wells in the Alberta Plains South core area and a Hamilton Lake horizontal in the Alberta Plains North core area. Zargon also closed property dispositions during the quarter that totaled $1.94 million. Further increases in oil volumes are expected this year, as the company continues to direct virtually all capital spending to oil exploitation, which offers stronger returns than gas-focused projects. Management is raising the capital budget by $10 million, to $65 million, following the company’s recent equity issue. The company will conduct

continuous oil exploitation drilling in each of its core areas. After spring break-up, a horizontal drilling rig in the Williston Basin is scheduled to drill three Elswick locations, then drill four wells at Weyburn before returning to Steelman, Saskatchewan later in the year. In Alberta, a second rig is set to drill four Glauconite oil exploitation wells at Killam and three horizontal oil exploitation wells at Taber. The rig will then move to Hamilton Lake to follow up on a Viking reservoir optimization project where one horizontal well has been drilled and production testing will begin once surface access is available. Zargon also plans two more horizontal drainage wells at Hamilton Lake before year-end. Also in Alberta, after spring break-up, a total of seven vertical oil exploitation, step-out wells will be drilled in the Bellshill Lake and Grand Forks properties, management said.

Solara to drill up to 10 wells in 2011 Calgary – Solara Exploration Ltd., a Calgary-based junior oil and gas company, plans to drill up to 10 wells on various operated oil projects situated in Alberta during the balance of 2011. The company has a net capital spending program of approximately $11 million to be funded from discretionary cash flow, proceeds from the sale of non-strategic assets and available operating lines. Solara may also undertake equity financings if its capital expenditure program is expanded as a result of drilling success on its budgeted projects. The spending plans come with the release of the company’s end-year financial results for 2010 reported on May 3. At Pembina Buck Lake, Solara plans to operate and participate in the drilling of four Cardium horizontal wells to follow up on its drilling successes in 2010 the first quarter of 2011. In 2010, the company operated the drilling and completion of three horizontal wells into the Cardium formation in the Buck Lake area. The three Cardium wells had test rates which were some of the highest initial rates for similar horizontal oil wells drilled in the Pembina area since 2008. One of the wells was placed on production in late November 2010 with the remaining two wells commencing

production in February 2011. Solara participated in a fourth well in March which has been drilled and completed, and is awaiting stimulation operations scheduled for June. Solara controls a 40 per cent working interest in two of the proposed new horizontal wells and a 26.7 per cent working interest in the remaining two horizontal wells to be drilled in 2011. Solara plans to drill an additional two horizontal wells on its Dewberry heavy oil project 100 per cent working interest lands located in eastern Alberta to evaluate both the Sparky and Dina formations. Solara also plans to drill up to two additional vertical wells on the project prior to yearend. The company has plans to drill two conventional vertical wells at its new heavy oil pool discovery located at Borradaile in eastern Alberta at a 100 per cent working interest level. There are also plans to drill a conventional vertical well to evaluate the oil potential of the McLaren formation at Rivercourse located in

eastern Alberta. Solara’s capital expenditure program is designed to further optimize its oil projects with 14 wells drilled in 2010 and a 100 per cent drilling success rate. Including produced oil and gas volumes for 2010, the company al-

most doubled its proved plus probable oil and gas reserves, adding approximately one million barrels of oil equivalent. Daily oil and gas production increased by 83 per cent for the fourth quarter 2010 compared to the prior period in 2009.

• SALES

As part of its ongoing asset rationalization program, the company sold a non-strategic asset in March 2011 for $4.1 million which materially reduced its bank debt. It also has pending asset dispositions totalling $1.4 million scheduled to close within the

next few weeks. As a result of its significantly enhanced cash flow from higher oil and gas production levels in the first quarter 2011, Solara is up to date with all of its financial obligations and has unutilized operating lines at its disposal.

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B28

PIPELINE NEWS June 2011

Codie Rouse of Rouse Industries Inc., a sister company to Southern Industrial and Truck, runs a Rouse MPD (Mud Pump Drive) 2.1 through its paces on the test bench. The twospeed planetary transmission will be paired with a 30-litre Cummins engine which was being prepared in the adjacent shop. Rouse Industries is based in Weyburn. Photos by Brian Zinchuk

Southern Industrial Southern Industrial and Truck Field technician Steve Tidy works on a relatively rare 30-litre Cummins diesel engine to be used for a 1,300 horsepower mud pump. The engine puts out 1350 horsepower. Weyburn’s Southern Industrial and Truck builds engine packages for drilling rigs as one of its ventures.

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PIPELINE NEWS June 2011

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Canadian Energy Services results boosted by drilling Àuid segment (Nickle’s Daily Oil Bulletin) Led by its drilling ﬂuids segment, Canadian Energy Services & Technology Corp. reported an increase in activity and revenue across all its segments in the ﬁrst

quarter. The company attributed the first quarter significant gains in its drilling fluids segment to increased industry activity, completion and integration of two accretive

acquisitions in the United States and a continuing industry trend to drill more complex, horizontal wells. “Q1 2011 was a very successful quarter for CES, and each of our

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business units made significant contributions to the results achieved,” Tom Simons, president and chief executive officer, said in a new release. Cash flow for the three months ended March 31, 2011 doubled to $18.77 million ($1.01 per diluted share) from $9.33 million (69 cents per share) in the comparable 2010 period. CES generated gross revenue of $111.5 million during the first quarter of 2011, compared to $49 million for the 2010 period, an increase of $62.5 million on a year-overyear basis. Drilling fluids related revenue from products and services in West-

ern Canada was up 34 per cent to $45.1 million from $33.7 million the previous year while revenue generated in the United States from drilling ﬂuid sales of products and services, gross of intercompany eliminations, was $55.1 million compared to $7.5 million the previous year. The signiﬁcant yearover-year increase in the company's U.S. results was due to the inclusion of Fluids Management activity which was acquired at the end of the second quarter of last year and the organic growth achieved from the Champion Drilling Fluids and Fluids Management divisions subsequent to their

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respective acquisitions. EQUAL Transport's trucking revenue for the three month period ended March 31, 2011, gross of intercompany eliminations, totalled $5.8 million, up 45 per cent from $4 million in 2010, due primarily to the increased industry activity in Edson and the continued expansion of the company's trucking operations in Saskatchewan. The Clear Environmental Solutions division generated $5.6 million of revenue versus $4 million during the prior year. Year-over-year, the Clear Environmental division has seen higher overall activity levels and continues to benefit from increased integration with the drilling fluids division, from diversification strategies into oilsands and horizontal drilling, and general improvement in industry activity levels. The gross margin for the period was $32.6 million or 29 per cent of revenue, compared to gross margin of $14.7 million or 30 per cent of revenue generated in the same period last year which is consistent to the prior year comparison on a percentage basis. CES recorded net income of $11.8 million (64 cents per share) for the three month period compared to net income of $18.5 million ($1.37 per share) in the prior year. As a part of the corporate conversion transaction completed by CES in January 2010, it acquired Canadian tax shelter in the form of non-capital and capital loss pools. As a result of the transition to International Financial Reporting Standards, the calculated full future benefit of the acquired noncapital losses has been recorded in the first quarter 2010 comparative period and the resulting increase to net income has been credited to retained earnings in that quarter. This accounting under IFRS has significantly altered the first quarter 2010 comparative figures with respect to net income and earnings per share calculations as a result of an increase to net income of $10.9 million.

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PIPELINE NEWS June 2011

Apprenticeship program receives industry support Regina - More youth apprentices will beneﬁt from the Saskatchewan Youth Apprenticeship (SYA) Industry Scholarship Program thanks to the generous support of 17 industry organizations who have provided funding totalling $350,000.

Fifteen companies that have each contributed $10,000 to the scholarship program include: • Allan Construction • Alliance Energy Ltd. • Christie Mechanical Ltd. • General Contractors Association of Sask.

• GESCAN Division of Sonepar Canada Inc. • Merit Contractors Association Inc. • Peak Mechanical Partnership • Prince Albert Construction Association • RNF Ventures Ltd. • Saskatchewan Construction Association

• Saskatchewan Provincial Building & Construction Trades Council • Sheet Metal Workers Local 296 Saskatchewan • Sun Electric (1975) Ltd. • Wallace Construction Specialties Ltd. • Westridge Construction Ltd.

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As well, two companies have each contributed $100,000: • EECOL Electric • PCL Construction Management Inc. “Saskatchewan has a growing need for tradespersons,” Minister responsible for the Saskatchewan Apprenticeship and Trade Certification Commission Rob Norris said. “Thanks to the investments made by these industry organizations, the Saskatchewan Youth Apprenticeship Industry Scholarship Program will help attract high school students into apprenticeships, helping them build careers and stay in Saskatchewan.” The scholarship was initiated by industry partners and the Saskatchewan Apprenticeship and Trade Certification Commission (SATCC) to profile skilled trades as first choice careers for high school graduates. It provides 40, $1,000 scholarships each June to eligible high school graduates who have completed the SYA program. “The SATCC is thrilled with the success of the Saskatchewan Youth Apprenticeship (SYA) Industry Scholarship Program, supported

by industry partners and the SATCC,” SATCC board chair Garry Kot said. “The scholarship fund is a way for industry to give back to apprenticeship training and trade certification. It is essential that we encourage Saskatchewan youth to become more aware of the wonderful career opportunities in the skilled trades. These scholarships mirror the great support and success we've already experienced with the SYA Program.” “Our member companies know the importance of attracting skilled labour to move our industry and our province forward,” Saskatchewan Construction Association executive director Michael Fougere said. "Providing scholarships to our youth is an important tool in the tool box that will help attract youth into the construction trades where there are solid and rewarding careers.” The SYA Program allows high school students to explore career opportunities in the skilled trades by providing awareness, research and hands-on experience. Interest in the SYA Program continues to grow since it was first offered province-wide in the 2006-07 school year. As of March 31, 2011, 249 schools were registered in the SYA Program, with 4,510 students participating (approximately 2,600 females and 1,910 males). Since the program's inception, 8,441 students in Grades 10-12 have registered and a total of 2,505 graduates have received certificates. Of these, 291 have registered as Saskatchewan apprentices. Seven former SYA participants have achieved journeyperson status. Employers and industry associations interested in contributing to the SYA Industry Scholarship Program are encouraged to contact the SATCC at 1-877363-0536.

PIPELINE NEWS June 2011

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PIPELINE NEWS June 2011

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

C-Section June 2011

Cancer convoy grows in scope By Geoﬀ Lee Lloydminster – Heavy oil trucks will be leaning on the horn in a new and improved charity truck convoy that hopes to raise more than $20,000 for cancer. The event goes ahead on July 23 under the direction of Tom Jack, also known as Trucker Tom, from Tom Jack Trucking. “We have already had a big response from the oilpatch. There are diﬀerent companies already stepping up,” said Jack who hauls oil, water and condensate for W-K Trucking Inc. in Mundare. More than 50 semi trucks are expected to register for the fundraising ride from Vermilion to Lloydminster under a new name, Tony’s Con-

voy for Hope – Pulling to Fight Cancer. Jack, and his wife, Janice King, chose the

name to honour Jack’s brother-in-law, Tony Rossi, who died of cancer just weeks after the

family members to cancer, and he is the latest.” Jack noted Rossi died in Toronto at age

“We do it because of our family members and our story,” said Jack, who says the experience

T Tom Jack and his wife Janice King hold up a new poster for Tony’s Convoy ffor Hope – Pulling to Fight Cancer event on July 23 in honour of Jack’s brother in-law, Tony Rossi. Rossi died from cancer last September following the initial Convoy for a Cure fundraiser in 2010.

Tony’s Convoy for Hope is dedicated to Tony Rossi of Toronto. Rossi was the brother in-law of event organizer Tom Jack. Rossi died last year of cancer shortly after Jack organized the initial truckers’ Convoy for Hope that raised about $17,000 for the Cross Cancer Institute in Edmonton. Photo submitted

i initial Convoy for the Cure raised more than $17,000 for the Cross Cancer Institute in Edmonton. “Tony was the latest in our family to pass from cancer,” said Jack. “We are honouring him. We have lost quite a few

53 on Sept. 4 after viewing videos of the convoy. He also called Jack at the start of the convoy to let him know he had planned a surprise appearance in Vermilion, but his health wouldn’t permit him to make the trip out West.

last year was very moving. “Everybody comes out not just for our story, but we give them a place to honour their family member or a friend who has battled cancer. Everybody has their own face on can-

cer. “You get big awareness with a lot of big trucks rolling down the highway.” Last year, 35 trucks took part in the convoy with little advance marketing, but Jack began spreading the word about Tony’s Convoy Hope back in January. “I work in the patch. I haul oil and I’ve done that for 17 years,” said Jack, who says he is marketing it to every operator and trucker he knows. “We have posters this year that are going out. Oil companies are taking posters, and lease operators are putting them up in their shacks and telling everybody about it,” he said. “It’s easy to market it this year because everybody knows about it. We never stop talking about it. We are very passionate about this event. “We are selling shirts and oil companies are buying shirts and making donations.” T-shirts sell for $20 apiece and sport the new event logo printed free of charge by Focused Screen Printing that Jack says contacted him to help out the cause. “All the money we raise goes to the Cross Cancer Institute in Edmonton and stays in Edmonton,” he said. “We were very proud that we did the whole event last year with zero expenses. That’s how we plan to keep it. If we raise a dollar, they get a dollar.” ɸ Page C2

PIPELINE NEWS June 2011

Public can ride along, too ɺ Page C1 Jack recently traded in his blue 2000 Western Star truck in a favour of a newer, bright red 2006 Western Star that will lead the convoy like Rudolph does for Santa’s sleigh. “With red, we will get noticed a mile away,” he said. “The old truck had 2.3 million kilometres. I have done 17 years of trucking and over a million of safe miles. It was time to get something newer and keep on trucking.” Truckers can register for the event online at www. tonysconvoyforhope.com and receive a pledge sheet and a truck sign from the Alberta Cancer Foundation that endorses the fundraiser. This year’s convoy will begin at the Highway 16 truck weigh scale in Vermilion at 9:30 a.m. and will take a new route at the ﬁrst exit to Vermilion through town before driving over the Highway 41 overpass and looping back east to Lloydminster. “This year we are trying to get Vermilion involved,” said Jack. “We are hoping companies in Vermilion will get their trucks out and businesses will donate items.” The convoy will end at the Lloydminster Exhibition Grounds for a family day from 10 a.m. to 4 p.m. that will include a live silent auction and a barbecue to raise additional funds. “This year we are doing a lot more to attract the public,” said Jack. “Gibson Energy has donated a driver simulator truck and prizes will be awarded for the top three decorated trucks in the convoy. “We also have bounce castles and sumo suits from All About Bouncing for the kids, along with glitter tattoos by Kenneth Blair Hair Salon. Balloons for all kids will be donated by Action Towing. The public can also ride along with the convoy on a Tibear Coaches bus by making a $10 donation for a seat. Individuals can write a dedication on the side of the bus with a $5 contribution to the Convoy for Hope Campaign.

Tom Jack, who is also known as Trucker Tom, drove this blue truck to lead off last year’s convoy that raised more than $17,000 for the Cross Cancer Institute in Edmonton. This year, Jack has a newer red truck that will lead off a convoy of about 50 trucks with a fundraising goal of $20,000.

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Drill stats up but need interpreting “That’s that new technology. Crescent Point is down there doing really well. They are doing new drills – directional with multi-

stage fracking, and they are having great successes.” Salkeld says that it’s safe to say the Bakken is becoming a proving

ground for new light oil drilling techniques and technology that will result in fewer wells being drilled. ɸ Page C5

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Drilling activity is forecast to grow everywhere in Western Canada except gas-heavy BC for the rest of 2011. New drilling methods and technology are requiring fewer wells to be drilled in order to maintain productivity however. Photo submitted

Calgary – Petroleum Services Association of Canada (PSAC) president Mark Salkeld is over the moon by his organization’s latest revised upward forecast of 12,950 wells to be drilled in Canada in 2011. The new forecast released by PSAC on April 27 represents a 5.7 increase from its original forecast of 12,250 wells published in November 2010. A preliminary revision on Jan. 31 raised the original forecast bar to 12,750 wells to be drilled in Canada in 2011. “We’ve gone from optimistic to ‘full on’ optimistic,” said Salkeld with the latest revision. “It’s looking really good out there. “We boosted our numbers by over 700 wells over our original forecast at the beginning of the year.” The only dark cloud is a continuing decline in the number of productive natural gas wells. The PSAC forecast is based on an average price of CDN $3.85/ mcf for natural gas for the year and a crude oil price average of $100

per barrel. The outlook for oil drilling in Western Canada is better than the statistics reveal given the fact new drilling methods and technology are reducing the number of new wells drilled while sustaining productivity. “One of the things that’s fundamentally changed as you know is the horizontal and directional drilling,” said Salkeld. “We are still forecasting more wells but there might not be as many because this new technology takes longer and they are more complex to complete the wells. “At the end of the day, they are on the wells longer and they get better production. They are getting better initial production rates anyway.” PSAC forecasts the greatest increase in well counts to take place in Manitoba with a forecasted increase of 13 per cent over 2010 numbers. Saskatchewan is only slightly trailing with an 11 per cent forecasted increase to 3,043 wells.

“The Bakken is the hot number for them,” said Salkeld. “They’ve come a long way. They are doing really well. “They have opened their doors to industry and are working well with industry, and there’s beneﬁts in that.

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Saskatchewan activity jumps 24% ɺ Page C3 “Saskatchewan is laying claim to being one of the front runners with supporting the new technology and having good successes,” said Salkeld. “New technology is opening it up. “Horizontal drilling has been around for a long time, but what it is in this multi-stage fracking, and the ability to get it in there and drill a horizontal or a lateral section into a known formation and be able to precisely fracture the formation to get those better production rates. That’s the key,” said Salkeld. Alberta boasts a healthy forecasted increase of 7.5 per cent to 8,732 wells drilled (rig released) while gas heavy BC is projected to experience a 15 per cent decline to 554 wells from the previous year’s 649 wells. “That type of gas in the Horn River is a dry gas for the most part,” said Salkeld. “It’s an onerous area for infrastructure (NE BC). They are still working up there – it’s just not as aggressively if gas prices were higher.”

“

Saskatchewan is laying claim to being one of the front runners with supporting the new technology and having good successes.

new technology. That’s a really good indicator. “They are building rigs to suit and redesigning and refitting existing rigs.” Salkeld says last winter they were “going full on” and still had 100 rigs that weren’t send out. “Part of that was labour and part of that was the rigs weren’t suited for the plays they were going after now,” he said. “All the equipment that’s available to the best of my knowledge in the industry at this point in time is booked. It’s ready to go. “We are going to suffer a little bit due to a little bit longer break-up due to the weather. “Once we get past that, then everything that can work is booked to go to work. That’s really good.” Asked where slant rigs commonly used in the Lloydminster area fit into the picture, Salkeld says those are for those producers going after the shallower formations. “The convention rigs that drill down vertically and drill on an angle need a whole bunch of space in order to do that,” he said. “A slant rig pretty much goes at an angle from surface. They definitely have their place in the new technology used as well.”

”

-Petroleum Services Association of Canada (PSAC) president Mark Salkeld According to a report by the Canadian Association of Drilling Engineers (CADE), every Western Canadian province except British Columbia saw a surge in drilling activity in the first quarter of 2011. There was an average of 589 drilling rigs were at work over the first three months of 2011, 24 per cent more than last year's 474 active rigs. That was most since the first quarter of 2006 when 718 rigs were busy. CADE reports activity in Saskatchewan jumped 24 per cent from last year to an average of 84 rigs at work while operators in Manitoba kept 15 rigs employed, up five rigs (or 50 per cent) from last year. “The industry is really healthy and it’s picking back up again. New rigs are getting built and rigs are getting refurbished and rebuilt to accommodate the

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PIPELINE NEWS June 2011

Clock ticking for Bonnyville oil show Â&#x201E; By Geoff Lee Bonnyville â&#x20AC;&#x201C; There will be no rehearsal for the Bonnyville & District Oil and Gas show June 22-23, but organizers from the Bonnyville & District Chamber of Commerce are as calm as

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ing our push on now for getting the preregistrations for free admission.â&#x20AC;? A media campaign is under way to encourage the public to register online before the May 31 deadline for free admission to the show.

STARS air ambulance will land a helicopter near the entrance to the Centennial Centre in Bonnyville during the oil and gas show June 22-23. Gate proceeds from paid admission will be donated to STARS which serves the oilpatch from various points in Western Canada.

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PIPELINE NEWS June 2011

Display focus on oil and gas, others welcome to visit ɺ Page C6 “It is also an opportunity to put the spotlight on Bonnyville and district, and highlight the area as a great place for businesses to set up a new shop.” New registrations are coming in every day and organizers have had to turn down some potential exhibitors that don’t fit the oil and gas profile the show aims to attract. “We want the feel of the show to be strictly oil and gas, so we are saying no to quite a few companies because it doesn’t fit what we want the show to feel like and look like,” said Robyn Ducharme, chair of the show and vice-president of the chamber. “We are inviting anybody who is kind of on that grey line that may not get a booth to come on down, get their free tickets and network. “There is no reason why companies that do business with oil and gas companies can’t come down and network even if they don’t have a booth. “In the end we have to keep the integrity of the show. We don’t want it to turn in a regular trade show at all. This is an oil and gas show.” The show will include inter-active displays, oil and gas company exhibitors; networking events; and education sessions with a line-up of industry speakers to be announced. All but two minor event sponsorships were sold before May, and organizers have printed 2,500 programs with expected attendance figures up in the air. “We are hoping for at least 1,000, but with the first show we don’t know what really to expect,” said Oliver. “We have ordered enough programs for 2,500 including the exhibitors and the sponsors. We are trying to push it and get the word out there. “We anticipate pre-registrations for admissions are going to pick up because we started a radio campaign for that and we have some paper advertising as well. “We just want to thank everyone for their support and hopefully everyone will come out for the show.” The show kicks off the evening of June 21 with a barbecue meet and greet for exhibitors and event sponsors hosted by Osum Oil Sands Corp. at the Shaw Centre at Moose Lake.

Cenovus Energy is one of the event sponsors of the Bonnyville & District Oil and Gas show at the Centennial Centre in Bonnyville. The company also sponsors this hockey rink at the centre.

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Platinum crane demos wow students Story and photos by Geoff Lee Lloydminster – With smiles on their faces, the opportunity to work the controls of a P&H 50ton crane seemed like a joy ride for many students who took part in a demonstration offered. The tryouts were offered by Platinum PumpJack Services Corp. in Lloydminster during the Bi-Provincial Try-A-Trade Career Expo held at the Lloydminster Exhibition Grounds May 4. The event attracted approximately 1,900 students from Saskatchewan and Alberta area schools. Under the direction of the certified crane operator Brian Freeman and safety coordinator Jerry Cowan, students eagerly stepped up to accept Platinum’s challenge to learn how to pick up a weight, move it and lower it onto a targeted area. “We were asked by the event organizers if we would be willing to bring our equipment in and give the opportunity for some hands-on training to some of these students. It will be good for them,” said Cowan. “We are setting up a crane and a picker truck to teach people the operations of the crane and load handling, and do some hand signals with them. “We are going to let them sit in the cab with a certified operator, and we will let them run the controls. “We will have some people on the ground with another certified

The event featured a personal protective equipment relay by Husky Energy at the Dick Jones Pavilion and a presentation on what engineers do for a living by professional engineer Brent Gebhart from BAR Engineering. Cowan says the oil

and gas industry is always looking for ticketed crane operators and he says it’s a rewarding career to pursue. “It’s a pretty good trade for people to get involved with and get that ticket because there is a pile of work in this province (Alberta) for it.”

Platinum PumpJack Services Corp. safety coordinator Jerry Cowan uses hand signals to help students learn how to operate a crane safely.

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Tyson Perrin from Bishop Lloyd Middle School seems at home working the joysticks of a P&H 50-ton crane under the direction of certiÀed crane operator Brian Freeman from Platinum PumpJack Services Corp. Demos were offered to students at the Bi-Provincial Try-A-Trade Career Expo at the Lloydminster Exhibition Grounds May 4.

operator, myself, and teach them hand signals and how to pick a load up and set it in place. “It will give them a good understanding of what’s out there in the workplace when it comes to operating cranes and picker trucks.” Platinum was one of a handful of oil and gas companies on hand to introduce students and prospective employees about what the trades are all about.

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PIPELINE NEWS June 2011

Try-A-Trade a hub of youthful energy Doug Cleghorn, foreman of Universal Industries tank shop, talks to students about welding careers during the Bi-Provincial Try-A-Trade Career Expo in Lloydminster May 4. More than 2,100 students attended the event to learn about the trades.

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Lloydminster – Hey kids, wanna start a career as a skilled tradesperson? You can’t beat the pay and benefits and there’s no shortage of work. That was the gist of the sales pitch to the 2,100 students from schools in Alberta and Saskatchewan who bused to the second annual Bi-Provincial TryA-Trade Career Expo at the Lloydminster Exhibition Grounds May 4. “We are trying to gear students to everything that’s out there and give them an idea of what jobs there are, and what their future could be in the trades whether it be commercial, oilfield, or residential,” said Dorothy Carson, executive director of the Lloydminster Construction Association, who organized the event. “What we are trying to do is give students a little glance into what a tradesperson does. They can talk to the schools and the employers, and they can have a hands-on experience.” The Career Expo featured hands-on trade demos, presentations and information booths from colleges that teach trades including Lakeland College, Saskatchewan Institute of Applied Sciences and Technology (SIAST) and Northern Alberta Institute of Technology (NAIT), government trade organizations and companies looking for future employees. Kent Carriere, CEO of Metaltek Machining in Lloydminster, was hoping to excite as many high school students as he could to become machinists and offer them advice on career paths. “I think your best bet would be go see the apprenticeship guys at SIAST or NAIT and look in to the programs there,” he said. “They have a pre-employment program that will give you a good taste of everything you need and your first year of hours and schooling to a second year level. You carry on from that point forward.” SIAST offers a machine shop program at its Saskatoon and Regina campuses where program head Grant Paul welcomes curious young people with open arms. “We have a program at SIAST called “Spend a Day” or “CSI” which stands for come, see and investigate,” he said. “You come and hang out in our shop for a day or two and see what we do. If it is what you want to do, then you can register and take it from there.” SIAST offers a 34 week pre-employment certificate course equivalent to a second year apprentice with trade training time. “We teach them lathes, milling machines, CNC training, drafting training, all the hand tools training and everything a machinist would do up to a 4th level.” SIAST also offers up to eight weeks of Level 1 to Level 4 apprenticeship training in Saskatoon. Paul says there is no better time to be a machinist with the demand for jobs as high as it is. “Right now, you will never see an ad for a machinist because employers cannot get enough machinists. “We get phone calls at our school in Regina every day for more people, and we can’t supply them,” he said. “We are never out of a job and we can’t find enough people.” Metaltek has openings for machinists or pre-employment apprentices who want to work on either manually operated or computer operated machines. “Once you have your basics, you can come in to our shop,” said Carriere. ɸ Page C11

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PIPELINE NEWS June 2011

Chris McArthur from Lloydminster Composite High School took part in a Universal Industries mig welding demo at the Bi-Provincial Try-A-Trade Career Expo in Lloydminster May 4.

Investing time to ¿nd future pressure welders ɺ Page C10 “We have journeyman machinists that will teach you from that point forward. You can go in whatever direction you want.” Metaltek specializes in the machining of downhole oilfield tools, but machinists make every conceivable part in the world. Universal Industries is also looking for new welders in Lloydminster where they make pressure vessels and tanks for the oil and gas industry. Universal set up a mig welding demo booth at the Career Expo that attracted a steady lineup of students interested in a tryout. “We need to invest in our future to find our newest future pressure welders,” said Doug Cleghorn foreman of the tank shop. “We are doing actual welding here. We are hoping to get as many kids interest as possible. “We are always looking for welders whether it’s first year apprentices right up to journeymen and pressure welders,” Cleghorn said. Universal has over 130,000 square feet of combined shop space including a 40,000 sq. ft pressure vessel manufacturing facility and over 75,000 squarefeet of tank fabrication space.

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Grant Paul, head instructor of SIAST’s machine shop program offered in Saskatoon and Regina, Àelded questions from students at the Lloydminster Exhibition Grounds.

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PIPELINE NEWS June 2011

Shield Wireline data tied to balance sheets

This tubing plug gripped by Trevor Gilby is a well completion tool used by Shield Wireline’s slickline operators and managers. The company has been in business since 1983.

Lloydminster – Shield Wireline Ltd., a slickline and production testing company based in Lloydminster and Provost, can help oil and gas producers make key decisions by measuring gas pressure in reservoirs and the volume of gas reserves in place. “The two services work hand in hand,” said Trevor Gilby, company president. “Without knowing bottom hole pressures on a gas well, you really don’t get the whole picture of what is happening. “Our bottom hole pressure and temperature recorders really work well with our production testing to give the producer the whole picture of what is going on with their gas well. “The slickline division completes the bottom hole work while production testers are flowing gas to surface.” Shield Wireline has four slickline units that use non-electric cable for running and retrieving pressure and temperature recorders and other hardware such as plugs and downhole tools. The work is done without any real time data coming back to the surface as is the case with wireline cabling. Production testing is conducted from surface equipment to determine the size of the gas reservoir, the flow rate capabilities and the type of gas available. “It gives you an idea of the reserves that you can produce,” said Gilby. Shield Wireline has four trailer mounted production testing separators, one skid mounted separator and a skid mounted line heater. All testing equipment comes with a pressure recorder or a dry flow meter, a deadweight, methanol pumps and piping for normal operations. “We flow gas through a meter which measures the amount of gas that is produced from the gas well,” said Gilby. “If there is a pipeline nearby, we send it to the pipeline to preserve gas or we will send it to a flare if there are no facilities.” Gilby says slickline and production testing data are extremely important for the oil and gas companies they serve in Alberta and Saskatchewan in order for them to justify expenditures on pipelines. “Nobody wants to run a line to a gas well and find out they have no gas there,” he said. ɸ Page C13

PIPELINE NEWS June 2011

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Determining the economics of a well ɺ Page C12 “In order to give them a good base of information when it comes to gas volumes, it’s extremely important to have a reservoir analysis done. “What it will do is tell them what volume of gas they have there, so if they have to run a $500,000 line to a well, they will know if they have enough gas to pay for that line and make it economical to run it. “We provide the data to do the reservoir calculations.” Shield Wireline also operates Sona-Dyne Services that provides fluid level, dynamometer and surface gas migration testing for oil companies. Sona-Dyne repairs fluid level equipment and has echometer (acoustic) fluid level equipment for rent or purchase. “With Sona-Dyne we are helping people to optimize their oil well and confirming what sort of operating condition they have with their pumping,” said Gilby. Acoustic fluid level equipment measures how much fluid is in the annular space in the well bore. “It gives you an idea of how fast or how slow you should pump it, or if you are over-pumping it and pumping dry which is much more critical nowadays with the PC pump,” said Gilby. Sona-Dyne crews also operate dynamometer Slickline operators Jamie Bodnariuk, left and Carl Martel just Ànishing washing this unit for a phoequipment that measures the loading on a conventograph. The unit was driven up from Shield Wireline’s Provost ofÀce. tional pumpjack. The low price of gas led Shield Wireline to diversify into oil and find new growth opportunities with gas to oil ratio or GOR testing that measures the amount of gas that is produced with oil. “We are trying to diversify into more oil situations and try to come up with tools that are valuable to the oil producers,” said Gilby. “In a lot of cases that’s where our GOR services come into play. Companies are required to report their oil to gas ratio. “With some of the new ERCB regulations in Alberta, we are finding ourselves running a lot more pressure recorders on oil wells and performing more GOR tests. “The government wants companies to preserve as much gas as possible and use it where possible.” Shield Wireline collects all of their data in the field from their flow computer and a report is compiled for the client about what they found. “All of our information is passed on to the government as well,” said Gilby. “It’s not only good for the oil companies and the operating companies to know what they’ve got in place for reserves, it’s also good for the government to know what they’ve got in reserves in place.” Suite 2, 6209-44 Street, Lloydminster, AB T9V 1V8 s DISPATCH 780-808-3999 OFFICE 780-808-2994 FAX 780-808-6393

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PIPELINE NEWS June 2011

Safety | Reliability | Efficiency | Emission Reduction Inquire about complete CSA B149.3 Inspection and Certification Services The PHM is prebuilt, wired and includes: Burner Management System (BMS), Valve Train, Burner, Firebox, Flame Arrestor and are function tested to ensure quality and performance. Optional solar or low power operation requiring only 0.2 amp to run. Optional factory installed electric or glycol heat trace.

Process Heater Module

For DRY or WET fuel gas without freeze-off issues. Systems from 100,000 - 10,000,000 btu. All systems are designed to comply with CSA B149.3-10. Pre-Wired and Function Tested at our facility, to reduce installation costs.

Tank VRU Burner System

Reduce or eliminate tank venting and Àaring. Utilizing VRU to heat the process. For use on Tank VRU’s. Operates on two dissimilar btu value fuels w/o changing ori¿ce or air settings. Optional solar or low power operation requiring only 0.4 amp to run. Optional factory installed electric or glycol heat trace. For DRY or WET fuel gas without freeze-off issues. Systems from 750,000 - 10,000,000 btu. All systems are designed to comply with CSA B149.310. Pre-Wired and Function Tested at our facility, to reduce installation costs.

Come See Us At: ł GO-EXPO Calgary, June 7 - 9 ł Bonnyville Oil Show, June 22 & 23

Kenilworth Combustion Southeast SK to Northeast BC

Contact Heine Westergaard

The only PLUG & PLAY Burner System in the industry.

ONLINE www.kenilworth.ca MAIN OFFICE 1-780-744-3974

Pronghorn Controls in Southern Nomad Electric in Northern Alberta and Central Alberta 1-780-624-2447 Contact Stan Neu 1-780-744-3974 Contact Clint Ferriss 1-403-501-4895

CCR Combustion in East Central Alberta Contact Kevin Moan 1-780-872-0706

PIPELINE NEWS June 2011

City of Lloydminster workers were on hand to help mark National Day of Mourning ceremonies on April 28 to honour workers who died from injury or disease in the workplace. The event included a lowering of Áags at City Hall.

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Lloydminster Mayor Jeff Mulligan led off a local Áag lowering ceremony at City Hall to mark National Day of Mourning on April 28. The event commemorates workers who have died or who have been injured in the workplace. In 2010, 136 Alberta workers and 45 Saskatchewan workers died from workplace injury or disease.

National Day of Mourning Lloydminster Mayor Jeff Mulligan, centre, is Áanked by city CAO manager Glenn Carroll, left, and Lloydminster Chamber of Commerce president Kevin Lundell in a lowering of the Áags ceremony to remember workers who died or were injured in the workplace. The event took place at City Hall during National Day of Mourning on April 28.

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PIPELINE NEWS June 2011

ATCO Electric plugs into jobs expo

ATCO Electric’s Gerhard Schwarz is hoping to interest area students and adults into Àlling current and future vacancies as the construction of a new 62,000 sq. ft. building in Lloydminster continues. Schwarz manned a booth at the Bi-Provincial Try-A-Trade Career Expo at the Lloydminster Exhibition Grounds May 3-4.

Specialising in Oilfield & Industrial Exhaust Components and Systems

Lloydminster – ATCO Electric plugged into the Bi-Provincial Try-A-Trade Career Expo in Lloydminster May 3-4 hoping to supercharge the interest of youth and adults into working for the utility as construction of their new 62,000 square-foot building continues. “We are hoping to find some young people who are interested in joining ATCO Electric,” said Gerhard Schwarz customer service supervisor at the Lloydminster Exhibition Grounds. “We have a need for a lot of staff coming up anywhere from engineering people and linemen to clerical support, draftsmen, surveyors and engineering technologists and communications technologists.” The new building in the Hill Industrial Park will centralize ATCO Electric’s Lloydminster operations and the company’s 85 employees who work out of three locations. “The need for the new building is basically due to growth,” said Schwarz. “We are adding more staff, and we are just running out of room in our current facilities. “It would be nice have everyone under the same roof and have a little more efficiency in how we get our work done.” The company formally unveiled its construction plans for the new energy efficient building at an open house on April 5. “The new energy efficient facility will allow us to achieve greater levels of operational efficiency and customer service as we continue to grow with the community,” said Bobbi Lambright, president, operations division in a news release. The new building is designed to reduce energy consumption by 55 per cent compared to buildings of similar size and use. Sustainable features include a high-performance heating, ventilation and air conditioning system, solar hot water panels and triple glazed windows. Rain water will be captured on the roof for re-use in landscaping and sanitary waste systems. Recycled building materials from local sources are also being integrated into the construction. The new facility will include a new mechanic shop to enable ATCO to handle more of its own maintenance work since the company runs a 24/7 operation. “We need to have our equipment available and ready to go,” said Schwarz who added they will be hiring some new construction crews with the expansion. “We will be hitting about 100 people by the end of 2012.” ɸ Page C17

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Come See Us Booth # 1025 Rotators are primarily designed tto extend the life of the production ttubing string for both beam pump and PC pump applications by use of manual, mechanical, and electric drive systems. A tubing swivel can be added tto the string where a no-turn tool or anchor is needed.

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Lloydminster 780.875.2151 • Provost 780.753.3132 Kindersley 306.460.0342 • Swift Current 306.773.5512

PIPELINE NEWS June 2011

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ATCO Electric’s new regional complex is scheduled to open in early 2012 with countless energy saving features included in the design. The need for the new building is in response to a growing demand for new electric service from the oil and gas industry and from new residential and commercial construction in the Lloydminster area.

New oil¿eld construction requires electrical ɺ Page C16 Schwarz says the oil and gas industry is one of ATCO Electric’s major sector clients with new oilﬁeld construction and power needs on the rise. “We would supply anything from brand new services to maintenance of the existing services,” he said. “We build the infrastructure into their sites. If they need power they come to see us. “We’ve really noticed this year with what is going on in the city itself that our oﬃce is getting a lot busier.

“We’ve had some good steady growth. There’s lot of stuﬀ going on in the province, and especially out here around Lloydminster.” The Lloydminster building will be among the top three largest regional centres in Alberta along with Fort McMurray and Grande Prairie with new career opportunities opening up throughout ATCO’s network. “We are adding quite a lot of people within our organization, and we are hoping to ﬁnd some people locally interested in joining our organization,” said Schwarz.

“Journeymen and linemen in particular are hard to find. Every utility is struggling to find journeymen as well as engineering staff. “We will have a nice facility to work in if they join us in Lloydminster,” Schwarz said. Construction of the facility began late last year with a grand opening being planned for the early part of 2012. “We have a planning session going , so we haven’t quite determined yet, but there will be an open house with invitations for people to come and tour the facilities,” said Schwarz.

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The Saskatchewan Oil Show in Weyburn Outside Booth #501

1-306-461-5526 1-403-350-4987

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PIPELINE NEWS June 2011

Nordic acquires gas rights Oil slicks found at Endeavour Lloydminster, Endeavour – Nordic Oil and Gas Ltd. has acquired a 100 per cent interest in natural gas rights on a section of land approximately 1.6 kilometres from their existing heavy oil properties near Lloydminster, Alberta. The recent acquisition from an unnamed seller comes with a fully equipped standing well bore already tied-in to a nearby pipeline system. “Our geological team has determined that the well can be perforated at a new interval,” said Donald Benson, Nordic’s chairman and CEO, in a news release on April 7. Benson reported the company planned to have the workover on the well completed shortly and have the well on stream by the end of April. Nordic also obtained a seismic option for the oil rights to the acquired section of land with exploration planned. “Over the next four months or so, we will acquire trade data or perhaps shoot new seismic, or do both,” Benson said. “We are very pleased with this new acquisition and believe that in addition to natural gas production, this could very well lead to substantial heavy oil development in the not-too-distant future for Nordic Oil and Gas.” ɸ Page C19 Oil slicks near Endeavour, Sask., has Nordic Oil and Gas excited. Photo submitted

PIPELINE NEWS June 2011

in Lloydminster area play

Oil slicks found at the conÁuence of the Lillian River and Kop Creek in Endeavour, Sask.

ɺ Page C18 Oil slicks Nordic announced May 16, today that Petro-Find Geochem Ltd., the company that discovered oil seeps on the Nordic land in Preeceville in 2007, has encountered a new series of oil slicks at Endeavour, in close proximity to the Company’s exploration well drilled this past winter. Paul Lafleur, president of Petro-Find, said that the most significant oil slick is located approximately a mile-and-a-half from Nordic’s 4-11 well drilled in December. Another oil slick is located on the northern border of Township 35, which is the Nordic land. Two other locations where oil slicks were encountered are at the confluence of the Lillian River and Kop Creek at the south end, just outside on township 35. “Based on this evidence, it is safe to say that oil slicks on Lillian River are derived from Kop Creek, which may be the surface representation of a fault,” Lafleur stated. Lafleur further said that he is referring to this latest discovery as “oil slicks” rather than “oil seeps”, “because we don’t know their exact origin.” “This latest discovery by Mr.Lafleur further reinforces our belief that the Endeavour/Preeceville area of east-central Saskatchewan is a region of great promise and potential,” said Mr. Benson. “Given this exciting news, we are anxious to return to the 4-11 well site to complete the acid squeeze and determine if we need to frac the well.” Analysis of 11 fluid samples taken from the 4-11 well back in January exhibited significantly high concentrations of benzene, indicative of oil accumulations, Mr. Lafleur stated. “Of particular significance is swab PB26Z (combined swab for intervals 937-939.5, 927-930, 917-920.5) which shows a benzene level of 2.55 ppm plus significant concentrations of toluene, ethyl benzene, and xylene,” he added. “It is believed that the well penetrated either a new pool, or the edge of an oil pool in the Red River Formation. The abnormally high concentration of C8-C10 (2.8 ppm) in this sample supports this finding.”

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

Serenity Yoga Studio Hwy. 17 South around the corner from Fabutan

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PIPELINE NEWS June 2011

Kenworth Lloydminster - A Division Of Edmonton Kenworth Ltd. 6101 - 63 Avenue, Lloydminster, AB T9V 3C1 Tel: (780) 871-0950 Fax: (780) 871-0926

2012 Kenworth T370 - 330 HP, Allison 6 Speed Transmission,14.6K front suspension, 23K rear suspension, Air brakes Custom Built Extended Crew Cab.

2011 Kenworth T800 - Cummins 500 HP, 46K axles 3.91 ratio, 46K AG 460 suspension, 18 Speed Transmission, 205â&#x20AC;? Wheel Base. $119,500.00

h T370 - 300 HP, Allison lli 2012 Kenworth 6 Speed Transmission, 14.6K front suspension, 23K rear suspension, air brakes. Full Tilt Service Rig-Up, 10,500 lbs Max crane and 35 CFM @ 100 psi air compressor.

2011 Kenworth T170 - 260 HP, Allison 5 Speed Transmission, 8K front suspension, 13.5K rear suspension, Hydraulic brakes.

For further information contact our team of HEAVY DUTY & MEDIUM DUTY Sales Reps

780.871.0950 Be Sure to visit us at the Bonnyville Show! Booth # 1131 & 1133 WE AT KENWORTH LLOYDMINSTER ARE PROUD TO BE PART OF THE HEAVY OIL INDUSTRY.

PIPELINE NEWS June 2011

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Lakeland burns rubber at career expo Randy Hobbis, Lakeland College automotive program head gives some instruction to Brayden Cooper from Bishop Lloyd Middle School on the operation of a bush hog at a bi-provincial career expo at the Lloydminster Exhibition Grounds. The May 3-4 event attracted more than 2,100 students from Saskatchewan and Alberta.

Lloydminster – Randy Hobbis, the head of Lakeland College’s auto service technician and parts technician apprenticeship programs, steered a lot students to his booth at the Bi-Provincial Try-ATrade Career Expo in Lloydminster May 4. Hobbis’ recruitment message is that there is no time like the present to learn these trades as there is a strong demand for qualified heavy equipment, automotive service and parts technicians in the oilpatch. “I think the demand is pretty high right now. It’s on an upswing,” said Hobbis. “They are looking for heavy-duty mechanics, especially. “In the oilpatch you can work on everything from the trucks that haul equipment around to the rigs that are out there doing the drilling or get into the well sites where there are motors keeping the pumps running. There’s lot of mechanical work in that area.” Lakeland College’s School of Trades and Technology offers a four year apprenticeship program for auto service and heavy equipment technicians, and a three year parts technician program at the Vermilion campus. There is also a 16 week pre-employment automotive/heavy equipment technician program that prepares grads to write their first year apprenticeship program. “The student demand for apprenticeships has been pretty steady,” said Hobbis. “It has started to increase again. The last few months the numbers are going up.”

If you have a speciﬁc problem on an application, we’ll help you design & develop novel production optimization equipment.

Come see us at the Bonnyville Oil and Gas Show June 22 to 23 booth # 524

At Premium We Know Tubing Swivels! We offer 4 different models each with unique characteristics that will suit any speciﬁc PCP and Rod Pump applications.

FEATURING, ONE WAY TUBING SWIVEL The Premium One-Way Tubing Swivel is used in conjunction with tubing rotators to allow the tubing to be rotated during production. It’s designed to allow torque anchors and right hand set tension anchor catchers to be set. Once the swivel is sheared with right hand torque, the tubing is able to rotate with right hand torque only. If left hand torque is applied, the unique multicam mechanism engages, allowing the torque anchor or right hand set anchor to be unset.

Check out our website for our other 3 models of Tubing Swivels

Packers, Downhole Tools, Flow Control, Coating, Others #8, 10672 – 46th Street S.E. Calgary, Alberta, Canada Phone: (403) 723-3008

Lloydminster, Alberta, Canada Phone: (780) 875-3050 Fax: (780) 875-3002 luistorres@premiumals.com Cell: (780) 522-8296

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PIPELINE NEWS June 2011

Metal shack pro¿ts fund disabled programs Lloydminster – The Bea Fisher organization has given itself a

hand up to generate additional revenue to fund programs for people

with developmental disabilities in Lloydminster with the manufacture of

Ted Hollington, director of enterprises for Bea Fisher Enterprises Inc., says sales of their manufactured metal oilÀeld shacks are strong. Any proÀts made by Fisher Building Systems Inc. go back to Bea Fisher Centre Inc. which serves people with disabilities in Lloydminster. Hollington manned an information booth at the Try-A-Trade event in Lloydminster.

metal shacks for the oilfield. Bea Fisher Enterprises Inc. is a revenue generating arm of Bea Fisher Centre Inc. that has been making wooden shacks since 1972 in addition to operating the Bottle Depot and Blue Box service. Fisher Building Systems Inc. was launched two years ago to tap into the growing metal shack market and generates profits to top up government funding for the non-profit social agency. “There seems to be a big demand for the metal shacks,” said Ted Hollington, director of enterprises for Bea Fisher Enterprises Inc., said at the Try- A-Trade Career Expo held in Lloydminster May 3-4. “We figured that’s where the business was going to, so we build metal oilfield shacks now. “Fisher Building Systems is a for-profit business with our profits

• We build ULC, UL, Flameshield, API-650, 620, 12F, ASME • 7-3000 bbl • 2,273-200,000 L Horizontal Contained • Pressure Vessels • 2,273-110,000 L Jacketed Underground • 2,273-120,000 L Vacuum Monitored • 1,250-5,000 L Rectangle • 5,000-200,000 L Single Wall Vertical

going back to help Bea Fisher Centre. “Funding from the government always runs short to run these programs, so we are trying to create some proﬁt so we can run the programs for people with disabilities.” The wood and metal divisions employ 12-14 persons with disabilities and are well known in the oilﬁeld industry. “We have a good name out there,” said Hollington. “We have been in business since 1972 building wood shacks so we are making the transition into the metal and learning the business as we go, and trying to get busier as we do it.” The shacks are made from sheets of galvanized metal ranging from 18 to 24 gauge material. “It comes in a coil and then it’s bent and rolled out,” said Hollington. Asked how sales were going, Hollington replied, “Our business is good and we hope to grow it even bigger. We have shipped them

up to Peace River, and we hope to get in the southern part of Saskatchewan in sales. “The oilpatch has always been responsive to us and they like to support us as well.” Each year, the Husky Energy Lloydminster Charitable Campaign raises money for the Bea Fisher Foundation that, in turn, supports the Lloydminster & Area Brain Injury Society. “We are always falling short and we want to be creative to do new things for our clients and keep them busy, so you need money to do that,” said Hollington. “Bea Fisher Centre serves people with disabilities. We have day programs for them to stay busy and teach them some things. “We have houses and apartments where clients live and are supported in their day to day activities. “Government funding never allows us to do all of those things, so we try to create some of our own money,” Hollington said.

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PIPELINE NEWS June 2011

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Forklift safety blitz disappoints Edmonton – Alberta’s Occupation and Health and Safety (OHS) blitz on forklift operations involving 87 employers and 181 inspections fell short of expectations with 214 orders issued. News of the forklift safety campaign outcome came on May 4 with the launch of stepped up OHS inspections where young Albertans work. This new safety campaign is the second of three planned focused inspections for 2011 with residential construction projects to be targeted in the fall. Thomas Lukaszuk, minister of Employment and Immigration, expressed disappointment in the outcome of the forklift safety program reported in the April edition of Pipeline News. “Because we announced the inspections in midFebruary and businesses expected to see us, I am disappointed to see forklifts and other equipment not properly maintained and operators not adequately trained,” said Lukaszuk in a news statement. “We’ve made great gains in this province including the lowest lost-time claim rates ever recorded. However, we clearly have our work cut out in some sectors, and this is one of them.” The forklift safety inspections focused on hazards related to worker training, competency and supervision, and safe operation and maintenance of equipment. Among the 214 orders issued by OHS oﬃcers, 24 related to requirements for proper inspection and maintenance. Another 20 resulted from failure to conduct a visual inspection prior to operating the equipment with 16 orders pertaining to hazard assessment requirements. Fourteen orders related to worker training, competency and proper supervision to safely operate the

Year 2005 2006 2007 2008 2009

LostTime Claims 218 210 178 182 116

Fatalities

317 345 352 310 219

0 0 0 3 1

equipment. There were also two stop work orders and two

“Post-secondary and high school students are beginning their summer jobs and I want to help en-

stop use orders, unrelated to the focused inspection campaign but still highlighting safety deficiencies in the workplace. “If there’s a bright side, we know that this campaign raised significant awareness among companies that operate this type of equipment,” said Lukaszuk. “I understand there was a rush to ensure operators were properly trained, and that companies offering training services still have lineups out the door. “But it shouldn’t take a focused inspection campaign to make that happen. That’s the culture we need day in and day out on every worksite in Alberta.” Alberta’s retail, restaurant, fast-food and construction sectors where young Albertans work are the focus of the ongoing workplace inspections.

sure those jobs are safe and healthy,” said Lukaszuk. “By focusing on employers of young workers, and the workers themselves, the importance of workplace health and safety will carry through their entire careers.” Young workers represent about 17 per cent of Alberta’s workforce. From 2006 to 2010, there were 27,166 lost-time claims from workers in Alberta aged 15 to 24, accounting for almost 18 per cent of lost-time claims from all workers. There were also 37 fatalities in this age category over the same time frame. By major industry sector, the wholesale and retail sector had the largest number of young worker injuries, followed by the construction and construction trade services sector.

Number of lost-time claims, disabling injury claims, and fatalities related to forklift – Alberta: 2005-2009

This unique event will showcase Bonnyville & District as the place for industry to grow & innovate. Featuring interactive displays, indoor & outdoor booth space, networking events & educational sessions, this is a premium opportunity for oil and gas industry related businesses to market themselves in the region.

June 22 - 23, 2011 Bonnyville & District Centennial Centre

brought to you by

Disabling Injuries

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PIPELINE NEWS June 2011

Students check out trades Lloydminster â&#x20AC;&#x201C; If numbers count, this yearâ&#x20AC;&#x2122;s Bi-Provincial Try-A-Trade Career Expo held in Lloydminster May 3-4 was a success. Approximately 2,100 students from Saskatchewan and Alberta schools registered to take part in this yearâ&#x20AC;&#x2122;s educational event to learn about trades. É¸ Page C25

Volunteers (l-r) Dawn, Heather and Tammy were kept busy handing out information bags to students arriving at the Lloydminster Exhibition Grounds for the start of the Bi-Provincial Try-ATrade Career Expo.

Bishop Lloyd Middle School student Kelsie Lever, left, helps steady a piece of Ă ex pipe while classmate Sarah Hart works a pair of cutters at a steamĂ&#x20AC;tter and pipeĂ&#x20AC;tter demo sponsored by Lakeland College.

Bill Rhode from R&R Masonry, left, teaches Nicole Matters the art of bricklaying.

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Event a success ɺ Page C24

Clayton Freeman from E.S. Laird Middle School in Lloydminster gets a hand hooking up his safety harness from Lakeland College carpentry instructor Trevor Provick.

That’s more than the 1,400 students who came to the event last year when it debuted as a one day event at the Lloydminster Exhibition Grounds. The Lloydminster Construction Association organized the expo and added a three hour evening session this year on May 3 to allow the public to attend and submit resumes. The career expo featured more than 60 exhibitors and hands-on trade demonstrations aimed at encouraging students to pursue careers and apprenticeship studies in the trades. Several companies and government employment agencies also gave presentations on everything from hair dressing and engineering to apprentice incentives and cooking.

Skylar McKenzie from Hillmond High School keeps his eyes glued to a computer screen while working the joysticks on this hydraulic excavator simulator from Precision Contractors.

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PIPELINE NEWS June 2011

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RockSolid mops up with horizontal cleanouts Vermilion, Alta. – The RockSolid Group of Companies, based in Vermilion, Alberta is well positioned to meet the well servicing and production optimization needs of oil and gas companies in Western Canada. T-Rock CT Services Ltd., RockSolid Nitrogen, RockSolid Rentals and RockSolid Energy Services divisions cover all of the main well servicing and performance bases in a one-stop shop concept. The business model extends to a busy shop in Creelman, Saskatchewan with another service outlet opening soon in western Manitoba to service the booming light oil market. To keep up with customer demand, RockSolid continues to grow its service fleet that now stands at five coiled tubing units, seven nitrogen pumpers and four cement/acid units. The company even has a heavy duty equipment repair shop in Vermilion to service its own equipment and fix customer vehicles. “Basically we can offer a complete package,” said Shawn Minish, operations manager in Vermilion. “We are finding more and more oil companies are going that way. I think one of our pluses is diversifying and being willing and able to try new things.” The growth in horizontal drilling and steam assisted gravity drainage (SAGD) wells has increased the demand for T-Rock’s CT or coiled tubing services in particular. Class I and Class II coiled tubing services range from production tubing and casing cleanouts using air, nitrogen, foam or fluid to the installation and retrieval of production and instrumentation strings. The units are also equipped to handle the placement and retrieval of production plugs, packers and retainers along performing drilling, milling and perforating functions. “We do a lot of drill-outs, packer plus systems, instrumentation, regular gas cleanouts and a lot of SAGD work – horizontal cleanouts,” said Minish. ɸ Page C28

Shaun Minish said the demand for nitrogen is on the rise for horizontal well frac cleanouts. RockSolid Nitrogen Services has seven units in the Àeld throughout Western Canada. The company has a shop in Creelman, Sask. and is set to open a new location in western Manitoba. Photo by Geoff Lee

Centennial Events August 18th to 21, 2011

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PIPELINE NEWS June 2011

A lot of work in the SAGD ¿elds ɺ Page C27 “A lot of the work we do from here is up north in the SAGD ﬁelds and all the way out to Fort Saskatchewan. “We can run anything from 3/4 inch coil for the rod side cleanouts right up to the two-inch. One coil tubing unit is specialized for the drill-outs. “We can swap the drums on this and that unit depending on whether we are pulling instrumentation strings or doing horizontal cleanouts.” Asked if the demand for coiled tubing services was on the uptick, Minish said it is but added the key point for the company is being able to keep with the new technology. “We’ve been lucky that way,” he said. “We have a new hydraulic portable spooling trailer for instrumentation, for example. We have made changes along the way to make sure we stay busy. “Basically, the new fracking technology – as a far as the Packers Plus system

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goes – they are getting bigger payouts on their zone so that’s driving a lot of the activity as well. “About 75 per cent of what we work on is horizontal cleanouts.” Cleanouts are performed by the RockSolid Nitrogen units that are capable of pumping up to 85 cubic metres a minute at 10,000 psi. The company can also put three bulker units on the road which each hold 18,000 cubes of nitrogen. “Nitrogen is used for doing gas well cleanouts, and we do a lot of ‘nitrified’ foam cleanouts on the SAGD wells,” said Minish. “The pumpers are also deployed during plant turnarounds for purging since nitrogen is inert and there is no chance for an explosion.” The company’s cement/acid units can handle pumping rates up to a cube and a half per minute at 10,000 psi. “You can handle working at high pressure with big rates 24 hours a day,” said Minish. The RockSolid fleet is rounded out with a stable foam cleanout unit for foam jobs on heavy oil wells. It comes with a 50 cube rig tank and helps lift sand to the surface. Primary cold heavy oil production with sand (CHOPS) improves the recovery of heavy oil from the reservoir. In the light oil Bakken play near Creelman, the demand is strong for RockSolid’s nitrogen and cement/acid services. “It’s all pretty deep where you start to get into that 3,000 metre plus well depth,” said Minish. Nitrogen is commonly use in the Bakken play for cleaning out fracks. “We have been in the Stoughton area for about four years now. We have a couple of houses there for the guys along with some land and a shop. “It’s another real busy area. We are also setting up a new shop in Manitoba in the coming days.” RockSolid is owned by Randy Martin who has grown the company over its 10 year history to support a RockSolid Energy Services division that rents out a variety of downhole coil tubing tools, and a RockSolid Rentals division. The rentals division manages a fleet of collapsible water storage bladders currently being used as frac bags in the Stoughton area and in the Grande Prairie area of Alberta and the Montney area northeastern British Columbia. “They are big storage tanks that are rolled out in about 45 minutes,” said Minish. “Each bag will hold about 600 cubes of fluid.”

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PIPELINE NEWS June 2011

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Lakeland grad toots for HOOT Originally published in Lakeland Link May 2, 2011 Lloydminster – As a child, Alyson Davenport thought a career in marine biology would be in her future. But after a year of taking science courses at university, that notion took a dive, causing her to look for something completely different. “I am bilingual so I enrolled in a French faculty at university,” says Davenport. “Perhaps it was the combination of studying science in French that made my year so difficult, but I also knew that if I were to pursue marine biology, I would have to relocate to an area far away from my family and home. "I wasn't sure that I wanted to do that so I started to have a change of heart. Maybe it was a combination of all these things, but at that time I felt I needed to find something different. " That was April of

2008. And find something different she did. Davenport, an honours student who graduated with distinction from Lloydminster’s Holy Rosary High School, enrolled in Lakeland College’s heavy oil operation technician program at the Lloydminster campus. She graduated from the program in July 2010. Now, at the age of 21, she is employed as a full-time pumper at Husky’s Bolney site. She is also studying to advance her credentials by taking evening courses at Lakeland to earn her third class power engineering ticket and intends to eventually earn a second class ticket. Davenport says her new career with 10hour shifts with an eight days on and six days off schedule fits well into her lifestyle. She adds her job in the oil industry challenges her and rewards her with a salary well above what she thought

Lakeland alumnus Alyson Davenport credits the heavy oil operation technician (HOOT) program at Lakeland College in Lloydminster for landing a career in the heavy oil patch with Husky Energy. Photo submitted

she’d make at her age after completing a oneyear certiﬁcate program. Because of the nature of heavy oil operations, workers deal with a range of physical demands and natural elements. As well, lab and mechanical systems that involve high-pressure valves, steam, oil and gas can present added risks and occupational hazards.

But for Davenport, it’s just part of the business and it’s not totally foreign. Her father, who still works in the oilﬁeld industry, did shift work while she and her brother and sister were growing up. She also says that her family and boyfriend were very supportive when they heard about her decision to pursue a career in the oilﬁeld. “They were all very

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supportive,” says Davenport. “It was a career choice that was very different from most people in my family, but they were all very encouraging,” adding that her mom works in the banking industry. Despite having a positive practicum experience with Husky as part of her Lakeland training (she was tech lead of the lab group at Husky’s Pike Peak ther-

mal site), Davenport says she thought she’d have some issues breaking into the field because she is a woman. However, her worries about not being accepted by her male peers were soon put to rest. “My co-workers are great. They can see that I know what I’m doing and I’m not treated any differently at the job site because I am a woman.” Davenport intends to stay in the oilfield business and encourages more people, especially women, to consider taking the heavy oil operations program to launch their career in the oilfield. “There are so many opportunities in field and such a shortage of skilled, trained workers,” says Davenport. “I’m so glad I pursued this career path. The number of doors that have opened to me never would have had I not taken my training at Lakeland. I highly recommend it.”

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PIPELINE NEWS June 2011

Pipeline leak in recovery mode Edmonton – The Alberta government continues to work with the Energy Resources Conservation Board (ERCB), Plains Midstream Canada, and other appropriate agencies during clean-up efforts following a crude oil pipeline leak about 100 km northeast of Peace River. Crews had recovered approximately 1,264 m3 of product (7,836 barrels or 30 per cent) of the original 4,500 m3 (or 28,000 barrels) estimated to have spilled, according to a government update on May 9. The Rainbow Pipeline’s oil spill on April 29, the worst Alberta oil spill in 35 years, led to the closure of Little Buffalo school in the First Nation community of Little Buffalo over fears of poor air quality from the spill. Some students reportedly began suffering from headaches, dizziness, disorientation and nausea only a couple of hours after the spill, though the school staff was unaware of the incident at that time. There have been no injuries resulting from the incident and the government continues to maintain there is no threat to public safety.

Continuous on-site sampling is being conducted by Alberta Environment’s Mobile Air Monitoring Laboratory and has not identified any Ambient Air Quality Objective guidelines being exceeded. Plains Midstream will continue to conduct air monitoring at the spill site, Little Buffalo School, and Marten Lake School and Recreation Centre over the next several weeks to ensure air quality guidelines are not exceeded. The school reopened on a day-to-day basis on May 9 when the government confirmed the spill was contained with more than 300 people working to clean up the site. Most of the leaked crude oil collected along the pipeline’s 30-metre rightof-way and spread into nearby stands of stagnant water where it was contained. Skimmers are being deployed on the main pond area to recovered the oil while vacuum trucks are being used to clean up oil on the ground. Contaminated soil is being removed and transported to an approved waste disposal facility.

Going overseas with natural gas heaters Regina – Lloydminster-based Grit Industries’ line of in-line heaters for natural gas applications is taking off, with serious prospects in Europe, according to owner Wayne King. While at the Williston Basin Petroleum Conference in Regina on May 3, King said, “We’re working on enlarging our product line.” They are developing a prototype 1.5 million BTU heater, under their Cold Weather product line. It’s a low NOX, high efficiency heater, used for heating natural gas and flammable liquids. “We’ve been working on this for a year,” he said. “We have to have it ready and in operation by December in England.” It’s their first application of the heater overseas. An English utility is doing evaluations of leading natural gas technology from around the world, King said. “We have a good opportunity to win this evaluation. They have 350 large water bath heaters that have to be replaced.” Gas heaters have become a significant part of their business, Kind said. “That’s our biggest growth. “Now our shop’s too small. We need to build a bigger shop.” “We’re looking at the eastern part of Canada, perhaps Nova Scotia,” he said. “Lloydminster, in the great scheme of things, is quite remote.”

“

Lloydminster, in the great scheme of things, is quite remote

”

- Wayne King - Grit Industries

He noted the expense of freight to Lloydminster for the raw materials, high labour costs, and the expense to then ship them out. It’s important to be near a container port, he said. “What the heck’s our future? Our roots are in heavy oil, absolutely. We have to either peel off operations (or go for) another facility.” “The workforce has taken its toll on us. It’s quite a dilemma,” he said. As a side note, King has recently joined Enterprise Saskatchewan’s Petroleum Sector Committee. “I’m also working with a company called CanGas,” he said. “They’re gathering vented gas coming off the wellhead. Rather than flaring, they’re putting a truck there and compressing it.

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PIPELINE NEWS June 2011

C31

BAKKEN DISPOSAL ALTERNATIVE FOR DRILLING AND PRODUCTION WASTE CCS Corporation’s Arcola Disposal Facility is open for business

The right way to dispose of it; right where you need it. Open 18 hours daily, and right off the highway, the Arcola Disposal facility is convenient and ready for your delivery. Deliver your produced water and frac water to the Arcola Disposal Facility, and know it is being handled and disposed safely and responsibly. Work with a leader in oilﬁeld waste management. CCS sets the standard in safe practices, and environmental stewardship.

New waste oil credit program has provisions that allow for reduced disposal costs, or even a possibility of a return. Expanded service options are being developed for treatment, recovery and disposal of additional waste streams.

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C32

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D-Section

PIPELINE NEWS

June 2011

Saskatchewan’s Petroleum Monthly

Innovation drives growth of coiled rod maker Story and photos by Geoff Lee Edmonton – C-Tech Design & Manufacturing and Pro-Rod Coiled Rod Solutions go handin-hand to meet the growing domestic demand for coiled rod and service equipment particularly in heavy oil wells. C-Tech and ProRod Solutions are divisions of C-Tech Oilwell Technologies Inc., an innovative oilfield technology development company dedicated to developing coiled rod technology and products. The Edmontonbased company is owned by Dover Corporation in the United States and operates under Norris Production Solutions that aims to be the world’s premier artificial rod lift company. Pro-Rod opened a second rod manufacturing plant in California last year with a third plant to open this year in southern Oman. A fourth plant is being planned for 2012 in a location to be announced. “The Oman location situates us well in the Middle East. That’s our biggest international draw in the last couple of years,” said C-Tech founder and company president Mark Widney. “As the light oil depletes – even in the Middle East – their further reserves left to exploit are actually heavy oil so they come to Canada to

get the Canadian technology. “Canadians have the strongest expertise success and knowledge for lifting heavy oil. “That’s why we are building plants all over the world. Coiled rod has a high transportation cost component to it because of the size of the reels it needs to go on to. “The logical sense is to put the plant in the market versus trying to service the rest of the world from the middle of Alberta,” Widney said. In Western Canada, C-Tech has doubled its market share of coiled rod in the past six years with future growth planned in the light oil Bakken play of southeastern Saskatchewan. “It’s an area that we will be going to next,” said Widney. “It’s a great opportunity that is ideally suited for coiled rod applications. We need to set up the service and infrastructure in order to capitalize on that opportunity.” In the meantime, the company has its work cut out with orders for coiled sucker rod and service equipment spilling into 2012. Pro-Rod is only one of two coiled sucker rod manufacturers in North America. A sucker rod string connects a downhole pump to the drive equipment at surface traditionally using 25 foot joints of rod connected

C-Tech sales manager Rob Redman stands behind an X-celerator, a stand-alone coiled rod injector head that has driven sales of coiled sucker rods around the world.

with couplings. Pro-Rod manufactures continuous coiled sucker rod that is ideally suited for horizontal and deviated wells without the need for couplings associated with conventional coiled rod. “It has exactly the same speciﬁcations and mechanical properties of conventional sucker

rod,” said Widney. “The main selling point is that it doesn’t have any couplings. About 75 per cent of all rod failure is in the coupling and we don’t have any couplings, so you eliminate 75 per cent of your potential breakage and wear problems. “It also extends the pump life because there

Supplying and Servicing a variety of Tubing Anchor/Catchers to Southeast Saskatchewan’s Oil Industry Now Selling Pump

is less back pressure on the pump not having to pump by the couplings.” Fluids and solids do not have to pass over connections and create pressure drops that are detrimental to progressive cavity pumps. “As heavy oil has developed more and more directional drilling, more extended reach wells are

being drilled so you don’t have a coupling every 25 feet trying to make a bend,” said Widney. “It’s one steel rod making the bend. “With a conventional string every 25 feet you have a contact point because the coupling is bigger than the rod. ɸ Page D2

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PIPELINE NEWS June 2011

Coiled rod reduces wear on tubing ɺ Page D1 “With a coiled rod string the whole rod string interfaces with the tubing so the wear is distributed throughout the length of the well versus in concentrated 25 foot points.” Continuous rod can also increase production by eliminating the rod coupling piston effect and the capability to use larger rods in smaller tubing. Pro-Rod also does coiled rod installations and on location welding along with string design and transportation services at various locations in Western Canada including Lloydminster. “We custom build and deliver real time strings made specifically for the well that’s being requested,” said Widney. Sales and service growth in Canada and around the world are being driven by a standalone coiled rod injector head developed and patented by C-Tech. The coiled rod injector head called the X-celerator meets the market need of service companies to run and pull coiled rod without requiring a separate piece of dedicated equipment or crew. The X-celerator is a portable gripper unit made by C-Tech that can also be truck mounted, trailer mounted, skid mounted or mounted to a service rig or flushby. The development of the X-celerator has grown the coiled rod service equipment fleet to more than 100 worldwide. “We make a unique artificial lift product that requires a specialized piece of equipment,” said Widney. “When we go to a new country, we have to supply all of the necessary equipment that is used to fully run the coiled rod product along with the coiled rod. “We need to ‘populate’ other areas around the world with the technology to be able to utilize the coiled rod product. Without the injector, you can’t get coiled rod down hole. It’s intrical to sales.” Widney says the usual practice is to sell the equipment to an end-user producer or team up with a third party service provider. “In certain applications, we will actually do it ourselves and set up our own service companies and build the equipment for ourselves,” he said. C-Tech has also developed its own patented portable welding system called the Fireblade for all field welding requirements pertaining to coil rod installations and servicing. ɸ Page D3

An operator lowers a completed reel of coiled rod on a 20,000 lb. transport reel ready for delivery. The Ànished rod is given a Ànal coating to inhibit rust.

Brodie Schmitt, a junior plant process operator, checks the diameter of the continuous coiled rod in the Pro-Rod plant.

C-Tech custom manufactures a variety of equipment and machinery for the oilÀeld service industry including this new double telescopic Áushby unit.

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PIPELINE NEWS June 2011

North American and overseas ɺ Page D2 In Edmonton, the company manufactures everything from coiled tubing units and rapid-rod service units to ﬂushbys, coiled tubing and rod injectors. “We are a custom manufacturing facility,” said Bob Redman, equipment sales and marketing manager. “Our slogan is concept to completion.” “The market demand is huge and is coming from all over the world. “We have a very large customer base in Western Canada and customers in the Netherlands, California, Oman, and South America and throughout the U.S. “Saskatchewan is very busy right now and we

are selling many C-Tech flushby units into that market.” C-Tech can also make multi-purpose telescopic and slant flushbys for pulling and running rods. The company has set up an equipment jig on a truck chassis to fit and mount equipment to shorten the manufacturing time when new truck bodies arrive at the shop. The company has a complete mechanical and steel fabrication shop with more than 21,000 sq. ft. of space, 12 bays equipped with five and 10 ton cranes all within a seven acre rig-up yard. The Pro-Rod manufacturing plant is constantly evolving by utilizing and implementing the latest technology applied to their new coiled rod plants being built around the world.

C-Tech and Pro-Rod were sold to Dover in 2005 with the Norris operational arm becoming the world’s largest conventional sucker rod manufacturer in the world. “With the acquisition of Harbison-Fischer, we are also the largest bottom hole pump manufacturer in the world,” said Widney. “Over the last ﬁve years, we have expanded the suite of products available so when a customer comes to us whether they want conventional rod, coiled rod or bottom hole reciprocating pumps, they can buy it all from one place and have all the design work done in one place. “International growth and adding to our product line to suit our customer needs are our two main objectives.”

Quality controls built into coiled rod Edmonton – Pro-Rod is manufactured from micro-alloyed, modiﬁed hot rolled carbon or alloy steel. Coiled sucker rod is available in diameters of 13/16” (20.6 mm), 7/8” (22.2 mm), 1” (25.4 mm) and 1 1/8” (28.6 mm) in steel grades of 1536M (carbon), 4120M (chromium-molybdenum) and 4330M (nickel- chromium-molybdenum). Raw coils are uncoiled, straightened and welded together using a butt-fusion process. Pro-Rod then uses high temperature induction furnaces to quench and temper the steel. This heat treatment process cou-

pled with the metal’s chemical composition produces the necessary hardness, toughness, corrosion properties, metal strength, microstructure and tensile strength that is optimal for continuous coiled rod in artiﬁcial lift systems. The rod is then coated with an oilsoluble coating which protects it from atmospheric corrosion in storage. Pin end connections are welded on to the end of the rods using a butt-fusion process. The rod is then coiled onto transport reels ready for installation. Quality control inspections are performed and recorded at each step of the manufacturing process.

Dan Morgan, Pro-Rod plant manager, stands by a coil rod production reel. Seven to nine sections of raw coil rod are straightened and welded together by butt fusion. Photo by Geoff Lee

Millennium Oilflow Systems & Technology (MOST) is a manufacturing company making products for the oil field, specifically for production of heavy oil by the artificial lift system (PCP application). Products manufactured and sold are made to ISO 9001-2000, API and CSA standards.

OUR POLICY

To manufacture precision, quality products that meets or exceeds industry standards and customer requirements while continually striving for improvement.

New Lloydminster Ofﬁce: 5103 62 Street Lloydminster West, Alberta Canada T9V 2B3 CELL: 780.808.0950 CELL: 780.808.9852

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PIPELINE NEWS June 2011

CJS FlatPak Hydraulic PCP – “An Innovative New Solution” CJS of Lloydminster introduces its “Hydraulic” Progressive Cavity Pump System which Facilitates: • PC Pump landings in heel of horizontal and deviated wells to optimize production rates without rod and tubing wear. • Chemical injection at the pump intake via a capillary included in the FlatPak • Well optimization and prevention of well “pump-off” via data systems and sensor wire included in the FlatPak • Elimination of space out error as the rotor is pre-installed in the correct position prior to pump installation • Provision for reversing the pump to self-flush • The ability to perform standard coiled tubing clean outs to the top of the rotor and standard side entry clean outs • The running of multiple conduits and electrical cable deployed in a single operation with a conventional coiled tubing unit • Elimination of the drive head and stuffing box minimizing moving zing mo parts and assuring minimal environmental impact • Elimination of tubing rotators • Elimination of no turn tools as system is torque neutral

Downhole Submersible Driver • Deployed with 25.4 mm hydraulic lines

• 800 ft-lbs of torque at tool

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• Reverse pump and clean out up tubing

• Reduced down hole equipment

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PIPELINE NEWS June 2011

Husky plans 45-day upgrader turnaround By Geoff Lee Lloydminster – The Husky Lloydminster Upgrader will undergo a minor 45-day maintenance turnaround this fall in what is shaping up to be a productive year for Husky Energy. News of the turnaround was released with Husky’s first quarter results along with resolve to maintain production levels from Western Canada with accelerated development drilling. “As you can see from the results, this has been a strong quarter for Husky compared to the same quarter a year ago,” said Asim Ghosh, Husky’s CEO, during a conference call from Calgary on April 27. “Our production is up five per cent, earnings are up 70 per cent, cash flow is up 36 per cent, so from all key metrics, it was a good quarter.” “We are pleased with the progress we have made in the last 10 months to execute our strategic plan.” Performance was driven primarily by increased production volumes, higher realized crude oil prices for the Atlantic Region and South East Asia, and higher throughput rates and margins within the downstream segment. “Our first quarter results are in accordance with our execution plan,” said Ghosh in a news release. “Actions undertaken to grow near-term production have achieved the intended result during a period of strengthening prices. “At the same time, our downstream refining segment posted strong performance, with higher

throughput enabling us to capitalize on improving market conditions.” “In addition, we have made steady progress in advancing our mid- and long-term growth initiatives. Steps taken in the quarter have enabled Husky to achieve important milestones towards progressing the Liwan Gas project oﬀshore China.

“This project will create shareholder value by tapping into the fast growing energy markets in Hong Kong and mainland China.” First quarter production averaged 310,400 boepd compared with 280,500 boepd in the previous quarter with the company on track to achieve their nearterm production targets. ɸ Page D6

The Lloydminster Husky Upgrader will undergo a 45-day turnaround this fall with capacity reduced to 70 per cent. The company reported strong Àrst quarter results in April with an accelerated development drilling program in Western Canada.

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PIPELINE NEWS June 2011

Construction continues on Paradise Hill SAGD ɺ Page D5 “In Western Canada, the foundation of our business described in the strategy, in the ﬁrst quarter we drilled 234 exploration and development wells,” said Rob Peabody, COO at the conference call. “Ninety-four per cent of the wells targeted oil or liquids rich resource gas plays in line with our strategy. “In oil resource plays, we focused our opportunities in the Lower Shaunavon and Bakken zones of southern Saskatchewan along with the Viking zone in southwest Saskatchewan and central Alberta.” A total of 16 wells were drilled in the quarter from these plays with six wells placed on production at a combined rate of 440 barrels a day. “Looking at our activities in Lloydminster in heavy oil, construction of the 8,000 barrel per day South Pikes Peak project (SAGD thermal) is about 60 per cent complete,” said Peabody.

“The project remains on budget and on schedule. We expect first production in mid 2012. “Construction also continued on the 3,000 barrel per day Paradise Hill project (SAGD) which was commenced at the start of the quarter. First production there is expected in late 2012,” Peabody said. “Our horizontal well development program targeting new geological horizons in the Lloydminster area has been running at a strong pace. Thirty one of the planned 104 wells for 2011 were drilled in the first quarter.” It was also noted by CFO Alister Cowan that capacity at the upgrader would be reduced to 70 per cent during the planned 45-day turnaround this fall. Husky recently reported the upgrader returned to full capacity following repairs from a Feb. 2 fire that also cut capacity to 70 per cent and prompted the first of two safety investigations in the quarter.

“The ﬁrst quarter was more challenging from a safety perspective,” said Peabody. “As you are aware, we had a ﬁre at the upgrader that resulted in reduced throughput. We also had an incident while fracking a well in Western Canada (March 7 near Edison). “I can assure you that both of these incidents are the subject of rigorous investigations. “Lessons learned from the incidents will be shared throughout the organization and our industry partners, where appropriate, to guard against any re-occurrence. “We made progress in the quarter in accelerating our near-term production. So far, to date, we remain on track to achieve our production guidance,” he said. Husky advanced its development drilling of its liquids-rich gas assets in the Alberta Deep Basin in the quarter. “Our prime focus in the near term is Ansell where liquids production

Husky's Lloydminster Upgrader will have a 30 percent reduction in capacity during a 45 day turnaround

from the Cardium averages about 50 barrels of natural gas per mmcf of gas,” said Peabody. In the Ansell area, four rigs were active and a total of 20 wells were drilled during the quarter. “We are currently shut down for breakup,” said Peabody. “We plan to recommence drilling in the second quarter with 21 wells. “In the third quarter, we expect to commission extra capacity at Ansell to take production to around 56 million cu-

bic feet per day and over 2,000 barrels per day of liquids.” Peabody also told the conference audience that Husky’s plan for their new Cardium plays was “to grow the business by 30,000 barrels a day” over a ﬁve year period with current production at 5,000 barrels a day. He also reported additional exploration and development drilling continued at their plays in northeast British Columbia in the ﬁrst quarter. Two development

wells were drilled at Bivouac and the ﬁrst horizontal development well drilled in the Horn River basin with “very encouraging results” according to Peabody. Progress was also made at Husky’s Tucker oilsands project with production averaging 2,000 boepd in the quarter with new production wells to added in the second quarter. Husky also increased its land holdings in its gas resource portfolio during the ﬁrst quarter by 29,000 acres.

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PIPELINE NEWS June 2011

U.S. reviews Keystone XL documents

A new set of environmental documents for the Keystone XL pipeline is undergoing a 45-day public review in the U.S. A Presidential Permit to approve construction of the U.S. portion of the pipeline is expected by the end of 2011. Photo submitted

Calgary – TransCanada Corporation’s Supplemental Draft Environmental Impact Statement (SDEIS) for the Keystone XL pipeline is undergoing a public review for a 45-day period ending June 1. The U.S. Department of State published the SDEIS on April 15 for public comment moving the project closer to a Presidential Permit to build the U.S. portion of the crude oil pipeline. The permit is expected to be issued by the end of 2011. “The public release today of the supplemental environmental impact statement for this project is a signiﬁcant step forward in ensuring that timeline is met,” said Russ Girling, TransCanada president and CEO in a

news release. According to SDEIS and previous information TransCanada has filed with U.S. regulators, the Keystone XL will use highly-qualified engineering and environmental professionals to design and construct the pipeline. In addition, TransCanada says there will be virtually no emissions associated with the operation of the pipeline and its related facilities, and the pipeline will be buried deeper than regulations require. The pipeline will utilize the latest technology and strong steel to manufacture the pipe to exceed industry standards and regulatory requirements, and additional shut-off valves will be installed in key locations. The company will also install

16,000 secure data sensors on the system to provide operators with realtime information on pipeline pressure, volumes and ﬂow. The completed Keystone system is being promoted as a practical way for the U.S. to bolster its energy and economic security by increasing its supply of oil from a friendly and reliable source in Canada. TransCanada is promising it will build a safe, modern and leading-edge pipeline with a very limited environmental impact. It will generate more than $20

billion in new spending for the U.S. economy and generate $6.5 billion in new personal income for U.S. workers and their families. The pipeline will also deliver $5.2 billion in taxes over the life of the project. The Energy Board of Canada has approved the Canadian portion of the Keystone XL from Hardisty, Alberta to Monchy, Saskatchewan where it will cross the border into Montana on route to Oklahoma and the Gulf Coast. The U.S. portion will be built ﬁrst.

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PIPELINE NEWS June 2011

Hydraulic PC pump a game changer? Lloydminster – CJS Coiled Tubing Supply Ltd., the Lloydminster-based developer of Flatpak coiled tubing, continues to push the technology envelope forward with the launch of a hydraulic progressive cavity pump that eliminates rods and tubing. The technology couples a CJS driver to an industry standard PC pump using encapsulated Flatpak tubing to convey and actuate the driver in the heel of a horizontal wellbore. The Flatpak system includes a capillary in-

jector along with data cables to provide the operator with real time pressure and temperature changes. The ﬁrst ﬁeld installation of the new hydraulic PC pump took place in February in a heavy oil application near Lloydminster with the promise of reduced maintenance and operating costs over traditional rod driven pumps. “Rod driven PC pumps are an excepted process that we have been using for years and years, but they have inherent problems as any

This drum of Flatpak coiled tubing is used to convey new hydraulic progressive cavity pump technology downhole. The new technology eliminates the need for rods and tubing.

pumping system does,” said Collin Morris, CJS president. “One of the more pronounced problems they have had more recently is that in horizontal wellbores and slant wellbores, they tend to see more tubing and rod wear due to the deviation of the hole. “The hydraulic progressive cavity pump was designed to speciﬁcally eliminate the rods and tubing to eliminate that wear and reduce servicing and downtime.” The new hydraulic system can boost oil

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production with its ability to land the pump at a 90 degree angle in the horizontal section of a wellbore. “Typically, when completing a horizontal around here they will land the tubing in the more vertical portion of the well, not necessarily around the heel in the horizontal portion,” said Morris. “That means you leave a certain amount of the hydrostatic column on your zone which limits your overall production. “With this system you can lay it down at 90 degrees right down in the horizontal section of the well and recover the maximum oil potential of the wellbore.” Morris says industry reaction to the hydraulic PC pump technology has been “awfully good” with the cost savings benefits and features helping to spread the word. “We are doing it for a number of local companies now, and internationally, we are getting a lot of attention from it,” he said. “The system generally costs less depending on what you are doing and there is less subsequent servicing costs and there is more production from the same wellbore due to the fact you can recover oil from the entire hydrostatic column.” The hydraulic PC pump system can also prevent well pumpoff via data systems and sensor wire included in the encapsulated Flatpak tubing. The capillary injection line can be incorporated directly into the intake of the PC pump to inject sand suspension chemicals, friction reducers and corrosion inhibitors to perform any number of different tasks. “The systems we just ran locally included a chemical injector and downhole digital sensing package for pressure and temperature to give us discharge pressure, backside pressure, and wellbore optimization downhole and overall real time data monitoring downhole,” said Morris. ɸ Page D9

PIPELINE NEWS June 2011

Anywhere you run a PC pump ɺ Page D8 Despite the success of the hydraulic PC pump system, CJS continues to be selective about the type and location of wells chosen to deliver and market the technology that Morris says is still a re-

search and development system. “We have only had it on the market for four or ﬁve months,” he said. “In my opinion, it’s still very junior and it’s obviously working extremely well – but that’s no need to jump up and down

yet. “As we get other models and more run time and more history obviously, we will broaden that marketing. “Anywhere you can currently run a PC pump, you can run this technology.” The hydraulic driver is designed for all types of vertical and horizontal oil and gas well applications and provides about 800 ft. lbs of torque at the pump motor. This compares favourably to approximately 1,000 to 1,200 foot-pounds of torque at surface for a standard rotary

system. “We can get it higher or lower than that and anywhere from 100 to 400 rpm isn’t uncommon either,” said Morris. “Depending on the type of pump we run or the type of driver that we run, we try to marry the two together.” The hydraulic PC pump also eliminates space-out errors as the rotor is pre-installed in the correct position prior to pump installation. The system even eliminates the use of a drivehead and stuﬃng box and no turn tools or tubing rotators are among its lengthy list of advantages.

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9419 - 27th Avenue, Edmonton, AB, Canada Phone: (780) 438-3493 Fax: (780) 438-6655 Email: bill@lamarreequipment.com Collin Morris has set up some bench testing equipment at the CJS shop. A test block is used for the bench test whereas the top sub connector he holds in his hand would take the place of the test block in Àeld applications using the hydraulic progressive cavity pump. Photo by Geoff Lee

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PIPELINE NEWS June 2011

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PIPELINE NEWS June 2011

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Osum awesome with new oilsands leases Calgary – What got big just got bigger. Osum Oil Sands Corp. has acquired an additional 32,640 acres of oil sands leases in the Saleski Grosmont carbonate region west of Fort McMurray. The sizeable new leases form a corporate territory called Saleski West contiguous to Osum’s existing carbonate holdings. The oilsands leases complement Osum’s existing joint venture lands and its 100 per cent carbonate lands renamed Saleski East. This new acquisition, together with recent Crown land acquisitions contiguous to Saleski East, brings Osum’s total land holdings in the Saleski region to approximately 124,032 net acres of contiguous land plus 21,920 net acres in the Cold Lake region. Saleski West comes with an assigned 870 million barrels of best estimate contingent resources by GLJ Petroleum Consultants.

The estimate raises the bar on Osum’s corporate contingent resource total by 36 per cent to 3.2 billion barrels plus 360 million barrels of proved plus probable reserves. GLJ estimates the contingent resources at Saleski West could support total production of 80,000 barrels a day. The production estimate increases Osum’s total long-term sustained production potential from its reserve and resource base by 30 per cent to 350,000 boepd. “We are very pleased with this strategic acquisition and what it adds to our already substantial inventory of development opportunities,” said Steve Spence, Osum president and CEO on May 12. “The contiguous nature of our substantial land position in the Saleski Grosmont carbonate trend will allow for integrated development and expansion of commercial projects well

Osum Oil Sands has boosted its estimated contingent resource total in the Saleski Grosmont carbonate play by 36 per cent with the acquisition of new oilsands leases. Image submitted

into our future.” Osum continues to drive forward on its joint venture lands at Saleski with its steam assisted gravity drainage (SAGD) pilot project that began in December 2010.

The results from this pilot are expected to provide valuable insights into how to best develop the Grosmont carbonate resource, which can be applied across all of Osum’s carbonate assets. Work towards com-

mercializing the company’s 100 per cent acreage in the region is also ongoing with the completion of an extensive 19 well core program completed this past winter in Saleski East. Osum is also pro-

ceeding with preliminary work at its planned 35,000 barrel a day commercial Taiga Project near Cold Lake in anticipation of receiving regulatory approval this year. First oil from Taiga is anticipated in 2014.

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PIPELINE NEWS June 2011

ILC opens prairie recruiting base Saskatoon – The International Labour Centre (ILC), known for recruiting Ukrainian workers from Kiev for employers in Western Canada since 2005, celebrated the opening of a new recruiting base in Saskatoon on May 11. The official opening was held at Sutherland Hall with a guest list that ranged from Saskatchewan employers, Ukrainian community representatives, SIAST staff, Saskatchewan government officials, and Ukrainian workers. The new office will help to bridge the time and distance gap between employers in Saskatchewan and potential immigrant workers recruited by ILC from Kiev. “It is very important for us to be closer to our clients and employers,” said Gareth Charpentier, ILC’s marketing and sales manager. “With the time difference between Ukraine and Canada, it makes it difficult to communicate with employers effectively sometimes. “In terms of communications with our clients and being able to get in touch with all the right employers it’s going to be a lot easier for us to meet and greet and communicate with those people.” ILC has maintained a strong relationship with the government of Saskatchewan’s Immigrant Nominee Program, SIAST and the Ukrainian Canadian Congress, which have provided the necessary immigration and community settlement support. Saskatchewan government officials have visited ILC’s office in Ukraine on four occasions since 2004 to help employers recruit Ukrainian skilled workers in the province. SIAST began partnering with ILC in 2009 to provide assistance in the recognition of candidates' skills and English levels in test centres in Kiev so that employers are able to make the best choice. More than 500 tradesmen and their families have used ILC’s services to move to Saskatchewan where the demand for skilled workers continues to grow. ILC has seen strong demand for its services from the oil and gas, hospitality, manufacturing, transportation, meat processing, construction and agriculture sectors since it began recruiting over 10 years ago. Floorhands, derrickhands, welders, heavy-duty automotive mechanics and CNC operators lead the list of occupations in the oil and gas industry that ILC hopes to hire new Ukrainian workers for. “Historically, oil and gas hasn’t been one of our main clients, but going forward I am planning on attending the Weyburn Oil and Gas show,” said Charpentier.

From left: Volodymyr Gyschak, director general of KYLC (Kyiv-centred labour programs), Victoria Shamina, International Labour Centre (ILC) manager of international programs – Kiev based, Irina Matsiuk, ILC Canada ofÀce general manager, and Gareth Charpentier, marketing and sales manager for ILC Canada pose for a photo at the opening of the new ILC ofÀce in Saskatoon. Photo submitted

“We are going to be going to the Bonnyville oil and gas show as well to really get our name out there. “There is a demand there for foreign workers because of labour shortages and housing shortages. “A lot of employers I talk to say they just can’t hang on to their workers for more than a few months because they come in earn their money then take oﬀ. That’s one of the real struggles for the oilﬁeld employers.” Ukrainian workers have a strong tradition in Saskatchewan with approximately 13.6 per cent of the population reporting a Ukrainian ethnic origin in the 2006 Canada Census. ɸ Page D13

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PIPELINE NEWS June 2011

The lure of perogies, Ukrainian music and dancing helped to draw a crowd to Sutherland Hall in Saskatoon to celebrate the opening of a new ofÀce for the International Labour Centre that will strengthen ties between employers in Saskatchewan and ILC’s recruiting base in the Ukraine. Photo submitted

D13

The opening of the new International Labour Centre in Saskatoon featured a talk by Kevin Cunningham, senior manager of GLM Industries about his experience working with ILC. GLM has hired 30-40 welders from ILC for their oilÀeld manufacturing company.

Good technical skills, good experience ɺ Page D12

“Ukrainians are very hard working,” said Charpentier. “They are used to working long hours in Ukraine so they are not going scoff at working some overtime, especially since they know if there is the opportunity to immigrate, they are going to work a lot harder. “They also have good technical skills, good experience, and are well educated. That’s what makes us confident hiring into the Ukraine market.” Ukraine imports most of its oil but offers training for careers in the energy sector at the National Technical University of Oil and Gas in Ivano-Frankivsk. ILC tries to recruit experienced oilfield candidates in Ukraine who typically come to Canada on a temporary basis, usually for a two-year

term. “We usually try to ﬁnd candidates with drilling experience,” said Charpentier. “It makes sense in the long run – if the employer wants to keep them, they can apply through the Saskatchewan Immigrant Nominee Program in Regina. That way, the employer can keep them full-time.” Charpentier cites the example of Royal Well Servicing in Lloydminster that recently promoted a couple of its temporary immigrant workers to positions of skills in demand as drillers that allows them to seek permanent residency in Canada. Ukrainian workers who gain oilﬁeld experience in Russia are motivated to work abroad by the promise of higher wages and a better lifestyle, says Charpentier. “In Kiev, the capital, you can make only US$500 a month. That’s the av-

erage wage. “When you see the average wage in the oil patch here they see the opportunity to immigrate. “Many of the people have families that come on their own, but if they know there is an opportunity for them to immigrate long term, that’s a real motivation for them.” Charpentier says there was a recent video in Ukraine that reported that 49 per cent of young people surveyed would be interested in leaving

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• Industrial touch screen PC with a simple, easy to use interface • Real time monitoring of pressure, temperature, ﬂow and tank levels • Automatic safety shutdown control on pressure and/or temperature alarms • PDF reports of all jobs saved on the hard drive and easily transferred to a USB stick to be passed on to the client at the site • Remote support anywhere world wide with an internet connection • Optional GPS system for easy navigation on road or in the patch • Optional Field Invoicing Module to complete work tickets in the ﬁeld

the country to work abroad. Since 2000, ILC has facilitated the recruitment and placement of more than 5,000 Ukrainians in a variety of trades and occupations collaborating with employers in international markets such as Canada, United Kingdom, Republic of Ireland, Sweden, Italy, and several others. In Kiev, ILC is aﬃliated with the Kyiv Youth Labour Centre (KYLC), a state agency, that was established in 1993.

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D14

PIPELINE NEWS June 2011

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PIPELINE NEWS June 2011

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Emerge scores a double oil play Calgary – Emerge Oil & Gas Ltd. scored a double oil play in April. The feat was accomplished with their productive first Viking light oil well at Coronation, Alberta and a productive heavy oil well near Primate, Saskatchewan in a new heavy oil pool. The Viking well began producing on March 15 with a 30 day average of 120 boepd comprised of 70 per cent light sweet oil and 30 per cent natural gas. This is an 800 metre horizontal well completed with a 16-stage, 15-ton per stage waterbased frac. The well is one of four (3.5 net) wells completed in the first quarter of 2011 as part of the company’s 2010 heavy oil farm-in commitment. A farm-in is an agreement when one oil and gas company buys an interest from another in an existing oil field, to help finance development and production. Emerge has two (1.9 net) follow-up locations ready to be surveyed following spring breakup,

and plans to drill a total of ﬁve wells in this area in 2011. The Calgary-based junior oil and gas company has four (three net) sections of land with Viking potential in the Coronation area for future development. A farm-in well in the Primate area southeast of Macklin has produced at a 30-day average rate of 120 boepd since it came on production in the ﬁrst quarter of 2011. This new heavy oil pool discovery is on trend with a heavy oil pool discovered in 2005 which has accumulated more than 1.5 million barrels of oil to date. Emerge has access to 1,920 acres (three sections) with a 100 per cent working interest in the Primate area. The company has seven follow-up wells surveyed to date with a potential to drill a total of 12 wells to develop in the McLaren heavy oil pool. The company currently operates within two principal areas, including the Lloydminster heavy oil area of

west-central Saskatchewan and the medium to light oil producing area of east-central Alberta. Emerge is continuing to develop its drilling program on farm-in lands prospective for Viking light oil in the Kirkpatrick Lake area of Alberta, south of their Coronation properties. The farm-in agreement, announced on Jan. 25, provides Emerge with access to approximately 30,000 net acres (approximately 47 net

and plans to spud its ﬁrst well as soon as spring break-up permits. Emerge also reports that its Silverdale oil battery near Lloydminster became fully operational in early May and will play a major role in reducing operating costs for 2011. The company anticipates a $1.50-$2.50 per boe reduction in corporate operating costs over the second and third quarters of 2011 from the Silverdale battery

expansion. The facility, which includes an oil sales pipeline, natural gas metering station, emulsion processing, water injection and truck weigh scales, will have the capacity to treat 12,000 boepd of oil and inject 60,000 boepd of produced water. Emerge has invested approximately $10 million into the construction of this state of the art facility, which is capable of processing third party volumes.

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Pad drilling AKITA Drilling Ltd. is staking much of its future on the success of pad-drilling, and currently counts 11 paddrilling rigs among a 35 total drilling rigs. By year-end, the Calgarybased contractor will add three more pad-drilling rigs to its fleet, and finish 2011 with 39 rigs in all. Murray Roth, AKITA's vice-president of finance and chief financial officer, said during their annual meeting in Calgary May 9 that pad-drilling rigs can cost $15 million to $20 million each, but better economics and a smaller environmental footprint makes them strong competitors in Western Canada's drilling market. Heavy oil and steam-assisted gravitydrainage (SAGD) wells are a mainstay for such rigs, he said, adding that two of the company's pad-drilling units are also drilling for potash in Saskatchewan. Management said conventional rig activity and rig rates showed

sections) of land, of which approximately 28 net acres include Viking petroleum rights. Emerge has committed to drill ﬁve horizontal Viking wells to earn a 70 per cent working interest in 10 sections of land, with a rolling option to earn the remainder of the farm-in lands. The ﬁve commitment wells on the farmin deal are required to be drilled by Aug. 31. Emerge has surveyed 11 wells to date

marked increases in the ﬁrst quarter, compared to 2010, while the company's increased number of pad rigs contributed to the overall increase in quarterly revenue.

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PIPELINE NEWS June 2011

Baytex plans 5 cyclic steam wells Calgary – Baytex Energy Corp. reported its ﬁrst quarter results of 2011 in May, tipping its hat to what lies ahead for its oil and gas exploration and development program in Western Canada and the United States. The Calgary-based company produced a quarterly record of 46,902 barrels of oil equivalent, an increase of four per cent over the previous quarter. “We expect quarter-to-quarter production growth throughout 2011,” said Anthony Marino, president and CEO, in a May 12 news release. “Due to better than anticipated heavy oil drilling results and gas plant restrictions on certain gas properties that aﬀect both natural gas and natural gas liquids (NGL) production, we now project that our production mix will be comprised of 69 per cent heavy oil, 15 per cent light oil and NGL and 16 per cent natural gas.” During the quarter, Baytex participated in the drilling of 71 (57.8 net) wells with a mix of 60 (46.8 net) oil wells, one gas well, six test wells, three thermal observation wells and one dry and abandoned well. The company will continue to advance its Seal thermal project in the Peace River oilsands with news of a third successful injection cycle on their pilot well in the quarter with a projected steam to oil ratio of 1.9 based on initial production results. Baytex also completed the acquisition of new heavy oil assets near Seal and in the Lloydminster area of western Saskatchewan for $155 million. Baytex has an exploration and development capital budget of $325 million for 2011 designed to generate an average production rate of 49,000 to 50,000 boepd for the year.

This pie chart shows the asset mix and associated revenues for Baytex Energy in the Àrst quarter of 2011. The company has an exploration and development capital budget of $325 million for the year. Image submitted

The company plans to drill at least 15 additional multi-lateral cold horizontal wells at Seal this year. A third rig was added to the Seal horizontal drilling operations at the end of the quarter. Plans are afoot to drill an additional five horizontal cyclic steam stimulation wells at its Cliffdale CSS site near Seal to complete a 10-well commercial module. In the first quarter the company drilled one

thermal observation well and four horizontal CSS wells at Cliﬀdale. Those wells were placed on cold production at rates of approximately 25 barrels a day per well and are scheduled for steam injection upon the completion of steam facility expansion. The heavy oil assets acquired in the Lloydminster area contributed approximately 1,400 bpd in the ﬁrst quarter that should rise to 2,600 bpd for the rest of 2011. ɸ Page D17

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PIPELINE NEWS June 2011

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North Dakota Bakken, Three Forks on Baytex's horizon ɺ Page D16 During the ﬁrst quarter, Baytex drilled 31 (28.8 net) producing wells and two thermal observation wells on its heavy oil properties in the Lloydminster area. Baytex also drilled eight (5.4 net) oil wells, one gas well and one dry and abandoned well in its light oil and gas areas of Western Canada. Light oil and natural gas production averaged 15,110 boepd in the quarter on a mix of 6,606 barrels per day of light oil and NGL and 51 mmcf/d of natural gas. The company drilled and completed three net horizontal Cardium wells in the quarter. Two of the wells were placed on production and established 30-day average peak rates of approximately 230 boepd per well. The company plans to drill approximately ﬁve additional Cardium horizontal wells in 2011. Baytex also drilled and completed one unstimulated Viking multi-lateral well in Alberta that has not been on production long enough to establish a 30day average peak rate. Plan call for the drilling of approximately 15 additional Viking light oil horizontal wells in 2011, the majority of which will be unstimulated multi-lateral wells in Alberta. In the Bakken/Three Forks play of North Dakota, 12 (3.6 net) wells were drilled in the quarter that ended with 11 (4.1 net) wells waiting for multi-stage fracture treatments. Fracture treatment dates are scheduled in the current quarter for at least seven of those wells. To date, Baytex-interest wells on 640-acre spacing have established 30-day average peak rates of 260 bpd. Meanwhile, Baytex-interest wells on 1280-acre spacing have established 30day average peak rates of 435 bpd.

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PIPELINE NEWS June 2011

Titanium acquires do-it-all e-coil units By Geoﬀ Lee Lloydminster – Titanium Tubing Technology Ltd. continues to live up to its name with the introduction of a new stiﬀ e-line unit that eliminates the need for a downhole tractor to push tools or equipment while logging or intervening in horizontal wells. The hybrid unit will also be backed by a new instrumentation coil tubing unit suited for obtaining real time data in steam assisted gravity drainage (SAGD) heavy oil applications. Titanium is working with Perm Services Inc. in Calgary to build their own instrumentation strings. “We are really excited about all the new tech-

“

We will be the ﬁrst service after the drilling rig to be on the well just to make sure everything is in good condition before they carry on with the well service

”

- Pat Potter, Operations Manager nologies we are pursuing,” said Pat Potter operations manager at the company’s base in Lloydminster. “We are kind of going in a couple of diﬀerent

directions trying to capitalize on as much technology as possible.” The e-line unit will run an electric line similar to what’s used on a wireline unit pumped through coil tubing and pushed downhole with an injector instead of a tractor. “We have it down at the manufacturer doing retrofits,” said Cory Potter president. “It’s going to have a scissor lift cab and more capacity on the drum. “We are not the first ones to have it but it is something we want to move into. “It should be more cost effective and more efficient because those tractors break down often. The failure rate on a tractor is pretty high.” Supervisor Chris Bogue expects the market will embrace the benefit of having real time date returned to surface by the wireline inside the coil when the unit goes into service in June. He says the unit is a big improvement to running a memory logging tool or a time delay tool to the bottom of a horizontal well, and not knowing if it collected any data until the unit is brought to surface. “Some of these jobs are taking 10 to 15 hours to do and when they get it to surface they still have to check to ensure they have data,” said Chris. “Sometimes they don’t have data so the oil company has to pitch another 10 to 15 hours of running time for multiple services to re-run the tool because it didn’t work the first time. “With electric line coil you can get immediate data results from the bottom of the hole. “If the tool is not working you can go about different procedures to make it work, or immediately pull it out of the ground without having to waste time logging the whole horizontal lag just to find that it’s not working and having to re-log it.” Chemicals can also be applied through the coil tubing when the wireline is pulled out. Pat says the decision to acquire the e-line unit and instrumentation unit fits the company’s plans to grow through diversification and new technology opportunities. “It’s going to be a great thing for us. It has the potential to be pretty lucrative for us. We are leaving a lot of potential revenue on the table by just doing the service work,” said Pat. “We are promoting stiff e-coil as something that’s going to do away with downhole tractors. “It gives you real time capabilities as opposed to memory tools or time delay tools. With real time and coil tubing, you are seeing everything as it happens so that is the huge benefit. “It’s a huge cost savings to the customer because you know if you have a failure in real time you can correct that as it’s happening.” Ditto the enthusiasm from Cory who says this will be the first time Titanium Tubing has done any wireline services. “I think it’s a great growth area for us. A lot of the data we are looking for is to make sure the cement in the casing is good (bond log). “It will be a real good addition to the company and bring some great experience for our guys. “We will be the first service after the drilling rig to be on the well just to make sure everything is in good condition before they carry on with the well service.” The new instrumentation coil tubing unit designed for SAGD heavy oil applications will feature the instrumentation strings built by Perm Services. Instrumentation coil is coil tubing with M.I. (mineral insulated) cables in it to run temperature and pressure recorders and return real time data to surface. “The instrumentation itself will give you real time data to surface mainly for SAGD applications so can tell temperatures and bottom hole pressures which is huge – there is no more strip mining,” explained Chris. ɸ Page D19

PIPELINE NEWS June 2011

D19

Cory Potter, Chris Bogue and Pat Potter from Titanium Tubing Technology are excited about the business prospects for their new stiff e-line unit and a new instrumentation coil tubing unit to be delivered in June. Photo by Geoff Lee

Titanium catches east coast attention Éş Page D18 â&#x20AC;&#x153;Once they start to learn the data from these wells they can increase the production.â&#x20AC;? The data will allow the well operator to steam the formation to the optimal temperature to maximize the amount of oil they can get from the formations. â&#x20AC;&#x153;Having that data on surface real time, they can adjust to that to increase their oil production,â&#x20AC;? said Chris. Chris adds there will be additional training for the crews of both units â&#x20AC;&#x153;considering there is a whole new world of electronics inside the truckâ&#x20AC;? as well as inside the coil tubing.

â&#x20AC;&#x153;Maintenance is pretty basic, but there are deďŹ nitely some technical aspects to it,â&#x20AC;? he said. In other news, Titanium caught the attention of some east coast oil and gas companies in March that invited them to do some well servicing near Moncton New Brunswick. â&#x20AC;&#x153;It excites us to diversify in diďŹ&#x20AC;erent areas just as we are trying to diversify in diďŹ&#x20AC;erent technologies as well,â&#x20AC;? said Pat. â&#x20AC;&#x153;We have been invited to go back in the middle of June to do some more well servicing, and from there we are oďŹ&#x20AC; to Newfoundland for a couple of wells as well. â&#x20AC;&#x153;We want to capitalize on diďŹ&#x20AC;erent markets and oil ďŹ elds.â&#x20AC;?

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D20

PIPELINE NEWS June 2011

Essential bulks up and heads to Colombia Calgary – Essential Energy Services Ltd. can claim official bragging rights as the largest provider of coil tubing and nitrogen well services in Canada on May 31 when its $187 million acquisition of Technicoil Corporation is a done deal. The acquisition announced April 4 also means Essential will be the fifth largest conventional service rig operator in the country. The Essential well servicing fleet numbers 54 service rigs, 34 coil tubing rigs, and 23 rod rigs. There are also 14 e-line trucks in the company’s downhole services and rentals division. The Technicoil purchase adds 17 masted coiled tubing service rigs and nine mobile free-standing conventional service rigs to Essential’s inventory. The combined company will be strategically positioned to service the various oil and liquids rich natural gas resource plays in Western Canada that are being developed with horizontal wells and multistage fracturing technology. Essential also sells and services a full range of downhole holes including the Tryton Multi-Stage Fracturing System from its Tryton Tool Services Ltd. division locations across Western Canada. “We are excited by the deal,” said Mike Drever, who is the general manager of coil tubing operations from Red Deer to Manitoba. “As far as Essential goes, we cover it all right from our shallow gas around Medicine Hat to the deeper Class II stuff and now with Technicoil, it just takes it to a whole new level. “We have 34 coiled tubing units without Technicoil. They are coming onboard with 17 of the deeper ones. They just complement what we’ve already got going on. Everybody’s excited about the deal.” Essential has been working out of Weyburn for a number of years with trucks heading as far east as Manitoba to provide a full range of well completions

Essential Energy’s acquisition of Technicoil Corporation makes the Calgary-based company the largest coil tubing and nitrogen provider in Canada and the Àfth largest conventional service rig operator in the country. Essential is well established in the Bakken play of southeastern Saskatchewan. Graphic submitted

and workovers and wireline and fracking services. “Horizontal drilling is huge as far as we go,” said Drever. “Out in that area we are drilling the ports and working alongside some of the bigger frac companies fracking the wells. “Basically we are doing anything and everything as far as those horizontal wells go.” Essential is also poised for growth in Colombia and has shipped one double service rig, two coil tubing rigs, two nitrogen pumpers, three rod rigs and two wireline units south to commence servicing producing wells and new drilling activity in that country.

Colombia is the third largest oil and gas producer in South America and its royalty structure supports further exploration and development activity. Essential sees growth in Colombia through oil and gas plays involving horizontal well drilling stimulation and completion technology. Essential has a $27 million capital spending budget for 2011 focused on increasing the depth of its coil tubing ﬂeet, upgrading service rig support equipment and increasing tubular rental stock. The Calgary-based company states in its ﬁrst quarter released May 10 that it will review that budget once the Technicoil acquisition is complete.

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PIPELINE NEWS June 2011

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Custom manufactured trailers Regina – Advance Engineered Products Ltd. expects its new second generation wet/ dry combination unit manufactured at its Regina plant will generate a honk or two from oil and gas industry end-users. The ﬁrst two combo units were delivered in April to a major Western Canadian petroleum carrier that will use it to haul liquid diesel or gasoline in one direction, and dry products such as cement or lime on the backhaul. The wet/dry combo unit eliminates empty miles and hauls up to 94 per cent of the payload of conventional one-way petroleum and pneumatic B-trains. “You only haul wet or dry in one direction,” said Doug Kee Jr., manager of national accounts at Advance’s head oﬃce in Regina. “You can’t just load up the whole train because you would be overweight. It’s really for picking up the payload on the backhaul.

“There are a lot of companies out there with larger fleets that do both hauls, especially in the eastern part of the country. “You are putting more money in your pocket if you can haul in both directions. The second largest cost behind the driver in the trucking industry is fuel.” The two combo units were custom built for Advance’s fleet customer to replace their first generation units that went into service in 1988 and 1990 and were recently retired. “They decided that the spring suspensions and everything have been beat up enough on them that they are retiring those units and wanted replacement units for that haul,” said Kee. Each unit has a 53,000 liquid litre capacity over four TC 406 coded liquid compartments and 1,400 cubic feet of dry bulk capacity over two compartments which feed three hoppers.

Advance Engineered rolled out two new wet/ dry combination units for 2-way hauls at its manufacturing plant in Regina. Pictured (l-r) are: Daryl Stauch (truck driver), Doug Kee Jr. (manager - national account ), Darryl Rieger (Ànal assembly leadhand), Ken Balzer (quality control), John Secuur (suspension foreman), Randy From (Ànal assembly), Kevin Rieger (Ànal assembly), Terry Yanko (Ànal assembly).

The new wet/dry combo unit can carry typical bulk liquid products such as bio-diesel and ethanol and dry loads such as salt, sand and crushed limestone. “Our capabilities are not limited to building just wet or dry,” said Kee. “We could build wet/ wet. “In the past we have built ones with the middle section made of stainless steel, and you can haul acid in the middle and diesel on the outside compartments. “We could do so many diﬀerent things with this in so many different marketplaces.”

Advance Engineered specializes in the custom manufacture of tank trucks, trailers and vacuum truck equipment made for a global market at three main manufacturing facilities in Regina, Kamloops and Surrey. “We are very custom,” said Kee. “A lot of companies aren’t as custom as us and not willing to work with their customers maybe as much as we are. “If someone wants a speciﬁc kind of suspension or a paint job, or a speciﬁc kind of tires or running gear, we can make any changes that

the customer asks for. “We consider ourselves to be the premier custom manufacturer in Western Canada. “That’s what we really push for. We don’t just have a run of the same stuff very often. We build for people with specific needs or specific hauls.” Advance Engineering has service locations across Canada including shops in Lloydminster, Saskatoon, Regina, Calgary, Edmonton, Kamloops and Vancouver serving Western Canada. The company also operates Westech Vac Systems (Nisku, Alta.),

Dumur Industries (White City, Sask.), and Lazer Inox (SaintGermain-de-Grantham, Quebec) as wholly owned subsidiaries. “We are pretty diverse,” said Kee. “It comes from having a marketplace that is so up and down that you have to find different niches to get into and keep everybody working. “We have taken on quite a few different products over the years. An example of what we are building is another wet/dry combo with the ability to haul wood on the top of a diesel tank. ɸ Page D23

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PIPELINE NEWS June 2011

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Backhaul market eyes a new wet/dry combo ɺ Page D21 “You can haul diesel into a remote location like in the pulp and paper industry, and then you turn around and haul wood out. “It’s a big cost saving. About a third of your cost is fuel,” Kee said. Advance Engineered builds everything from aircraft refuelers and dairy and sanitary transports to hydrovacs and petroleum and crude oil trailers. “The crude oil market is the strongest right now for us,” said Kee. “Our busiest market is Western Canada. It’s mostly oil driven. “We are making a lot of tridem trailers for the crude market and also 38,000 litre crude oil haulers

for the Lloydminster area. “A lot of the larger ﬂeets are ordering replacement units that they are going to retire. Last year and the year before wasn’t fantastic for the market so a lot of people didn’t order a lot. “They decided this year is the year they are going to order to replace some of their components. We are busy,” Kee said. Advance can custom manufacture everything from 406 reverse super Bs and to 407 tri-drive trucks for crude hauling and a full range of petroleum haul-

ers from cargo tanks to stainless steel transport products. “The oil and gas market is driving the demand,” said Kee. “As soon as the crude market goes up, then the petroleum market goes right after that. “If they are bringing the product out of the ground they have to reﬁne it and somebody has to deliver it after it’s done. “They also have to supply fuel to those rig sites of the industry that takes it out of the ground,” Kee said.

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We are currently adding safety professionals, safety trainees and experienced safety rescue personnel to our team. Due to unprecedented growth in all areas we are currently seeking the following safety personnel: 1. NCSO National Construction Safety Officers - Fully accredited NCSO are required for new positions within the company. If you are currently working on your designation, we are willing to support your completion. Use Reference # 11-02-01 NCSO. 2. Safety Supervisors - Senior and Junior. We are actively seeking fully qualified senior safety supervisors capable of supervising large projects and turnarounds. Qualified junior supervisors will be included in our in-house safety training programs and be eligible for progressive promotion. Use Reference # 11-02- 02 Sup 3. Safety Trainees - People with a desire to lead safety on the work site and willing to participate in our comprehensive safety training program are encouraged to apply. Basic Oilfield tickets are required to be considered for this position. Use Reference # 11-02-03-trainee 4. High Angle and Confined Space Entry Rescue Personnel - Must be willing to continuously train to hone your skills. You must also be prepared to work as a team member both on and off the worksite. Use Reference # 11-02-04-Rescue 5. Safety Equipment Quality Control Technicians - Experience in the repair and maintenance of breathing apparatus and gas detection is a requirement to be considered. Use Reference # 11-02-05-Techs 6. Safety Training Instructors - Must be certified in ENFORM H2S Alive and St. John Ambulance First Aid instructor programs. Use Reference # 11-02-06-Instructor In return for your commitment, we offer a highly competitive compensation and benefits package, combined with long term career development. We are currently offering the following positions at these operating centres: Lloydminster, Bonnyville and Red Deer, with the Safety Equipment Quality Control Technicians operating from Red Deer office. Target Safety Services Ltd builds and fosters an environment that takes pride in working safely in a team environment and is managed through effective leadership. We are committed to providing continuous training and we support a substance abuse free workplace.

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PIPELINE NEWS June 2011

Endless Tubing adds oil to its gas pro¿le Maple Creek – Low natural gas prices continue to lead Maple Creek Endless Tubing Ltd. on its path of diversity that began last year with the addition of its first two Class II coiled tubing service units for oilfield work. A third Class II unit will be delivered any day, breaking the company’s longheld profile as a privately owned business providing specialized service to gas companies in southern Saskatchewan and Alberta. “It got a little slow in natural gas last year because of the commodity price being down so we got into the Class II,” said company founder and president Dan Holmedal. “We acquired two units last year, and I have another one being built as we speak. It should be done here in a month. “We are trying to get into this horizontal well cleanout market with our three units. We are trying to diversify. You have to do whatever you can with what you’ve got.” Endless Tubing converted two of its Class I units into 1 ½ and 1 ¾ inch Class II units with the third two-inch unit being manufactured for clean-outs and drill outs and related well work. The 1 ¾ inch Class II unit has an e-line in it for perforating and logging on horizontal oil wells. Holmedal says Endless Tubing has been a family business since its inception in 1987 with his wife Janice handling the bookkeeping and administration. One of their sons, Joel, is the safety co-ordinator and another son, Derek, overlooks the Class 11 operations. Endless Tubing has a fleet of 14 service vehicles working out of their established locations in Medicine Hat and Maple Creek and their new oilfield base in Shaunavon. “We have a little bit of work around Shaunavon, and we do a little in Weyburn and up around Red Deer with 5 1/8 inch BOPs on each Class II unit,” said Holmedal. “They are mostly doing cleanouts on horizontals because they have a capacity for servicing up to 3,200-metre wells. Asked to describe the buzz about Shaunavon, a 90 minute drive from Maple Creek, Holmedal said, “The people around Shaunavon – they’ve got a heck of a boom town going on. “There is no place to stay. There is a lot of building going on there. Shaunavon’s a happening place right now. “It’s getting really busy around the Shaunavon, Gull Lake and Kindersley areas.”

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Holmedal is also buoyed by news that natural gas prices are strengthening along with the demand for the company’s Class I coiled tubing units for shallow natural gas cleanouts. “Business is starting to pick up a little bit,” he said. “The commodity price came up a little bit so there is a little bit more activity. It’s mostly cleanouts and abandonments and stuﬀ like that. “It was pretty slow last year between being wet and everything, but it’s picked up a little bit. I think it will be OK this year. “Right now for the new equipment, horizontal wells are driving the business. I am building a 2 inch coiled tubing unit right here right now. “ Endless Tubing also has a pumping unit, catch tanks that go with each unit and a side spooler to spool tubing. “We leave tubing in the ground in a lot of the shallow gas wells around here and they change out the sizes and we can roll it up and dispose of it or store it,” explained Holmedal. Some of the Class I equipment is used to do cleanouts on old existing gas wells to get their production back up.

Maple Creek Endless Tubing had a rig on display at the Redvers Oil Showcase in 2010. File photo

Customer First • One Advance • Operational Excellence

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Gibso is a leader in the truck transport Gibson of en energy products throughout North America. With a ﬂeet of over 1,900 Amer trailers, Gibson can carry out logistically trailer complex jobs safely – no matter the comp product, volume or destination. produ Check them out at www.gibsons.com! Chec

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PIPELINE NEWS June 2011

D25

Call for funding expires June 6 The Alberta Upstream Petroleum Research Fund (AUPRF) is seeking applications for the 2012 funding cycle for projects that are of focused interest to industry. Industry has invested over $2.1 million in 2011 in AUPRF environmental research projects leveraging signiﬁcant additional funding resulting in projects with total costs equaling more than $7.8 million.

Research funds are generated through an Alberta well levy, collected on behalf of the Canadian Association of Petroleum Producers (CAPP) and the Small Explorers and Producers Association of Canada (SEPAC) by the Energy Resources Conservation Board in Alberta. The AURPF funds are distributed with direction from CAPP and SEPAC as part of their commitment to improving environmental, safety and health

performance of their members’ operations. The Petroleum Technology Alliance Canada (PTAC) has been contracted to facilitate this program and is neutral in the AUPRF process. The deadline for Step 1 applications is June 6 after which selected applicants will be asked to submit detailed proposals in mid June. Visit the PTAC website (www.ptac.org) for more information on the funding application.

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PIPELINE NEWS June 2011 Left: Romyn Clark, from Camrose Composite High School took second place honours in the auto service trades competition at the Vermilion campus of Lakeland College. Photos submitted

Right: The future of trades is in good hands in the Lloydminster area judging by the results of this year’s regional skills competition for trades. Trevor Charron from Holy Rosary High School in Lloydminster won the electrical wiring event and qualiÀed for the provincials held May 11-12 in Edmonton.

Come and see us at the WEYBURN OIL SHOW!

Students earn berth in provincial trades test Vermilion – The 2011 Lakeland Regional Skills Canada trades competition was well timed to tweak interest among Saskatchewan and Alberta high school students bused to the second annual bi-provincial Try-A-Trade Career Expo in Lloydminster May 3-4.

More than 1,900 students from the two provinces came to the expo to learn about trades through handson demonstrations and information at the Lloydminster Exhibition grounds. Many students and teachers came to the event stoked by the success of Alberta students at the skills competition held at the Vermilion campus of Lakeland College on April 21. A total of 48 high school students from Lloydminster, Mannville, Camrose, Vermilion, Kitscoty and Athabasca took part in competitions for auto service, cabinet making, carpentry, culinary arts, electrical wiring and welding. The top two performers in each trade category from nine Alberta regionals advanced to the Provincial Skills Canada competition held in Edmonton May 11-12. Karsten Nielsen from Camrose Composite High School took the top spot in auto service followed by Romyn Clark from the same school. Karen Woloshyn from Lloydminster

Comprehensive High School punched her ticket to Edmonton as the winner of the cabinet making event as did runner-up Cory McKibbin from Camrose Composite. Reuban Patterson from Camrose Composite captured first place for carpentry followed by Levi Wonsik from Mannville School. Katelyn Kjos from Camrose Composite cooked her way to the top in culinary arts with Elizabeth Brace from Lloydminster Comprehensive in second place. Trevor Charron from Holy Rosary High School in Lloydminster was the winner of the electrical wiring event. Dustin Kambeitz from Lloydminster Comprehensive qualified for the provincials with his second place performance. Ethan O’Neill, from Kitscoty Junior Senior High School earned top honours in the welding competition ahead of Evan Rondeel from Lloydminster Comprehensive.

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PIPELINE NEWS June 2011

D27

Coiled rod company joins Apex

Rick Joyes with Apex Advanced Solutions Inc. stands before a coiled rod transport trailer at the Williston Basin Petroleum Conference.

Career Opportunities

Lloydminster - In October 2010, the management group of Tierra Alta Production Systems Corp. closed a deal which resulted in the buyout of a majority shareholder thus creating a more direct partnership with Apex Distribution Inc. – One of Canada’s 50 Best Managed Companies. This direct partnership gave reason to change

the name to Apex Advanced Solutions Inc. “Our strategic partnership allows us to leverage the strength of Apex Distribution’s market presence to better serve our customers in the Canadian market. We work closely with distribution to promote the Apex advantage which has been expanded to now include all of Advanced Solutions products and

value-add services,” said Jeff Taylor, operations manager, field services. Following breakup, Apex Advanced Solutions will be introducing additional coiled rod servicing equipment, more specifically a second Truck Mounted X-celerator (TMX), a mobile Fireblade welder and a hot shot truck and trailer, to the Southern Saskatchewan area. “This added investment will enable us to better serve our valued clients in the area and allow us to expand our coiled rod business in the market. As our business in the region grows, Apex Advanced Solutions will continue to add the required equipment to service its customers,” Taylor said. Apex Advanced Solutions Inc. is part of the Apex Group of Companies which is comprised of: Apex Distribution, Apex Valve Services, Apex Remington (USA).

Integrity Maintenance is looking for

Labourers Must have valid tickets Please fax resume to: 1-306-453-2298 Attn: Mark Slykhuis Or call: 1-306-577-3311

Magnum Cementing Services is currently accepting applications for drivers, operators, supervisors and manager in ALL LOCATIONS. Past experience is an asset. Magnum offers a competitive wage and bonus program. If you are looking for a positive work environment and ability to grow with the company this is the job for you.

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Seeking

Apprentice & Journeyman Heavy Duty Technicians phone: Tyler 780-872-3885 Kevin 780-871-8931

Precision Well e l Servicing Ser Servicing i g in Es Este Estevan steva van is currently looking va oki king ng g for a:

Heavy H eavy Du Duty ty Mechanic Mec nic c Who is res responsible sp for mechanical chaniica cal al repair repa re pair iirr and and maintenance main m n of industrial dustrr engines, service ervicee rigs er rig igss and and support supp su ppor orrt equipment. eq qu Requirements: emen n Relevant Rele leva vant nt ttraining, rainin ing, in g, credentials ntials an and nd ccertiÀ e cations; valid d driver’s drivv ’ss licence; certiÀed to complete com mpl e a PMVI/CVIP PMVI pecti tiio on and d proven p oven n mechanical mech nical abilities bi ities in in engine eng g Inspection & electrical electtriicall overhaul. overhaull. Precision n offers offeers competitive compe peti titi tivee pay, pay a , excellent e cellll t beneÀ ex b eÀts and prog pr ogre ress ssion n opportunity. oppo ort rt progression Please apply apply in in person/phone pers pe rson son/p /pho hone ne (306) (30 3066 637.6257 too Matt O’Neill, O resum um m to MONeill@precisiondrilling.com MON O ei ONei eillllll@p @precisiondrilling ng.com or ng o visit the or email resume ect ctio ion io n of our our website web w ebsi eb site at:: Careers section www.precisiondrilling.com ndri nd r lllling co ri om

Suretech Tool Services Inc., a new and progressive service company, is seeking a downhole tool technician for the Lloydminster area.

Pumping & Stimulation Division Are currently accepting applications from individuals experienced with:

Preference will be given to experienced tool hands. Suretech offers competitive compensation, beneÀts and room for advancement.

Interested applicants can submit a resume to: kschneider@suretech.ca or by fax to 403-948-3320. Only those candidates suitable for the position will be contacted for an interview.

Fax: (780) 872-5239

Coil Support Pumping Acidizing

Nitrogen Pumping Remedial Cementing

With some of the newest equipment in the industry and Technicoil’s commitment to its employees, we offer room for advancement, excellent wages & benefits. If this opportunity interests you and you have a current H2S Alive, First Aid, PST and a Class 1 or 3Q Driver’s license with a 5 year Driver’s License abstract, please apply to: In Person: 5416-39139 Highway 2A (Blindman Industrial Park) Phone: FAX: E-Mail:

Red Deer County, AB T4S 2B3 403-314-3090 403-309-3320 dfraser1@technicoilcorp.com

D28

PIPELINE NEWS June 2011

Career Opportunities Journeymen Electricians Employment Opportunity Independent Pump Co. is a locally owned and operated Subsurface Pump Shop, serving south east Sask. Duties: Repair, Assemble, Deliver and Perform Various tasks related to Subsurface Pumps Must be able to provide, Excellent Communication and exceptional organization skills. Dedication to excellent customer service is a must * Special consideration will be given to those with a mechanical ability and oilÀeld experience.

Subsurface Pump Technician: Technician * Wage: Competitive and reÁective of experience * Excellent Health BeneÀts * Bonus Program * Must have a valid drivers license and drivers abstract * Capable of working Áexible hours and participating in the on call rotation * Safety tickets are an asset, but not required Please drop off resume to: Independent Pump Co. 72 Devonian Street Estevan, Sk. S4A 2A7 Or e-mail: cwock@ipc-sk.ca Come join the Small Business atmosphere today Only persons to be interviewed will be contacted.

PetroBakken Energy Ltd. is a premier, light oil exploration and production company targeting resource plays that offer growth and high netbacks.

2 OPERATORS (ESTEVAN) 2 FOREMEN (ESTEVAN) 2 FIELD EHS ADVISOR (ESTEVAN) PetroBakken offers a competitive compensation and benefits package including relocation. For more information about the above positions go to our website at www.petrobakken.com Thank you for your interest. Only those selected for an interview will be contacted.

Class 1A, Heavy Duty Tow Truck Drivers for the Lloydminster area. Full time, Permanent Position. Will Train. Abstract Required. Call John or Ginette 1-888-875-8111 or Send Resume to Fax: 780-846-0005 Email: actiontowinglloyd@hotmail.com

PowerTech Industries Ltd. in Estevan is seeking 3 Journeymen Electricians for work in the Southeast Saskatchewan Oil & Gas Industry.

This truck is looking for an experienced Crew Foreman

Education: Interprovincial Journeyman Electrician Experience: 1 year (preferred) Safety Certificates are needed. 1st Aid/CPR, H2S, WHMIS. Applicants must have a valid driver’s license. Oilfield background preferred. Full benefits packages and RSP plan. Duties: Day to day electrical construction and maintenance in the oilfield. Wage/Salary Info: Depending on experience & qualifications. To Apply: Fax: (306) 637-2181, e-mail sschoff.pti@sasktel.net or drop off resume to 62 Devonian Street, Estevan, SK.

is looking for a CREW FOREMEN Join our team! Must have all required tickets related to positions. Competitive salary & beneÀts negotiable with experience. Fax resume to 634-6949 or email to: kpachal@supremeoil.ca or call Dwight 421-3778

PIPELINE NEWS June 2011

D29

HELP WANTED

OilÀeld & General Logistics Since 1984

Pipeline construction company requires

Specializing in Bulk Acids & Solvents

Estevan, Sk. Branch

REQUIRES IMMEDIATELY

DRIVERS

Labourers Pipefitters Foreman 1 ton operators Equipment operators Welders

for Acid Transport Trucks to work out of Estevan Branch. Multiple positions available. Good Mechanical skills and safety tickets needed. Mandatory drug & alcohol testing performed. BeneÀts available and competitive wage scale.

Fax resume and current Driver’s Abstract to:

403-529-6790 or 306-486-2043 For more information call 306-461-9385

email: bclowery@banditpipeline.com or fax 780-875-7684

Essential Coil & Stimulation Services is a company recognized for safety and excellence with in the oil and gas industry. We strive to provide a good working relationship with our customers. Currently we provide services throughout Alberta and Southern Saskatchewan. Essential Coil offers competitive wages, scheduled days off, group beneÀt plan and employee savings plan. If you are an energetic team player with superb attention to detail and strong communication skills, we invite you to apply for the following positions at our Weyburn location:

TRICAN WELL SERVICE LTD. is one of Canada's fastest growing well service companies, providing a comprehensive array of specialized products, equipment and services utilized in drilling, completion, stimulation and reworking of oil and gas wells in the Canadian and International marketplace. At Trican, we base our recruitment practices on the belief that a company's greatest asset is its people.

We are looking for a qualiÀed person for the following position:

Shop Hand

Coil Tubing Operators Coil Tubing Helpers

Apply with resume to

Class 1 driver’s license is preferred, but all class of drivers are welcome to apply. Previous oil Àeld experience & valid tickets are an asset Email or fax your resume & a current driver’s abstract to: tschwab@essentialcoil.com Fax: 306-842-8906

93 Escana Street or fax to (306) 634-4294 or mail to P.O. Box 1488 Estevan, SK S4A 2L7

Looking for

Toughnecks “Is it your time to shine? Ready for your shot? Looking for opportunity for advancement?”

Precision Well Servicing. * Openings in the Southern Saskatchewan and Manitoba Areas for:

Trican provides services in Fracturing, Cementing, Acidizing, Coiled Tubing, Nitrogen and related services in our field bases ranging from Fort Nelson, BC to Estevan, Saskatchewan.

WE ARE CURRENTLY HIRING:

• SUPERVISORS • OPERATORS • DRIVERS • FRAC HANDS • HEAVY DUTY DIESEL MECHANIC • BULK PLANT OPERATOR • NITROGEN OPERATORS ND • 2 YEAR APPRENTICE HEAVY DUTY DIESEL MECHANIC A valid Class 1 required as well as prior experience in the above pressure pumping operations. Class 3 and selected Class 5 licenses will be accepted. On the job training from the ground up. Seasonal positions available.

Trican offers a dynamic work environment and a competitive salary and benefit package. Please apply in person to any of Trican's field bases or forward your resume and references, in confidence to:

Trican Well Service Ltd. Box 849, Estevan, SK S4A 2A7 Fax: (306) 636-2669 • Email: rfisk@trican.ca

Experienced Operators, Derrickhands and Floorhands.

We offer a comprehensive beneÀt package, $15/day PPE Allowance, excellent wages, a safe working environment, GREAT opportunity for travel and advancement and a company matched deÀned contribution plan

You know the name, now join our team

“Recognized by our peers by receiving the Class “A” award for Safety Leadership at the annual CAODC Service Rig Awards Banquet.”

Apply today at www.toughnecks.com

Coil Well Servicing Division Is currently accepting applications from individuals experienced with Coil Well Servicing in the positions of:

Lead Operator & Operator 1 & 2 With Technicoil’s commitment to its employees, we offer room for advancement, excellent wages & benefits. If this opportunity interests you and you have a current H2S Alive, First Aid, PST and a Class 1 or 3Q Driver’s license with a 5 year Driver’s License abstract, please apply to: In Person: 5416-39139 Highway 2A (Blindman Industrial Park)

PRECISION WELL SERVICING

FAX:

Red Deer County, AB T4S 2B3 403-309-3320

E-Mail:

employment@technicoilcorp.com

If you have questions, please contact us at 403-314-3090

www.technicoilcorp.com

D30

PIPELINE NEWS June 2011

DO YOU HAVE WHAT IT TAKES?

Field / Plant Operator Weyburn Area

Canyon is the fastest growing Fracturing Company in Western Canada. If youâ&#x20AC;&#x2122;re looking for a career with a leading organization that promotes Integrity, Relationships, Innovation, and Success then weâ&#x20AC;&#x2122;re looking for YOU!

At ARC, our strong track record of success has been built on our core belief that outstanding people, combined with a great corporate culture creates a winning environment. Our Operations team is currently seeking a Field Operator for the Lougheed Ă&#x20AC;eld, near Weyburn, SK. This is a fulltime, permanent position. The successful incumbent would be required to relocate to the Weyburn area.

CLASS 1 DRIVERS Canyon is looking for: x Frac Pump Operators x Crew Cab Operators x Data Van Operators x Blender/Chemical Operators

x x x x x

The incumbent would be responsible for the day to day operation of a number of pumping oil wells and a Sour process facility which includes a Gas Plant. Duties will include (but not limited to) daily production reporting, inspection of wells and facility, routine maintenance and servicing requirements. Optimization is always an important focus. Ensure all Corporate Safety and Environmental policies are adhered to at all times. This position will provide a very challenging environment, with the potential for career growth.

Bulk Truck Operators Pump Operators Iron Operators Coil Operators Coil Supervisors

A post-secondary Technical or Engineering degree or certiĂ&#x20AC;cate would be preferred. We will consider applicants that are recent new graduates from a Petroleum Technologist or Engineering undergraduate program. An equivalent combination of post-secondary education and directlyrelated experience may be considered. The incumbent would be a positive team player with a strong work ethic. Attention to detail and strong organizational skills are also key attributes.

Applicant requirements: x x x x x x

Self motivated Willing to work flexible hours Current abstract Safety focused Team oriented

Closing Date: June 15, 2011 ARC is proud to offer a challenging work environment with opportunities for growth. Interested applicants are invited to submit a cover letter and resume to ARC Resources Ltd. via one of the following: Apply on line at: http://www.arcresources.com/en-ca/about/careers.htm Fax: (306) 634-6161

Clean Class 1 License (driving positions only)

Why Canyon?

Or Mail to:

Canyon is a dynamic, rapidly growing company powered by motivated and successful people. Canyonâ&#x20AC;&#x2122;s business continues to be conducted with integrity and consistently reflects the value of our diverse workforce, customers and suppliers. Our premium compensation package contains an industry leading benefits plan, including RRSP matching and a confidential employee and family assistance program. If you value success achieved in an ethical environment, built on strong relationships, please contact us.

ARC Resources Ltd. P.O. Box 250 Estevan, Saskatchewan S4A 2A3

We thank all applicants; however, only those selected for an initial interview will be contacted. To apply: email your resume to hr@canyontech.ca or fax to (306) 637-3379

FRACTURING ACIDIZING COILED TUBING CEMENTING

Attention:

www.canyontech.ca

Trevor Sealy Area Superintendent

We thank you for your interest in ARC Resources Ltd. however, only those candidates selected for an interview will be contacted. No phone inquires please.

Calfrac has grown from a small oilfield services company to an international leader in fracturing and coiled tubing well services.

Rotational Opportunities As a key part of our strategy, weâ&#x20AC;&#x2122;ve developed a rotational schedule for our Canadian operations. The 3-weeks-in, 2-weeks-out field positions currently available are:

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On your application, please include this code: CWS001 Call us: 1-877-908-FRAC (3722) Fax us: 1-403-234-6655 Apply online: www.calfrac.com/careers

PIPELINE NEWS June 2011

D31

Quality

Resources Guide

LAMICOIDS & metal cable tags EfĂ&#x20AC;cient Service

Call Linda for more information

4â&#x20AC;? HWDP - W/4â&#x20AC;? Full Hole Connections Specialized Reamers for 6 1/8 thru 8 3/4 Horizontal Wells 149 mm to 218 mm Reamers

Estevan Trophy & Engraving

Brad Lamontagne Tel: (306) 739-2263 â&#x20AC;˘ Cell: (306) 577-9818

Phone: 634-6005 â&#x20AC;˘ Fax: 634-6405 Email: estevantrophy@sasktel.net

Email: smrltd@sasktel.net â&#x20AC;˘ www.stoneymountainrentals.com

lancew@aspentrailer.com www.aspentrailer.com

Lance Wotherspoon Regional Sales Manager

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We Look Forward to Seeing Our Customers at the Oil Show

Aspen Custom Trailers 6017-84th Street S.E. Calgary, AB T2C 4S1

[T] 403 236 2244 [F] 403 236 8829 [C] 403 813 6319

[Toll Free] 877 236 2244

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â&#x20AC;˘ 1 Day Incident Investigation Workshop â&#x20AC;˘ Industrial Supervisor Training We can customize these courses to the clientâ&#x20AC;&#x2122;s needs. Visit us at: www.dbsafetysolutions.com

D.B. Safety Solutions Inc. Don Beahm CRSP, CHSC Weyburn, Sask. Phone: 306-842-3584 â&#x20AC;˘ Cell: 306-861-7093

LECLAIR TRANSPORT General OilďŹ eld Hauling

Lyle Leclair Cell: 306-421-7060

Lloyd Lavigne â&#x20AC;˘ Kirk Clarkson

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

Phone: (780) 753-6449

Fax: (780) 875-7076

24 Hour Service

CFP, CLU, CH.F.C., RHU â&#x20AC;˘ Life Insurance â&#x20AC;˘ Disability Insurance â&#x20AC;˘ Critical Illness Insurance â&#x20AC;˘ Employee BeneĂ&#x20AC;t Plans

Great-West Life ASSURANCE COMPANY

105, 335 Hoffer Drive, Regina, SK. S4N 6E2

Bulk Agency

OIL / INDUSTRIAL / AGRICULTURAL / AUTOMOTIVE

352-7668

TOLL FREE 1-877-778-7460

1404 SCARTH ST., REGINA, SASK.

Phone: (780) 875-6880

Dwight G. Blomander,

Tel: (306) 359-2015 â&#x20AC;˘ Fax: (306) 359-3034 E-mail: dwight@dgbcanada.ca Toll Free: 1-855-359-2015 â&#x20AC;˘ Cellular: (306) 421-1935

STOCKING ENGINE PARTS

5315 - 37th Street Provost, AB T0B 3S0

6506 - 50th Avenue Lloydminster, AB

Specializing in Industrial & Oilfield Motors

Life Licence sponsored by The

WEEKDAYS 7:30 A.M. - 5:30 P.M. SATURDAYS 9 A.M. - 1 P.M.

Owners/Managers

912 6th Street, Estevan

634-7275

RICK CORMIER Manager

Box 609 Carlyle, SK S0C 0R0 www.truetorq.ca

Bus: (306) 634-8084 Cell: (306) 577-8833 Fax: (306) 453-6075 ttorq@hotmail.com TERRY DODDS (24 hrs.) (306) 634-7599 Cell. (306) 421-0316

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

Toll Free: 1-866-457-3776

website. www.continentalengine.ca FAX 525-8222

continentaleng@sasktel.net

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

Specializing in well site and pipeline surveys Yorkton 306.783.4100

Swift Current 306.773.7733

Edmonton 800.465.6233

Weyburn 306.842.6060

Lloydminster 780.875.6130

Calgary 866.234.7599

Regina 800.667.3546

Medicine Hat 403.528.4215

Grande Prairie 780.532.6793

Box 208

Estevan, SK

S4A 2A3

461-8471 â&#x20AC;˘ 461-8472 â&#x20AC;˘ 461-8473 Call: Clinton Gibbons

D32

PIPELINE NEWS June 2011

The Metaltek Team Will Take Your Ideas To The Next Level

Metaltek shares your passion for New Technology, from adapting existing equipment to designing new products. We are committed to Quality Control at the highest levels in the industry. Our State-of-the-Art Facility provides innovative manufacturing capabilities. We continue providing Cost Effective solutions at all levels from stocked parts to prototyping.

ABSA Registered â&#x20AC;˘ Conforming to ISO and API Standards â&#x20AC;˘ 24hr Service

780 - 875 - 6535

www.metaltekmachining.com

Design - Engineering - Manufacturing

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

Special Section

50 years for Jerry Mainil Ltd. By Brian Zinchuk Weyburn – There are very, very few service companies in the oilpatch that last 50 years. So it is with this in mind that Jerry Mainil Ltd. will have set off fireworks during the Saskatchewan Oil and Gas on June 1 in celebration. It’s quite an achievement for a family firm that has withstood the numerous boom and bust cycles over the years. The second generation has stepped up, and the third generation has begun to take part in the business, too. Jerry Mainil, now 76, is no longer running Jerry Mainil Ltd., having handed it off to two of his sons, Dale and Dennis, and his son-in-law Calvin Tracey. He is still active with his oil company, Caprice Resources, a small junior producer. The third pillar in the family enterprise is Jeranda Holdings, the family farm operation that, including all the family members involved, farms approximately 17,000 acres. (See related stories page E7, E12 and E15). The anniversary of the company may be this July 1, but that’s the anniversary of the incorporation. It’s actually older than that. “I fired up before I incorporated the company,” Jerry told Pipeline News during an interview in his Caprice Resources office. “Weyburn was where I grew up. I was born in Lampman,” he said. At a young age, his family moved to Yellow Grass where his father tried his hand at running a grocery for a year and a half. They moved to Weyburn in 1946, but still farmed at Lampman. Oil production began in the Weyburn field in 1954. He was 21 when he started working over the winter of 1955-56. “I worked a year on the rigs when I came out of high school,” Jerry said, noting he was a roughneck on a drilling rig. But the oilfield wasn’t his initial plan. “I rented some land. I was going to farm. I did farm for a few years at the home farm.” Opportunity presented itself, however. “We bought a 3-ton truck, put a tank on it, and hauled water. I started hauling for Leduc Central Drilling. That was the fall of ’55. It was $25 a day to have a truck and man. ɸ Page E2

Jerry Mainil made the front page of Saskatchewan Business magazine for the March/April 1980 edition.

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PIPELINE NEWS June 2011

Incorporate family, then business ɺ Page E1 “One year my brother Art worked with me, too. Then he went back to school in ’56, and that’s when I took everything over. I was doing most of it. He hauled for a month and a half while I took a welding course. “I farmed out at Lampman until 1959. Then I hired a guy on the water truck. I started welding and was farming,” Jerry said, noting that he operated a welding truck. In 1958 he bought out Elmer Kuntz, a welder from Moose Jaw. This added a backhoe to the operation, his first dirtmover. “We just kept expanding from then on,” he said. The purchase of a pipeline outfit added a ditcher and other equipment. “I was welding pipeline before that,” he said, but noted he didn’t have the leaks the other welder had. Jerry had a small welder at the time. He was working on an old rig that had a break on the derrick. He wasn’t so sure about it, but the drilling superintendent for Central Leduc Drilling said, “You’re welding it. You get up there and weld it.” Shop, wife and family “I built my first shop in 1959, right where the newest shop is,” he said. That building was the office, and a place to do repairs and welding. The 1960s would be a busy period of business and family expansion. His wife, Orlanda Andres, also came into the picture then. “That all came about the same time,” he said. “She came to Weyburn to start working here. She was a social worker from Herbert.” They met through friends of the family, and were married June 3, 1961. “She raised six kids. That was her job,” Jerry said. Those children are, in order of age and followed by their spouse, Dennis (Cindy), Dale (Deana), Danette (Calvin) Tracey, Joanne (Doug) Maurer, Michael (Cindy, or “C.J.”) and Pamela (Darren) Haupstein. Danette is a former teacher’s aide, Joanne is a retired teacher who farms with her husband Doug, and Pamela is a chartered accountant with Sunrise Health Region, and Pamela and Darren have a dairy farm towards Griffin. Dennis was the first to arrive, in 1962, and Pamela was born in 1970. Dennis, Dale and Calvin would go on to become part of Jerry Mainil Ltd., while Michael joined the family oil firm, Caprice Resources. Incorporation “We incorporated July 1, 1961,” Jerry said.

Jerry Mainil in the ofÀce of the old shop.

By that time, welding was their biggest venture. “We started pipelining then. I bought out a fella in ’61 that was doing a lot of maintenance work. That’s when we really got going with it. “We worked as far away as Redvers and down to the border, and with wildcat rigs out west. Our main thing was here at Weyburn, and we did some at Midale. “From then on, we started buying more equipment. In the mid-’60s I bought out another guy in trucking. We got into pickers and trucks.” Dirt moving “I started with small Cats, and they just started building up, from ’63 on,” Jerry said. “We didn’t really get into lease building until the 1970s. It was mostly pipelining, cleanup, maintenance. We kept getting bigger Cats, then lease building popped in.” There was a progression of equipment, going through D4, D5, D6, D7 and D8 Cat dozers over the years.

ɸ Page E3

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The Mainil clan has stuck together, running three ventures over the years, including Jerry Mainil Ltd., Caprice Resources, and Jeranda Holdings, the family farm. From left are Calvin Tracey, Dennis Mainil, patriarch Jerry Mainil, Michael Mainil and Dale Mainil.

Oil company and farm started ɺ Page E2 Caprice startup Caprice Resources had its origins at this time, too. “It was a company we set up to deal with used equipment in 1963,” Jerry said. The name was Oilfield Sales and Salvage. It was set up with a few partners. “I picked up some land, and we drilled our first well in 1965 by Goodwater.” That well eventually became part of the Cenovus Weyburn Unit, home of the well-known CO2 flood. They have a small portion of the ownership. Jerry joked there’s a bout three zeros after the decimal in their percentage, but it’s there. “We drilled a couple more. In 1971, we got a pretty good one. It wasn’t a gusher, but it was pretty good. It’s still producing today.” It was around that time the name was changed to Caprice Resources. At the same time, there used to be a service rig company called Addison & Leyen that they shared office space within their shop. Jerry Mainil and Alfred Addison were partners in the used equipment venture, and Ron Barber (of Barber Motors) was also part of Caprice. Addison sold out the rig company around 1970s, and sold out his shares in Caprice in the early 1990s. “I drilled maybe one or two a year,” Mainil said. The mid-’80s saw more active drilling. Over the years, they had their share of duds. Michael said, “If you don’t want to drill dusters, don’t drill wells.” They’ve bought the odd well to fill in, but over the years, most of the growth has been through the drill bit, according to Michael. “That was my hobby,” Jerry said. “He had to do something in the winter,” Michael added. (see related story page E12)

Farm startup In 1968, Jerry returned to the farm, buying land northwest of Weyburn. The farm would become the third pillar in the family operation, and has grown to approximately 17,000 acres, 106 quarters of land, over 42 years between the various members of the family. (see related story page E15) Back with Jerry Mainil Ltd., the expansion phase of the 1960s led to their first satellite operation. “We operated out of Swift Current for 10 years – 1965 to 1975. It wasn’t the way I wanted, so we sold out.” He said it’s best to be in one area, and “I didn’t have the right guy running it.” With an operation in Swift Current, he bought a Cessna 182 to commute between the two sites. The plane is still in the family, and several of the children have their pilots licences. Bill 42 The mid-1970s were tough years in the Saskatchewan oilpatch. The Allan Blakeney NDP government brought in legislation that hit the oil companies hard. “We shut ’er down, completely,” Jerry said. “It was a headache from one thing to another. “It affected the whole oilfield. The companies wouldn’t spend any money. We cut back. We had to. A couple years after, things began to pick up.” The late-1970s saw their foray into lease building pick up. But it wasn’t long before Pierre Trudeau’s National Energy program in the 1980s took its pound of flesh. “We had so many great governments,” he said wryly. Things went dead again. “We just parked some equipment in the back of the yard and let the rust build up.” Things would pick up again a few years later. Coming of age By this time, the children were coming of age. They were always involved on the farm, but now they were putting in time with Jerry Mainil Ltd., too. Den-

nis graduated in 1980, Dale in 1983. “I swamped on welding trucks and stuff,” Dale said. He came on full time in 1983. “I cleaned pumpjacks for two summers.” “We got the less appealing jobs,” Michael said. “They started where everyone else started,” Jerry stated. At the bottom. The daughters in the family worked at the local Dairy Queen. By the late ’80s, the boys were moving up, running crews. Children take over “They took over in ’92, and I was out,” Jerry said. “It was for them to take over. I had lots of other things to do.” From that point on, Jerry’s focus would be on Caprice Resources, as well as the farm. “It took 11 years for Dad to feel comfortable enough to throw the keys at us and say, ‘Sink or swim,’” Dennis recounted. “We bought it, it was our baby.” Dennis, Calvin and Dale would be the new partners. Calvin, who had married Danette Mainil in 1986, had been working at the family firm for several years along with Dennis and Dale. Calvin had worked with his own father running Cats in the oil industry. “He left us with the opportunity, but we had to make it work,” Dennis said. While Jerry helped out, he had fully stepped back from Jerry Mainil Ltd. within a few years. Customers first One might think if there’s an oilfield services company and an oil company in the same family, the oil company might get first dibs on services. You would be wrong. “We’re second fiddle,” Michael said. “You can’t show favouritism. We do not,” Dale said. “We have to prioritize, like other companies. Once you get a contract for a big player, you have to keep them going.” ɸ Page E4

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Family is the key to success: Mainil ɺ Page E3 Community involvement In January of this year, Jerry Mainil led a family-wide effort in a major donation to the Weyburn and District Hospital Foundation. The family donated an investment portfolio worth in excess of $800,000 towards a new hospital for the city. The sons repeatedly noted their father’s humility. Indeed, this large donation never even came up during the initial interview, despite the donation being made only a few months before. It was noted in one of the newspaper clippings Orlanda had provided. “Mom and Dad came to us each individually,” Dennis said. “Dad had some money he wanted to donate to the Weyburn Hospital Foundation. He wanted it to come from the whole family.” The family now includes 22 grandchildren, some of whom are now working in the family business. Over the years, there have been donations to things like playgrounds, curling, baseball, gyms, the golf course, and learning disabilities. The scrapbook lent to Pipeline News in preparation for this story had more newspaper clippings about curling than anything else. Jerry spent a lot of time curling over the years, and won his share of oilmen’s bonspiels. “I won Estevan, Weyburn, and Regina. I should have won Swift Current, but I lost it on the last rock,” he recalled. Over the years there has also been a lot of hunting, fishing and golfing. Jerry was a part-owner of the Weyburn Red Wings for several years and was on the executive when they had some tough times during the ’60s and ’70s He’s also been known to roast a pig or two. There have also been several awards, including the very first Southeast Saskatchewan Oilman Award in 1993. He was inducted in the Saskatchewan Petroleum Industry Hall of Fame in 2003. “I don’t think there was a piece of equipment I couldn’t run,” Jerry said of his time running Jerry Mainil Ltd. Explaining that his father is very much a hands-on type of man, Michael pointed out he is well known for taking shovels out of people’s hands to “show how it’s done.”

A reminder As the interview wrapped up, Jerry reached into his desk and pulled out two small books – bank books, from a time when every transaction was transcribed by hand. The date of the first entry is June 4, 1956, 55 years ago. The balance read $682. A month later, it read $129.71. “I don’t think I ever got in the red, though,” Jerry said. “A family is the key to anyone’s success, and that’s what I have. That’s the whole family. Everything. You can’t pick one part out,” Jerry said. Referring to his first generation of offspring, he said, “All of our family is here.”

Tony Mack, seen here in 1993, worked over 40 years with Jerry Mainil Ltd.

Jerry Mainil holds the Àrst bankbook for his company, with the opening balance of $682. By the end of the month, most of that was gone, but it didn’t go into the red.

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PIPELINE NEWS June 2011

Still growing, 50 years on: Jerry Mainil Ltd. Pickers are an integral part of Jerry Mainil Ltd’s business.

By Brian Zinchuk Weyburn – Jerry Mainil Ltd. may have started with one water truck back in the mid’50s, but today, it’s one of the largest oilfield construction businesses in southeast Saskatchewan. July 1 is the 50th anniversary of the incorporation of Jerry Mainil Ltd. The company operates from the same yard it set up shop in back in 1959. The original shop is gone as a result of a series of five expansions over the years, the most recent just a couple of years ago. The company’s specialties include lease and road preparation, oilfield maintenance, facility fabrication and assembly, pipelining, welding, trucking (including pickers, winch and bed trucks), and environmental reclamation. In 1992, Dennis and Dale Mainil, and their brother-in-law Calvin Tracey took over ownership and operation of the company from the Mainils’ father, Jerry Mainil. The three work closely together, and aren’t hung up on titles. While there is a lot of crossover, each looks af-

ter certain areas of the business. Calvin’s responsibility lies with much of the dirt work, and he spends a lot of time out in the ﬁeld. “I’m more of a hands-on guy in the ﬁeld,” he said. Dale is more into sales, and equipment purchasing. He also spends the most time of the three looking after their other venture, the large family farm. Dennis looks after the trucks and pickers, and acts as something of a dispatcher and co-ordinator. He also handles much of the administrative end. “I’m in more of a general managing position,” he said, looking after things like payroll, accounts receivable and

payable. “You need someone in here who can see the whole picture,” he said, regarding the co-ordinaton of day-to-day operations. All three would climb on any piece of equipment. “We enjoy that part of it. That’s how we started,” Dale said. The company’s work area is throughout southeast Saskatchewan. “We go anywhere,” Dale said. Crescent Point and Cenovus are major customers of Jerry Mainil Ltd. The rest of the clientele is made up of a broad range of companies. “We’ve got a broad industrial base,” Calvin said. ɸ Page E10

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PIPELINE NEWS June 2011

Management team works closely together Dennis Mainil looks after the corporate and administrative side of things.

ɺ Page E7

The company does a lot of its own maintenance and repair.

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Experienced staff The staff that was once one man now is over 110, half of whom have been around for at least five years, and a quarter of whom have over 10 years experience. Four have been there for over 35 years. Duane Skjonsby has 39 years in, Alfred Flemming is at 38, Daryl Irwin is 36, and Dan Lohse is at 35. “We’ve got a good core of people,” Dale said. The company could use another 20 workers over the summer. “Our customers are willing to give the younger employees a chance to learn,” Calvin added. “I think everything is growing, but on the dirt side, we’re definitely expanding. I think the staffing issue is the biggest concern, finding qualified people to move down here,” he said. The company has grown a lot over the years, especially from 2009 to 2010, but has found personnel to be the limiting factor for additional growth, according to Calvin. “We’ll find them,” Dale said. “Once they get here for a month or two, they find Weyburn’s a nice community. We help them relocate. “We’ve been to the Philippines to recruit people. We’re not afraid to look out of the box.” High drilling activity is driving lease building and cleanup. “You need lots of equipment to keep up with their demand,” Calvin said. Weyburn field Patriarch Jerry Mainil first started hauling water on some of the first wells of the Weyburn field in 1955, and that field, now operated by Cenovus, has always been very important to the company. “It’s a big part of what we do,” Calvin said. The enhanced oil recovery operation using a carbon dioxide flood is very important to them, and he added that they did a lot of work upgrading wellheads for the CO2 flood. The company has a small satellite operation at Goodwater, the heart of the Cenovus Weyburn unit. But as for operations bases further afield, they prefer to operate out of Weyburn. From 1965 to 1975, the company had a Swift Current shop, but it didn’t work out. ɸ Page E11

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Calvin Tracey specializes in the dirt work.

E11

Dale Mainil spends a lot of his time taking care of the family farm, Jeranda Holdings.

Experienced, long term staff ɺ Page E10 Like a switch Dennis noted the oilpatch can operate like a toggle switch, full on, or full off. His preference would be to see more of a throttle, where a company can run at 75 to 80 per cent, providing flexibility for holidays and equipment repair. However, in busy times, any buffer soon gets absorbed by growth. He spoke of their “spare Cat,” the oldest dozer in the fleet, which is meant to fill in as needed. However, it’s needed nearly all the time. While everything is full-bore now, Dennis said there were tough years in the past, too. “We’ve had guys on a work share program, but only a couple times,” he said. Part of keeping a loyal workforce is being loyal to them when the times are slow, keeping them busy, and not just pushing brooms. Multitasking was what kept Jerry Mainil Ltd. going, especially with Weyburn not being the centre of the action. They had to be diverse to stay busy. “We do a lot of our in-house maintenance,” Dennis said. That includes engines, undercarriages, truck decks and general maintenance. When a new

piece of iron comes in, they “Mainilize it,” adding items like chain grab hooks, ice picks for outrigger pads, reinforcing the buckets and installing GPS systems. With the strength of the southeast oilpatch in recent years, there have been a number of companies coming in, looking for part of the action. “After the crash of ’08, in ’09 there was deﬁnitely pressure from Alberta contractors coming in. We’ve supported the community for 47 years

(at that point). Our people live here. It’s more than just ownership. It’s Weyburn,” Dale said. Future Dennis said, “At this point, we’re going to keep going the way we’ve been doing it. If opportunity knocks, we’ll take it. If not, we’ll be in survival mode. In 2008, 2009, when it crashed, it gave a reality check.” They have proved resilient, however, and the management team, now in place for nearly 20 years themselves, has grown in their roles.

“When Dad left, I thought, ‘We’re done,’” Dennis said. “When Paul left, I thought the same thing. Paul Baudria was Dad’s next in command. He helped give us guidance. Paul was, in the history of Jerry Mainil Ltd., a key factor.” It helped that their early years of ownership, the mid-1990s, were good ones in the oilpatch. A third generation is now coming of age. “It’s a diﬀerent world now,” Dennis said. Several of the

Mainil grandchildren are choosing university, but there is also some interest in the family business, too. “Three of my boys are here today. One just

ﬁnished engineering and is going to work for Cenovus.” There will be a place for family members, should they choose to join the company.

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PIPELINE NEWS June 2011

A petroleum engineer, Michael Mainil is vicepresident of Caprice Resources.

Caprice Resources part of Mainil group of companies for 48 years Story and photos by Brian Zinchuk

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Weyburn – Caprice Resources got its start in 1963, and in an era of mergers and acquisitions where wells can change hands in the blink of an eye, it has remained under the same ownership for 48 years. Michael Mainil is the vice-president of Weyburn-based Caprice Resources, while his father, Jerry Mainil, is the president. While Michael spent his early days working with Jerry Mainil Ltd., his schooling put him on a diﬀerent path. Michael pursued a degree in petroleum engineering. Michael says their production “is about the 700 barrel per day mark.” They have approximately 50 wells. It’s a mix of light and medium crude production, but mostly light. Most of their work is in the Midale formation, however, they are looking at new horizons. “We just recently drilled two Bakken wells last year. One wildcat is north of Stoughton. It would be great if breakup allowed them to be produced,” he said in late April. “One got fracked, the pumpjack is on, the tanks are there and it’s ready to go.” The price of oil has driven the Bakken exploration. “We’re on the northern fringe of the Bakken. There’s potential, but you have to have the right price to make it work,” he said. “If those are successful, we’re deﬁnitely going to expand.” The Bakken wells use the Packers Plus system. “I wanted to rely on their

expertise,” Michael said. “I think we can be more aggressive with the Bakken with the price of oil,” he said, but noted there are sharp declines, and “expenses can kill you.” Midale wells, on the other hand, have a more steady decline in their rate of production. “We focus in certain core areas,” Michael said. Their Weyburn field is eight miles south of the city, where they have three sections. That field is largely saturated for drilling. “If we can squeak one more in there, we will,” he said. They’ve also drilled by Macoun and Benson. “Dad drilled on target wells and we developed infield with horizontal,” he said. “When I moved back, we implemented a waterflood. It was started around the turn of the century.” “We’ve seen a great response to our waterflood.” Michael said southeast Saskatchewan was built on Midale wells. “You don’t have to frac them, for one. When you can drill and complete for half the cost, there’s a value.” Michael chose petroleum engineering for his schooling. Caprice, at the time, was in its infant stages, and he was still working on the construction side. “I knew I wanted to work in the oil industry. Dad knew people at SAIT, and encouraged me to look into that school.” Michael liked the practicality of a technical school. “It inspired me to go on to engineering and get the degree,” he said. ɸ Page E13

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PIPELINE NEWS June 2011

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Caprice Resources takes its turn at the Bakken ɺ Page E12 He chose Wyoming for his university, noting they were one of three or four schools that came to SAIT to encourage students to complete their degree. The University of Alberta, on the other hand, was not so encouraging. “About five of us graduated from SAIT and went to Wyoming,” he said. During his summers, he worked as a field operator for PanCanadian, then as engineering assistant with PanCanadian at Ponoka, Alta. That’s where he found full-time work. He got his professional engineer designation in 1996 while he was still with PanCanadian. The company wanted him to move to Calgary. “It was either moving to Calgary or home to work for Dad. I’m not a bigcity kid.” Asked if it was a foregone conclusion he would go to work for the family oil company, he responded, “It was there, but it wasn’t a foregone conclusion. There were a lot of offers for Caprice back then.” Michael joined his father’s firm a few years after Jerry stepped away from the construction business, handing it off Michael’s brothers Dale, Dennis, and brother-in-law Calvin Tracey. Caprice would be Jerry’s focus from that point on, along with the farm. “There was a transition, definitely,” Michael said. He went from a corporate approval structure to one man’s opinions. “If he liked the idea, we went ahead. If he didn’t like it, I had to justify it. His opinions were based on experience. “A perfect example of that was the waterflood that Caprice did on the existing field. It added quite a few years.” As for working for an oil company where it was their money on the line, he said, “You’ve got to be the right person. When it’s your money on the line and sometimes things go wrong, you’ve got to be the kind of person to take that pressure.” They are looking at at least five wells this year. “That’s my goal,” Michael said. “If things work out, we might drill more.” As a small operator, it can be difficult to get the attention of service companies when the big companies are going hard. Their most recent well was drilled over breakup because they were right on the highway, and thus could still move heavy goods. The availability of services is a limiting factor, he said. As for which services, he responded, “All of them. There was a severe backlog. “I like to think I have a good relationship with the service companies I use. If you work with them they, will help you out when you need them.” “Dad still does a lot here. Any final decisions still go by him drilling locations, etc. He still wants to be involved deciding when and where we drill.” The company has five staff, including Michael and Jerry Mainil. Operators and consultants are contracted out. Michael will occasionally act as well-site supervisor when drilling. He also has followed in his father’s footsteps in curling, and is a fixture at the numerous oilmen’s bonspiels in the region. As a director of the Weyburn Oilfield Technical Society, Michael looks after the annual Weyburn oilmen’s bonspiel with another director.

PROUD SUPPLIER T O CONGRATULATIONS ON 50 YEARS IN BUSINESS 1305 Railway Avenue, Weyburn 306.842.4185

Caprice Resources’ Michael Mainil is a Àxture at local oilmen’s bonspiels, such as Weyburn’s last January, where he was one of the organizers.

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PIPELINE NEWS June 2011

Field supervisor started when he was 18

Daryl Irwin has been with Jerry Mainil Ltd. for 36 years. Photo by Brian Zinchuk

Congratulations On 50 Years of Business!

Hwy 39E, Weyburn • 843-2629

Congratulations on 50 years Jerry Mainil Ltd. DUSTIN DUNCAN, MLA Weyburn - Big Muddy (Tel) 842-4810

Weyburn – When it comes to long term employees, Jerry Mainil Ltd. of Weyburn has plenty. Four of them have been there for 35 years or more. Daryl Irwin started working for Jerry Mainil Ltd. on Aug. 26, 1974. “I was 13 or 14 days away from 18 when that happened,” he said. Irwin started as a swamper on a pipeline crew, working south of Weyburn for PanCanadian. “At the time, that’s all there was for oil well, (just) south of town.” “I swamped in various positions. I started running a sideboom quite a bit on pipelining. I ran quite a bit of small Cats, blade, then started running crew trucks for quite a while. I ran pipefitting, and setting jacks, lots of fibreglass. “ Irwin has also run pickers as well. “You didn’t need a ticket back then. “I’ve just about run every piece of equipment except grader and buggy.” These days he’s a field supervisor. “I look after a lot of Cenovus’ work. Not all of it, but a bit of it. My office is my black truck.” “I was born in Winnipeg. We lived on a farm in southern Manitoba. When I was six, we moved to Fillmore. Dad was originally from there.” The family would end up moving to Yellow Grass. Irwin would move to Alberta for a year for work, but became sick of Alberta in short order. He had a buddy working for Jerry Mainil Ltd., so he hired on. “Hopefully I’ll still be looking at the grass from the right side when I leave here. That’s my goal, anyway,” said the 54-year-old. “These employers keep you on pretty well,” he said. Only once, in the mid-’70s, was he temporarily laid off, back in his early days. It was when Bill 42 caused the Saskatchewan oilpatch to grind to a halt. “The oilpatch is either flat out or nothing,” he said. “That’s how the oilpatch works.” As for retiring, he said, “It will be a little while yet.”

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Staying close to farming roots

This 2005 photo shows the Mainil operation, formally known as Jeranda Holdings, in action.

By Brian Zinchuk Weyburn – It’s impossible to tell the Mainil story without including their farming endeavours. While Jerry Mainil Ltd. has been working in the service industry, and Caprice Resources was the junior oil company, never far from their attention is the evergrowing farm. Jerry Mainil grew up as part of a family farm, and apparently there was no question he would some day return. Now the Mainil family farms approximately 17,000 acres. He started his career planning to farm, and did so for several years at the family farm in the Lampman area. He got out of that in 1959, during the early days of Jerry Mainil Ltd. In 1968, Mainil bought out a farmer northwest of Weyburn. “I started really farming in 1969. In ’71 I bought two, in ’75, I bought six more. From then on, I just kept buying.” He recounted. By the mid ’80s, he had six or seven sections. A collection of newspaper clippings tell the tale of the farm’s growth. In 1999, it was 7,000 acres, then 2003, it was 12,500 acres. “With the boys and everything, we’re up to just about 17,000 acres,” he said now. The total is 106 quarters between the various Mainil families. Most of it is north of Weyburn, but about one quarter of the land base is near Fillmore. “That was really my hobby, for when I retire.” The Mainil children were always involved with the farm, he said. Dennis Mainil got his two year diploma in vocational agriculture from the University of Saskatchewan. The operation includes Jerry Mainil, his sons Dale, Dennis and Michael and daughter Danette Tracey. The setup is rather unique. Each has their own individual land. Jeranda Holdings (named for Jerry and Orlanda Mainil) owns the equipment and provides the people. The equipment is essentially used as in-house custom operation. They have six full-time people, and will go up to 14 during seasonal work. “It’s a family farm,” Dale said. “At the end of the day, it’s a family farm run in a corporate way. “We all pay custom fees. We all own different percentages,” he said. The operation has four large four wheel drive tractors, six combines, four large swathers, two highclearance sprayers and five semis. The fleet includes John Deere, Case and Caterpillar. Dale spends the most time on the farm, while the others’ focus is more on the other aspects of their various businesses before they head out into the field at the end of the day.

Photo submitted

When you have thousands of acres, you need a really big seeder, like the one Michael Mainil is pulling here. Photo submitted

Hwy. 39 E • Weyburn • (306) 842-4686

www.southcountry.ca

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PIPELINE NEWS June 2011

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