Pipeline News December 2011

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

December 2011

Canada Post Publication No. 40069240

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Volume 4 Issue 7

A20 - Exclusive Look At Boundary Dam 3 CCS

B1 - LXL Consulting Manages Seismic Projects

C1 - Grit Moves Its Manufacturing

C27 - Need a Career?

Pilot Kris Newton of Mustang Helicopters positions his chopper above a truck to pick up bags of seismic cables near Estevan.

Photo by Brian Zinchuk

Rig Technician Apprenticeship Program 2012 training dates:

Location:

Motorhand (Level 1)

March 12 to 30

Derrickhand (Level 2)

April 2 to 20

Driller (Level 3)

April 23 to May 11

To register in the Rig Technician Apprenticeship program, please contact the Saskatchewan Apprenticeship and Trade CertiďŹ cation Commission toll-free at 1-877-363-0536.

Saskatchewan Energy Training Institute, Estevan Complete course descriptions are available at www.southeastcollege.org or www.saskapprenticeship.ca

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PIPELINE NEWS December 2011

News

Notes

Sask. drilling rig count Àat, but high According to Nickle’s Rig Locator (www.riglocator.ca), Saskatchewan’s drilling rig count has largely remained at for the much of November, oating in the 98 to 104 rig range. The total rig count has been near 139. As of Nov. 21, there were 98 active drilling rigs and 41 down rigs, making up a 71 per cent utilization rate.

Only Manitoba has done better for its utilization rate, with typically only one rig of its 22 to 24 rigs down at any given time. On Nov. 21, there were 23 active rigs and one down rig, for a 96 per cent utilization rate.

On that same date, Alberta had 345 of 559 rigs active, for a utilization rate of 62 per cent, while British Columbia saw 49 of 75 rigs drilling, for a utilization rate of 65 per cent.

Early November of 2011 saw approximately 30 more active drilling rigs than either 2010 or 2009.

Saskatchewan’s overall active drilling rig numbers throughout 2011 have been substantially higher than 2009 and 2010 numbers except for the spring time and early summer, due to ooding.

Alberta Star agrees to another Landrose well Alberta Star Development Corp. has agreed to participate in drilling and completing one (0.5 net) well located on the company’s Landrose property located in west central Saskatchewan.

The company holds a 50 per cent net interest in the lands.

The costs to drill, complete and equip the well are estimated to be $420,000. The company intends to fund its 50 per cent interest by contributing all of its interest (50 per cent net interest) in certain oilďŹ eld equipment with a deemed value of $60,000 to equip the well and $150,000 cash.

Western Plains Petroleum is operator and the spud date for the well was expected to be on or about Nov. 20, subject to rig availability and regulatory approvals.

Briefs courtesy Nickle’s Daily Oil Bulletin

Enbridge Inc. is jumping into the void left by the delay of U.S. approval of the Keystone XL pipeline.

The competing company plans to buy 50 per cent ownership in the existing Seaway pipeline to reverse a 150,000 barrel a day pipeline from Cushing Okla. to Texas as early as the second quarter of 2012 with expansion to 400,000 bpd by 2013. Pictured are Enbridge storage facilities in Hardisty.

File photo

Keystone delay hits TransCanada, helps Enbridge „ By Geo Lee Pipeline News Calgary, Alta. – The economic vibrations from the U.S. State Department’s call to delay its decision on the fate of TransCanada’s Keystone XL pipeline until after the 2012 presidential election are being felt by contractors, suppliers and communities in Alberta and Saskatchewan.

New legislation proposed by Nebraska to reroute the line to avoid the environmentally sensitive Sandhills area is backed by TransCanada, but does little to cheer potential benefactors along the Canadian leg of the line from Hardisty, Alberta to Monchy, Saskatchewan. “Honestly, everything that’s happened over the last week – we haven’t had all those discussions,â€? said Keystone media spokesperson Shawn Howard on Nov. 15, one day after the reroute plan was released. “Obviously some of our senior leadership is testifying at hearings and things like that. They are trying to ďŹ gure out what all these recent developments are going to have – what kind of an impact it will have. “Ultimately, a delay does not help contractors. I know that even some suppliers who will be providing equipment and some of the manufacturing are very concerned,â€? said Howard. “They’ve staed up and were ready to go based on the timeline for approval that was expected.

“So they are obviously concerned about what that impact will have on their business and their workers and whether they will have to lay people o.â€?

Approval of the Keystone XL was delayed by the State Department’s announcement on Nov. 10 that further assessment of alternative routes in Nebraska was needed to determine if the pipeline is in the U.S. national interest.

The Canadian part of the pipeline was approved by the National Energy Board in 2009, with TransCanada expecting U.S. approval of the project this year with construction starting as early as January 2012 on both sides of the border.

Prime Minister Stephen Harper recently called the approval of the project a “no-brainerâ€? due to the expected economic beneďŹ ts for Canadians and Americans.

The proposed $7-billion, 2,763-kilometre pipeline, capable of pumping up to 830,000 barrels a day of crude to the U.S. Gulf Coast, is expected to generate 20,000 jobs for American workers alone.

Construction of the pipeline in Nebraska would require ďŹ ve or six new pump stations and more than 442 km of new pipelines.

It would generate more than $150 million in property taxes to county and other local governments in that state during the operating life of the line and employ over 2,200 construction workers. “We just don’t know what the impact will be,� said Howard about the delay. ɸ Page A6

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Tight diesel supply in patch

By Brian Zinchuk Pipeline News Estevan – Ever get a little anxious watching the fuel gauge on your truck? Southeast Saskatchewan’s oilpatch knows that feeling all too well.

By mid-November, a widespread shortage of diesel had everyone closely watching their consumption, and trucks were being limited to 300 litres a day.

The situation is dripping with irony, as the industry which supplies the fuel was nearly running dry. Truckers hauling tens of thousands of litres of crude oil could only get the 300 litre ration.

Raymond Girard, owner of Girard Bulk Services Ltd. in Estevan, explained the history behind the shortage. First Shell’s Scottford refinery had a planned shutdown. Then there was a fire at the Coop Refinery in Regina on Oct. 6. Finally a particular feedstock for the PetroCanada refinery in Edmonton ended up in short supply. All this, combined with a robust economy and harvest, and tanks are dry.

The result has been a scramble to keep clients operating, but they have been able to hold their heads above water. Indeed, many of the service companies Pipeline News talked with spoke very highly

of Girard’s efforts to keep them going.

“We went through a period where we knew it was going to be very tough,” Girard said. “Twenty five per cent (of daily fuel needs) would come in,” he said.

There was some relief in sight as of Nov. 15. They started to get 100 per cent, then 125 per cent of their requirements, letting them get back to up to at least one or two days stock.

“It’s coming back,” he said that day.

“My staff are unbelievable. We made it work,” Girard said.

Asked about the diesel shortage, Red Dog Drilling president Wayne Zandee said, “It’s real, that’s for sure.”

“We’re getting enough fuel to finish current holes, but we don’t know how far you get before a shortage stops you.

“If you don’t have fuel, you don’t have a choice.

You plan ahead to know where the casing point is,” he said.

They have been checking continuously to see if they will have enough fuel to make it to the next stage in the well – surface casing, intermediate casing and completion. ɸ Page A7

Individual units have been limited to 300 litres per day as of mid-November due to a diesel shortage.

Photo by Brian Zinchuk

News

Notes

Cenovus boosts 2011 spending Cenovus Energy Inc. is allocating more capital than expected to its oilsands business, mainly to accelerate expansion at Foster Creek and Christina Lake, as well as on conventional oil operations this year, bringing total expenditures for 2011 to between $2.6 billion and $2.7 billion.

Previous plans were to spend $2.4 billion to $2.6 billion.

In the Bakken and Shaunavon areas, the company will install centralized batteries to reduce the impact of spring breakup and lower overall trucking and transportation costs.

In November it was to put four additional rig crews to work in southern Alberta and the rigs will then move up to northern Alberta's oilsands to drill stratigraphic wells. The level loading of work allows cost efficiencies and secures supply of rigs and crews, said John Brannan, chief operating officer, during an Oct. 27 third-quarter conference call.

The company drilled 40 wells in the Bakken and Lower Shaunavon plays during the third quarter and expects to drill about 30 more wells during the fourth quarter in its Saskatchewan tight oil plays, said Brannan.

Atikwa completes three wells in MB Atikwa Resources Inc. reports that it has completed the drilling and casing of three new horizontal wells targeting Spearfish light oil in the Pierson area of Manitoba.

The recently completed 13-23, 6-24 and 1530 wells were part of a three-well program that the company drilled throughout October and early November. Good hydrocarbon shows were encountered throughout the drilling of all three wellbores, the company said.

The wells were scheduled to be fractured and put on production before the end of November.

The previous wells in the program continue to show strong inflow characteristics, with the recently fractured 14-13 well hitting a high of 128 bpd over the last 30 days.

The company is in the process of licensing two additional wells in the area, which it intends to drill before the end of the year. With the addition of those two wells the company will have drilled a total of eight (5.3 net) Spearfish wells in the area.

Briefs courtesy Nickle’s Daily Oil Bulletin

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EDITORIAL

PIPELINE NEWS December 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

Associate Advertising Consultants: SOUTHEAST • Estevan 1.306.634.2654 Cindy Beaulieu Glenys Dorwart Kristen O’Handley Deanna Tarnes Teresa Hrywkiw SOUTHWEST • Swift Current 1.306.773.8260 Doug Evjen Stacey Powell NORTHWEST • Lloydminster Daniela Tobler 1.780.875.6685 MANITOBA • Virden - Dianne Hanson 1.204.748.3931 • Estevan - Cindy Beaulieu 1.306.634.2654 CONTRIBUTORS • Estevan - Nadine Elson To submit a stories or ideas: Pipelines News is always looking for stories or ideas for stories from our readers. To contribute please contact your local contributing reporter.

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Special thanks to JuneWarren-Nickle’s Energy Group for their contributions and assistance with Pipeline News.

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Editorial Could we have a decade of stability?

On Nov. 7, Saskatchewan’s people voted resoundingly for the Brad Wall Saskatchewan Party government. The Saskatchewan Party took, by far, the largest percentage of votes for one party in Saskatchewan history. Just shy of two out of three voters cast ballots for the Sask. Party.

What does this mean for the oilpatch? In one word, stability.

Ever since he was elected in 2007, Wall has preached stability, stability, stability. At the Weyburn Oil Show, he said they were not going to “jack around” with royalties. Every speech both he and Energy and Resources Minister Bill Boyd gave over the last four years regarding energy made clear that royalties were not going to be messed with.

The election focused on potash royalties, but the oilpatch’s collective unease about any royalty discussion left an underlying concern of “Is oil next?”

NDP leader Dwain Lingenfelter said no, but earlier in the year, he had also made allusions to the government getting back into the gas business via a Crown corporation. Anyone in the oilpatch who as a long memory will recall SaskOil and its impact. Talk to an old-timer about the fun the oilpatch had in the 1970s, and they will still curse.

There’s one thing the resource sector likes: stability. If they are going to spend $2.7 million drilling and completing a Bakken well, they want to know that

their economic formula is not going to be messed with.

If they are going to be drilling 50 of these wells, that becomes even more pertinent.

It makes you a lot more confident in your investments when you can bank on the playing field not being changed.

Liberal leader Ryan Bater said during the campaign that royalties should at least be looked at, if not changed. As an academic argument, that may be sound.

But on a realistic basis, whenever something is “looked at,” there is an expectation of some sort of change. We saw that in Alberta, and look at what happened. The result was not pretty for Alberta, and strengthened the argument to leave well enough alone here in Saskatchewan.

We seem to have set up a royalties system that is working, quite well at least for oil, so rocking the boat becomes a scary proposition. For natural gas? With gas prices at $2.93 US per million btu at Monchy on Nov. 17, don’t expect any sort of royalty change to help or hinder. Natural gas development in Saskatchewan is going to remain flatlined for the foreseeable future.

By the end of this term, the current royalty regime, originally brought in by the Calvert New Democrat administration, will be a decade old. In some minds, that may be outdated. But for others, it may have been part of the recipe for Saskatchewan’s greatest decade in generations.

PIPELINE NEWS December 2011

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Opinion A modest Keystone XL proposal From the top of the pile Brian Zinchuk

Another day, another Keystone XL pipeline delay. This time, it’s for a year.

In early November, Nebraska’s legislature was debating moving the line on the basis of esthetics (thin soup, methinks), while the Globe and Mail pointed out, “The office of the U.S. Inspector General has launched a ‘special review’ of the Keystone XL permitting process, following conflict allegations brought forward by several U.S. senators.”

This would soon be followed by a decision to put off the final decision for a year.

After much muttering under my breath, I realized the best way to tackle this is to offer “a modest proposal,” a la Jonathan Swift. In a 1729 satire, Swift suggested the Irish should eat their own children.

My modest proposal doesn’t include cannibalism, at least at first. It could come to that.

Here it is: If the Americans think the world would end if Canadian oilsands oil flows through the Keystone XL pipeline, then surely it will end if oil continues to flow through the original Keystone pipeline, or the Enbridge mainlines. Don’t forget Alliance, or any other international pipelines. Let’s include TransCanada’s natural gas mainlines for

good measure, since they are such an evil company.

Yes sir, let’s go to the borders and shut off ALL of our pipelines. Then those protesters should be very happy indeed.

When the price at the gas pump shoots to $10 a gallon, then $15, maybe even $20 in Chicago, those protesters will get exactly what they want. They might have a hard time screaming out their chants and waving their signs in January, since cutting off natural gas to the Midwest will essentially cause them to be freezing in the dark, teeth chattering.

Perhaps they could get more oil from those lovely Saudis, whose women aren’t allowed to drive, vote, or even show themselves in public. For when they’re not funding madrassas in Afghanistan with their newfound wealth, they may be training in American flight schools to fly airliners.

As oil breaches $200 a barrel in the Lower 48 and is shooting for $250 with a bullet, there will be no complaint about a price differential between WTI and Brent oil. Just because much of the U.S. has been getting their oil at a $20 discount compared to Brent oil prices, it doesn’t mean it has to stay that way. There will be no glut of oil at Cushing without Canadian oil in the mix.

Indeed, North Dakota should be happiest of all, because instead of thousands of people moving there to work in the oilfields, it will be millions. The U.S. will have to suck the Bakken dry to make up for just a small portion of lost Canadian production.

However, many of those millions will lose a lot of weight getting to Williston, because they had to walk. They couldn’t afford the gasoline to drive to North Dakota, even if there was gas to be bought.

Louisiana will be booming too, because nearly every supertanker in the world will be turning to the Gulf Coast. What captain would take oil to England for $147 a barrel, when they could get $200 from an American buyer? They’re going to have to build dozens of terminals and pipelines to make up for the lack of Canadian production. Oh no, more pipelines. Ah well, they’ll get over it.

Those Nebraskan farmers won’t have to worry about a possible pipeline spill on their farmland and apparently the only aquifer in the world a pipeline can’t be built across. They won’t be able to put fuel in their tractors anyhow. The protesters should be thrilled that a lack of corn production leads to lower carbohydrate diets for all Americans.

They might get so cold and hungry in Chicago, that cannibalism thing might not be far off.

The U.S. Army, having just returned from Iraq, would be locking-and-loading again. The 101st Airborne would be dropping on Fort McMurray, while other units would take Edmonton’s refinery row, the pipeline terminal and tank farm at Hardisty, Alberta, and every pumping station from there to Gretna, Manitoba. Regina, with its refinery and huge tank farms, sits near several major Western Canada mainline pipeline corridors, so maybe the 1st Cavalry Division could camp out at Mosaic Stadium. Think they’d even become Rider fans?

At least this time when occupying a foreign land in order to control its oil and gas supplies, American soldiers will be able to speak the language. Everywhere except Quebec, that is.

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

Shouldn’t a sore thumb be newsworthy?

When it comes to reporting oil and gas stories, the mainstream media never seems to be able to strike a balance between the good, the bad and ugly.

In the case of the proposed TransCanada Corporation Keystone XL pipeline to run from Hardisty, Alberta to Oklahoma then south to the Texas Gulf Coast, the bulk of reporting has focused on covering protesters packaged in the simplistic “dirty oil from the tarsands” theme.

Is there such a thing as clean oil given the nature of the product or how it produced, shipped and processed? Has there ever been a clean oil project that doesn’t generate carbon emissions?

Calling oil from Alberta’s oilsands dirty is simply calling a spade a spade, but it’s misguided too.

Why are there no protests by Americans against the dirtier U.S. refineries in the Gulf Coast that will benefit from the oil the pipeline will carry?

What is also missing from the media coverage is any awareness the line will carry a lot of U.S. oil from states like Montana and from North and South Dakota.

The proposed Keystone XL has convinced some producers like Imperial Oil to shelve plans for a refinery for its Kearl project to the benefit of the oilsands and the air we breathe.

That job can now take place in the dirty U.S.

Lee Side of Lloyd Geoff Lee

Gulf Coast! Isn’t that Gulf Coast the same place where one of the world’s worst oil disaster occurred, fouling every beach for hundreds of miles?

That dirty oil sure as heck didn’t come from Alberta. I hope no one “occupies” my space by venting sarcasm into the atmosphere.

Locally, the mainstream media in Western Canada mostly missed acknowledging the role the oil and gas industry played in the October collapse of the Canadian Pacific overpass on Highway 16 east of Lloydminster.

It seemed the mayor of Lloydminster was the only official to proactively recognize and praise some industry players such as MCR Crane & Rigging in his official blog and general message of thanks for quick work to reopen the highway.

Most of the mainstream reports featured quotes from the usual emergency response officials – with none of those officials speaking on behalf of the oil and gas industry that did most of the grunt work.

Where did the cranes came from and how and why did they get there?

Some of that information originated from the mayor’s blog that noted one of the cranes happened to be at the ADM canola processing plant where managers cleared the crane to respond to the emergency.

Why do so many news organizations fail to make the connection between the emergency and the key responders – in this case MCR and Mammoet – both Edmonton-based crane companies?

The same thing happened in 2010 when just about every available oil and gas business in Kindersley rushed to the scene of a January fire that burned the arena to the ground.

There were all kinds of photos of oilfield equipment and some quotes from oilfield officials at the scene, but not much coverage of why they got involved and the key role they play in emergency planning.

Maybe the good news role the oil and gas companies play in creating jobs and responding to local emergencies is too obvious. But when it stands out like a sore thumb, isn’t that news?

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

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PIPELINE NEWS December 2011

Goal is to see pipeline built

ɺ Page A2 “What’s happening right now in Nebraska – there’s a new process under way and we are still trying to figure out how it’s all going to come together.

“We’ve got companies making our pump stations and manufacturing pipe.

You don’t go and build all this stuff and then stockpile it because you would have a lot of money just sitting around just waiting to be put into use with the equipment you buy.

“This has a major impact way beyond TransCanada, and the impact of the delay is obviously felt in Canada and in the United States as well,” said Howard.

“It’s not just for suppliers but it is for people in communities along the proposed route, and we do feel bad for them because some of them were counting on the additional tax revenues coming in sooner.

“Local businesses were looking to host workers in the community where they shopped, ate or slept.”

The project has faced stiff opposition from environmental groups, unions, and politicians concerned about the carbon footprint of Alberta’s so-called dirty oil sourced from the oilsands area and about sensitive areas the pipeline would cross.

“It’s really unfortunate that professional activists used a lot of fear and misinformation and hurt a lot of communities along the way because of these delays that they have created,” said Howard.

TransCanada officials believe the Keystone XL is the best option for American and Canadian producers to get their oil to the U.S. Gulf Coast where competitive sharks are quickly feeding on news of the delay.

Enbridge Inc. unveiled plans on Nov. 16 to buy a 50 per cent stake in the

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Seaway crude pipeline that pumps up to 150,000 barrels of crude a day from Texas to a refinery hub in Cushing, Okla. where the mainline Keystone pipeline ends.

Enbridge will spend $1.5 billion (U.S.) to purchase a half interest in the line and work with Enterprise Products Partners LP that owns and operates the other half the system to reverse the flow of oil from Cushing to Texas as early as the second quarter of 2012.

The capacity of the Seaway pipeline could be expanded to 400,000 barrels a day by 2013.

The increasing flow of Canadian crude oil by pipelines to the U.S. Midwest refining market has been augmented by growing production from the Bakken play in North Dakota.

“That’s why the market approached TransCanada to build Keystone to move crude out of here to places where it’s needed which are the refineries in the Midwest and on the U.S. Gulf Coast,” said Howard.

The delay in the approval of the Keystone has stoked interest in the proposed Enbridge Gateway pipeline from northern Alberta to Prince Rupert to tap into the Asian market, but Howard says TransCanada doesn’t see that pipeline as a competitive threat.

“It’s different markets for a similar product, but there’s different destinations for them,” he said.

“Even if they received an approval quickly, it’s still going to take years to actually have that built and ensure that all the agreements with First Nations and others are in place.”

Howard says TransCanada’s commitment to work with Nebraska to reroute the Keystone XL as soon as possible is cause for renewed optimism.

“It provides a path forward. We weren’t able to move the pipeline route until the Department of State said they wanted a new route that avoided the Sandhills,” he said.

“So it’s very focused in terms of where the pipeline will be rerouted from.”

The next step will be an environmental assessment conducted by Nebraska’s Department of Environmental Quality to define the best alternative route for the pipeline that address concerns regarding the Sandhills region.

“We want to have this new route selected as quickly as possible, but we want to make sure that it’s a thorough and careful process,” said Howard.

“Ultimately, in terms of how long this could take, the timing of decisions is not within our control. All we can control is the information we provide to make sure we get it to them promptly, and let the state and federal agencies do their jobs.

“Our goal is to make sure we get this pipeline built, so if this is part of how we get there, we take that in stride and we will continue to work really hard putting a plan together that shows Canadians and Americans this is going to be one of the safest pipelines ever built.”

Howard says everyone at TransCanada’s head office in Calgary is trying to take it one step at a time given the fluid nature of the project and the rapid pace of breaking news.

“I am sure there is fine print somewhere – on a daily basis that says ‘subject to change,’” he joked. “There is more to come.”

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PIPELINE NEWS December 2011

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Getting by, but just barely, for many local operators ɺ Page A3 For a 20-day well in the winter, it can take up to 60,000 or even 70,000 litres of diesel for that one drilling rig.

As of Nov. 16, there were 102 drilling rigs operating in Saskatchewan.

Another driller, Weyburn-based Panther Drilling, had to shut down one of its three rigs for nine hours for fear of running out before the fuel truck got there in the morning.

Panther general manager Jim Kopec said two rigs had good supply as of Nov. 15, but the third, not so much. “We didn’t want to get caught in the hole,” he said. “This was more of a caution.

“We’re watching our fuel supply and running boilers as necessary.”

As for consumption, he said, “We’re probably anywhere from 2,500 to 3,500 litres per day per rig. If you were doing a lot of tripping, with the boiler, it can be as high as 4,500 litres per day.”

Panther is supplied by Weyburn-based Mazenc Fuels and Girard Bulk Services. He spoke highly of both, saying, “They’ve stood with their customers.”

Ralph French, president of R French Transport of Forget, noted they have had to turn down jobs due to the shortage.

He said, “We are getting it from where we can.

We deal with two fuel suppliers, so get can get 300 litres each.

“So far, we’ve managed through it.”

The company draws from Co-op and Girard Bulk. Girard has been delivering fuel for their frac heaters.

“He’s keeping me as supplied as much as he possibly can,” French said of Girard.

When asked if they’ve had problems with the shortage, Dion Reafhor, dispatcher with Spearing Service LP in Oxbow, said, “Not really. We’ve been fine.”

For their shorter haul runs, 300 litres is sufficient.

Longer hauls into the U.S. fuel up south of the border.

Weyburn’s Jerry Mainil Ltd. runs a lot of thirsty heavy equipment and trucks. However, they were keeping up. Dennis Mainil, said “So far we’re running business as usual. It shouldn’t be a problem, I hope.”

Carson Energy Services, a division of Flint Energy Services, has noticed the shortage. Glen Miller, assistant general manager for southeast Saskatchewan, said it had affected them in certain circumstances.

“We’ve gotten by here. We get it shipped in bulk.

We’ve just got to be careful with how we do on the usage.

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Finding diesel fuel can be a challenge, with many cardlocks out of service in November due to the diesel shortage.

Photo by Brian Zinchuk

Estevan-based L&C Trucking’s Blair Hunter said of fuel suppliers, “It’s sporadic. At any given time, any one of them can run out. A couple of times, there was no fuel.

“We keep a couple of slip tanks just in case. That’s to get someone back, not to go out.

“We had a truck in Regina that was coming home from Edmonton. It took two hours to get fuel, waiting in line at the Husky.”

Hunter pointed out the shortage was everywhere,

and demand will rise as rigs need fuel to operate boilers.

While the common ration has been 300 litres per truck per day, that’s not nearly enough for typical usage. “A typical truck would run 450 litres per day,” Hunter said. “That’s an eight-hour day, five miles per gallon. That’s an average day, not a heavy day.”

When “busy, busy,” a truck on a 14 hour day can consume as much as 700 litres, he said.

An Estevan Geothermal POWER Investment Opportunity A presentation by former resident, Kirsten Marcia (Muir), P.Geo., President and CEO of DEEP Earth Energy Production Corp.

Location: The Days Inn When: Sunday, December 11, 11:45 am (lunch will be provided) Monday, December 12, 11:45 am (lunch will be provided) Monday, December 12, 7:30 pm (bar service)

Please RSVP by December 9th to Jolene at (306) 651-5181 or jwatson@hcfm.ca

You are invited to an investment presentation for DEEP’s geothermal power project targeted near Estevan. The success of this project will not only be a huge win for the green renewable energy sector, but also put Estevan on the “global map” for being Canada’s first major successful geothermal power project.

The project will exploit the heat contained in the deep hot aquifers of the Williston Basin through conventional drilling and convert the heat to electricity for sale to SaskPower, using “off-the shelf” turbine technology.

A8

PIPELINE NEWS December 2011

Estevan Mayor Gary St. Onge, centre, cuts the ribbon for the new Estevan MRC MidÀeld branch.

Photo submitted

MRC Mid¿eld opens Estevan location Estevan – With the addition of a third location in southeast Saskatchewan, MRC Midfield has “triangulated the Bakken,” according to Mel Fitzpatrick, branch manager in Es-

tevan.

Along Estevan’s Kensington Avenue, there is a row of oilfield supply stores.

MRC Midfield has just joined that group, establishing its new

location at the corner of Kensington and Devonian Street.

The grand opening was held Nov. 17.

A few hundred people attended, and facility tours were offered.

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A buffalo roast supper was followed by a ribbon cutting.

“We’re focusing on the Bakken and many more formation plays in the area. We have locations in the U.S. and here servicing the whole area,” said Fitzpatrick.

The addition of Estevan provides three service points in southeast Saskatchewan – with Carlyle and Weyburn as the other two, forming a triangle around the Bakken fairway in this province. In southern Saskatchewan the company also has locations in Swift Current, Gull Lake, Kindersley, and Richmound.

Virden, Manitoba is also on the list, as are Tioga, Stanley, Mohall and Belfield in North Dakota and Sidney in

“

We’re focusing on the Bakken and many more formation plays in the area.

”

- Mel Fitzpatick Montana.

“We’re one of the largest in the world for pipe, valves and fittings in the industry,” he said. “This initiative is an expansion of the bottom hole pump shop that had been here for three years.”

“We’re a fully comprehensive supply store,” Fitzpatrick said.

“We handle everything that corresponds with supplies, with our core business being pipe,

valves and fittings.

Their tubulars includes casing and tubing, as well as line pipe.

With their location adjacent to several other supply stores, Fitzpatrick noted, “There is a very respectable group of competitors in town. There’s a spot for MRC Midfield to establish itself with the major expansion of the oilfield in the region. ɸ Page A9

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PIPELINE NEWS December 2011

A9

Triangulating the Bakken Éş Page A8 “We are in a very good spot. Kensington Avenue is always regarded as supply row. We had to be right here. This project has been long in coming. We could have been here sooner, in Estevan, but the location, everything, had to be just right, in order to represent ourselves for years to come.

In the pump shop, the focus is on insert and tubing pumps. “We analyze what the failure is. We put forth recommendations as to what to replace or upgrade, and we put it into a pump tracking program and send it to the customer.�

The company supplies new pumps as well as reconditioning customers’ pumps. “We maintain customer-owned property,� Fitzpatrick said. “We needed a fair bit of space for the bottom hole pump shop.�

The whole building is 13,500 square-feet, sitting on two acres of yard space. Sucker rods, pipe, and secondary containment components are stored within the compound. There is room to expand to the east, if need be. “This will certainly serve our needs for the immediate time frame,� he said.

As of early November, there were nine people working with MRC MidďŹ eld in Estevan, including inside and outside sales reps, warehouse people and bottom hole pump shop workers. The sta ’s experience is extensive, according to Fitzpatrick. “Relationships are everything in this oilďŹ eld. We are very sincere in developing our relationships with the key players in the area,â€? he said.

Fitzpatrick spent most of his life in Carndu. “I’ve been in the oil industry my whole life. My dad had an oilďŹ eld operating business I was in since I was 16. “After drilling rigs and university, I came back to Carndu and operated oil wells, and provided supervision as a consultant. From there I started up the Carlyle store (for MRC MidďŹ eld) six years ago.â€?

Fitzpatrick still manages the Carlyle location, in addition to the new Estevan location.

Branch manager Mel Fitzpatrick, left, and Scott Bigney, inside sales, are part of the crew at MRC MidÀeld’s new Estevan location.

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A10

PIPELINE NEWS December 2011

Palko Environmental has been on a tear of late developing new facilities. This disposal well site south of Oungre is nearing completion, while another nearly identical site is being built south of Stoughton. Now the company will be building a solid waste landÀll near Heward.

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Palko acquires land¿ll assets Land¿ll near Heward next on the agenda Heward - On Nov. 10 Palko Environmental Ltd. announced the purchase of assets permitting the development of an industrial/ oilfield landfill and treatment pad near Heward, Saskatchewan, northwest of Stoughton.

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associated regulatory approvals and landfill operations infrastructure. Palko purchased the assets from Harthaven Waste Management Ltd. for cash consideration of $1.88 million plus applicable taxes.

“The Bakken continues to be one of the largest, most profitable resource plays for our customers,” said Steven Peterson,

Palko’s president. “This purchase continues the strategic expansion of our network into solid waste management, thereby allowing us to provide our customers with superior integrated waste management solutions.”

“We’ve been working on that for a little while,” he said. ɸ Page A11

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A11

The sun may be setting on this facility, but it's rising on Palko's growth plans.

Palko continues to add new waste facilities ɺ Page A10 Currently the landfill site is bare land, but the approvals are in place for development. Palko expects to begin construction in the second quarter of 2012 and start operations in the latter half of 2012.

“It’s a Class II oilfield landfill,” Peterson explained. It will be the third in the region, and a logical extension of Palko’s oilfield waste business. Currently they are hauling solids to another facility after processing at the company’s original Midale facility.

“It’s just northwest of Heward, off Highway 33,” Peterson said. The site is approximately one mile off the highway.”

In proximity to Palko’s five southeast Saskatchewan facilities, the landfill and treatment pad will be strategically positioned as the nearest solid waste

management facility for drilling, production, spills and reclamation within the Bakken field.

The company is currently completing disposal well facilities at nearby Stoughton and a little further south at Oungre. Both of those facilities are adjacent to the highway. That’s important, according to Peterson, who said “It allows you to accept products out of your normal trading region if it’s on a highway.”

In addition Palko announced that it has approved, constructed and started operations of an exclusive waste handling tank farm for a major Canadian oil producer near Weyburn, Saskatchewan.

The tank farm allows the producer to streamline its waste management logistics and leverage Palko’s various facilities and expertise in order to increase the

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A12

PIPELINE NEWS December 2011

Jason Berg, with his back to the camera, and Amtarpreet Singh, in the black hardhat, guide a grate to be installed as a walkway at the new Palko Environmental facility south of Oungre. Both work for Endurance OilÀeld Supervision and Construction.

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New company builds water disposal facilities Estevan – At Oungre, one project Endurance Oilfield Supervision and Construction was coming together, and another one at Stoughton was still in its early stages as of mid-November. Both were for Palko Environmental.

Endurance fired up operations in May of 2011 with the expansion of a facility at Midale.

The company is owned and operated by Mike Irvine. His wife, Heather, is co-owner and does the administration work for the company.

There’s no shop for the fledgling company yet, but “hopefully soon” that will be taken care of, Irvine said.

Currently they operate two trucks, and have two other field personnel besides Irvine.

The work focuses on oilfield construction and maintenance, or as Irvine put it, “Building facilities and maintaining them, and all the other maintenance that comes along with the oilfield.”

The fall has been spent building two disposal well facilities for Palko Environmental, one south of Oungre, the other south of Stoughton.

“I started working for Viking when I was in high school, went to McGillicky’s for a while, then back to Viking,” Irvine said. “I wasn’t a very happy school person. The oilfield was my route. That’s why I was working in high school.”

Unlike a lot of other people his age in the oilfield, Irvine stuck around Saskatchewan, forgoing the Alberta experience. “Lots of people did (go there), but I didn’t want to go there. I like it here,” he said. ɸ Page A13

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PIPELINE NEWS December 2011

A13

Clockwise from bottom left: Theron Morin, Jason Berg, Adam Farquhar and Amtarpreet Singh use a roller to move a walkway grate into position.

Berg and Singh work with Endurance OilÀeld Supervision and Construction, while Morin and Farquahar are with Jerry Mainil Ltd.

Jumping on the opportunities out there ɺ Page A12 Irvine has done refractory work at Boundary Dam Power Station as well.

He was running a crew truck before launching Endurance.

He was born and raised in Estevan. Starting his own business at 25, he noted, “There are opportunities out there, and I thought I’d jump on them.”

Starting during an extremely wet spring might have sounded risky, but he said, “I was busy last year through

all that, pumping water all over the place.”

Indeed, Irvine said he gets several calls a day, saying, “Hey, we need a crew.”

“I want to get more trucks, but you can’t find the right guys to run them,” he said. “I want to keep expanding, This is the Àltration system for the new Palko Environmental facility near Oungre. to add a few trucks, for sure, but that comes with ‘Where can you find the guys?’”

He likes to turn wrenches himself, saying, “I’m a very hands-on person.”

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A14

PIPELINE NEWS December 2011

Going out with the advance party Story and photos

by Brian Zinchuk

Vern Parker of Saskatchewan, left, operates the seismic drill, while Jeremy Lariviere of Prince Albert, loads shot holes.

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Torquay - Seismic projects come in big and small. Pipeline News had a chance to visit a somewhat-larger one for Canada running along the U.S. border in the Torquay area in November. It is an area that has seen considerable seismic analysis in recent years, and currently has a strong drilling rig presence.

CGGVeritas is the creator and manager of the program. One of the largest international geophysical services firms, the company focuses on helping clients acquire and understand seismic data to support the exploitation of hydrocarbons throughout the world. Kent Milani, vice president, CGGVeritas multi-client and new ventures, Canada and Alaska land, explained the scope of the project.

He said, “The program is a multi-client data library program in the Bakken oil shale with a target depth of 2,200 metres. As part of our data library, we manage the entire program

as a turnkey solution for our clients conducting permitting, survey design based on collaboration and input from our clients about the target and imaging objectives, data acquisition, and processing with delivery of pre-stack migrated data as the end result.

“The 3-D program covers approximately 200 square-kilometres utilizing 5,000 channels of Sercel 408 multicomponent recording technology and dynamite energy source.

“At present we are drilling the shot holes and will begin recording in the next few days (as of Nov. 7). All of the services will be managed locally in Canada.

“As a whole, the company has acquired over 10,000 square-miles of shale data (proprietary and multi-client) in most of the major shale plays in North America.

Under the data library model, we currently have programs completed or under way in the Bakken, Haynesville, Montney, Eagleford and Marcellus with plans to expand into new regions in the future,” according to Milani.

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On Nov. 10, the project was finalizing the drilling stage in which the crew is drilling holes and setting the dynamite in advance of the actual seismic data recording. Seismic projects utilizing explosives are first surveyed, drilled, and loaded with dynamite in the shot holes as part of the advance party. The shot holes are aligned along a precise, GPS-guided grid that, for this program, ran east to west.

As the advance party completes an area, the crew begins laying out equipment including geophones (earth microphones, or sensors) connected by cables that are strung along a grid pattern of north-south recording lines. They are tied into a data acquisition system, in this case the Sercel 408. This simultaneous work allows the crew to begin recording immediately after completing the drilling. The careful coordination of an experienced project manager and observer overseeing the program ensures the proper detonation of the explosives in a planned sequence. The energy source will emit a signal deep into the earth and the subsequent vibrations from the various layers of the subsurface are recorded and captured in the form of seismic data.

Safety first Before heading out, the safety orientation reveals some interesting points. Following a robust safety management program that includes assessing hazards prior to “boots on the ground” and encompasses substance abuse screening, personal protection equipment, and roll-over protection in vehicles, the safety coordinator for CGGVeritas conducts a daily HSE meeting for the crew before they head out to the field. “We want to make sure everyone gets to go to and from the field safely,” said Don Sherstobitoff, safety adviser for CGGVeritas, who noted it is a policy of many of their clients. ɸ Page A15

PIPELINE NEWS December 2011

A15

It took Vern Parker, driller, and Jeremy Lariviere about 5 to 6 minute to drill and load a shot hole.

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CGGVeritas conducts survey ɺ Page A14 You won’t find an SUV on their job, because all pickups must have a rollover protection system, e.g. a roll bar, installed.

Quads, the workhorses of off-road field work, are forbidden. If you can’t use a truck, it’s a side-byside utility vehicle, or hoofing it on foot. Those sideby-sides must have a roll bar, windshield, and speed limiter.

The project has 10,800 shot points – drilled holes with a charge of dynamite placed in them – and 16,000 receiver points. All in all, it’s roughly a four-week project for the advance party, with the recording party following a week later, and have roughly a month’s work.

“It’s an old industry, but it’s fairly new to a lot of people,” Sherstobitoff said. At bare minimum, workers need their H2SAlive, WHMIS, TDG, first aid and CPR certifications. Defensive driving is also a requirement, and there’s even skid-truck training.

Drillers need their ground disturbance tickets, and blasters require a blaster’s ticket and an Enform shooters ticket.

Process “The client in this case is us,” said Trevor Dixon, the guide on this day, and project manager for the program. He indicated that a multi-client program is organized by CGGVeritas with underwriting and interest from several clients. The data is available for licensing by other interested parties. “You don’t wildcat wells like this.

“Today, drilling is based on geosciences. You need to define structures, and determine suitable locations for production, and that’s why we need seismic.”

Dixon explained the process. First, a client would pick an area to investigate. The seismic company would then contact the landowners to acquire permission and permits. On the Torquay project there were just 90. “We had 100 per cent buy-in. Not one farmer told us to go away,” Dixon said.

Next they come in and do the line locating, followed by the surveying. Drilling and placement of the charges is next.

The recording party then shoots the program, and collects all their material in the field after the data is recorded.

It’s a blast The advance party preps the job for the recording crew.

Seismic programs work like ultrasound, sending vibrations into the ground and receiving the reflections. First you need an energy source – either explosives, or a vibrating truck known as a vibroseis. ɸ Page A16

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PIPELINE NEWS December 2011

Stringent rules for the placement of explosives ɺ Page A15 “We’re blasting. This job’s dynamite. The majority of the business in Canada is dynamite,” Dixon said.

The choice between dynamite and vibroseis depends on a number of variables such as the terrain, environmental regulations of the area, the imaging objectives and target depth.

Shot holes vary in depth. On this job, they’re 15 metres, or roughly 50 feet. Each hole is loaded with a one-kilogram stick of dynamite.

It seems that setting off explosives has gone high-tech.

“We use a detonator that can’t be detonated by anything else. It’s called a smart cap,” he said. The blasting caps are electronically programmed now which reduces the risk of early detonation and keeps

the crew and public safe.

On this project, the shots are spaced 60 metres apart along the source lines. Source lines are 360 metres apart.

Where it’s impractical to place them, such as in sloughs, or near houses and water wells, the shot holes are offset. Such placement is heavily regulated, Dixon pointed out.

Before any of this can happen, the entire region must be swept for underground utilities. First-Call, a screening of the area for underground utilities, can take weeks, he said. On this project, each section of the project took a week to sweep before work could take place.

“You wouldn’t want a driller to drill into a low or high pressure pipeline.

“The seismic industry is the premier safety in-

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dustry. In my opinion, seismic has been a leader in safety,” Dixon said.

2-D, 3-D and 4-D seismic An active seismic program can be identified first by the numerous lathes placed by the surveyors, thousands in number, identifying each recording point and shot point. Green lathes are for receiver lines, orange ones indicate energy source lines.

Surveying has changed substantially. Now there’s no rodman or chaining. It’s all done with GPS. “You use the GPS and put the flag in the ground.

Such advancements have reduced the manpower requirements, according to Dixon, “But the scope of the jobs increased ten-fold.

“In the ’80s, 300 kilometres of 2-D was a winter’s worth of work for a 30 man crew. Now it’s 5,000 kilometres of 3-D for an 80 man crew. To prep that, on the front end you need 200 people on the advance party.

“2-D is used as a regional search for early exploration of an area. If they find something interesting from the long 2-D lines, they’ll conduct a more intensive 3-D survey of a specific area. 3-D surveys provide a much higher resolution image because the survey is designed on the basis of a grid where source points run orthogonal to the receiver points. The complexity of the design dictates more equipment, more energy, and more crew members,” Dixon said.

Cenovus Energy has in the past talked about their “4-D” seismic programs monitoring the Weyburn unit. In it, they conduct the same seismic program over and over in the exact same locations, providing the fourth dimension of time to monitor the flow of carbon dioxide in the CO2 flood. Companies like CGGVeritas do the ground work for them.

In the 4-D case, geophones are left in the ground. Thousands of geophones are buried for that purpose, placed in a plastic pipe with a “pigtail” lead to connect to. The crews dig them up, take the cap off, and plug it in.

No line clearing In the north, slashing, clearing lines through dense brush or forests for laying out equipment, is a major part of the job. But in southeast Saskatchewan, where a good chunk of the trees were planted by hand, it’s a non-issue. Dixon said they didn’t have to do any clearing on this job. ɸ Page A17

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PIPELINE NEWS December 2011

A17

Fast-moving drillers a competitive lot Éş Page A16 “This would be a big job if we were required to clear lines and the cost would go up exponentially,â€? he said. “In Canada there are a host of environmental regulations that govern how the tree lines are cut, including the width and number allowed, which can make it challenging to maneuver and greatly impacts productivity. The source lines would be cut by bigger mulchers, the recorder lines by smaller ones.â€?

Mulchers are a relatively recent innovation, and a welcome one. “Our footprint is at least 50 per cent smaller than it was 10 years ago,� he said.

Air support A sure sign a recording crew is in the area is the presence of a low-ying helicopter, typically carrying bags of cables from one area to another.

Part of the advance party’s job is determining staging areas for the helicopters to minimize their ying time. “Helicopters are expensive to operate on an hourly basis, so you really want to make sure they are ying the least amount possible,â€? Dixon said. “It’s much easier to

lay out the gear and pick it up,� he said of helicopters. “They have it down to the second.�

Helicopters also mean much less impact on the ground, with simply men walking across it, rather than trucks or ATVs. “Ultimately, we save hundreds of thousands of dollars using helicopters,� Dixon said.

Drilling “This is a buggy,�

Dixon said as we approached one of several drills on the project. It’s a substantial unit with high otation tires. Like a four-wheel-drive tractor or rock truck, it articulates in the middle to steer. “Drillers are highly competitive,â€? he said, noting the fast pace of the drilling.

First the hole is drilled, with the driller adding a stem of auger every 10 feet. It takes just two minutes to drill a shot hole.

Then the helper activates the computer chip in the blasting cap.

He places the charge of dynamite on a long rod, and places it in the bottom of the hole. He keeps adding sections to his pole until it reaches the bottom. Then he yards out the rods, disassembling it as he goes,

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Lariviere is hoofing it, carrying his rods from hole to hole on his shoulder, since quads are not allowed on this job. He’s dressed for the cold, but notes at -12 C, the temperature’s about right. The ground is sti enough to work on.

This "smart cap" is computer activated.

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before pushing some of the drill cuttings back into the hole. The wires are then wrapped around the stake.

Drillers are paid by the metre, and try to do about 80 holes a day, Dixon said. As such, they move fast. Within six minutes, the hole is complete, the shot is loaded and wired, and they are o to the next hole.

Vern Parker of Saskatoon is the driller, while Jeremy Lariviere of Prince Albert is the helper. Parker is on his 28th winter working seismic. At one point he had his own drill, but now he contracts out.

He started with his brother at Cudworth, Saskatchewan’s home to seismic drilling. “At one time there were 21 seismic drill contractors in Cudworth,� Parker said.

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A18

PIPELINE NEWS December 2011

Newfoundland teacher Tales from now watches dynamite a seismic Ray Bruschett

Ray Brushett of CGGVeritas taught school for 25 years, then did some coiled tubing work out of Whitecourt. He’s also run an ocean fishing lodge for three years on the west coast. Now he’s spending his winter doing seismic work.

He came west after working as a weather observer on the Hibernia offshore oil platform.

“I left shortly after the crash,” he said, referring to Cougar Helicopters Flight 491, which went down March 2009. Brushett taught two of the victims in school.

“I had a couple years retirement, but it didn’t work out,” he said, laughing.

As a teacher, he had had enough. He wanted to work privately, and make some money.

His home is in the countryside, at Thorburn Lake, Newfoundland.

Now he’s responsible for the inventory and delivery of explosives to the drilling rigs.

lifer

This winter marks Trevor Dixon’s 34th year doing seismic, and he wouldn’t have it any other way.

“I guess they call me a lifer. My older brother was working in seismic, making pretty decent money,” he said.

His brother told him to go talk to a man in Calgary, and soon he was put to work.

“They flew me to the Arctic. My family had bets to see how long I would last.”

He started out at as “jughound,” or “juggie,” a worker who distributes and then collects long rolls of cable. “In the Arctic, we were working 18 hours a day,” he said.

Dixon saw that the surveyors were in the camp earlier in the day, and had their pick of the food and hot water. “I applied to be a surveyor, and got a job the next week.”

He’s worked all over Canada, and in 20 states.

“This winter I’m going to the Arctic to Norman Wells.”

CGGVeritas, he noted, has crews located all around the world in the United States, Canada, the Middle East, Indonesia, Africa and South America.

“I couldn’t work an 8 to 5, five days a week. To make the same money, I would have to work 7 to 7, seven days a week Married with three kids, he married somewhat later in life, at age 40. If he was working that 7 to 7, he notes he still wouldn’t see his kids.

“As an industry, we’ve been slow the last couple years due to the economy. I’ve been home six months.

This year it will be four. I’ll have worked approximately 220 days this year. That’s the average. When the economy was bad, we were lucky to get 120 to 130 days.

“When I’m home, I’m home. I garden, do yard work, renovations.

This owl near Torquay was keeping up with the pickup truck.

Photo by Brian Zinchuk

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PIPELINE NEWS December 2011

A19

Second winter on seismic Alicia Cormier of Spruce Grove, Alta. who works for SeisMed, is in her second season of seismic. She has her advanced Level III emergency medical personnel training, a two-week course.

She’s worked with drilling and service rigs, as well as frac crews over the summer.

Asked how she keeps awake, Cormier responded she stays well rested for work.

Part of her job is conducting radio checks on the location of all the crew every hour or two hours, depending on the size of the crew.

“My job is very quiet, but quiet is a good thing,” she said.

Drill push used to drive vibroseis Matt Scott has spent 11 years working in the seismic field, most of that time with CGGVeritas.

At first he was a vibroseis operator. A vibroseis is a heavy, large truck with high floatation tires and a large flat base-plate that is lowered to the ground. The truck emits vibrations into the ground by lowering the base-plate and shaking for a period of time, called the sweep.

“The vibrator controller in the vibrator cab sends a tone to you and

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you start shaking,” he said. The process is largely computerized now, and the driver simply drives to the next point.

A vibrator will apply between 60,000 to 80,000 pounds of downpressure, he noted.

“We work all over the place,” he said. Scott has personally worked in Senegal about seven years ago.

As drill push, he supervises the numerous drills on the job, and takes care of the dynamite inventory.

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A20

PIPELINE NEWS December 2011

PIPELINE NEWS December 2011

A21

Pipeline News Exclusive

Boundary Dam CCS project rises on the plain The structural steel for the carbon capture plant is coming together

Story and photos

by Brian Zinchuk

Turczyn said.

The engineering, procurement and construction contractor is SNCEstevan – As a winter storm was Lavalin Inc., also known as SLI. “We’ve got roughly 160 people about to blow in, bundled up ironworkers manipulated large, heavy working on the carbon capture projbeams as the crane operator gingerly ect right now,” he said. “It’s going to moved them about. Slowly but surely, ramp up. We could hit the 600 mark SaskPower’s big bet on carbon capture next summer, when you include those and storage has begun to take shape on working on the rebuild of the generating unit and the carbon capture the plain south of Estevan.

The SaskPower Boundary Dam project.”

SaskPower is letting the private Integrated Carbon Capture and Storage Project is the first commercial- sector address the housing situation scale implementation of CO2 post- for the influx of workers.

The overall project is on schedule combustion capture in the world. The $1.24 billion project got the go-ahead right now, Turczyn said. Construction in April 2011, and work started imme- started May 1, and the majority of the diately. It is expected to be complete in foundation work is in place while some slabs will be delayed until spring. the first quarter of 2014.

“We’ve got most of the excavation The project involves a rebuild of Unit 3 at Boundary Dam Power Sta- complete. We’re doing a little bit of tion (one of six generating unit at the backfilling,” he said.

“The structural steel – it’s coming facility) and the addition of a fullytogether. We started from the north integrated carbon capture system.

Pipeline News was provided with and are working south,” Turczyn said. an exclusive tour of the construction “In January-February, we’ll have the people come in and start the exterior site on Nov. 17.

Professional engineer Bob Turczyn walls.

Before that happens, some of the is SaskPower’s supervisor of construction. Prior to the carbon capture proj- large components will be put into place. ect, the U of S product had worked on The largest single-piece component is the construction of the Poplar River the 350-ton, 133-foot long CO2 stripper. The pressure vessel is anticipated and Shand Power Stations.

“Right now I’m supervising the to arrive in mid-December from its contractors on the clean coal project,” manufacturer in the Edmonton area.

It’s so large, a 650-ton Manitowoc crane is being brought in for the express purpose of erecting the monster vessel. Once it’s in place, the crane will be disassembled and taken away.

“That’s a huge crane to erect the CO2 stripper, and then it’s gone again,” Turczyn said.

Other large components include the large amine storage tank, whose round foundations are already evident at the centre of the facility. The amine tank will be built early in the new year.

Turczyn explained, “It’s a large chemical processing plant, more or less.

You use an amine chemical to combine with the CO2 in the absorber. You then take it to the stripper and strip it out.”

SaskPower decided to go with the Cansolv Technologies Inc. process, produced by a subsidiary of Shell Global Solutions International BV.

Gary Cooper, manager for stands before the completed ture plant.

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construction SNC-Lavalin, a graphic of carbon cap-

In addition to SNC Lavalin, there are a number of smaller local contractors including PCL and its subdivision Coram of Regina, Kelly Panteluk Construction of Estevan (which is doing nearly all the dirt work) and Hirsch Construction of Estevan (which is handling general construction duties). Skylift Services of Estevan is doing additional crane work on a regular basis.

Concrete came from local suppliers Glen Peterson Construction and Turnbull Redi-Mix. For big concrete pours, Turczyn said, “They had to use all their trucks and go 24-hours a day.”

Dart Services provided concrete pumping.

Balzer’s Canada from Regina is doing pipefitting and electrical work.

Substantial component work is

Phone: 634-5016 1033B 4th Street • Box 695 • Estevan, SK S4A 0W4 • Fax: (306) 634-3166 • serviceestevan@thundercity.ca

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coming from just down the road, in Oxbow. Saskarc Industries is building large portions of the modular units. They will then be transported to the site and installed.

Gary Cooper, construction manager for SNC-Lavalin, said, “The job’s going well. The weather is starting to close in. We were expecting that.

“We started Oct. 1 putting up structural steel.”

As of mid-November, approximately 25 per cent was up.

“It will be finished early spring, next year,” Cooper said of the structural steel.

The main building for capture plant is 400 feet long and 120 feet wide. The northern half is 75 feet tall, while the southern half is 30 feet.

The facility under construction is only for Unit 3. Should SaskPower decide to do similar carbon capture projects when it gets around to replacing Units 4, 5, and 6, they will require their own facilities.

Two underground 54-inch highdensity polyethylene lines, a feed and a return, run to a heat rejection plant located one kilometre south of the facility near the cooling water outfall

for the existing power plant. However, in this case, it is a closed-loop cooling system, and heat is not discharged into Boundary Dam Reservoir.

Cooper hails from Port Colborne, Ontario, near Niagara Falls. “This will be my fourth winter here,” he said. Prior jobs for SaskPower include the Queen Elizabeth Power Station expansion in Saskatoon and the construction of the natural gas Yellowhead Power Station in North Battleford.

Over the next four to six months, several goals are slated, according to Cooper. They will close in the building, bring in the larger vessels and equipment as the steel work goes up, and put temporary heat into the building.

They will finish some civil construction activities and start on mechanical activities.

While the project involves cutting edge technology, the construction activities underway at Boundary Dam are quite conventional.

“The components, the type of construction, is the same as any other heavy industrial site you would build.”

He said.

Labour hasn’t been a problem.

“We’ve been able to meet our own requirements,” he said, noting SNCLavalin can “draw on a large pool of staff.”

As for their sub-contractors, they’ve been OK, so far.

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As the structural steel goes up, large components will be installed, before the building is clad.

The view from the roof of the Boundary Dam Power Station shows the scope of the carbon capture project under construction.

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A22

PIPELINE NEWS December 2011

Tubing inspection done Estevan – When is a piece of tubing good enough to put back in the hole, or should it be retired into cattleguard fencing? That’s the job of tubing inspectors like ARKK Tubing Inspection Services, which has operations in Estevan.

Randy Labrecque looks after ARKK’s Saskatchewan operations.

“We perform rig floor production tubing inspections on oil and gas wells,” Labrecque said, noting the practice is becoming more and more common.

“We determine how thick or how thin the tubing is and detect holes, stress points corrosion and rod wear defects,” he said. “This has been around for many years. The technology is continually changing and improving, and ARKK is progressing with that

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technology.”

“It’s a magnetic unit. We put an inspection tool on the rig floor. We hook it up to a power source on the truck and a magnetic field is produced through the mag coil.”

That coil is essentially a big copper spool of wire.

“We put power to it. It magnetizes the pipe,” Labrecque said. “As it gets thicker or thinner, the inspection tool detects flux leakage based on how thick or thin the pipe is. This is how it detects defects in

the pipe. It’s a non-contact trip tool, which means nothing touches the pipe except for stripping rubbers on the top and bottom.”

Those rubbers also centre the pipe in the tool, in the middle of the magnetic field.

“When we inspect pipe, for each joint of pipe we get an inspection chart. When the well is complete, these charts provide an inspection profile.”

The well profile shows the percentage of wall loss due to corrosion and rod wear for each length of pipe. ɸ Page A23

A good football program guides town choice Born in Rosetown, raised in Biggar with a wife from Regina, Randy Labrecque and his wife found it to be too much being on their own with a new baby in Alberta without any immediate family. “I was moving home, regardless,” he said.

His employer, ARKK Tubing was supportive. “If you want to set up a shop, we’ll support that,” he recalled.

Labrecque’s previous career was that of a funeral director, having grown up in the family business.

Football has also been a major part of his life. “I was an O-lineman,” he said. “I played with my high school in Biggar, and played in the Saskatchewan Senior Bowl all-star game.”

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He was recruited by the University of Regina, but that didn’t work out. “I was pretty young and inexperienced to be playing with grown men at the time,” he said.

Labrecque played a year of junior football with the Regina Prairie Thunder, and then bounced around several schools and programs, including across the 49th.

“It reinforced my love of the game,” he said. “It really played a big part in why I started coaching football.”

A two-week stint at Jamestown College in North Dakota was the final straw to his realization that playing football was no longer his gig. However, it did leave an impression on the type of coach he wanted to be.

A strong, new football league in Estevan was a large factor in why Labrecque chose to move to Estevan. It resembled the program he was involved with in Alberta. He started with the Bantam Steelers, and last season worked with the local high school team, the Estevan Comprehensive School Elecs.

“I was the offensive co-ordinator and O-line coach,” he said.

Team sports help on the business side, he said, noting it “keeps guys motivated to go to work. I preach a team atmosphere at ARKK. The biggest resource we have is the people we employ. We have a fantastic staff.”

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PIPELINE NEWS December 2011

on site: ARKK Tubing

A23

Randy Labrecque shows the inspection tool ARKK Tubing Inspection Services uses to detect defects in tubing.

Photo by Brian Zinchuk

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ɺ Page A22 “I have been doing this for six years,” Labrecque said, noting he has seen all kinds of different wells and problems.

The company puts new workers through three months of training before they go out on their own, he added.

Asked how frequently companies want inspections done on their tubing, he said, some companies wait till there is a well failure, some want to see an inspection every three or four times the tubing comes out of the hole, or they want to change it out before it becomes a problem. “Preventive maintenance is a big priority these days,” Labrecque said. “Nothing is made to last forever.”

Asked if coiled rod makes a difference, Labrecque said it depends on the well. “Application is 99 per cent of it. Doglegs, bends, will put a perfectly symmetrical grove on that length of pipe.”

But there are answers to that. “We use ultrasonic

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thickness meters to confirm defects on all inspections, especially if we get into full-length rod.”

Interpretation of charts and educating customers in that regard is an important part of the business. Tubing is labelled as yellow band, blue band, green band and red band, depending on the amount of wall loss.

Seven people work with ARKK, including two in Estevan. Raymond and Koreen Cyre are the owners, and look after the administration.

Things are picking up for the company in southeast Saskatchewan. “Every month is busier than the last,” he said. “You have to be patient, put in your time. There are two of us running around, and we’re busier more often than not. We’re lucky to be in a constant state of growth. The biggest challenger around here is having the right people.”

“We have other opportunities. We’re going to need more staff,” Labrecque said.

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A24

PIPELINE NEWS December 2011

Suburban Extended Stay Hotel Opens The new Suburban Extended Stay Hotel joins the growing number of hotels in the northeast corner of Estevan. It is also within walking distance of the new Saskatchewan Energy Training Institute.

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Estevan – The Suburban Extended Stay Hotel opened in Estevan on Oct. 14, and none too soon. With winter coming and campers less appealing, clients were chomping at the bit for the new hotel to begin operations, and occupancy rates have been high.

The initial plan had been to open months sooner, but construction delays held that up, according to Ruth Wall, general manager. The wet weather in the fall of 2010 and spring of 2011 were factors.

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As an “extended stay” hotel, things are a little different than a conventional hotel.

“They’re all equipped with kitchenettes in them,” Wall said of the rooms. They include a cooktop, fridge, microwave, coffeemaker, toaster, cooking utensils, dishes and cutlery, wash rack and kitchen sink.

Similar to a typical hotel room, there are either one or two queensized beds. Suites have a separate bedroom from the living area.

“Because we’re extended stay, we only do weekly housekeeping,” Wall said. “It’s like an apartment, furnished.

They just move in.”

“Our goal is to have a home away from home.”

“We have guest coin-operated laundry on each level as well.”

There is a meeting room and workout room, but no pool or hot tub. Two computers can be found in the business centre, just down the hall from the front desk. All the rooms have wireless Internet as well as hardwired Internet. Each room has a 32-inch flat screen TV. One elevator services the building.

Pricing is based on a four-tier system, with the most expensive being one to four nights, and discounts applied

for longer stays. Clients staying over 30 days get the highest discount.

“We have guests who booked Oct. 17 and are staying until Dec. 22.

Some are staying until April,” Wall said.

There’s quite a mix of oilfield companies, one-night leisure guests, weekly guests, corporate clients and even hockey teams. Several of the oilfield company have taken blocks of rooms.

“We’ve got subtrades under the main companies as well staying with us,” Wall said.

As of early November, approximately 70 per cent of the client was oilpatch related. “It could go higher,” she said. During the weekends, some rooms have become available, but during the week, they are routinely packed.

Canyon Technical Services, who set up their Estevan base just a few blocks over from the new hotel, is one of those clients, taking a substantial block of rooms for their frac crews. “The guys are ecstatic,” said Ron Deringer, base manager for Canyon. “The rooms are bigger, and with the kitchenettes, they can cook their own meals.”

There will be approximately 13 people working at the hotel. Wall and her family moved to Estevan in the spring of 2011. The remainder of the staff is largely local. ɸ Page A25

WITH THANKS From Our Entire Staff

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PIPELINE NEWS December 2011

A25

The addition of the Suburban Extended Stay Hotel to Estevan takes a small amount of pressure off the short housing situation in the city.

Your Home Away From Home Each room is equipped with a stovetop, fridge and microwave, in addition to the Áuffy pillows.

Estevan’s Newest Hotel

Room for families to visit ɺ Page A24 For the new hotel, like nearly every other business in the region, it’s tough to find enough people.

“Staffing is an issue,” she said. “I’m still short on housekeeping. I was stripping beds before I met you. Have I been working long hours?

Yes.” Indeed, just prior to opening, much of the executive and administrative staff for the management group was helping out with final preparations. “The CEO was helping with housecleaning.”

The ownership of the hotel lies with a limited partnership, which includes some local ownership. The management group is Encore Hospitalities of Winkler, Manitoba. Bridgeroad

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Developments, also of Winkler, acted as general contractor.

The clients, Wall said, have been extremely grateful. “They love it here. They say it’s one of the best properties they’ve stayed in for an extended time.”

One difference of a hotel versus a camp is that family can come, visit, and stay in the same room as the client.

“One family came for two whole weeks,” Wall said, adding such visits “help stabilize relationships.”

“We try to accommodate the family,” she said.

It’s common for two workers to share a two-bed queen room, depending on the company’s request.

The parking lot will not be paved until next With a round of best wishes to all our good friends at Christmas.

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A26

PIPELINE NEWS December 2011

Shifting Gears

One Woman’s Perspective on Life, Liberty and the Pursuit of Land Locations

By Nadine Elson The Christmas season is officially here. If I hadn’t figured it out by the Christmas carols now playing on the radio and in the stores, or the lights twinkling on the houses in my neighbourhood, I knew it for sure when I saw the large gaily wrapped

3D

nut tray at the oil company office.

Many companies use the Christmas season to express thanks to existing customers by sending Christmas cards, but oil companies are extraordinarily generous with gifts of nut trays, boxes of

All kinds of Christmas gifts chocolates, bottles of liquor, and items of clothing and hats personalized with their company logos.

I recently attended a shower. Not a baby shower or a bridal shower, it was billed as a Shower of Blessings after the Flood.

Dan and Renee King of Roche Percee, like many other residents of southern Saskatchewan, had been victims of flood waters. They were rebuilding their house after the flood damage.

Attendees contributed to a money tree or brought household gifts.

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In thanking everyone for their generosity, Renee talked about how hard some of their days had been due to the flood. She cried when she recounted a particularly difficult day of throwing out wet and damaged belongings that held memories. Her children did not witness their mother in distress though, because another couple from the church had taken all 5 siblings for the day, feeding them physically and emotionally.

“It was such a gift!” she said, “A gift of encouragement on a day when I was feeling so low! It was such a blessing to know that my children were being cared for and having fun even in the midst of my sadness.”

“A gift of encouragement”- the phrase stuck in my head and I thought about it.

The dictionary defines a gift has something given voluntarily

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without payment in return, to show favour to someone, to honour an occasion, or to offer assistance. By that definition, encouragement is most certainly a gift.

I, too, have been given the gift of encouragement.

Many times as it turns out. As recently as after church on Sunday, Gloria told me how much she appreciates the column and looks for it every month. She told me that reading my column and imagining me in the patch, has inspired her to step outside her own comfort zone. Last week, Dale, a former oil supply store owner and friend of my father, greeted me outside the grocery store and told me how much he enjoyed reading the column too.

The column has been running for a year now. Many people over the last year have taken the time to read it. Many have also encouraged me with their comments in person, through Bruce, and e-mail. Olive, a dear 93-year-young lady who was the receptionist in the law firm that my father came to article in as a young man in 1957, called my home phone in February and left a delightful message on my machine.

I heard from a former employee of mine when

her mom sent her the column in the summer.

When I wrote about the local Desk and Derrick Club and the regional convention being held here in May, president Claudia liked to column so much she had it copied, and inserted it into all the registration packages. I think it was the mental image of me winning the wet T-shirt contest that tickled her funny bone. Her action was a gift to me as many registrants commented to me on the piece.

So this Christmas, as you are making plans to give gifts to your employees, bosses, suppliers, customers, and families, I hope you remember to give the really important gifts, the gifts that money cannot buy. The gifts of encouragement, love, understanding, gratitude, and time are worth more than the most expensive nut tray.

Nadine lives in Estevan, with her husband and family, and works as a hot shot driver in the oil patch regularly delivering goods in and around Estevan and Shaunavon, Saskatchewan, and Sinclair and Waskada, Manitoba. Her mission, beyond delivering the goods quickly, is to have every interaction be a positive one. She can be reached at missiondriver@hotmail.ca

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PIPELINE NEWS December 2011

A27

Keystone delay idles welders

Welders like these ones, working on Enbridge’s Alberta Clipper project in 2009, were gearing up to go to work on the Keystone XL pipeline for TransCanada. While they are still likely to Ànd work, the delay disrupts many plans and lives.

File photo

are “rig welders,� who hire on not only themselves, but their truck and welder. Unlike many other tradespeople, they don’t just show up to work with their hard hat, boots and lunch bucket.

Welding rigs are typically one-ton duallies with either a custom built service body or box insert equipped with everything from a large welder to grinders and acetylene torches. They are not cheap. “$100,000, minimum, to get rigged up,�

Knipple said of the investment required to set up a truck for big-inch pipeline welding, including the truck, welder, accessories and tools. “If you’re going to run in that circle, you have to be set up to go.

You have backups for everything – two of everything that’s services, prepped and ready to go.� “A lot of guys have been getting ready for it, spending money, arranging accommodations, purchasing trailers.�

The pay for welders is top-notch, but the work is hard and demanding. “At points you’re literally running, then down in the ditch, then up, in and out of the mud.�

All the while there’s no room for error. “One or two repairs for a tie-in welder, and you’re done. You don’t get to fail welds.� Knipple said. “It’s perfection

every time.�

So what will they do while Keystone remains in limbo? “Go work on other jobs. That’s what we do.

We work contract, construction,� Knipple said. “It’s a setback, a letdown, but not a showstopper. “We do other work, absolutely. But we wouldn’t want to see two or three of these jobs go sideways.�

He added that the loss of the work is devastating for some areas of the U.S. “Where does it go from here? If the U.S. doesn’t want it, we don’t know where it’s going,� he said. “It’s too bad. It’s all based on politics.�

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Regina – The Keystone XL pipeline project isn’t just a pie in the sky project for those who build such things. It’s a real, high-paying job, and now it’s gone, for at least a year. “It was announced, awarded.

Everything looked like it was full steam ahead,â€? said Troy Knipple, business manager for Local 179 of the United Association of Journeyman and Apprentices of the Plumbing and PipeďŹ tting Industry of the United States and Canada. UA Local 179 Saskatchewan, along with Locals 488 Edmonton and 254 Winnipeg represent the welders, spacers/pipeďŹ tters, and welders’ helpers on such mainline projects. “It aects for labour,â€? he said, nothing they expected eight months or more of work in Saskatchewan. There would be approximately 50 to 60 UA members per spread, and two spreads were planned.

In anticipation of a major project like TransCanada’s nowdelayed Keystone XL, big-inch pipeliners spend time getting prepared, none more so than the highly-skilled welders.

While their numbers may be small compared to the hundreds of operators and labourers on a 400 to 600 man pipeline spread, their investment is high. Many of them

A28

PIPELINE NEWS December 2011

Drilling program, acquisitions (Nickle’s Daily Oil Bulletin) Legacy Oil + Gas Inc. says its organic program delivered strong results, helping boost third quarter production 14 per cent while keeping the company on-track to reach its 2011 exit production target of 15,750 bbl. of oil equivalent per day.

For the three months ended Sept.

30, 2011, Legacy increased production to 12,642 boepd compared to 11,131 boepd for the same period in 2010 due to successful drilling and subsequent tie-in of wells in southeast Saskatchewan and North Dakota.

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As well, the corporate acquisitions of Bronco Energy Ltd. and the acquisition of Spearfish light oil assets in the Pierson area of southwest Manitoba from Molopo Energy Canada Ltd. added to the increase in production reported in the third quarter of 2011

compared to the same period in the prior year.

Current production is in excess of 15,000 boepd, which represents an increase of 47 per cent over second quarter 2011 average volumes.

Average year-todate output of 11,898 boepd was 54 per cent higher than production during the comparable period in 2010 due to the corporate acquisitions of Villanova Resources Inc., CanEra Resources Inc., Bronco and Molopo, as well as continued successful drilling and tie-in operations.

During the first nine months of this year, crude oil production averaged 8,270 bpd, 29 per cent higher than the equivalent period in 2010 of 6,432 bpd.

Natural gas production averaged 13.4 mmcf per day for the nine month period ended Sept. 30, 2011, compared to 5.36

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mmcf per day last year, while natural gas liquids production averaged 1,102 bpd compared to 383 bpd a year earlier.

Heavy oil production averaged 292 bpd versus nil bbls per day for the nine months ended Sept. 30, 2010.

The increased volumes and strong realized prices helped Legacy bump up third quarter earnings over 200 per cent to $7.91 million from a net loss of $7.27 million during the same quarter last year. Year-to-date profit was $11.94 million versus a net loss of $4.73 million for the first nine months of 2010.

Cash flow and revenue also showed strong improvement yearover-year.

Legacy participated in the drilling of 42 (32.1 net) wells during the third quarter, targeting light oil with a 100 per cent success rate. Excluding acquisitions, the company spent $101.78 million on capital expenditures in the quarter: $78.12 million on drilling and completions, $14.05

million on equipping and facilities, and $8.7 million on land, seismic and other.

At Bottineau County, North Dakota, the three Spearfish horizontal wells brought on production in June 2011 continue to produce above the type curve, with oil rates over the first five months of production averaging 82 boepd per well.

Legacy has one rig drilling in the area and expects to drill up to six wells before yearend. The company said these wells have confirmed the presence of an emerging light oil resource play in the Spearfish and proven the productive potential of a large portion of Legacy's Bottineau County acreage position of 50,836 net undeveloped acres.

In addition, recent drilling at Pierson, Manitoba, has demonstrated significant success, with the five most recent wells showing initial production rates in excess of 100 boepd with low water cuts. ɸ Page A29

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PIPELINE NEWS December 2011

behind Legacy's production hike ɺ Page A28 Legacy said it has initiated completion operations with a 10-stage acid fracture stimulation on the first Rundle well drilled in this year's program at Turner Valley, Alta. Initial flowback/ swab results are expected in seven to 10 days.

The company currently has three rigs drilling at Turner Valley and expects to finish drilling two additional horizontal wells before the end of November and immediately proceed with multi-stage acid fracture completion operations.

The company said its horizontal multistage acid fracture stimulation recompletion continues to perform favourably. Prior to the fracture stimulation, this was a poorly performing seven-year-old Rundle horizontal well and the multi-stage acid fracture recompletion in Febru-

ary 2011 resulted in an initial four-fold increase over the unstimulated oil production rate.

The well's current production is approximately 75 boepd, nine months after the stimulation. In addition, Legacy has designed and constructed a portable jet pump skid to better optimize production in Turner Valley, as a result of the successful pilot project run last fall. The jet pump has been operational for approximately one month and has resulted in a three-fold increase in production rates to 60

All the best!

boepd from 20 boepd on a marginal 10-year-old unstimulated re-entry horizontal well. An extended production test will be completed and additional optimization candidate wells will be tested in the future.

Stoughton area Legacy also continued to improve upon fracture stimulation design and execution in its Stoughton/Heward and Star Valley areas of Saskatchewan. The company identified the potential improvements that could be realized in oil rate and reduction of initial water cut over two years ago

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when these areas were acquired. Legacy said it has been at the forefront of evolving the Bakken stimulation program to more, smaller tonnage fracs, minimizing fluid volumes and improved frac fluid design.

Improvements have

been seen over the past two years and the company has continued to refine the frac design.

Recent wells have demonstrated 30-day initial production rates of approximately 150 boepd and water cuts as low as 25 per cent compared to

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the pre-Legacy operated historical average of 125 boepd and 57 per cent water cut. The company believes that, over time, the improved initial performance should lead to positive technical revisions to reserve bookings.

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PIPELINE NEWS December 2011

BlackPearl expects $125-$135 million in 2012 infrastructure spending Building infrastructure in its core areas of Blackrod, Onion Lake and Mooney will be the focus of BlackPearl Resources Inc.’s capital budget of between $125 million and $135 million next year.

Among the projects are construction of a heavy oil battery at Mooney to handle increased volumes from the ASP (alkali surfactant polymer) flood. At Onion Lake, spending will include building a

heavy oil battery, and planning for a pipeline to connect the facilities to a major oil gathering system as well as drilling up to 14 horizontal wells that will eventually be used for thermal development of the property.

In addition to these infrastructure projects, BlackPearl will continue with its conventional development program at Onion Lake with up to 50 wells planned. It also plans to drill five

to 10 horizontal wells on Phase 2 lands at Mooney. At Blackrod, the company will begin the detailed engineering work for the first commercial development phase of its SAGD project as well as drill 10 additional delineation wells required for the commercial application.

It is expected that this capital program will be funded from existing working capital and anticipated cash

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BlackPearl also has an unused $25 million line of credit that is available.

Plans call for the sale of some of the company’s non-core properties in 2012. If it is successful, BlackPearl would likely expand its capital program and accelerate the development in its core areas.

BlackPearl reduced its loss in the third quarter and posted increased revenue and funds flow along with higher production in the third quarter and nine months. The loss for the three months ended Sept. 30, 2011, declined to $51,000 (nil per share) from a loss of $1.44 million (one cent per basic and diluted share) in the comparable 2010 period.

Oil production averaged 8,113 boepd, a 22 per cent increase from the third quarter of last year. BlackPearl attributed the increase mainly to the 63 wells drilled at Onion Lake in the spring, the majority of which were put on production during the third quarter. It still has 18 wells from the

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spring drilling program that will be brought on production when its thermal development plan receives regulatory approval, which is expected in the first half of 2012.

Operating costs were $18.31 per boe in the third quarter, which is higher than previous quarters due to the significant number of new wells brought on production at Onion Lake during the quarter. These wells tend to have higher initial expenses due to increased sand production, increased fuel costs until wells are tied into the fuel gas system, and increased emulsion trucking and treating costs.

In addition, although the incremental costs of initially re-pressurizing the reservoir at Mooney are being capitalized, the existing operating costs are continuing with lower production levels (since half the wells were converted to injectors), which contributes to higher operating costs on a per bbl basis.

The Blackrod SAGD pilot has been steaming for more than five months and oil production is at 200 bbls per day and is continuing to ramp-up. BlackPearl anticipates in the

next six to 12 months the well will reach its target production range of 500 bpd to 800 bpd.

The company is extremely pleased with the development of the SAGD pilot, John Festival, BlackPearl president, said in a release.

“All of our early milestones have been met and we are confident we will meet our commercial targets for our pilot in terms of steamoil-ratio and peak oil production rate. Based on the consistent geology across the Blackrod lease, this pilot will be able to validate the entire project potential of over 70,000 bbl. of oil per day,” the company said.

BlackPearl also is continuing to work on its commercial development application and is on target to file this application with regulatory authorities during the first quarter of 2012. Although its original plan was to initially seek approval for a 40,000 bpd project, it has since decided to file the application for an 80,000 bpd project to reflect the entire scope of the project. The first phase of the project will likely be 10,000 to 20,000 bpd.

ɸ Page A31

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A31

Onion Lake battery part of BlackPearl capital budget ɺ Page A30 Onion Lake At Onion Lake, BlackPearl has filed an application with regulatory authorities for a 12,000 bpd SAGD project and in the meantime has slowed down its conventional drilling program. Upon approval, expected in the first half of 2012, it will immediately begin drilling up to 14 horizontal wells that will be used as oil producers when SAGD operations begin. In addition, it plans to drill up to 10 conventional vertical wells before year-end in areas that will not affect future SAGD development.

The focus for the next few months is to optimize production from the wells drilled during the first half of the year as well as plan for the construction of the heavy oil treating facility and the 30-kilometre pipeline that would tie into an oil gathering system.

At Mooney, the first phase of the ASP flood

began in July, with the initial injection of chemicals and water. BlackPearl said it encountered minor problems with some of the surface facilities during the startup phase but these issues have been resolved and it has been continuously injecting for over three months.

The objective is to initially re-pressurize the reservoir, after which it would expect to see response through increased oil production.

It is expected to take six to 12 months to repressurize the reservoir and then an additional six to 12 months to reach peak production rates of between 3,000 bpd and 4,000 bpd.

Construction of the heavy oil battery to handle increased fluid volumes is ongoing and the facility should be in operation by mid-2012.

As a result of the temporary slowdown in drilling at Onion Lake, BlackPearl has shifted some of its 2011 capital program to Mooney. It

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expects to drill up to 14 horizontal wells before year-end, 10 of which will be drilled on the Phase 2 expansion lands.

These wells will be produced conventionally until they are added to the ASP flood in the future.

In addition, BlackPearl has advanced some of its non-core assets with successful drilling at John Lake, Zoller Lake and Salt Lake, which are currently producing over 750 bpd.

John Lake is a conventional heavy oil project located in the Cold Lake oilsands region.

BlackPearl, which has a 100 per cent working interest, has drilled three successful horizontal wells in the area during the last 12 months and plans to drill an additional five wells before year-end. Oil production from the area has increased to over 400 bpd and the company believes the area has the potential to support a development of 40 to 50 horizontal wells.

Zoller Lake, in central Saskatchewan, is a heavy oil prospect in the Birdbear formation.

During the third quarter BlackPearl (100 per cent working interest) drilled

two successful horizontal wells, each producing over 100 bpd with plans to drill up to four additional wells next year.

BlackPearl maintained a strong balance

sheet in the third quarter with working capital of $64.2 million and no debt after incurring capital expenditures of $135.66 million in the first nine months of the year.

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A32

PIPELINE NEWS December 2011

Envirotanks hit the ice roads Biggar – If you watch closely during this season’s episodes of Ice Road Truckers on History Television, you might see a familiar site: big white fuel storage tanks with the logo AGI Envirotank on the side.

It turns out some of the loads carried last winter on Manitoba’s ice roads during filming of the popular television show originated in Biggar, Saskatchewan.

Justin Wappel, who handles sales for the

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Biggar-based tank manufacturer, confirmed that their units were hauled by two of the drivers, Hugh Rowland and Rick Yemm. The company was contacted earlier in the year for permission to display their logo. Name brand logos are often obscured on television now unless such permission is obtained.

Those tanks were part of a large order of tanks destined for Northern Canadian communities last year, according to Wappel. “Last year we sent 30 tanks to vari-

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ous points in the Arctic Circle,” he said. “Others are going into the Yukon this year, too.”

Those that appeared on TV were taken to Theresa Point, Manitoba, by ice road in March 2011. They appeared in three episodes.

Since those episodes initially aired in the United States in late summer, and in Canada in November, they’ve been getting a lot of calls from people who recognized the product.

“The response was pretty good,” Wappel said.

“Everyone kind of knew about it.”

They’ve been entertaining calls from clients, media, friends and family. The exposure has resulted in requests for quotes on other products.

AGI Envirotank is deeing demand rise.

They are looking at streamlining production, he said. Potash, uranium fuel storage and crushing plants are all growth markets. Orders also keep coming in for 2,000 and 2,500-barrel oil tanks.

“Who says a small company from Saskatchewan can’t do well?”

Wappel asked.

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PIPELINE NEWS December 2011

A33

Husky could eventually drill as many as 2,600 wells, most of them horizontals, in its emerging liquids-rich gas play at Ansell in west central Alberta. The company is also drilling new wells in the Bakken this year and is stepping up thermal projects and piloting in the heavy oil region around Lloydminster.

Husky will announce its 2012 capital spending plans during an investors’ day on Dec. 5.

Photo submitted

Husky grows by the drill bit

By Geoff Lee Calgary, Alta. – Husky Energy plans to continue to grow by the drill bit in Saskatchewan and Alberta to further exploit its emerging oil and gas plays and extensive resource land base.

That strategy helped the Calgary-based company to double its profits to $521 million in the third quarter (Q3) ending Sept. 30 compared to $261 million in the same period a year ago.

Total production before royalties averaged 309,100 barrels of oil with a lengthy summer shutdown of the Rainbow pipeline in northern Alberta reducing production by about 6,000 barrels a day.

The company generated value in the quarter from advancements at its major growth projects, namely the Liwan Gas project in Asia, the Sunrise Energy project in the Albert oil sands, and the West White Rose satellite oilfield in Atlantic Canada.

“We continue to make substantial progress on developing our emerging oil and gas resource plays, and we are advancing our growth pillars,” said Rob Peabody, chief operating officer, who focused on Husky’s upstream activities during a Q3 conference call on Nov. 3.

“Excluding heavy oil and the oil sands business, we currently produce about 169,000 barrels of oil equivalent a day in oil and natural gas from our base in Western Canada,” he stated.

“Our strategy is to continue to shore up that solid foundation by repositioning our investment into an emerging portfolio of oil and liquids-rich gas resource plays.” ɸ Page A34

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PIPELINE NEWS December 2011

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Cardium play attracts Husky's attention ɺ Page A33 Husky has a gas resource land base of approximately 900,000 acres in Western Canada with the focus on developing its emerging liquids rich gas assets at Ansell, Kaybob and Kakwa in west central Alberta.

A preliminary development plan for Ansell calls for as many as 2,600 wells to be drilled into the Cardium and deeper Mannville formations. Most of the

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wells will be horizontals.

“If you do the math on that you get very material amounts of production something that approaches the current level of production at Husky now, in terms of gas,” said Peabody in response to an investor question on Ansell’s potential.

In the first nine months, 28 Cardium formation wells and four multi-zone wells were drilled at Ansell.

Planned activity for the remainder of the year includes drilling six more Cardium wells and five deeper multi-

zone wells.

“We recently commissioned additional offload capacity which increases total production capacity at Ansell to over 50 million cubic ft. per day of gas and 2,000 barrels per day of liquids,” said Peabody.

Husky has an extensive Western Canadian oil resource land base of approximately 500,000 acres with exploration and development priority given to its highestpotential prospects. The company was active in six oil resource plays during the quarter, drilling 15 wells. ɸ Page A36

PIPELINE NEWS December 2011

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PIPELINE NEWS December 2011

Emerging plays to pad Husky’s production ɺ Page A34 Husky drilled four wells in the quarter at its light oil Oungre project in the Bakken in south central Saskatchewan, and plans to drill five more there by the end of the year.

Production at the end of the quarter from four wells completed in 2010, and one completed in 2010 was 570 bpd, with more production

to come.

“We are seeing great results at the Bakken, well in line with our expectations, but we don’t have huge running room in the Bakken,” said Peabody during the question period.

“It’s a reasonably modest play and we are looking for something in the 3,000 plus barrel a day range.”

“We have a num-

ber of other plays with various stages of running room, and we have a number of emerging plays that we are working which we think could be very material.

“Our overall strategy has been to start exploiting the ones that we have in the portfolio – part of our current land base while at the same time developing longer term emerging

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plays.”

Husky drilled 20 wells in its Viking light oil plays near Elrose Saskatchewan and Redwater Alberta in the quarter with 15 additional wells planned by year-end.

The company is also constructing a gas gathering system at Redwater to reduce flaring with production performance in both areas on par with expectations.

“With improved conditions we have also stepped up activities in our other resource plays in the Lower Shaunavon zone in southern Saskatchewan and in the northern Cardium trend at Wapiti and Kakwa in west central Alberta,” said Peabody.

Husky continues to expand its horizontal drilling program for heavy oil in its Lloydminster operations.

The company is accelerating its thermal developments in the region with an eye to increasing thermal

production from the 20,000 bpd level today to between 40,000 to 50,000 bpd.

“Over time, the target is to achieve an increasingly higher proportion of heavy oil production from long-life thermal projects at finding and development and operating costs that are comparable to the current levels we see with CHOPS production,” said Peabody.

Construction of the 8,000 bpd South Pikes Peak thermal project is progressing on schedule and was over 70 per cent complete at the end of the quarter.

The project is within cost estimates and first production is expected in mid-2012.

The 3,000 bpd Paradise Hill thermal development is progressing on schedule and is approximately 45 per cent complete. Paradise Hill is scheduled to produce it first oil in the third quarter of 2012.

A single well pair thermal pilot achieved first oil at the new Rush Lake project in October and four additional pilots are now operational.

The Sunrise oil sands project near Fort McMurray also saw the start of major construction activity in the quarter along with the completion of drilling approximately half

of the planned SAGD wells in phase 1.

The contractor for the central plant facility has mobilized to the site and the construction of a 1,500 per son camp is under way with more than 500 workers already onsite.

The company report the Sunrise project remains on schedule and on budget towards first production in 2014.

Other project milestones in the quarter included the sanctioning of the development of the main field of the Liwan Gas Project in the Asia Pacific region and first production from a pilot program at West White Rose in the Atlantic region.

“In summary, we continue to execute against our strategic plan and we are on course to achieve the milestones we set out a year ago and I think the achievements of the quarter are a vindication of that conclusion,” said CEO Asim Ghosh.

“The strength of our balance sheet leaves us in a good position to weather the economic uncertainty as we are faced with a new piece of news emerging with astounding regularity every month over much of the last year.

“We are well positioned to keep the ship on course regardless of that uncertainty.”

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PIPELINE NEWS December 2011

A37

Husky tightens fracking safety measures Calgary, Alta. – Husky Energy has tightened its safety procedures for employees working on critical fracturing operations in the wake of a flash fire during a frac job at a Husky sweet gas well near Robb, Alberta on March 7.

That accident left about a dozen people injured including some Husky workers.

“We recently completed a review of our well fracking procedures” said Rob Peabody, chief operating officer, during Husky’s third quarter (Q3) conference call on Nov. 3.

“The additional measures we are taking are to further safeguard our people from potential hazards.

“Now, during critical phases of the operation, workers are completely removed from high risk areas.

“It is one example of how we are using Husky’s operational integrity management system to introduce intrinsically high levels of process integrity and safety into our operations,”

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said Peabody.

In other Q3 news, Husky completed a 42 day minor maintenance and inspection at the Lloydminster upgrader in early October with the upgrader operating at 80 per cent capacity during that period.

The company also reports construction of its new office complex in Lloydminster is progressing well, and will be ready to move in early in 2012.

Peabody cautioned against assuming the new building will lead to a larger workforce and new hires.

“We had to replace the building because it was very old and had some issues. We have put a replacement building in place,” he said.

“I think the only thing I would take from the building is that is does represent the fact the Lloyd is a very long wave-length business and we expect to be there for another 20 years in the same way that we have been there for the past 60 years.”

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A38

PIPELINE NEWS December 2011

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Ten-month rig releases up 12 per cent over 2010 Operators rig released 10,570 wells across Canada in the first

10 months of 2011, up about 12 per cent from the 9,465 wells drilled

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were 6,724 wells rig released to the end of October versus 6,258 in the comparable period last year (up 7.45 per cent).

Saskatchewan’s rig release count is up about 32 per cent this year to 2,876 wells compared to 2,180 in the January-toOctober time frame in 2010.

Many of the wells drilled this year are still under confidential status, but of those with a reporting status, almost 72 per cent are listed as oil or bitumen wells. That compares to 56 per cent of the wells with a status listed as oil wells in last year’s first 10 months.

To the end of October, only 20 per cent of the wells with a reporting status are listed as gas wells.

Meterage over the first 10 months is up almost 19 per cent to 19.26 million metres

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versus 16.19 million metres in the comparable 2010 period.

Alberta meterage has climbed about 24 per cent to 12.13 million metres from 9.81 million metres in the January to October period last year, while Saskatchewan meterage has increased nearly 22 per cent to 4.44 million metres from 3.64 million metres in the first 10 months of 2010.

In comparing Alberta and Saskatchewan rig releases, the former’s overall count for the 10-month period included 280 outposts and 232 new pool wildcats. In Saskatchewan, 307 outpost wells were rig released, as were 105 new pool wildcats.

British Columbia and Manitoba continued to see decreases in the number of wells rig released, year-over-year.

In B.C., the 10-month rig release count declined to 515 wells from 557 in the comparable period of

2010. Meterage is also down slightly, to 1.87 million metres from 1.88 million metres in last year’s January to October period.

Manitoba operators rig released 428 wells to the end of October, off less than one per cent from 431 wells last year. Drillers have sunk 775,607 metres of hole versus 777,292 metres in 2010.

In October, rig releases were down in Alberta, falling 6.8 per cent to 877 from 941 in the year-prior month.

Rig releases increased in the other western provinces, with the biggest percentage climb happening in British Columbia, where 48 wells were rig released in October, up from 41 wells a year ago.

Manitoba rig released 85 wells in October (up from 76 a year ago), while Saskatchewan operators drilled 367 wells (up from 341 wells in October 2010).

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PIPELINE NEWS December 2011

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PIPELINE NEWS December 2011

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

B-Section December 2011

LXL Consulting likens project management to architecture Story and photos

by Brian Zinchuk Calgary – When you want to construct a building, you hire an architect. When you want to run a seismic survey, you hire a seismic consulting firm like LXL Consulting Ltd., of Calgary.

“We’re a project management company. We don’t own any equipment,” said Mark Leriger, one of the partners behind LXL Consulting. “We act as the operations group for oil companies.”

He likened their role to that of an architect for the zone. They have 15 people in the office, and about 50 people in the field. There is always someone working with every portion of the field crews.

“We go to bid on behalf of our client,” Leriger said.

Some companies will shoot large areas on spec and then sell data to whoever is interested in paying for it. Others shoot for specific clients, and the data remains proprietary.

“We are not a spec company. That would be a big conflict for us. We don’t do it.

“We are always doing it for the operating partner,” Leriger said.

While there may be several companies farming in on a project, he explained, “We only report to one client, usually. It’s A Great Plains Drilling seismic drill, subcontracted to LXL Consulting, works near Crusader Drilling easier that way.”

Rig 2.

The same territory is often studied repeatedly. Leriger explained, “When you shoot a 3-D, you don’t own all the land under it. You might only own a quarter-section, but you need to shoot at least a mile around it to get a good picture.”

That data may be used for the next land sale. Even if the company is not successful in the sale, they may sit on the data instead of sharing it with others.

“I’ve certainly shot similar programs two or three times in the same area in two to three years,” he said, pointing out they could be for different mineral rights, perhaps at a different depth, or a different type of 3-D. “It’s a function of how close the receiver lines are and source lines are. A shallow zone is very dense, while a deeper zone is much further apart,” Leriger said.

For instance, the oilsands are generally quite shallow. As a result, it can cost $700,000 to shoot a square mile in the Athabasca region, as opposed to $70,000 for the same area in Saskatchewan.

But when it costs $10 million to drill a well in some areas, spending $5 million on seismic it not a bad investment, especially when it reveals numerous drilling locations.

“At $10 million a well, that’s important,” he said. ɸ Page B2

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B2

PIPELINE NEWS December 2011

Cole Butler pulls rods out of a loaded shot hole after shoving in a one-kilogram charge.

Wireless technology begins to take hold in seismic surveys ɺ Page B1 “You can have four clients owning mineral rights on the same section of land, all at different depths,” he said.

For a typical Bakken depth, at about a mile deep, you would need two miles of surface coverage to get “full resolution.” On a square mile, one would need to shoot two miles square.

In Wyoming, he noted, you might need four miles square.

“It’s like a big cone. The deeper you go, the wider you have to have your aperture at the top. We try to set it up so you have the best resolution at your zone.”

That prime area of resolution will be several hundred metres thick.

The company will probably have 20 projects in Saskatchewan in 2011. That’s down a bit compared to the year previous, he explained. Alberta is picking up, following the “proven success” of the Bakken.

“I’ve never seen so much work in the Swan Hills.

We’ve just done two huge 3-D projects there,” Potash While the oil and gas sector may be looking for the next big pool in Saskatchewan, the potash sector is a huge consumer of seismic surveys.

“Potash is a fairly big job in Saskatchewan,” Leriger said. “They’re mining a three-metre thick zone over 10 square miles in area, so mining ma-

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chines need to follow the zone precisely. You need a lot more geophones and tighter grids for better data.

We call it ‘fold.’”

It’s the same concept of more megapixels in a digital camera. The operation is identical to ultrasound diagnostics.

Wireless Wireless technology has been sweeping the technological arena for years now, and seismic is no different. In a business which sees “jughounds” walking hundreds of miles carrying just as many cables over the course of a project, wireless would seem to be a no-brainer. But it has its pluses and minuses, according to Leriger.

He noted it had fitful starts many years ago, for instance. Indeed, the first time out with wireless a decade ago “was a disaster,” he said.

“We have a wireless crew working in northeast British Columbia,” he said. Of their eight crews working currently in British Columbia, Alberta, Saskatchewan, North Dakota and Montana, only one was using wireless.

Those geophones each get a signal to record, gathers the signal, then shut themselves off. Data cards are then collected.

“The only problem is you’re shooting blind.

“We take a shot, we look, the data looks good, it’s nice and clean, we move on,” Leriger said. But if the data gets contaminated or the dynamited didn’t explode, they don’t know until the data is collected from the recorder boxes at the end of the day.

“If you shot all day, it’s a bit of a risk. The risk is probably worth it,” he said.

Just in case a moose steps on a geophone, or something else unforeseen happens, they overcompensate with additional sensors.

There are two types of wireless systems prevalent – ones where the geophones are connected by cable to a recorder box, and others where individual geophones collect the data themselves, with no cables.

“We use microwave link right now,” he said of wireless communications. It can be expensive, but necessary in places like working across the Peace River.

Wireless is coming of age rapidly, however. He noted one Chinese crew working in Africa is recording a million channels using a wireless setup. “The biggest we might record is 10,000,” Leriger said.

“There’s a lot of money in seismic research,” he added, noting that huge computers are needed for analysis.

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B3

A look at a small seismic project Somewhere in southeast Saskatchewan – If the dateline sounds nebulous, that’s on purpose. When talking about seismic work, confidentiality is the name of the game.

It’s mid-November, and we’re on a small seismic job adjacent the U.S. border, somewhere in southeast Saskatchewan with LXL Consulting, the project manager for the project. It’s close enough to Yankee territory that long-time drill push Joe Higgins came across a border monument while scouting.

The small crew is staged out of an old farmyard, providing some shelter on the otherwise cold, windswept plain. It’s one of the first truly brisk days this fall, and the workers start to get cold as soon as they stop moving. Higgins pointed to the trees and said, “Wind protection, it’s not often we get that.�

Compared to other projects in the region covering hundreds of square kilometres, this one is tiny, just 5.6 by 5.6 km. “This program is 1,940 shot points, relatively small,� Higgins said.

The project is small enough that there’s no helicopter on the project, something that is commonplace otherwise. Helicopters are used to move coils of cable from one location to the next. This time, a truck would carry all the cables for the recording crew, which follows shortly after the drilling crew is done.

He pointed to his large-screen Garmin GPS on his dashboard, preloaded with a specialized program showing the grid of energy source (dyna-

mite) lines and recording lines. Technology has advanced a lot over the years, according to Higgins. “We’ve been on this job for a week. On other jobs, we’ve been here three weeks,� he said. LXL was working on six programs in southeast Saskatchewan this fall. “We’ve got two drills. We had three yesterday. We’ll be done tomorrow,� he said. Done, that is, except for a “buggy� style drill, with articulated steering and large floatation tires to get into the soft spots they couldn’t get into with the more truck-like models they were using. A tractor that was hauling drill cuttings from a nearby drilling rig had to be hired for a few hours to pull one drill out.

The drills run up and down lines of evenly-spaced stakes. The driller and his helper first drill the hole, then place one-kilogram dynamite charges and a blasting cap into the hole before pushing cuttings back in to close it off. (See Keep moving, page B4).

On this day another LXL representative is one site, taking a look at the drills. “Today LXL Safety is doing an audit on all our equipment,� Higgins said.

That involves checking a rig out, checking for items like fire extinguishers and making sure first aid kits are up to spec, and that the lights are working.

Higgins has been doing seismic work for 25 years. He grew up in Bjorkdale, in northeast Saskatchewan. After high school he went to the Northern Alberta Institute of Technology

It takes about six minutes to drill, load, and partially back Àll a shot hole. The yellow tubes in Cole Butler's hands are sticks of dynamite.

(NAIT) for industrial production technology, which involved a lot of calculus and mechanical design. “That’s why this came easy to me when I was young, for organization. I got out of NAIT broke, and went into the patch.� “I needed some cash off the start. I decided to stay with it.�

Initially it was working as a swamper for a rig moving outfit at Zama Lake, in the absolute northwest corner of Alberta. “When I started, it was two-wheel drives and chains. The crew managers would drive cars,� he said. That’s a far cry from the large 4x4s and side-by-sides today.

Higgins started in seismic as a driller’s helper, then went to vibroseis. That’s the style of seismic work which uses mammoth units that lower a plate to the ground and shake. “I drove them, maintained them, looked after a crew for a bit, then slipped over to the recording truck and managed a crew,�

Higgins said. ɸ Page B4

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PIPELINE NEWS December 2011 Drill stems, similar to augers are 10-feet long

Six projects in Sask. ɺ Page B3 Higgins has found over the years that seismic life isn’t too bad. He’s been from Williams Lake to Washington, spent a summer doing vibroseis all over Prince Edward Island, then headed into Ontario and Quebec. There was also a stint in Colombia, where he eventually realized you could see marijuana growing along the side of the road. “I didn’t know what it was,” he said of the time.

Columbia was also peaceful at the time, he added.

Higgins now calls Cochrane, Al-

berta, home. His wife, a former teacher who taught school until their first child was born, has been with him for 31 years. That’s quite an accomplishment in a career that is by definition always on the road. “We knew that going in, that I was going to be away. We just worked it that way,” he said.

A group of young moms at the church helped.

The pair have two kids, one of whom is a chemical engineer who has worked in the oilpatch, but is now in financial services, and another who is an athletic trainer.

Keep moving to keep from freezing Jamie Hartman of Balcarres moves pretty quick. Parking his truck-style drilling rig, he walks along the catwalk from the cab to his control station and starts feeding drilling stem into the machine.

Soon he’s got a 40-foot (12 metre) hole in which the dynamite charge can be placed.

His helper, Cole Butler, is also a Saskatchewan product, hailing from Porcupine Plain. While this season is Butler’s second, it’s Hartman’s sixth.

“You’ve got to work hard and keep moving,”

Hartman said, sheltering himself from the wind on the lee side of the truck.

“We’re drilling shot points for seismic exploration,” he said.

It takes about five to six minutes per hole.

Asked about rock, he said, “Currently, it’s not too bad. If unable to drill through, we move ahead a bit and try again. It has to be within five metres of the stake.”

Butler, who followed the truck on a quad, said, “I load the hole. I make the charge. I have one cap and a one-kilogram bomb. I use my loading poles to drive it into the ground.”

This job used standard blasting caps. It is now possible to get computerized blasting caps which require a specific signal to activate.

The drill uses water to lubricate the drilling. However, in subzero temperatures, it’s apparent it’s difficult to stay dry, as flecks of mud were spread across Butler’s coveralls. “I don’t bulk up too much.

Gotta keep moving,” he said.

“It’s better than sitting at home,” said the 18-year-old Butler, who worked last summer on a chuckwagon racing team.

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PIPELINE NEWS December 2011

Great Plains Drilling sees

B5

Story and photo by Brian Zinchuk Cole Butler loads one-kilogram sticks of dynamite into each shot hole

Cudworth – Certain communities seem to become drawing points for certain types of workers. Hanley is known for its pipeliners, while Manor has long been a source of drilling hands, and indeed, drilling company management. But Cudworth, northeast of Saskatoon, has its own claim to fame – it’s home to seismic drillers.

Among them is Great Plains Drilling Ltd., a family operation that over years of consolidation has become the largest in Saskatchewan. It’s owned and operated by the Hauber family.

Indeed, the entire clan is involved in the operation. Gary Hauber heads it up, while his wife Sharon is office manager. Each of their three children and their spouses are involved, too. Daughter Sharon Hackl is the safety co-ordinator while her husband Ian Hackl runs a drill. Son Dustin Hauber is a drill push while his wife Amanda handles human resources. Jason Hauber, the third sibling, is also a drill push, and his wife Cindy does books.

“The whole family – that’s all of us,” said Gary.

“I’ve been doing this since 1979 with my brother. In 1988, we split up, and I started Great Plains Drilling,” Garry said.

His brother operates Double H Drilling, but Gary has since bought out most of Double H, with his brother still operating his own drill.

Indeed, there were many small operations based in Cudworth, but the burden of regulation, particularly on the safety end, has led to consolidation, according to Gary. They’ve bought out quite a few of the smaller one-and two-drill operations in town. Many of those operators now subcontract under Great Plains.

He noted its harder for small operators to keep up with all the safety audits, especially if you’ve only got one drill.

The company has approximately 70 people in its employ.

“You’ve got to look after your people. I can have 25 drills in the yard, but without the people, you’re nothing,” Gary said.

Asked how so many seismic drillers ended up coming from Cudworth, he said people noticed there was money to be made, and got into it. “It has been a good living. I’ve got my whole family involved.” ɸ Page B6

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PIPELINE NEWS December 2011

gold in that pink rock ɺ Page B5 Great Plains currently operates 25 drills and nine water support vehicles.

Three are tandem trucks, while six are tracked water-hauling units.

Of the drills, there is one 6x6, eight tandem trucks, and three buggies. The remainder are known as LIS units, for low impact seismic. They are smaller, tracked units meant for low impact operations. At just two metres wide, they can operate in bush seismic lines that are only 2.5 metres wide.

“They do the bush work. We have some in Esterhazy,” he said, noting the wet conditions in that area.

Saskatchewan’s potash industry is booming, with numerous new mines in the works. But before any mining can be done, the ore body needs to be defined, and thus seismic drillers are being kept busy.

“Our biggest breadwinner is the potash in Saskatchewan,” Gary said. “It’s nice. We can do it right at home here.”

They still do some drilling for small oil companies, but the bulk of the work is for the potash operators. Great Plains has been working for pretty much anyone who has been doing potash exploration, both long-established players and newcomers.

“We’re doing a big program at Regina for Vale,” he said. It’s their third winter working in that area.

For some it’s important for them to do seismic surveys every year, he noted.

In typical operations, a potash hole may be 30 feet deep, and a drill will be able to do 120 holes a day. Oil companies have more variance, from 40 to 50 to 60 feet per hole.

Seismic drillers are paid by the metre, generally speaking. “We try to do between 1,000 and 1,200 metres a day,” Gary said. “In good digging, you can get 1,200. It’s not always that good.”

Some areas have a lot of rocks, for instance.

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PIPELINE NEWS December 2011

B7

Zipping along at a few hundred feet Estevan, Red Deer – A small grey MD 500 helicopter could be found buzzing around Estevan for much of the fall as a seismic program operating just outside the city was underway. That helicopter is part of the Mustang Helicopters eet.

Mustang Helicopters president Frederick Allard noted they have been doing seismic “forever.� They move over 600,000 bags a year. “Seismic for us is bread and butter,� he said, noting they have operations all over North America.

They have a eet of 25 aircraft dedicated for seismic work in the winter. “We’re one of the biggest helicopter companies,â€? he said.

The company is based near Red Deer, Alta.

Mustang chief pilot Nigel Day said, “We probably do seismic 65 per cent of the time. It’s our main breadwinner for now.�

The company operates coast-to-coast, or as Day said, with “no borders. We’ll go international.�

The bulk of the work is in Alberta, British Columbia and Saskatchewan, but they’re also on the East Coast, West Coast, and even up to BaďŹƒn Island. “We are truly coast-to-coast,â€? he said. “We’re a project-oriented company.â€?

Helicopters are instrumental in seismic surveys.

Day said, “It increases eďŹƒciencies and is less disruptive to the ground environment.â€? “The number one factor is cost eďŹƒciency. “We move recording equipment – cables, power supplies, and recording boxes. We have a computer program that lays out a grid for the pilots to y.â€?

The program, called DynaNav, is loaded by the client, and allows for accurate placement of equipment exactly where it is needed. It is used in agriculture as well, he added.

The eet is a mix of Eurocopter A-Stars and

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MD 500s, as well as some Bell 205A-1 and Bell 206 III models. “We’ve got 11 A-Stars that are less than ďŹ ve years old,â€? he said.

Day, himself, has own since 1991. His career was primarily with the military. “I was a military chief pilot with the British

Army Air Corps back in the day,� Day said. As a sta sergeant, he was a ight commander. His experience included ying Lynx, Gazelles and Squirrels.

His primary mission was in reconnaissance. Day was supposed to transition to Apache attack helicopters, but that didn’t happen. He has since spent the last seven-and-a-half years in Canada. “It’s exciting times. We’ve got some excellent people on board – good equipment, good people,� he said. “We have 30 pilots, which will increase to 40,� he said. ɸ Page B8

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PIPELINE NEWS December 2011

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The vast majority of Mustang’s pilots are Canadian, and a few are exmilitary.

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A commercial pilot is also likely to see three times as many ying hours in a year compared to a military pilot.

Saskatchewan has been a busy place for the company of late. “We did the most work we’ve ever done over the last nine years in Saskatchewan over the last year,� he said.

Most seismic work

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PIPELINE NEWS December 2011

B9

Oilsands Quest to ink sale in 2012 Calgary – For Oilsands Quest Inc., it’s a case of better late than never to have the financial means to develop its core bitumen pilot project at Axe Lake in northern Saskatchewan.

The company reports it expects to close the sale of its Wallace Creek bitumen assets in Alberta by the end of January 2012 after previously expecting the sale to go through by the end of October when the deal was announced on Sept. 27.

Oilsands Quest is working with a third party to finalize the terms of a letter of intent to purchase the Wallace Creek properties for $60 million including $40 million cash and a $20 million post-closing payment if certain conditions are met.

As well as the purchase to sell agreement, the transaction closing is subject to board approvals, financing and approval by shareholders.

The U.S. based company that operates from Cal-

Hawk updates operations Hawk Exploration Ltd. announced Oct. 20 it drilled two (2.0 net) wells in the third quarter in its Lloydminster and Chauvin core areas.

At Edam, Hawk drilled the 5-34-4828W3 well, which encountered 3.5 metres of oil pay in the Waseca formation. This well has been completed and equipped and is currently on production at 30 bbl. of oil per day. At Chauvin, the company drilled the 13-22-42-1W4 well, which encountered 2.5 metres of oil pay in the McLaren formation.

This well has also been completed and equipped and is currently on production at 40 bpd.

At Seagram Lake, Hawk continues to produce three (1.5 net) recently drilled Leduc horizontal wells. The three wells are currently producing 80 (40 net) bpd with an average water cut of 73 per cent.

The company’s re-

maining two (1.0 net) horizontal wells are currently suspended after testing large amounts of water (99 per cent water cuts).

Hawk employed a service rig on one of the suspended horizontal wells and in an attempt to locate the source of water in this well. Various downhole logging and imaging tools have been employed to determine the source of the water and the company is now using packers to

shut off the water.

Should the operation prove successful, Hawk will employ the same techniques on the remaining wells to reduce the watercut and potentially increase oil production.

The company plans to drill one (0.5 net) single leg horizontal well in Seagram Lake in the first quarter of 2012 and plans to modify its completion technique on this well to limit water encroachment.

Hawk’s production for the third quarter averaged approximately 455 boepd. Current production is approximately 500 boepd and is comprised of 90 per cent crude oil.

In the fourth quarter, the company said it will continue to monitor production from its Seagram Lake wells. In addition, Hawk plans to drill two vertical wells targeting heavy oil in western Saskatchewan.

gary will continue to assess its strategic partnerships options and longer-term development plans as it heads into 2012.

In the meantime, the company’s near term financial liquidity is assured with a flexible $12 million share purchase agreement reached on Oct. 17 with Socius CG II Ltd, a subsidiary of Socius Capital Group.

“This funding enables us to prepare for the pilot project at our core Axe Lake oilsands property, which we believe will prove the asset’s commercial recoverability and increase its value,” said Garth Wong, CEO of Oilsands Quest.

The pending sale of the Wallace Creek assets and the share purchase by Socius are in response to a non-compliance notice the company received earlier this fall from the New York Stock Exchange.

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B10

PIPELINE NEWS December 2011

Seismic shift detected in CAGC apps

Mike Doyle is president of the 220 member CAGC that holds its annual geophysical meeting in Red Deer each year during the third week of September.

Calgary – A noticeable seismic shift is taking place in the use of seismic as a pure exploration tool to more of a production tool in the quest for better imaging and data.

The industry in Western Canada is seeing growth in the use of 4D and microseismic applications along with new seismic uses for imaging carbon sequestration in reservoirs.

Mike Doyle, president of the Canadian Association of Geophysical Contractors, says the trend is most notable in the Bakken shale oil play in southeastern Saskatchewan

and the shale gas play in the Horn River area of northeastern B.C. “The world continues to change, whether it’s looking for efficiencies in how companies operate, or as in our case, just looking for better seismic imaging. We see equipment continue to evolve out in the field,” said Doyle.

“Here in Canada in certain areas in the shale plays or oilsands type of work – SAGD stuff – we do see a lot of 4-D.” The industry defines 4-D as the use of 3-D seismic surveys acquired at different times in the productive life of a reservoir.

“Another branch, which falls under new technology to som e extent and is also very prevalent in terms of how it’s expanding, is a whole group of products called microseismic,” said Doyle.

“This tends to do more with listening passively over long periods of time on some source that exists already,” said Doyle.

A microseismic system would typically employ an array of geophones buried near the surface to pinpoint real time seismic activity during hydraulic fracturing.

“Fracking will cause

seismic vibration as a byproduct,” said Doyle.

“If you listen to it and utilize it in the same way that we create seismic, then in many ways, you can have get additional information. It’s an additional tool in your tool box.”

Doyle estimates about 30 per cent of seismic in Western Canada today is production seismic in contrast to its historical use as strictly an exploration tool.

“You did it before you actually went to land sales, and you did a 2-D, and depending on what you saw there, you did a 3-D, and so on,” he said. ɸ Page B11

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PIPELINE NEWS December 2011

B11

4-D seismic monitoring CCS ɺ Page B10 “Certainly in today’s day and age, to some extent that exists, but there are fewer of what I would call frontier areas that don’t have a lot of seismic done already.

“So we see a lot now and the microseismic is an example of it, and the 4-D stuff, in what I would call production seismic,” he said.

“When you get into some areas like the oilsands or SAGD areas or the Horn River basin – all those areas – once the initial work is done and they are moving into fracs and stuff, then it’s all production seismic.

“You’ve got activity happening and there’s a requirement to know what’s going on under the ground if you are fracking or what your pool is doing in a yearto-year basis if it’s a 4-D type of thing.

“Another example that’s coming on stream

here of late is the use of seismic for carbon sequestration,” Doyle said.

Passive seismic monitoring is being used in the Weyburn area to demonstrate the security of CO2 sequestered in underground reservoirs.

“Once again, you create kind of a baseline and as you are storing the carbon you are looking to see where the stuff is going and making sure it doesn’t get out,” explained Doyle.

“Seismic will give you that on a ‘shoot the seismic year-to-year’ type of deal.

“From that aspect it’s becoming a more precise tool and having a much more broader application,” he said.

As for aerial seismic use, Doyle says the industry defines seismic as ground-level work.

“When you take a step up – geophysical encompasses more than just seismic – then you get into stuff like aero-

magnetic gravitational surveys or whatever,” he said.

“The higher level the tool – aeromagnetic or whatever – gives you only a very broad look at things, so your anomalies have to be very large to even get a feel that they are there.

“Even with those types of surveys, once you have done that type of work and have some sense of what’s going on, and you like what you see, your next move would be something like a 2-D survey.”

As the head of the CAGC, Doyle keeps his own ear close to ground for new issues or regulations that impact the 220 members and sectors he speaks for across Canada.

“We represent the seismic industry for the upstream oil and gas sector in Canada,” he said.

“That includes the land seismic guys who do the work and all the services

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and suppliers to those entities.

“One of our main functions is working with various regulators on changes to regulations. They are constant in the sense that one government or another is always making some changes.

“We deal with hard geophysical regulations as well dealing with the OH&S or WCB depending on what province you are talking about, and everything

surrounding the safety said Doyle. and training with that,” ɸ Page B12

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B12

PIPELINE NEWS December 2011

Strong interest in Sask. plays ɺ Page B11 For Saskatchewan CAGC members, the website includes current regulatory and safety topics such as provincial blasting permits, cellphone legislation and First Nation and Metis consultation policy frameworks.

“Saskatchewan is a busy area for our members,” said Doyle.

“Saskatchewan, through governance and how it’s handled its royalties, etc. remained active when Alberta dropped off the map to some degree in the really tough years of ’08 and ’09 until changes were made in the royalty

system.

“So we continue to see strong interest in plays over in Saskatchewan.

When you look at plays like the Bakken, those shale plays are much more along the line of production seismic in the sense that you need to know what’s going on and what’s happening when you are doing your fracking.”

Doyle said a lot more exploration drilling took place in northern Saskatchewan and Alberta a few years ago when commodity prices boomed.

“With the drop in commodity prices, you see it pushed down to the south where there are better known ar-

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eas and where it’s cheaper to operate,” he said.

“Ultimately, the costs are better known there than when you go into frontier areas.”

Doyle says the first quarter of the year is always the busiest time of year for CGAC members as it will be this winter as companies ramp up their seasonal hiring in a tight labour market.

“HR will continue to be front and centre on everyone’s mind going for-

ward,” said Doyle.

“In many aspects of our industry, an entry level worker could be an entry level worker in many other facets of the oil and gas industry or construction or natural resources. It just goes on and on.

“We are all competing to some degree for the same pool at the bottom end. Just our pure numbers here in Canada make that an ever increasing difficult task.”

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PIPELINE NEWS December 2011

B13

Diaz to sail into 2012 with momentum Calgary, Alta. – Diaz Resources expects momentum from its third quarter results will carry it into 2012 with more production expected from its core heavy oil prospects in Lloydminster and Macklin.

The Calgary-based junior oil and gas explorer reports it made significant progress towards increasing oil production during the third quarter ending Sept. 30.

The company drilled four new wells in its ongoing development program with approximately $1.6 million raised from the sale four non-core properties to fund additional drilling in 2011.

Diaz did not need to draw on its bank line during the quarter, leaving itself well positioned to proceed with its ongoing drilling plans in the current fourth quar-

ter.

The company drilled three wells in its ongoing Lloydminster heavy oil development program during the third quarter, noting of them were successful.

The company is pleased to report that a new partnership horizontal well that came on production in the Macklin area on Sept. 18 was still producing in excess of 100 barrels of oil per day (45 bpd net to Diaz) midway through November when Diaz re-

leased its update.

Diaz also expected to drill two offset wells to that new producing well at Macklin by December and anticipates a continuous development program if results warrant.

The company will continue to focus on its heavy oil development programs in the Lloydminster and Macklin areas and if successful, should exit 2011 with a significant increase in its oil production from current levels.

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B14

PIPELINE NEWS December 2011

CAODC eyes mores rigs, Àat well count in 2012 Calgary – The Canadian Association of Oilwell Drilling Contractors expects 2012 will be remembered as a year of rig building and labour shortages in Western Canada given its forgettable forecast for a slim one per cent rise in the number of wells to be drilled.

CAODC expects 12,672 wells will be drilled in 2012, up slightly from the 12,555 the association predicts will be spudded by the end of 2011.

The standout good news for 2012 is the expected addition of 35 new and larger rigs that will bring the registered fleet total to 840 with more experienced crews needed to operate them.

“We are anticipating a flat year with a very marginal increase compared to 2011,” said Nancy Malone, CAODC’s vice-president of operations.

“We’ve got a growing rig fleet, but a manpower shortage, so that’s going to limit us in our ability

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to drill more wells. What we are saying is, it’s not bad news, but we are not looking for any significant gains.”

Malone noted that well counts are not necessarily a good or accurate barometer of the drilling sector in Western Canada even in boom years.

“If you look back to 2007 when we drilled 23,000 wells – if you look at the operating days that were associated with those wells – it is the exact number of operating days that we are doing now for 12,000 wells,” she said.

“So for the drilling contractors, we are at the same place we were at during the last boom. ɸ Page B15 The Canadian Association of Oilwell Contractors expects a marginal increase in the number of wells to be drilled in 2012 at 16,672 compared to 12,555 anticipated to be spudded by the end of this year. CAODC also expects 35 new and larger drilling rigs will be added to the Áeet in 2012 while labour shortages will continue to limit increased drilling activity.

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stock up on Kalvin Nankivell President OfÀce: (306) 462-2130 Fax: (306) 462-2188

Claudia Mullis Vice-President Box 123 Kisbey, SK S0C 1L0 nankivelltrucking@signaldirect.ca

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PIPELINE NEWS December 2011

B15

Finding skilled labour key to running more rigs ɺ Page B14 “We are very busy and quite healthy right now. The limiting factors of course are the shortage of skilled workers – but 12,000 wells is very busy.”

Malone says the expected growth of the rig fleet in Western Canada in 2012 is reminiscent of 2007 when the fleet gained 49 rigs, but the equipment being built today is in response to the need for larger heavier rigs capable of drilling long reach directional wells.

“That’s just a function of the technology that’s needed now to drill those wells,” said Malone.

“The smaller rigs that are a little shallower – some companies have been doing a bit of transition work with them and rebuilding them so they have the capacity to do some of the horizontal work.

“That’s how they are going to reach their targets – with the larger rigs.”

The CAODC forecast for 2012 is essentially a mirror image of 2011 with a comparable strong first quarter utilization rate of 68 per cent.

The majority of the industry’s operating days – about 50,090 will be utilized in the first three months of the year.

Drilling could take place under ideal conditions with a weather forecast for even colder and snowier conditions than this year with rigs able to drill to the end of March.

The picture for drilling in the second quarter during some weeks of spring breakup is less clear,

but CAODC predicts 20 per cent utilization with an average of 165 rigs working with a total of 14,811 operating days.

In 2011, the industry averaged 24 per cent utilization in the second quarter compared to about 15 per cent historically.

This year’s third quarter was one of the best on record with a 57 per cent utilization rate that is not likely to be repeated or topped in 2012.

The association is looking for 53 per cent utilization for the third quarter with an average of 441 rigs working for 39,587 days.

The fourth quarter of 2012 will reflect the usual ramp up for winter drilling with 55 per cent utilization with 41,472 operating days.

The 2012 CAODC drilling forecast is about 16 per cent lower than the 15,100 wells the Petroleum Services Association of Canada predicts with the release of its outlook on Nov. 3 but that figure could be tempered by a shortage of skilled workers.

“Last winter we heard about a lot of rigs that sat because of lack of crews,” said Malone.

“It will be somewhat of a repeat performance this winter. Having said that, I don’t know if there would be significantly higher rig counts on average if we had more people.

“Certainly you would probably see another 50 rigs working on average through that first quarter. We need very experienced workers to come into the field. You can’t just take anyone off the street. It’s very skilled work.”

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Malone says there is no quick fix to recruiting and training new skilled workers that will take up more the association’s time and urgency in 2012 with new rigs coming into service.

“Obviously, every contractor has their own personnel internal strategy in terms of new recruiting,” said Malone.

“As an association, what we trying to do is look at some of the underutilized workforces in eastern Canada, and helping out trying to recruit people locally into the industry.

“The third piece of the pie would be potentially looking at temporary foreign workers, but that’s a much longer process.

“So for this winter, I think our contractors are doing a lion’s share of the work in the sense they have been working the phones and trying to get guys back if they have gone to construction or other careers.

“Long term certainly, we are looking to get the word across Canada,” said Malone.

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B16

PIPELINE NEWS December 2011

Transition from cold native oil to THAI oil expected Kerrobert – Heavy oil production from Petrobank Energy and Resources Ltd.’s toe-to-heel air injection (THAI) project at Kerrobert is expected to rise thanks to improved reservoir conditions in the third quarter.

Production averaged just 30 barrels of oil for the period ending Sept. 30, but chief operating officer Chris Bloomer is optimistic production will rise as the use of in-situ combustion technology shifts from single well testing to full field development.

“Given the fact that we have a tremendous amount of heat energy in the reservoir, the reservoir is pressuring up, and we are starting to see good inflow into the wells – those rates could come up at any time very quickly, and we are in a positive trend in that respect,” said Bloomer during a third quarter conference call.

“During the quarter, we made significant operational progress at Kerrobert.

“All production wells are operating. It is important to note that all these wells operate differently and it’s our goal to get them to operate in a similar way over time.”

The Kerrobert project is in the production startup phase with nine of 10 injection wells on air injection in the quarter along with increased air injection rates.

The project continues to grow with 11 of 12 well pairs on combustion by

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One of the air injection wells is not currently operational, but Petrobank continues to operate the associated production well as the affected reservoir is being heated by surrounding air injection wells.

“These are all positive milestones for Kerrobert,” said Bloomer.

“We have seen temperature increases at the toes of the production wells and along the wellbores. The reservoir pressure is beginning to increase which is something we were looking for. We see fluid levels in the production wells increasing.”

Bloomer describes what’s taking place in the reservoir as a top down process that initially produces heavy native oil followed by hot upgraded THAI oil.

“Given the fact we have a tremendous amount of heat energy in the reservoir we expect that to increase and get the drainage increasing in the reservoir and start seeing more THAI production,” he said.

Bloomer says with the liquid flow into the production wells increasing, it is important not to draw the wells down too aggressively in the early stages of THAI production.

“We want to try to get them balanced out, and we want to make sure we don’t draw in the bottom water or impact the way the combustion front is developing in the reservoir,” he explained. ɸ Page B17

HO–HO–HOpe It’s Merry!

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We know we’re filled with joy as we recall the good times we’ve had serving our friends and neighbors this year.

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PIPELINE NEWS December 2011

B17

Kerrobert THAI Prairie Mud Service ¿eld production “Serving Western Canada With 24 Hour Drilling Mud Service” expected to rise ɺ Page B16 “We have also seen THAI upgraded oil occasionally, and our surface facilities are operating normally.”

Petrobank will continue to take a controlled approach to manage air injection and production at Kerrobert to initiate combustion and increase reservoir pressure across a much larger area.

“We want to inject air, balance the production, and have the combustion build across the reservoir. We are seeing that with the increase in pressure,” said Bloomer.

“We do expect to transition from the production of cold native oil to the production of hot THAI oil and we expect at that point for production rates to increase.

“This is consistent with what we have seen with the previous demonstration wells (two

pilot wells) that we have at the project, but now we are dealing with a full field development, and we are trying to balance everything across the reservoir.

“We are very optimistic that we will seeing consistent THAI production in the near term.”

Bloomer notes that the project shift from single well testing to a multi-well commercial application of THAI “may extend the time frame” for achieving normalized production rates.

“We are going to continue to increase air injection rates, build up the combustion front, continue to increase the reservoir pressure, and we will take what these wells give us in the near term and balance out the whole reservoir,” said Bloomer.

“We continue to have very strong confidence in THAI. There

is nothing that we have seen in the Kerrobert development so far that would lead us to believe anything differently.”

Petrobank also reports its year over year production results were down thanks in part to the loss of output from the spinoff of Petrominerales Ltd. that went into effect Dec. 31, 2010.

Third quarter 2011 volumes were 39,075 barrels of oil equivalent per day compared to 72,762 boepd for the same period last year. For the nine months ended Sept. 30, 2011, output was 38,637 boepd versus 80,106 boepd.

Petrobank recorded third quarter earnings of $15.35 million, a slight decrease from net income of $16.15 million during the same period a year earlier.

Head OfÀce: Estevan, SK Tel: 306-634-3411 Fax: 306-634-7310 Ray Frehlick, President Cell: 306-421-1880

Calgary Sales OfÀce: Tel: 403-237-7323 Fax: 403-263-7355 Chuck Haines, Technical Sales Cell: 403-860-4660 Environmental Division: Tel: 306-634-3411 Fax: 306-634-1951 Darwin Frehlick, Manager Cell: 306-421-0491

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B18

PIPELINE NEWS December 2011

Buried treasure Ariel Blondeau, a survey assistant with Midwest Surveys, digs for a survey pin just outside of Forget on Nov. 3.

Photos by Brian Zinchuk

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PIPELINE NEWS December 2011

B19

Tanker support On Nov. 25 PetroBakken made a $10,000 donation towards a new pumper/tanker Àre truck for the Redvers Volunteer Fire Department. The truck is expected to cost about $200,000. The department responds to approximately 2526 incidents a year. Most are Àre calls, but there has been a rash of rollovers of late. "The biggest issue we run into is water," said Fire Chief Brad Hutton.

From left are PetroBakken area manager Clayton Leavitt, Fire Chief Brad Hutton, PetroBakken operations administrator Daralee GrifÀn and production superintendent Jared Schlamp.

Photo by Brian Zinchuk

Average drilling days (Nickle’s Daily Oil Bulletin) Drilling Corporation topped the list as the most active contractor across three of the four western provinces over the first nine months of 2011.

The company topped the list in Alberta (2,112 wells and 2.92 million metres of hole), Saskatchewan (524 wells and 751,248 metres) and Manitoba (100 wells and 170,758 metres).

Nabors Drilling, meanwhile, ranked first in British Columbia with 94 wells and 403,400 metres.

Overall, Precision was the top contractor in Canada in the first nine months of 2011 with 2,808 wells and 4.1 million metres drilled. Its biggest customers were Canadian Natural Resources Limited (721 wells), Husky Energy Inc. (359 wells), Encana Corporation (205 wells), Devon Canada Corporation (143 wells) and Cenovus Energy Inc. (140 wells).

Ensign Drilling Inc. sat in second with 2,091 wells and 2.73 million metres of hole. Ensign’s biggest customers were Canadian Natural (326 wells), Cenovus (205 wells), Suncor Energy Inc. (179 wells), Nexen Inc. (102 wells) and Marathon Oil Corporation (93 wells).

Third-ranked Savanna Energy Services Corp. drilled 1,256 wells (1.74 million metres), while Trinidad Drilling Ltd. ranked fourth with 768

wells (1.53 million metres).

Savanna’s top customers were Cenovus (298 wells) and Encana (151 wells). Trinidad’s top clients were Murphy Oil Company Ltd. (95 wells) and Tundra Oil & Gas Partnership (76 wells).

The number of wells drilled by Canadian Association of Oilwell Drilling Contractors (CAODC) members rose to 9,777 wells in the January to September period from 8,094 wells in the first nine months of 2010, while operating days climbed to 91,531 from 73,433 last year.

The average number of days it takes to drill a well continued to rise for CAODC members, due to the continued use of horizontal drilling and the lack of shallow gas drilling. It took on average 9.3 days to drill a well in the first nine months of 2010, up from 9.1 days last year.

The average number of days to drill a well rose in Alberta, Saskatchewan and British Columbia.

In Alberta, it took an average 12.11 days to drill a well in the first nine months of the year, up from 9.98 days last year. This year’s average number of

days per well is the highest since the Nickle’s Daily Oil Bulletin started record keeping in 1990.

In Saskatchewan, it took 10.57 days on average to drill a well in the January to September period, up slightly from 10.34 days in the comparable period last year. This year’s average is the highest since 1990.

B.C. wells took an average of 27.03 days per well, up from 25.87 days per well in last year’s first nine months, and the highest since 1991 when the average was 27.21.

HAPPY

HOLLY

DAYS!

As another year comes to a close, we want to let you know how very much we enjoyed serving you, and wish you all a very joyous and wonderful holiday season.

Prairie Mud Service Head OfÀce: Estevan, SK Tel: 306-634-3411

Greetings of the Season Thank you for your goodwill and support all year long.

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B20

PIPELINE NEWS December 2011

PIPELINE NEWS December 2011

PIPELINE NEWS

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Canarctic Inc. CanElson Drilling Inc. Canyon Technical Services Ltd. Capital GMC Capital Rig Repair Carlyle RV & Leisure Carnduff Electric Ltd. Carson Energy Services Ltd. Cathedral Energy Services CCS Midstream Services CEDA Century 21 Lloydminster Realty Champion Technologies CHASE Auto Body Supplies Chasing The Dragon Choice Electrical Supply Ltd. Choice OfÀce Products Chris Crone Christie Corrosion Control Ltd. Circle D Transport City of North Battleford City of Weyburn CJS Coiled Tubing Supply Ltd. Clariant Oil Services Classic OilÀeld Service Ltd. Classic Vacuum Truck Ltd. Clean Harbors Canada Cliff Nankivell Trucking College Park Motors Come Inn & Suites Ltd. Competition Environmental Ltd. Concord Well Servicing Conquest Equipment Continental Engine Rebuilders Ltd. Control Technology Inc. COR Safety Solutions Country Boy Enterprises Inc. Country Covers Courage OilÀeld Services Ltd. Creative Fire Crescent Point Energy Corp.

Crown Advertising CSI Canada Safety CSI Crude Services Inc. C-Tech Oilwell Technologies Inc. Cummins Western Canada Curly’s Picker Services Ltd. Custom Truck Sales CWC Well Services Corp.

D & D OilÀeld Rentals D & S Auto Trailer Sales D B Safety Solutions Inc. Dash Tools Davco Welding Ltd. Davidson Truck & Tractor Day Construction Dayman Trucking Ltd. Days Inn Deep Earth Energy Production Corp.

Dekker OilÀeld Services Ltd. Demby Trailer Ltd. Denmax Energy Services DFI Diamond Low Holdings Inc. Direct Way Power Solutions Ltd. Do All Metal Fabricating Don’s Tire Shop Doreen Eagles Constituency OfÀce Doull Site Assessments Ltd. DPS Microbial Solutions Driven Energy Ltd. DT Planetaries Inc. Dustin Duncan MLA

Dwight Blomander Dynamic Resources Ltd. Dynamite OilÀeld & Picker Service Inc. E9 Enviro Ltd. Eagle OilÀeld Services Ltd. Eagle Well Servicing Earthmaster Environmental Eclipse Rentals Inc. Edge Harley Davidson - Lloydminster Elmer Doell Elotech Holdings Ltd. Enbridge Pipelines Endeavor Machining Solutions EnerÁex Energy Auctions Inc. Ener-Test Well Servicing & Rentals Ltd. Enform Ensign Big Sky Drilling Ltd. Envirotec Services Incorporated Equal Transport Essential Coil & Stimulation Services Estevan DiversiÀed Services Estevan Meter Services Ltd. Estevan Motors Estevan Plastic Products Estevan Telephone Answering Service Everett Jones EverGreen Enviro - Carlyle Excalibur Equipment Ltd. Exhaust Masters Lloydminster Extreme Excavating F & L Concrete Services Ltd. Fast Trucking Service FAVA OilÀeld Technology Fibreglass Solutions Ltd. Fieldtek Holdings First Choice Energy Services First Truck Centre Lloydminster Inc. Fisk Repair & Rental Service Flaman Group of Companies Flint Energy Services Ltd. Flyin e Medical Foley Inspection Services Inc. Foord Trucking Fort Garry Industries Ltd. Four Seasons Sales Frontier Inspection Ltd. Frontier Peterbilt Full Tilt Field Services/CE Franklin Fusion Industries Ltd. G Force Diesel Service G.T. & H. Holdings Inc. G.W. Trenching & Hauling Garrison Oilwell Servicing GASFRAC Energy Services Inc. Gateway Industrial Park Limited GB Contract Inspection Genesis Cleaners Gerald Rusnak Gescan GFI Systems Gibson Welding Gilliss Power Tongs Girard Bulk Service Glen Peterson Construction Global Steel Ltd. Goodon Industries Ltd. Goudy Transport Goulet Trucking Ltd. Granby’s On 9th Great Dane Engineering Inc. Great PaciÀc Salmon Great Plains Ford Greg S. Trewin Grimes Sales & Service Co. Ltd. Grimes Well Servicing G-Stegen OilÀeld Services Guardian OilÀeld Services Guest Controls Ltd. Halliburton Hank’s Maintenance

Hard Knocks Fighting Championship Hard Shak Structures Harley Davidson (Yorkton) Haulin’ Acid Heat Hawg Inc. Heating Solutions International Inc. Heavy Crude Hauling Hess Fishing & Rentals High Card Pump & Mechanical Hirsch Construction Holden Colony Sheds Home Hardware Building Centre Hornoi Leasing Ltd. Hot Tools HSE Integrated Ltd. Hunting Energy Services Hurricane Industries Hutt’s Trucking Ltd. Hydrodig Hytop Well Servicing Ideal Autobody I-Gen Solutions Corp.

Independent Pump Co. Independent Well Servicing Ltd. Industrial Communication Systems Industrial Electric Integrity Maintenance Ltd. Integrity Post Structures International Labour Centre & Immigration Investors Group-Estevan IPAC-CO2 Research Inc. Ironhand Drilling Irwin’s Machining & Welding Jack Lindsay Jadah Homes Jade Homes Inc. Jaywest Country Homes Ltd. Jerry Mainil Ltd. Jewal Holdings Ltd. JJ Trucking Ltd. JK Containments Kal Tire Kash Downhole Anchors Kelly Lafrentz Trucking Kelly Panteluk Construction Co. Ltd. Kelro Pump & Mechanical Kendall’s Auto Electric Co. Kenilworth Combustion Kenworth Lloydminster Kilo Technologies Ltd. Kobes Welding Ltd. Korpan Tractor Kramer Ltd. KRJ Custom Fabricating Kudu Industries Inc. L & C Hotshot Service L & C Trucking LP L.D. Allan Enterprises Ltd. Lakeland College Lamarre Equipment Inc. Lampman Autobody Lampman Electric Land Solutions Inc. Landon Fillion Lane Land Service Ltd Laurie Ganton Leading Manufacturing Group Inc. Leclair Transport Ltd. Leipert & Associates Les-Lee Consulting Level Best Technologies Ltd. Lloydminster Paint & Supplies Lonestar Lorna Pylychaty: RE/MAX Lynco Construction Ltd. M & R Machines Ltd. M.E.T. OilÀeld Construction Ltd. Mach 1 Diesel Repair Mack Auction Company Magnum Cementing Services Ltd. Mammoet Canada Western Ltd.

Manitou Flushby Services Ltd. Marmit Plastics Inc. Marquis Alliance Energy Group Inc. Maverick Construction Max Refractory Services & Rentals McGillicky OilÀeld Partnership Sandra McGillicky Memory Williamson Metaltek Machining Metra Equipment Inc. Meyers Norris Penny Midwest Industrial Services Millennium Land Ltd. Millennium OilÁow Systems & Technology Millinneum Directional Services Ltd. Minard’s Leisure World Mission Hot Shot Services Mobile Data Technologies Ltd. Moose Mountain Mud MR Website Mryglod Steel & Metals Inc. MTM Energy Services National Oilwell Varco National Trailer Parts New Drill Generators Newalta Corporation Newtech NDT Inspection Services Nore’s Auto & Trailer Sales Nor-Mar Brutis Bodies Norsestar Ventures Inc. North America Pipelines Northern Blizzard Resources Inc. Northern Factory Workwear Northern Lights Welding Northwell Rentals Northwest Regional College NSWB Oil & Gas Orphan Fund Oil City Diesel Outlaw OilÀeld Hauling Owen Oil Tools/Core Labs Packers Plus Palko Environmental Ltd. Pason Systems Corp.

Pat’s Offroad Transport Peddler Consignments Pemoco Ltd. Penn West Exploration Penner Builders Penta Completions Supply & Services Ltd. Percy H. Davis Custom Brokers PetroBakken Pinetree Wholesale Pinnacle Builders Pipemaster OilÀeld Services Pipestone Livestock Pipeworx Limited Plains Environmental Inc Plainsman Mfg. Inc. Platinum Energy Services Corporation Platinum Performance Polycore Tubular Linings Pongo Holdings Ltd. Poplar Tree Inn Power Tech Industries Prairie Land & Investment Services Ltd. Prairie Mud Service Prairie Petro-Chem Prairie Rat Hole Service Ltd. Prairie Sky Cabins Prairie Western Reclamation & Const.

Precision Drilling Trust Precision Instrumentation & Supply Ltd. Precision Well Servicing Premium ArtiÀcial Lift System Ltd. Probity Capital Advisors Inc. Prodahl Environmental Services Ltd. PS Electric Ltd. PTI Group Inc. Pure Chem Pure Energy Services Ltd.

Purr-fect Dry Cleaners PWM Steel Services Ltd. Quality Tire Service Quality Wireline Service Quantum Downhole Systems R & R Tank & Equipment R. French Transport Ltd. R.E. Line Trucking Ltd. R.L. Electric R.M. Of Laurier #38 R.M. Of Pipestone Racken Enterprises Rapid Rod Service Rbanx Rearden Well Servicing Red River Lumber Redhead Equipment Ltd. Redvers Generators Ltd. Redvers Oil Show Regens Disposal Renegade Petroleum Ltd. RG Gagnon Ritchie Bros. Auctioneers Rocky Pine OilÀeld Services Ron Fonstad Ron Field (Field Farms) Ron’s Work Wear Store Room By Room Furniture Rotex Energy Ltd. Royal LePage (Weyburn) Royal LePage Wheat Country Reality RSC Rentals Running Bear Rentals Ltd. Sabre Machining Safe-Tee Management Safety Buzz Safety Source Sam’s Trucking Estevan Ltd. Sanjel Corporation Saskatchewan South East Enterprise Region Savanna Energy Services Corp.

Schlumberger Canada Ltd. Scott Land & Lease SDMC AG Inc. Senchuk Ford Lincoln Sales Ltd. Shaw Earth Moving Inc. Shellshock OilÀeld Services Ltd. Shield Wireline SIAST - Woodland Campus Signal Direct Communications Silver King Lodge Site Energy Sky’s The Limit Boarding House Slimband Smart Power Systems Corp.

Smith Services Smoke Em Diesel SMS Equipment Sonic OilÀeld Services South Country Equipment Ltd. South East Electric Ltd. South East Environmental & Safety Seminar Southeast Health Group Southeast Regional College Southeast Rentals Southern Pressure Testers Ltd. Southern Bolt Supply Southern Plains Co-operative Ltd. Southern Range Well Servicing Spearing Service LP - Oxbow Spectra Financial Springwater SRI Homes Steam-Est Industries Ltd. Stellar Signs Stewart Steel Inc. Stimsol Canada Inc. Stoney Mountain Rentals Ltd. Stream-Flo Industries Ltd. Strike Energy Services Strongco Equipment

Sun Country Well Servicing Inc. Sun Valley Land Ltd. Sunbelt Business Brokers Superior Propane Supreme OilÀeld Construction Sure Flow Consulting Services Inc. Suretech Tool Services Inc. Suretuf Partnership Svein Bryeide Construction Swayze Concrete Ltd. Synergy Credit Union T & T OilÀeld Services Ltd. T.K. Trailer Sales T-45 Oil Corporation Tanner Trucking & Bit Servicing Target Safety Services TBO Team Snubbing Services Technicoil Corporation Telsec Building Corp.

Telus Tempco Drilling Terra Developement Terry’s Teric Transport Ltd. The Container Guy Three Star Trucking Ltd. Thunder City Power & Leisure Ltd. Titan Logix Corp.

Titan Production Testing Ltd. Titanium Tubing Technology Ltd. TNT Tank & Trailer Sales Toscana Capital Corporation Total OilÀeld Rentals Town of Bonnyville Town of Carnduff Town of Oxbow Transco Energy Services Tremcar West Inc. Trenouth Family Holdings Ltd. Trican Well Service Trimount Estevan Development Ltd. Trophy & Engraving Shop True Torq TS & M Supply TSE Operating Service Ltd. TSL Industries Turnbull’s Excavating Ltd. Two Creeks/Got Mats United Centrifuge Ltd. Universal Contract Logistics Victaulic Village of Kisbey Village Of Kitscoty Virden Recreation & Water Sports Vortex Drilling Warner Industries Waterway Houseboat Vacations Weatherford Wireline Services Welclean Land Services Welltec Canada Inc. Western Canadian Bank Western Financial Group Western Star Trucks North Ltd. Western Underground Consulting Ltd. Weststeel Weyburn Co-op Weyburn Oil Show Board Weyburn Security Williston Basin Pet. Conference Wil-tech Industries Ltd. Wood Country Work Source Solutions Wrangler Well Servicing Xtra-Tuff Rig Mats Young’s Equipment Inc. Your Link Inc. Zargon Oil & Gas ZCL Composites Inc.

We Look Forward To Working With You In 2012 - Merry Christmas And A Happy New Year!

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PIPELINE NEWS December 2011

Seismic recording crew Top: two seismic workers use a small boat to cross a pond on a reclaimed mine site east of Estevan in early October. They strung wires across the pond, pushing geophones to the bottom.

Right: Stringing and collecting long wires is a fundamental element of seismic recording.

Photos by Brian Zinchuk

Merry Christmas With gratitude and best wishes for a jolly good season to all.

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PIPELINE NEWS December 2011

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Pictured (left to right): Lakeland College Board of Governors’ chairman Milt WakeÀeld, Alberta MLA Genia Leskiw, Alberta Advanced Education & Tech. Assistant Deputy Minister Darlene Bouwsema, Vermilion Mayor Bruce Marriott, Lakeland College president Glenn Charlesworth, Jim Johnston of the Alberta Apprenticeship and Industry Training Branch, and Lakeland's Dean of Trades & Tech. Bert Samuelson.

Photo submitted

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Lakeland upgrades oil¿eld trades digs Vermilion, Alta. – It was a bricks and mortar day at the Vermilion campus of Lakeland College on Nov. 9 with a ribbon-cutting ceremony to officially open the rebuilt Applied Engineering Building.

The revamped building houses expanded welder and steamfitterpipefitter apprenticeship and pre-employment programs offered at the Vermilion campus.

The building, originally built in 1970 for welding training, was upgraded thanks to an $11.5 million contribution from the government of Alberta.

The reconstruction makes room for 75 combination welding booths with a fume extractor installed at each work station and upgraded lighting throughout.

Improved functionality of the space has enabled the college to incorporate a plasma cutting table, sub arc welder and establish a special testing station for B Pressure recertification.

Student locker/ shower rooms plus a student study area are among the new additions to the area.

“We’ve essentially renewed this 40-year-old facility, creating a safe, functional and innovative learning environment for

our students,” said Glenn Charlesworth, president of Lakeland College.

“I know it will serve our college, our students and our province well for years to come.”

The building has been in use since late August and the response from students has been very positive.

“It’s unbelievable,” said Dusty O’Connell, a second year welding apprentice. He took his first period of training last spring in a temporary training space at Lakeland.

“The space is ventilated very well. The booths are very roomy and because you can do most of the welding techniques in your own booth, it makes it more efficient as you don’t have to wait for a machine at another location to be available.”

The modernized building is also used by local high school students who take basic and intermediate welding classes in the Career and Technology Studies program.

Evening continuing education classes, B Pressure welding recertification, and Lakeland Regional Skills competition are all hosted in the Applied Engineering Building.

It’s estimated that as many as 400 students

will use the space during the current academic year.

“With this renewed building, Lakeland College is playing a very direct role in Premier Redford’s vision to expand the recruitment of post-secondary students in rural areas,” said Advanced Education and Technology Minister Greg Weadick in a news release.

“Even more importantly, the programs offered in the new building will help make a difference in the lives of Albertans as they complete their trades training. And I can’t think of anything more important than that.”

Welder and steamfitter-pipefitter are among eight apprenticeship programs offered at Lakeland’s Vermilion campus.

Other programs are automotive service technician, carpenter, electrician, heavy equipment technician, instrument technician, and parts technician.

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PIPELINE NEWS December 2011

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PIPELINE NEWS December 2011

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Rod Gantefoer a former minister of Ànance for Saskatchewan has a new job as the head up the, STARS Foundation team. Gantefoer is pictured sitting in a BK117 helicopter used by the air ambulance service. STARS recently purchased two used BK117s from an air ambulance company in the U.S. STARS will being to operate in Saskatoon and Regina in 2012.

Photo submitted

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Calgary, Alta. – Shock Trauma Air Rescue Society (STARS) has purchased two of three used BK117 helicopters for air ambulance service in Saskatchewan as ďŹ rst reported by Pipeline News in August.

The two BK117s were purchased from Air Methods Corporation in the United States in September and are currently being outďŹ tted with a medical interior. A third BK117 has not been purchased.

The helicopters are expected to be in service in 2012 in Regina where STARS service is set to begin by next spring and in Saskatoon where it will start later in the year.

STARS recently purchased two new long range AW139 helicopters with a third planned for duty in Saskatchewan in 2013 with the air ambulance program quickly expanding in Western Canada.

STARS signed a memorandum of agreement with the Province of Manitoba on June 28 to facilitate future discussions and work toward a permanent helicopter air ambulance program in that province.

STARS also operates 24/7 in Alberta from bases in Calgary, Grande Prairie and Edmonton.

The urry of developments includes the hire of former Saskatchewan ďŹ nance minister Rod Gantefoer in November as executive vice-president for the STARS Foundation.

Gantefoer retired from provincial politics before the fall election and will provide leadership to the STARS Foundation team in his new role.

His mission is to develop community partnerships and fundraising initiatives to enhance STARS’ patient care and transport program.

STARS is a charitable, non-proďŹ t organization that has responded to more than 21,000 emergencies in Alberta and eastern British Columbia since it began in 1985 in Calgary. ɸ Page B26

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PIPELINE NEWS December 2011

From left, STARS pilot Greg Curtis; Saskatchewan’s Rod Gantefoer, the new STARS Foundation team head; Saskatchewan MLA Warren Steinley; Gantefoer’s son-in-law Michael McKerracher, a partner with KPMG and STARS Áight paramedic Cam Bell.

Photo submitted

A new fund leader is hired by STARS ɺ Page B25 Donations to STARS from major companies that do business in Saskatchewan have been steady in the lead-up to provincial service in 2012.

Husky Energy donated $250,000 to the establishment of STARS in the province on June 27, bringing their total commitment to over $1 million.

Other recent noteworthy donations include $5 million from Crescent Point and a multi-million-dollar, long term plan by PotashCorp to support the construction of a helicopter base in Saskatoon estimated at a $27 million value.

Some of the money raised to date will go toward the purchase of a long range AW139 helicopter for Saskatoon following the purchase of the two AW139s headed for Alberta.

Gantefoer will oversee all STARS fund development activities throughout Alberta and Saskatchewan will work primarily from the new STARS base in Saskatoon.

“I am honoured to begin my new role with STARS, and to have an opportunity to continue in public service,” said Gantefoer in a news release.

“Every day, I will be motivated by the knowledge that STARS is responding to critically injured and ill patients across Western Canada, and that my work will directly contribute to that important activity.”

Gantefoer’s resume includes 16 years as a member of the Legislative Assembly of Saskatchewan, which included appointments to Minister of Finance and Government House Leader.

“We are thrilled to have Rod join the STARS team,” said STARS CEO Dr. Greg Powell.

"His strong leadership experience and history of public service will greatly benefit our organization, and ultimately our patients."

Gantefoer served on many committees during his time in government including health, finance, education, labour, economic development, environment and resource management.

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40247758•10/23/09

B26

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PIPELINE NEWS December 2011

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PIPELINE NEWS December 2011 Oct. 11 became another of day of remembrance this fall for Lloydminster Mayor Jeff Mulligan who wrote a blog about the three truck accidents that occurred that day when a vacuum truck caught Àre; a semi crashed into the side of a Nelson Lumber on Highway 16, and another semi truck with an overheight track hoe struck and collapsed the CP rail overpass at the east end of the city. Mulligan says he will never forget that wild day on the roads that inspired the topic of his Oct. 22 blog titled, A Day to Remember.

Photo by Geoff Lee

Lloydminster mayor addresses two remembrance days

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Lloydminster – This fall there were two different days of remembrance for Lloydminster Mayor Jeff Mulligan to react to, with one unforgettable day happening by accident.

The scheduled event was the annual Remembrance Day ceremony on Nov. 11 that Mulligan attends in memory of fallen members of our Armed Forces in previous wars.

The wildcat day of Oct. 11 when three truck accidents occurred in the city also caught Mulligan’s attention and became the subject on his Oct. 22 blog reprinted below under the heading, A Day to Remember.

“October 11, 2011 … the day that I will remember for quite a while…

“Mr. Mayor, someone is calling for you about an oilfield truck that is on fire on 50th Avenue downtown.”

“Mr. Mayor, someone is calling for you about a semi-truck that has jumped the boulevard on Highway 16, hit a half-ton truck and come to rest by tearing the front of Nelson Lumber.”

“Mr. Mayor, someone is calling from the Premier’s Office about a track hoe on a semi-trailer truck that has hit the CP overpass and dislodged the bridge deck completely. Oh yeah, the truck is stuck under the bridge, too.”

“Was it the full moon? Do things always happen in 3s? I quickly had to get past these questions of fate and superstition to work alongside a group of outstanding professionals who were able to secure the CP overpass site, conduct the assessment, clean-up and traffic re-direction during a crisis.

“With 70 tons of steel balanced precariously over the road, partially embedded in a semi-trailer truck, on one of the busiest highways in the area, everyone executed at a high level on short notice to alleviate the problem.

“Thanks to everyone involved, with a special shout out to ADM Industries for allowing us to access the crane and crew that were on their site, for a job very well done. We owe you all!

“Until next week …

“Mayor Mulligan”

Truck Cell: (306) 823-3512 Cell: (306) 823-7111 Res: (306) 823-4309 Fax: (306) 823-4663

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PIPELINE NEWS December 2011

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Nordic to deploy two-dimensional seismic exploration for drill site Lloydminster – Nordic Oil and Gas Ltd. expects to complete 6.5 kilometres of 2D seismic exploration this month over the west half of a section of land near Lloydminster, Alberta that it acquired in April.

The goal of seismic for the Winnipeg based company is to determine the best location to drill their next heavy oil well in the area before the end of the year.

“The two lines of seismic will be tied-in to an existing well in the adjoining section to the north

of us, and to an existing well in an adjoining section to the south,” said Donald Benson, chairman and CEO in a news release on Oct. 18.

“The information that we obtain through the seismic process and subsequent interpretation, will tell us the best possible location for a new heavy oil well.

Nordic obtained a seismic option for the oil rights to a section of land located at 04-50-3-W4 on the LSD grid when they acquired a 100 per cent interest in the natural gas rights from an

arm’s length vendor last spring.

The current spacing allows Nordic to drill up to four new wells on this land, which is approximately seven miles west of Nordic’s existing heavy oil production in Lloydminster.

“Since this is ‘virgin territory’, stronger pressure should yield higher production rates than what we currently receive f rom our 33 1/3 per cent interest in 16 wells in Lloydminster area to the east of this proposed new well,” said Benson.

www.davco.cc

The staff at Davco wishes everyone a Safe and Happy Holiday!

OilÀeld Facility Construction Services AB & SK Myshak Crane and Rigging from Edmonton reinstalled the repaired steel CP overpass girder at the east end of Lloydminster on Nov. 1 with the aid of a 500 ton Liebherr LTM 1400 crane and a yellow coloured 265 ton Liebherr 1220. The girder collapsed on Oct. 11 when it was struck by an over height excavator on the back of an eastbound semi. MCR used the same 500 ton crane in tandem at the accident scene with a similar crane sent by Mammoet in Edmonton to lift and remove the fallen girder that was hauled away for repairs.

Photo by Geoff Lee

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B30

PIPELINE NEWS December 2011

Target Safety Services Ltd. held and open house on Oct. 28 to ofÀcially open their new company-owned quarters in Bonnyville. The Target shop has 8,000 sq.-ft. of space for storage and safety equipment rentals and two classrooms to deliver industry safety courses in a growing market area.

Photo submitted

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Bonnyville, Alta. – The new Target Safety Services Ltd. site in Bonnyville was a bull’s eye for clients eager to attend grand opening celebrations on Oct. 28 with food, refreshments and prizes on the line.

A free barbecue and a draw prize for a at screen TV added to the urgency to check out Target’s new quarters in a northeast area business condo and talk shop with local operations co-ordinator, Jim Rowe and general manager, Clint McKinlay who drove up from Lloydminster. “A lot of clients work in camps so it was tough for them to come down for it. They don’t work in Bonnyville; they are about an hour and a half away,â€? said McKinlay. “We still did all right. We had about 75 of our key customers that came through and said hello.â€?

Target has purchased about 8,000 sq.-ft. of space with three bays for storing and maintaining safety program equipment and safety equipment rentals with room for oďŹƒces and two classrooms for industry safety courses.

A double dipping opportunity was open to Target’s Bonnyville customers to sample goodies at an o-site hospitality suite at the local Neighbourhood Inn and enter another draw for a pair of tickets to an Edmonton Oilers hockey game.

The grand opening was held the day after Target’s quarterly meeting of managers for its Lloydminster, Bonnyville and Red Deer. There was talk about a similar event for Lloydminster clients sometime in 2012 on the agenda. “We’ll be expanding into a new building in Lloyd. That’s the plan,� said McKinlay. “We are dealing on a couple of properties right now. We haven’t decided which one we are going to take. We are hoping to have our land purchased soon (mid-November) and then start the building plans. ɸ Page B31

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Bonnyville, Red Deer & Lloyd all busy ɺ Page B30 “I don’t think there is a bad area right now. Bonnyville is busy, Red Deer is busy and Lloyd is busy.

“The industry has definitely picked up from where it was a year and a half ago. There is a lot of potential out there for all services,” McKinlay said.

Target’s core business is supplying safety supervision and equipment for plant shutdowns, facility and battery turnarounds, drilling operations, well servicing and construction projects.

The company provides a wide range of corporate safety management systems including safety audit readiness, safety program maintenance and safety program development backed by a quality control program for personnel and equipment.

Target will provide similar services to the Bonnyville market where the company has grown from a handful of employees in 2008 to more than 50 who settled into the new building in July.

“Before that, we actually rented part of another business in town,” said McKinlay. “Now we’ve outgrown it and need our own space.

“This allows us to expand our services and to increase our office support for the work we have up in the area.

“We have our two training classrooms in Bonnyville so we are doing our internal training up there right now and keeping up with client demands with construction projects and day-to-day maintenance work,” he said.

“We wouldn’t have invested in the building if we didn’t feel we didn’t have a fair shake of the market share up there.

“There are lots of drilling activity and construction projects on the go in all three areas for us.”

Target completed a 42-day safety supervision turnaround at the LloydminTarget’s general manager Clint McKinlay, who is based in Lloydminster, says the company will construct a new and larger building in Lloydminster in 2012 to keep pace with the growing demand for its suite of safety services and equipment rentals.

ster Husky Upgrader in early October with the bulk of resources coming from the Red Deer office where the company bases its quality assurance and quality control programs.

The Red Deer facility managed by company president Craig Dore, includes a 20-seat classroom and an interactive confined space entry vessel and fire training area, and special equipment for high angle rescue training.

“We are training quite a bit in Red Deer and we are also getting all of our turnaround equipment back to our QA/QC department since the season is winding down for that type of work,” said McKinlay.

This is also a busy time for Target in the year-end rush to secure safety projects and turnaround work for 2012.

“Probably the planning for 2012 started in May, but it’s one of those things that you never stop doing. If you stop planning for the future you’re going backwards,” said McKinlay.

B32

PIPELINE NEWS December 2011

Bonnyville Bonspiel

Meet the A-Event champs from the 31st annual Bonnyville Oilmen’s Bonspiel held Nov. 17-20. The winners from team Energy Electric are (left to right): Norm Hempel, Leonard Gadowski, Larry Hempel and Glen Strawson. In second place was the MRC MidÀeld squad of John Regnier, Tim Schultz, John Letwinetz and Russ Yarmuch.

The MidÀeld team of (left to right) Justin Dwan, Dalton Lyall, Clayton Shenher and Eric Brosseau took the top spot in the C-Event championship.

Behind them was the BFL Energy foursome of Greg Dwan, Gerry Croteau, Dave Dwan and Mark Skelton. A total of 33 teams took part in this year’s bonspiel.

There was an $8,000 payout to the top four teams in each of the top four events. Sharing a piece of the money was the top B-Event BQR team of (left to right) Andy Lafrance, Baz Churko, Rod Ouelette, and Shawn Broda.

They edged out the Precision Rentals outÀt of Jon Best, Grant Klippenstein, Craig Watson, and Doug Zingel.

Top spot in the D-Event went to the Patch Trash team of (left to right) Codie Cabay, Shane Poholluck, Kyle Poholluck and Rollie Gratton. They beat the Lloydminster Hurricane entry of Ralph Johnson, Jim Knepps, Les Pinskse and Tom Fisher. This year’s Bonnyville Oilmen’s Bonspiel was directed by chair Dan Sharun, a business development manager for production systems at Weatherford.

Photos submitted

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PIPELINE NEWS December 2011

B33

Wainwright spiel skips to 2012 also draw players from the region tuning up for the Unity or Lloydminster oilmen’s competitions in March.

“The bonspiel always kicked off the season. Now it will be right in the heart of it,” said Bishop who skipped his Baker Petrolite Wainwright-1 team to the B-Event title in 2010.

Bishop is a field manager who sells

products such as emulsifiers and corrosion inhibitors to oil and gas customers in and around Provost, Lloydminster, Consort, Wainwright and Edgerton.

Baker Petrolite is a division of Baker Hughes, a company that provides completion, intervention and production solutions to oil and gas companies globally to maximize recovery.

POWDER COATING Memories from 2010 will have to carry over through 2011. In this Àle photo, Travis Smith from Harvest Energy congratulates the 2010 B-Event champs from the Baker Petrolite Wainwright-1 group of Bob Bishop, Barr Humphreys, Ryan Humphreys and Damon Zajic. The 2011 version of the Wainwright Oilmen’s Bonspiel has skipped ahead to Feb 3-5, 2012 - a leap year!

Photo submitted

Wainwright, Alta. – The Wainwright Oilmen’s Bonspiel will draw a blank in 2011 thanks to a hiccup with ice-making equipment at the aging Wainwright Curling Club.

The installation of a new compressor one week before the three day event was set to begin on Nov. 4 forced organizers to reset the date of the 34th edition to Feb 3-5, 2012 – a leap year!

“They had some problems with the plant here and it was questionable,” said organizer Bob Bishop about holding it in its usual time slot which is in the first weekend of November.

“It definitely couldn’t have gone on the weekend that we always have.

“They had to put a new compressor in and order out of the States, and it took a lot longer than would they thought it was going to be.”

Repairs were also made last summer to the plant condenser that was replaced in 2004.

Bishop said that to his knowledge, this year was the first time the event had to be scratched, but he is optimistic the new date could work in their favour.

“We are going to see how this one goes, to be honest, and see what kind of a turnout we get,” he said.

“We have been looking for a reason to change, but you hate to move your date, but we were forced to move it anyway.

“We looked at the Nov. 11 weekend. It would have been really, really tight. We could have made it but there were too many question marks.

“There would have been too much work put into it – and then have it not go right.”

Last year’s event attracted 20 teams, but more could register for February when there is no fall hunting season or busy oilfield activity in November to compete with.

“It’s more wintery in February,” said Bishop. “We get away from the hunting season a little bit.

“Maybe we will pull some of those guys – maybe the guys doing fall work and construction maybe we get some out of that.

“I don’t know. We try it anyway and see how it goes.”

The Wainwright bonspiel could

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B34

PIPELINE NEWS December 2011

Extract oil sands data on web portal Edmonton – Digging up data on the environmental performance of Alberta’s oilsands facilities is now just a matter of opening a one-stop web portal by typing Oil Sands Information Portal on your browser.

Searchable data highlighting such things as facility-specific water use, greenhouse gas emissions, tailings ponds sizes and land disturbance and reclamation are part of Alberta’s ongoing work to make oilsands information more open and transparent.

“Open access to information allows people to form their own opinions and ask important questions about industry performance and regulatory oversight,” said Alberta Environment and Water Minister Diana McQueen.

“Science is driven by debate and discussion and it is my hope that this

site serves to drive excellence and innovation in oil sands environmental management. It is part of our commitment to being a world-leading, responsible energy producer.”

While oilsands data and information has always been publicly available, it has often been difficult to find and time-consuming to access. The portal is the culmination of three years work to compile data and information from a variety of sources.

In addition to facility data, the Oil Sands Information Portal includes an interactive map with real-time regional air quality information and river flow data. It also provides a downloadable data library with easy access to environmental impact assessments, water approvals and licences, and compliance reporting.

“This is just the beginning,” said Minister McQueen. “We know there is more information to add to the portal and we are committed to continually updating this valuable tool with new information and new environmental indicators as they become available.

“Once a new, enhanced monitor-

Enbridge goes with Bakken Access Program Houston-based Enbridge Energy Partners, L.P. is undertaking a series of projects, totalling approximately $90 million, to expand the

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ing system for air, land, water and biodiversity is built, this portal will serve as a key reporting tool.”

By consolidating environmental data from a variety of sources into one interactive portal, Albertans are better able to access information without having to search multiple sources or make formal information requests.

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gathering capacity on its North Dakota system by 100,000 bpd.

The Bakken Access Program, which is expected to be in service by early 2013, involves increasing pipeline capacities, construction of additional storage tanks and addition of truck access facilities at multiple locations in western North Dakota.

“This expansion project substantially enhances our gathering capabilities on the western side of our North Dakota system and complements our 120,000 bpd Bakken Expansion program, which is being

undertaken with significant term capacity commitments,” Mark Maki, president of the partnership, said in a news release.

Production forecasts from the prolific Bakken and Three Forks formations have recently doubled, accompanied by a corresponding increase in drilling activity, he said. “The Bakken Access Program builds upon the 2011 Bakken Expansion program and will enable the partnership to continue to provide attractive transportation options to our customers in the Bakken and Three Forks formations.”

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PIPELINE NEWS December 2011

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STP-McKay site could triple capacity Calgary â&#x20AC;&#x201C; Southern PaciďŹ c Resource Corp. plans to triple its current planned production capacity of bitumen at its thermal STP-McKay project located 45 kilometres northwest of Fort McMurray Alberta.

The Calgary-based company has submitted an application to the Alberta Energy Resources Conservation Board to expand its current Phase 1 project area from its design capacity of 12,000 barrels a day of bitumen a day to 36,000 bpd of bitumen.

Approval would allow Southern PaciďŹ c to construct a second-steam assisted gravity drainage (SAGD) facility within the project area capable

of producing an additional 24,000 barrels per day bpd of bitumen.

The Phase 2 expansion will be conducted in two integrated stages of 12,000 bpd with a producing project life of more than 20 years.

The application ďŹ ling proceeds an upcoming revised proved plus probable (2P) reserve classiďŹ cation based on a total project production capacity of 36,000 bpd of bitumen compared to the previously eligible capacity of 12,000 bpd of bitumen.

Southern PaciďŹ c said the new report that is to be completed by Dec. 31 from GLJ and Associates Ltd should allow the 2P forecast to be accelerated

and also recognize additional contingent resources from within the project area to be assigned as 2P. STP-McKay Phase 2 will have the beneďŹ t of all the information obtained from the ongoing construction and preliminary operations at STPMcKay phase 1 with steam scheduled to begin in the second quarter of 2012.

Southern PaciďŹ c is budgeting 18 months for regulatory approval of phase 2, based on the 15 months required for approval of phase 1.

AMEC-BDR who did the en-

gineering for Phase 1 will also complete the engineering for the phase 2 expansion.

That company recently prepared a scoping study at STP-McKay Phase 2 to meet the engineering requirements for the application submission.

Now, they are working on the Design Basis Memorandum (DBM), a more detailed level of engineering on the entire phase 2 project.

The DBM is expected to be completed in March 2012, at which time a detailed cost estimate on the project will be available.

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Wilmington acquires Wilmington Capital Management Inc. announced Oct. 27 that through a limited partnership in which Wilmington has an interest, it has acquired a 59 per cent indirect interest in a 100 per cent working interest in certain petroleum and gas assets in the Shackleton ďŹ eld in Saskatchewan and related assets.

The aggregate cost of the assets, including closing costs, will amount to approximately $19.8 million and is funded by a combination of cash and debt.

Wilmingtonâ&#x20AC;&#x2122;s share of the cash consideration to complete the acquisition is $6.22 million, which is being funded by providing cash for subscription units in the partnership. The remaining 40 per cent indirect interest will be acquired by four other investors in equal amounts and their share of the cash consideration to complete the acquisition is $4.29 million, which is being funded by providing cash for subscription units in the partnership.

In connection with the acquisition, the part-

nership has also entered into a credit facility with a Canadian bank in the amount of $9 million, of which $8.5 million was drawn to fund the acquisition. The credit facility is secured by the assets.

The assets will be professionally managed

by Airwell Services 2011 Ltd., an entity whose purpose is to provide management services to the partnership. Wilmington has a 51 per cent direct interest in the manager. The remaining 49 per cent interest is held by another entity.

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B36

PIPELINE NEWS December 2011

Western Plains to farm out interest in Landrose area lands (Nickle’s Daily Oil Bulletin) Lloydminster-based Western Plains Petroleum Ltd. has entered into an agreement with an arm’s-length privately held oil and gas limited partnership to farm out its 50 per cent net interest in petroleum and natural gas rights in a drilling spacing unit in the Landrose area of Saskatchewan.

Alberta Star Development Corp. also holds a 50 per cent net interest in the lands.

Under the terms of the agreement, the farmee has agreed to fund the costs of drilling, completing and equipping one test well on the lands to earn a net 17.5 per cent interest after pay-out (a net 35 per cent before pay-out). Western Plains has agreed to contribute all of its interest in certain oilfield equipment to equip the test well. The parties have agreed that the value of the interest is $60,000 or 15 per cent of the estimated $420,000 costs of the well.

After pay-out, Western Plains will hold a 35 per cent net interest in the test well (15 per cent net interest before pay-out). Alberta Star is participating in the drilling, completion and equipping of the test well in respect of its 50 per cent net interest.

Western Plains was designated as operator under the agreement in respect of the drilling, completion and equipping of the well, which is expected to be spudded by the end of this month.

The company has also entered into an agreement to sell its 50 per cent undivided working interest in the Edam property in west-central Saskatchewan to its working interest partner on the property, a private Calgary-based limited partnership, for the cash consideration of $400,000, subject to industry standard adjustments, plus applicable taxes, based on an effective date of Nov. 1, 2011.

The Edam property consists of 40 acres (20 acres net to Western Plains) and one producing heavy oil well (0.5 well net to the company). Western Plains originally earned its working interest pursuant to a farm-in agreement with the partnership, whereby it paid 50 per cent of the costs of the drilling and completion of one test well, together with 50 per cent of the partnership’s out-of pocket costs related to the acquisition of the Edam property at a Crown land sale.

Cash proceeds from the sale of the company’s interests in the Edam property will be applied to its working capital. Closing is subject to standard industry conditions and regulatory approvals.

Sure Energy identi¿es pool extension Using a proprietary 3D seismic program In southeast Saskatchewan, Sure Energy Inc. identified an extension of the East Queensdale Alida light oil pool on its 100 per cent working interest lands. In the third quarter of 2010 the company drilled its first horizontal well into the interpreted extension.

The well was an open hole drill and completion, and it cost $1.3 million to put onstream. The well came on production at over 200 bpd and paid out in just over three months. It benefitted from the Saskatchewan horizontal well drilling incentive plan, which reduces royalties to 2.5 per cent for the first 6,000 cubic metres (37,740 bbls) of production.

Production in the area is typified by increasing water cuts relatively early in the well’s productive life.

Despite the cost of managing the water, the well realized an average netback of $67.59 per bbl in the third quarter.

During the quarter the company drilled three more horizontal wells into the prospect. All three were drilled from one surface location, which will include equipment to treat the oil and handle water for disposal. The wells came on in October.

Sure produced 64 bpd from the original Queensdale well in southeast Saskatchewan in the third quarter. The three follow-up wells are currently on produc-

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tion but are not yet producing at optimal rates. Field estimates for October are 270 bpd from the property.

In September, at Hatton in southwest Saskatchewan, Sure drilled its first well into a heavy oil prospect.

The company’s vertical appraisal well encountered 6.5 metres of heavy oil pay.

The well was completed and is currently awaiting facility construction and installation of a screw pump to enable it to be put on production. The well is expected to start producing in mid-November. Encouraged by the result, Sure purchased three more sections of 100 per cent working interest land (to give it a total of four) on the play.

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PIPELINE NEWS December 2011

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Emerge and Twin Butte Energy combine Emerge Oil & Gas Inc. reported increased production, earnings, cash flow and revenue for both the third quarter and nine months ended Sept. 30, 2011.

The company, which announced Nov. 14 that it plans to merge with Twin Butte Energy Ltd. and form a new entity that will retain the Twin Butte moniker, produced 5,479 boepd during the third quarter, a 10 per cent hike from output of 4,993 boepd recorded during the same period a year earlier.

Year-to-date volumes were 5,777 boepd versus 4,536 boepd during the first nine months of 2010.

Third quarter net earnings improved to $9.57 million from a net loss of $2.77 million last year, while profit for the nine months ended Sept. 30, 2011, increased to $14.83 million from a loss of $3.28 million for the first three quarters of 2010.

Emerge said in-

creased earnings were the result of higher oil and gas revenues, proportionately lower costs and net gains recognized on risk management contracts and an asset disposition.

Emerge drilled 10 (8.8 net) wells in the third quarter of 2011 with a 100 per cent success rate, and has drilled 38 (35.9 net) wells yearto-date.

Exploration and development expenditures of $19.68 million during the third quarter were primarily invested in the drilling of four (2.8 net) wells at Kirkpatrick Lake, three (3.0 net) wells at Primate, three (3.0 net) wells at Greater Lloydminster, and the completion and equipping of certain wells drilled during the second quarter that had been delayed due to wet field conditions.

Emerge also disposed of its Silverdale oil battery and emulsion processing facility to an arm’s-length energy ser-

vices company during the third quarter for cash proceeds of $18 million.

O p e r a t i o n a l l y, Emerge said it continues to maintain priority access to the facility for its emulsion processing and oil terminalling needs on a fee-for-service basis, which is not anticipated to result in a material change to the company’s go-forward operating costs from those incurred in the third quarter of this year.

The facility is centrally located to Emerge’s operations thereby minimizing intra-field trucking, and the company maintains access and fixed processing fees for a period of seven years.

The company said its fourth quarter drilling program is well underway with eight (8.0 net) wells drilled to date in the quarter of a total 12 (12.0 net) planned. This will bring Emerge’s total to 50 (47.9 net) wells drilled in 2011.

Recent drilling activity has been focused at

the company’s Primate field where production results have exceeded management’s expectations for vertical heavy oil wells in the area.

Emerge has acquired additional offsetting acreage in recent months and is actively acquiring seismic to increase its drilling inventory at Primate. The company has also been active at its Freemont property where two (2.0 net) wells have recently been drilled with 100 per cent success and are awaiting production equipment.

By the end of the year, Emerge anticipates exploration and development expenditures to total $68-$70 million, which is within its

capital budget set at the beginning of the year of $75 million, resulting in year-end net debt of $58-$60 million.

Based on current estimates, the company

expects 2011 production to average 5,700-5,800 boepd, which represents a 17 per cent increase (using the midpoint) from 2010 average production of 4,922 boepd.

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PIPELINE NEWS December 2011

Petro One ¿nds oil Petro One Energy Corp. reports that the first hole drilled on its 100 per cent owned J1 Rosebank property in Saskatchewan is an oil producer, and is being brought into production based on positive test results.

The vertical well has demonstrated a flow rate of 40 bbl. per day of light 30 degree API oil from the FrobisherAlida zone.

Based on this result, Petro One has been credited with

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NI 51-101 compliant proved plus probable plus possible reserves of 510,000 bbl. of oil, including 40,000 bbl. of proved reserves.

The company has been credited with six undeveloped locations, including three vertical and three horizontal targets that are planned to be drilled to exploit the full potential of this oil pool. These drill targets were selected by an independent geophysicist and an independent geologist based on well log control from adjacent producers and 3-D seismic.

Petro One’s Rosebank 11-29-4-23W1 well was drilled on the west flank of the Rosebank oil field, which has been in production since 1955.

The discovery well is located between two prolific oil producers: a vertical well 320 metres to the south that has produced 186,000 bbl. since 1984, and a horizontal well 300 metres

to the northeast that has produced 63,000 bbls since 2000.

“We are very pleased to have achieved an overall success rate of 100 per cent with the company’s first two drill campaigns that resulted in two new oil discoveries,” Petro One president Peter Bryant said in a news release.

“We have a systematic drill program planned to build both production and shareholder value. Petro One looks forward to building its production with a total of 26 undeveloped drill targets in both its J1 Rosebank and J5 Milton reservoirs. We also plan to move forward with drill testing the economic potential of more than 10 other stand-alone properties. These properties total more than 10.5 sections (6,720 acres/2,700 hectares), and include some of the best producing formations in Saskatchewan and Manitoba.”

• Pipeline & Plant Construction • Tank Moving

Warm Wishes this holiday season from the team at Denmax!

PIPELINE NEWS December 2011

B39

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

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B40

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly

C-Section December 2011

Grit Industries picks North Battleford for manufacturing

By Geoff Lee Lloydminster – Grit Industries Inc. left reporters short winded in October trying to keep pace with a rush of breaking news about their expansion plans to meet a growing customer demand for their products and services.

The Lloydminsterbased company announced on Oct. 18 they were moving and consolidating their manufacturing divisions into the former 91,000 sq.ft. Peak Manufacturing plant in the Parsons Industrial Park in North Battleford.

The consolidation will include their existing 20,000 sq.-ft. manufacturing building in the McMillan Industrial Park in North Battleford.

The company has been conducting repetitive parts manufacturing there to support its G55 containment system for the past five years.

That news was followed by word the Grit Industries group of companies has sold its properties within the city of Lloydminster with 12 months to vacate.

Construction is already underway on a new administration office and warehouse complex adjacent to the company’s Grithog Sand Control Systems site south of the airport in the County of Vermilion River.

Premier Brad Wall was one of several officials to attend Grit’s news conference in North Battleford where

Wayne King, president and founder of Grit Industries Inc., emerged from a reorganization meeting in Lloydminster to explain his company is expanding and consolidating all of its manufacturing processes into a 91,000 sq.-ft. building in North Battleford.

company officials explained the expansion plan is aimed at being able to continue to grow with customer requirements.

“We have been planning expansion for this for several years now,” said president and company founder Wayne King, who shared the news with the Pipeline News in Lloydminster.

“It’s great to have our upper management at Grit very much on side with what we are doing. We are growing the business.

“We are currently losing orders for deliveries that we haven’t been able to meet, and losing orders just because we haven’t had the capacity to deliver on time so we

want to rectify that.”

The new facility will allow Grit Industries to step up production of its Cold Weather Technologies division product line of natural gas dry line heaters designed to heat multi-tank or vessel applications in a number of industrial sectors.

North Battleford will also manufacture Grit’s burner system line of products for its A-Fire division that are targeted to the heavy oil industry along with its G55 containment systems for multiple applications.

“We are at the point where customer demand far exceeds our ability to produce the volume of product that’s required,” said Jim Spenrath, chief operating officer.

“The move to North Battleford will give us an opportunity to meet that demand in a modern state-of- the art facility.

“The facility alone will give us efficiency in terms of operations. We will be under one roof as opposed to being in four separate buildings that we’ve grown up in.

“That gives us manufacturing efficiencies that we simply can’t have in our existing locations.”

Grit expects to hire about 70 new employees in North Battleford to boost production with welders, gas fitters, assemblers and plasma and equipment operators, quality control specialists, electricians and managers on the priority list.

Grit also plans to move its engineering department and some senior management employees to the new location.

“We are pretty excited about it,” said Spenrath. “Any time you have an expansion, there is a certain amount of excitement there. There is also normal business anxiety, if you will. We are all hoping that we are doing the right thing for the long run future of the business.

“This will give us the capabilities we require.

We’ve got good strong people here and we are going to move forward.

“Over the next number of years, we will continue to grow our staff to deal with customer

demand,” Spenrath said.

“We are looking at relocating some of our employees from here and bringing in new employees from outside of North Battleford into that city.”

The ongoing construction of a new facility in Lloydminster will house Grit’s existing A-Fire service division along with administrative and sales staff. The new complex will be a base for research and development and for warehousing.

“As far as the Lloydminster operation goes, we will be consolidated under one roof here,” said Spenrath.

“We are still looking at expanding some areas of our business here. Some people here will be taking on new exciting roles.”

The Grit Industries group of companies currently employs approximately 130 people and a network of distributors across North America.

Niagara Falls was in the running as a possible manufacturing site with its close proximity to the U.S. export market, particularly for Grit’s natural gas pipeline heaters, but North Battleford won out for a number of reasons including familiarity.

“There is no question that the facility that we have acquired there is a building that suits our needs extremely well.

It gives us an extreme increase in capacity to allow us to grow,” said Spenrath. ɸ Page C2

C2

PIPELINE NEWS December 2011

Former RV plant to become Grit’s manufacturing centre Jim Spenrath, COO of Grit Industries, says the company has sold all of its property within the City of Lloydminster to make way for an expansion in North Battleford. The company is currently constructing a new head ofÀce complex in Lloydminster adjacent to its Grithog Sand Control Systems site. It will house sales staff with space for research and development and warehousing.

ɺ Page C1 “We have been very welcomed by the North Battleford community. We are familiar with the labour market; we are familiar with the people. We have a base operation there already.”

Grit Industries expects to manufacture products in Lloydminster and North Battleford during the transition period that could several months to complete.

The company has hired consultants to assist with planning the layout and efficiencies of the manufacturing space.

“We do have some retrofits to do in the building,” said Spenrath. “In an ideal world, we will get in there fairly soon. We have one year to get out of our current location as part of our sale agreement for the property in Lloydminster.”

The North Battleford site sits on a 12 acre parcel of land and includes 15,000 sq.-ft. of outbuildings.

Having a larger manufacturing base in Saskatchewan will allow Grit Industries to manufacture new products including products for the light oil market.

“Our goal is to relocate, get ourselves organized and see what shakes out of that,” that King. “We know we can grow our company.

“We have several new technologies that we have introduced over the years. We have a number of technologies that we are introducing into the light oil market in Saskatchewan and Alberta in heating technology.

“We really see significant growth in the heating of light oil without using pressure vessels and treating facilities and so on – heating light oil in a single tank production system.

“We believe we can provide a better more fulfilled service to the client by making this move. We needed to do something to improve our manufacturing. We needed to upsize our facility.”

King said he plans on having “some sort of residence” in North Battleford when the new facility is up and running but he added, “I fully intend on being in Lloydminster on an ongoing basis and growing our business in multiple locations.”

Grit has sales offices in Chicago, Illinois and Niagara Falls and is currently constructing new facilities in Wabasca, Alberta for trucking and A-Fire products.

“We certainly have growth in mind,” said King, who started the company in 1985.

PIPELINE NEWS December 2011

C3

Grit Industries lays its cards on the table

By Geoff Lee Grit Industries Inc. is expanding and consolidating all of its manufacturing processes into an existing building in North Battleford in the coming months.

The Lloydminster-based company, founded by its president Wayne King in 1985, has sold all of it properties within the city of Lloydminster.

Grit is currently constructing a new office/warehouse complex next to its Grithog Sand Controls Systems division near the Lloydminster Airport in the County of Vermilion.

King sat down with the Pipeline News on Oct. 20 to explain the rationale and the nuts and bolts of the expansion to North Battleford.

PN: What aspects of your business are moving to North Battleford?

GI: We have chosen to move the fabrication manufacturing section of our company. We are certainly not intending to move our field services group. We are not intending on relocating our secondary containment group.

PN: What functions are not moving to North Battleford?

GI: Not the field services and not the A-Fire product line. The A-Fire combustion technicians will all remain in a new shop out by the airport.

The secondary containment installation people and packaging people and sales and service will all remain in Lloydminster. The administration office will remain in Lloydminster as well.

It’s strictly our manufacturing processes that will be relocated.

PN: What is behind the move and consolidation?

GI: What we have found is that the customers who buy the goods that we have developed and currently manufacture – what doesn’t bother them is where the products come from. What does bother them is the cost of manufacturing that we have to incur in the Lloydminster region.

PN: Why is it a higher cost to manufacture in Lloydminster?

GI: As you know, Lloydminster is a very active community. It’s in the centre of the heavy oil industry. The fact is an unskilled or a low skilled fellow can come here with very little skill and get a relatively high paying job by going to work in the industry on drilling rigs or service rigs or driving a truck or what have you.

The division that we intend on relocating is a fabrication manufacturing facility that requires men. When we have to compete locally at the level of the service rigs and drilling rigs and other field activities, our products end up being higher priced than what a lot of our clients would like to see.

If we manufacture a product that we are selling to the petroleum industry, they are accepting the fact they have to pay a higher premium for the goods they are buying.

When we manufacture a product that we sell into other parts of Canada or

other parts of North America – like the East Coast and Midwest of the U.S., we are manufacturing in a high labour cost area when the trades people that we need to manufacture are available. This is driving up the cost.

PN: What kind of products do you make for the non petroleum industry?

GI: We manufacture a method of heating natural gas, for example, that is used primarily by gas utilities across North America. It’s a technology that we’ve developed in Lloydminster.

The technology is continuing to be developed, but we do have clients as far east as Nova Scotia. A large part of our client base is in the U.S. The natural gas utilities heat natural gas which enables them to distribute it to the cities and towns that they provide the service to. That’s a significant one of our product lines.

If Lloydminster is not the worst place, it’s one of the worst places to manufacture (non-petroleum products) due to the high cost of labour competing with the petroleum industry here.

PN: Are you an excited guy?

GI: Yes, I am excited. This is our goal. We have been planning for this expansion for several years. It’s great to have our upper management at Grit very much on our side with what we are doing. We are growing the business.

We are currently losing orders for deliveries that we haven’t been able to meet, and losing orders just because we haven’t had the capacity to deliver on time so we want to rectify that.

PN: Why did you pick North Battleford for your manufacturing facility?

GI: North Battleford was looked at as one of many communities that we looked at for relocating some of our product lines to. We actually considered quite seriously Niagara Falls. Niagara Falls, being in Ontario, it’s in a bit of depressed location. Several companies have ceased business.

It’s not only that labour is available, but they are also closer to our market for our natural gas line heaters. We also looked at other places in Ontario, but we decided on North Battleford.

We have had a facility in North Battleford now for nearly five years. We have a manufacturing shop there. We like North Battleford because the “attitude” that the labour has is secure; they are reliable and they are happy to be living in a community that has lots to offer.

There is a good high quality grade of trained journeyman technicians and apprenticed technicians and so on. There is less activity there compared to Lloyd, and there are certainly more people readily available. It’s not only the people and the cost of people; the fact is, there is actually a place to live in North Battleford, unlike Lloydminster. ɸ Page C4

C4

PIPELINE NEWS December 2011

Costs in Lloydminster impetus behind move ɺ Page C3 PN: Did you consider expanding in Lloydminster?

GI: We have sold our property within the city of Lloydminster. All the land and all the buildings have been sold. As long term planning several years ago, the company bought a piece of property on the outskirts of the city in the County of Vermilion River in the airport road area.

The idea was to relocate and build a building specifically for purpose and considering the manufacturing that we do, and the product lines that we have developed to build a building, that would ultimately reduce the input costs of the products.

When we looked at the cost of building a new building, the size we needed and equipped properly for us with lifting devices and so on with the type of equipment we have. We have water jet machines for example, that need to have high quality water both for usage and for disposal purposes.

There are problems with water in the county.

We also needed to have a lot of power. We are currently housed in about 65,000 to 75,000 square-feet in four different buildings, but we wanted to be under one roof in a configuration that allowed us to manufacture in an assembly line-like environment so we could reduce the handling and the inefficiencies of our current operation.

Because we live in Lloydminster and because we are hometown boys, that was our first idea – to rebuild in Lloydminster.

In the big scheme of things it was a much lower cost which allowed us to be more comfortable with the move. Perhaps there is more readily available labour in North Battleford. The city council was very excited to have us join

H

their community on a greater degree.

PN: What will happen with your Lloydminster manufacturing employees?

GI: Some employees are actually commuting from nearby North Battleford every day now so those people are really excited to be relocating in North Battleford. Other employees are not as excited – they have families and roots in Lloydminster. We anticipate we will have a staff of about 70 people to start in North Battleford.

We have already hired some people in the Battleford region. We have already hired some people out of Ontario as well. We will be looking for a broad range of middle management right from QC inspection to perhaps some purchasing and some shipping and receiving – certainly welders, shop floor fabrication welders, and pressure welders.

We will be looking for pipefitters, assembly people, and people for insulator cladding, sandblasting and painting and a whole broad range of manufacturing personnel.

PN: When will you start up?

GI: We have already started. For example, today we have a consulting group that has come in to assess our current operation. They have already been to North Battleford to look at the existing building to see how we could fit the existing equipment and the product lines that we currently manufacture into the new facility to make it as efficient as possible.

PN: What is the status of new building construction near the airport?

GI: We are in the middle of a new subdivision application. We are currently going through a traffic study and a water and drainage review. There will be other properties involved in the subdivision. There will be several properties subdivided off a large piece of property. These other parcels will be available to other businesses. The earth has been moved and compacted and ready for winter construction so we can move in the spring.

PN: Do you plan to further expand your facility in North Battleford?

GI: It’s a very large facility. Our goal is to relocate, get ourselves organized and see what shakes out of that. We know we can grow our company.

We have several technologies that we have introduced over the years. We have a number of new technologies that we are introducing to light oil in Saskatchewan and Alberta – heating technology. We really see significant growth in the heating of light oil without using pressure vessels and treating facilities and so on – heating light oil in a single tank production system.

PN: Where else do you conduct business?

GI: We currently have a sales office in Chicago, Illinois; we have a sales office in Niagara Falls and we have rep agencies (distribution network) throughout the U.S. and representation in places like Fort St. John and Drayton Valley and other parts of Western Canada. We certainly have growth in mind.

We are currently expanding into Wabasca in Alberta, building a facility there for trucking and for A-Fire and so on.

PN: What kind of shop have you had in North Battleford the last few years?

GI: We have an approximately 20,000 sq.-ft. shop in Battleford where we’ve been manufacturing for five years. We have been primarily manufacturing repetitive manufactured products. At this point, we don’t have our engineering body there; we don’t have our R & D department there. It’s all repetitive manufacturing.

When we do move to North Battleford, we will be moving our engineering department there. We will be moving a lot of high end senior positions to North Battleford. We will be bringing some new opportunities to the city and they are certainly excited to have us come.

PN: How many employees will work at the Lloydminster airport complex?

GI: We have the trucking company, Grithog Trucking Company (Grithog Sand Control Systems) that’s on the same site. There are going to be no changes there at all and they are expanding into Wabesca. With our sales group and our combustion technicans and electrical groups and so on, we will have about 60 employees there.

PN: Where is the site of the new manufacturing facility in North Battleford?

GI: In the industrial park on the eastern side of North Battleford, there is a 12 acre parcel of land with a 92,000 sq.-ft. building and 15,000 sq.-ft. of out buildings. It was an existing facility that was vacant for two years since the downturn.

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C5

SAGD proposal to challenge the Battlefords Denis Lavertu, director of business development for the City of North Battleford, showed Pipeline News the new manufacturing site for Grit Industries Inc. in Parsons Industrial Park.

Story and photos

by Geoff Lee North Battleford – Sometimes you’re the windshield and sometimes you’re the bug.

That was the situation City of North Battleford officials found themselves in on a memorable good news, bad news day on Oct. 19.

That morning, the city celebrated an announcement by Grit Industries Ltd. to relocate their manufacturing divisions from Lloydminster to a site at Parsons Industrial Park with Premier Brad Wall on hand to join the applause for the 70 jobs expected at startup.

Two hours later, Mayor Ian Hamilton got a phone call from Maple Leaf Foods’ head office informing him the company would be closing their bacon processing plant in North Battleford in 18 months, putting 332 people out of work.

The mood would have perked up had the city known Rallyemont Energy Inc. also picked Oct. 19 to announce that in the wake of a successful exploration drilling program, they plan to facilitate the development of a 5,000 to 10,000 barrel per day commercial SAGD project at Prince.

By comparison, the Maple Leafs Foods downsizing was a corporate restructuring move with little connection to the construction boom and heavy oil potential that have put the city on the map.

“Unfortunately, some of it is the news such as the closure of our plant,” said Hamilton. “We became very much national news, but we are also identified and noted in national magazines for the progress and stuff that is going on with development.”

There are nearly $1 billion worth of major construction projects on the go in the area including a $750 million, 260 megawatt natural gas power generating plant

by Northland Power called the North Battleford Energy Centre in the RM of North Battleford.

Last year, SaskPower completed its $250 million Yellowhead Power Station, a 138 MW peak load power plant located in Parsons Industrial Park.

Work is also forging ahead on the $50 millionplus Credit Union CUplex with four individual buildings housing a new curling rink, an aquatic centre, a field house and a centre for performing

arts.

In addition, the city is on pace to set a new building permit record of $100 million in 2011, and the province is pledging to build a new $100 million Saskatchewan Hospital by 2015.

The city is also poised to become a regional service centre for the emerging heavy oil and gas industry. ɸ Page C6

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C6

PIPELINE NEWS December 2011

Losing bacon plant, gaining factory Éş Page C5 Rallyemont Energy Inc., based in Saskatoon, recently wrapped up its exploration drilling and testing on its 83 sections of land 20 miles north of the city on the site of historical wells drilled in the 1950s.

The private Saska-

toon-based company just submitted an Environmental Project Proposal to the Saskatchewan government for a steam assisted gravity drainage (SAGD) project.

Allstar Energy Ltd. is also drilling on Red Pheasant First Nation land south of the Battlefords. The company

reported on Oct. 28 that ďŹ ve more heavy oil wells have been brought into production, bringing the total to six.

Allstar Energy is a private subsidiary of 49 North Resources in Saskatoon that has an equity stake in Rallyemont.

In a featured story in Saskatchewan Oil Report

2011, 49 North CEO Tom McNeill predicts North Battleford will reap enormous economic beneďŹ ts from a heavy oil industry that the city is starting to experience. â&#x20AC;&#x153;First oďŹ&#x20AC;, we are see-

ing a lot more business development around the service side,â&#x20AC;? said Denis Lavertu, the cityâ&#x20AC;&#x2122;s director of business development. â&#x20AC;&#x153;One thing Iâ&#x20AC;&#x2122;ve noticed is hours of opera-

tion, where itâ&#x20AC;&#x2122;s not the typical Monday to Friday business any more.

We are starting to see businesses that are opening later and are available after hours.â&#x20AC;? ɸ Page C7

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PIPELINE NEWS December 2011

C7

Tank builder grows Éş Page C6 Lavertu said G.L.M. Industries in Battleford is ramping up to hire another 60 workers in booming oil tank market. Leading Manufacturing Group in Vermilion also has plans to establish a similar plant adjacent to G.L.M. Lavertu said the city has no problem recognizing the potential from heavy oil production in the area and wants to be prepared for it. â&#x20AC;&#x153;We are seeing a lot of interest in new hotel development and a lot more retail and commercial, so we are seeing that growth as well,â&#x20AC;? said Lavertu. â&#x20AC;&#x153;We want to make sure we continue to stay diversiďŹ ed. Things like agriculture are still important. â&#x20AC;&#x153;You know that agriculture is doing well and the community is doing well, when every single car dealership is doing an expansion and adding one new too.â&#x20AC;?

The city is also working hard to ďŹ nd another compatible tenant or use for the Maple Leaf Foods plant as quickly as possible to ďŹ nd employment for those who will lose their jobs. â&#x20AC;&#x153;The grieving has not ended over that issue,â&#x20AC;? said Hamilton. â&#x20AC;&#x153;Thatâ&#x20AC;&#x2122;s a very signiďŹ cant impact on us and I have already started working on mitigating that. â&#x20AC;&#x153;You roll with that stuďŹ&#x20AC; and we are very optimistic that we will be able to transition that property to good use.â&#x20AC;?

Meanwhile, with an eye to attracting more long term companies like Grit, the city is moving ahead with plans to service another 14 acres of industrial land in the Parsons subdivision starting next spring.

Grit is moving into a 91,000 sq.-ft. building formerly occupied by Peak Manufacturing and will step up production of its Cold Weather division product line of natural gas dry line heaters and its G55 containment systems for multiple industry applications. â&#x20AC;&#x153;The unique things about Grit Industries is their innovation and thatâ&#x20AC;&#x2122;s what got us really excited and why we pursued them with vigor once they approached us,â&#x20AC;? said Lavertu. â&#x20AC;&#x153;With Grit, they are in a utility market with their Cold Weather technology. Itâ&#x20AC;&#x2122;s more utilitybased than oil and gas related so they are very diversiďŹ ed.â&#x20AC;?

The ongoing construction of Northland Powerâ&#x20AC;&#x2122;s $750 million, 260 megawatt base load power generating plant in the RM of Battleford has resulted in major economic spinoffs in North Battleford with up to 400 construction jobs on site earlier this year. The plant is expected to employ 25 to 30 fulltime people once it goes into operation in 2013.

Grit plans to create a training facility for youth at their new plant, combining classroom and handson training instruction in partnership with Northwest College and other local educators.

Job growth will also come from the replacement

of the 100-year-old Saskatchewan hospital with a 188-bed mental health facility.

Construction is nearly completed on the $8 million privately operated Harwood Manor for assisted living care. ɸ Page C8

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PIPELINE NEWS December 2011

G.L.M. Industries Inc., a company that makes oil tanks in Battleford, could be joined by competitor Leading Manufacturing Group from Vermilion, which has plans to establish a tank building operation across from G.L.M. The Battlefords are poised for further oilÀeld growth if heavy oil exploration north and south of the area switches to the production mode as expected.

Oil & gas important to north Battlefords future ɺ Page C7 “We still have significant jobs in the healthcare industry. That’s a very significance employer,” said Hamilton.

“We do have a diverse economy and we are very grateful for that because of the boom and the bust so to speak, and

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the ebb and flow of specific industries.

“Oil and gas is going to be important to the future of North Battleford. We are certainly well aware of the potential reserves that haven’t been proven yet but are known to exist just north of us.

“I think we will benefit greatly from it in a lot of ways that will be new to us because we haven’t got a lot of experience in this area.”

The city is already benefiting from new retailers at Frontier Mall with its Highway 16 frontage and the growing buzz about the Credit Union CUplex in the southeast commer-

cial district.

“When that is done, we feel our regional trade is going to increase and our ability to attract workers is going to increase dramatically,” said Lavertu.

North Battleford is building a variety of new housing to attract new families.

The city is servicing 40 new residential lots in the Fairview subdivision this fall, and a private developer is preparing to build another 43-lot subdivision.

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C9

ADM sowing its oilseeds for biodiesel

By Geoff Lee Lloydminster – Archer Daniels Midland Company plans to become an energy player in Alberta powered by the canola oilseeds that it processes in Lloydminster.

ADM announced on Nov. 14 that construction of a 265 million litre biodiesel plant will begin in the spring of 2012 which will boost ADM’s North American biodiesel production by 50 per cent.

The work will generate about 100 construction jobs and add 12 new full-time positions at ADM when the work is completed in the fourth quarter of 2013.

The project, named Northern Biodiesel Limited Partnership, is a joint venture between ADM and Canadian Bioenergy Corporation, a pioneer in the marketing and distribution of biodiesel, and a leader in the development of renewable fuels policy in Canada.

The new biodiesel plant will be located next to the existing canola processing plant and follows the construction start in March of five new storage bins and a second receiving system that will double ADM’s seed receiving capacity.

Canadian Bioenergy reported it began negotiating with ADM to build and operate the canola-based biodiesel production facility in Lloydminster back in April 2009.

“This new biodiesel facility will help support canola crush margins and capacity utilization at this facility,” said Mike Livergood, ADM vice-president, global oleochemicals, in a news release.

“The same agricultural processing operations we use to transform canola into oil for food and meal for animal feed also provide ADM with the ability and scale to efficiently produce cleaner-burning, renewable biodiesel.”

Typically, biodiesel production consists of reacting fats with an alcohol and a catalyst in a slightly agitated, pressurized and heated environment.

Biodiesel produced

at ADM’s facility in Lloydminster will help fulfil Canada’s renewable diesel fuel commitment.

Since July 1, 2011, all diesel fuel and heating oil sold in Canada must contain at least two per cent biodiesel.

Alberta’s Renewable Fuels Standard requires five per cent renewable alcohol in gasoline and two per cent renewable diesel in diesel fuel.

Saskatchewan introduced the Renewable Diesel Act in March that calls for fuel distributors to include a 2 per cent renewable diesel in diesel fuel sold in the province by July 1, 2012.

Biodiesel reduces the level of several pollutants in diesel fuel such as sulphur dioxide, carbon monoxide and carbon dioxide.

“Biodiesel represents a smart investment for ADM and for Canada,” said J.P. Montalvo, commercial manager at ADM’s Lloydminster facility.

“A robust Canadian biodiesel industry diversifies the fuel supply, provides environmental benefits and fosters increased local demand for canola, which creates value for rural communities.

“We look forward to working with canola producers to help meet Canada’s desire for renewable biodiesel.”

Canadian Bioenergy notes on its web site that it is also committed to working with local canola growers, oilseed processors and other partners to develop an integrated industry in the region to support the new ADM plant with the production of valueadded renewable fuel.

ADM also produces ethanol from its food crop processing plants in the U.S. Alberta Premier Alison Redford was scheduled to attend the Canadian Renewable Fuels Summit to be held in Calgary Nov. 28 to 30.

The renewable fuels industry in Canada generates $2 billion in economic activity each year and has created more than 14,000 jobs in total – most of those in rural Canada.

At the same time, renewable fuels produc-

tion will help to reduce greenhouse gas emissions by over 4.2 megatonnes. This is the equivalent of taking over one million cars off the road each and every year.

The ADM canola processing plant in Lloydminster will construct a new plant to produce 265 million litres of biodiesel fuel from canola oil seeds. The project will be completed in late 2013.

Photo by Geoff Lee

C10

PIPELINE NEWS December 2011

MERRY CHRISTMAS & BEST WISHES IN 2012

PIPELINE NEWS December 2011

C11

Alberta drives Maverickâ&#x20AC;&#x2122;s seismic services Â&#x201E; By Geoff Lee Saskatoon â&#x20AC;&#x201C; The anticipated construction of the Keystone XL pipeline through parts of Alberta and Saskatchewan could generate short-term reclamation work for Maverick Construction Ltd. based in Saskatoon and Red Deer.

The construction of the pipeline by TransCanada Corporation that awaits U.S. regulatory approval could also increase the demand for Maverickâ&#x20AC;&#x2122;s specialized low impact seismic line clearing services in Western Canada. â&#x20AC;&#x153;Once the XL goes through, then aside from supplying the crude plants and the ďŹ nishing plants, there is just so much more to be able to push down the line,â&#x20AC;? said Ron Bodnar, Maverickâ&#x20AC;&#x2122;s Saskatoonbased president. â&#x20AC;&#x153;The demand will be so much bigger for all of the areas. The need is going to shoot sky high.

â&#x20AC;&#x153;Thatâ&#x20AC;&#x2122;s what we are just looking into right now. We want to keep in tune with the XL given that itâ&#x20AC;&#x2122;s crossing part of Saskatchewan.â&#x20AC;?

Maverick has completed numerous contracts for the oil and gas, mining, agricultural, forestry and municipal markets including a lot of municipal road building and brush clearing for camps and lease sites this year.

The company has a growing ďŹ&#x201A;eet of specialized mulchers and shredders that minimize impact to the environment while achieving the highest productive results. â&#x20AC;&#x153;We have the perfect machines to do work for the XL line,â&#x20AC;? said Bodnar. â&#x20AC;&#x153;They need to reclaim everything once the line is in. With the machines we have, we can â&#x20AC;&#x2DC;sub soilâ&#x20AC;&#x2122; with our machines, meaning we can get down a little deeper in the ground. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s fantastic, and then they can capture

all of the topsoil; put it oďŹ&#x20AC; to the side; do their work with the pipelines, and then when they are all done to reclaim it, they just simply have to put that topsoil back. â&#x20AC;&#x153;All of the seeds and all of the mulch are all there so that helps.

Of course, they will go ahead and do their own reseeding as well.â&#x20AC;?

Maverickâ&#x20AC;&#x2122;s forte is seismic mulching and brush clearing with the demand for fall and winter seismic programs continuing to pick up, especially in Alberta. ɸ Page C12

Maverick Construction continually upgrades its Ă eet of low impact mulchers for fall and winter line clearing in Alberta and Saskatchewan.

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PIPELINE NEWS December 2011

Tons of seismic in Sask. ɺ Page C11 “The demand has been stronger this year without question than through the slow period – so much so that a lot of clients were looking at their programs much earlier this year,” said Bodnar.

“We were getting calls this spring for fall programs. There’s lot of action, however; Alberta is still king for us.

“Wherever they are sending their seismic crews to in Alberta, there are more trees in those areas than there are in Saskatchewan. We have a following in Saskatchewan, but Alberta certainly sets the pace.

“There is a lot of seismic activity in Saskatchewan, however; there aren’t a lot of trees in certain seismic projects.

“When BHP Billiton and everyone on the potash side is going hard, there are a lot of areas where there just aren’t any trees. They can go by avoidance then. That’s why we are very busy in Alberta.”

Maverick has also established strong business relationships with First Nations and energy clients exploring for oil and gas on reserve land in Western Canada.

Exploration companies rely on seismic programs to help locate oil and gas reserves and use the services of companies like Maverick to cut brush through forested areas to lay out access lines.

The lines allow energy and other resource companies to survey the subsurface geology using shock wave reflections with 2-D or 3-D tools.

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For the energy sector, 3-D seismic tends to result in fewer dry holes, more optimized well locations, guidance for horizontal drilling projects and a more complete evaluation of mineral rights than 2-D. “There is a difference between 2-D and 3-D seismic, but in both cases, they need lines cleared so that can locate their drill point or shot points,” said Bodnar.

“There is a variance that a lot of companies will allow, so that we can pick damaged areas to cut or areas that are not as vivacious. It can be done very selectively on a grid system.

“The 3-D system is really a grid system. The 2-D program is just a variety of long lines that could range from one to 17 kilometres.”

A couple of different lines are required for clearing to allow an exploration company to access their shot points to drill to proper depths to put their loads in. A line is also needed for access to tie the detonation wires to the shot point for a 3-D system.

“We have machinery that allows us to go in and cut lines at a very minimal disturbance,” said Bodnar.

“We cut by avoidance, so we don’t cut the healthier trees.

“We have specialized mulchers in our fleet in different widths and horsepower depending on what the client needs. We can cut right to the ground or leave it as a brush. With mulching you cut the vegetation and it stays on the ground.”

Maverick has recently expanded its operations in Saskatoon, and is in the process of moving its Alberta base from Sylvan Lake to a larger shop in Red Deer.

“The big thing is, we have realigned all of our equipment again in both provinces and we service B.C. as well. We have purchased new equipment and the bank knows it too,” said Bodnar with a laugh.

“We are finding you have to have a more diverse quantity of equipment now for mulchers. ɸ Page C13

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C13

Important to have the right machines Éş Page C12 â&#x20AC;&#x153;You have to have the appropriate sizes; you have to have the appropriate ground pressure, the appropriate horsepower, and the appropriate widths. â&#x20AC;&#x153;Our clients are more attuned to the environmental parameters than they have ever been before for public relations and environmental situations.

It all starts with that terrible publicity we are getting from the states about dirty oil,â&#x20AC;? he said. â&#x20AC;&#x153;All of the industry associations are supporting that itâ&#x20AC;&#x2122;s not dirty oil.

Itâ&#x20AC;&#x2122;s important when we are ďŹ rst up

that we too have a positive impact,â&#x20AC;? said Bodnar.

Safety always plays a key role at Maverick that ensures their equipment operators have a good understanding of their GPS navigation equipment to create lines that avoid hazards such as side slopes. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s very important on a seismic program to lead the drills â&#x20AC;&#x201C; where we go is where the drills go,â&#x20AC;? said Bodnar. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s important for us to take the path for the drill into a safe area. Thatâ&#x20AC;&#x2122;s why itâ&#x20AC;&#x2122;s important to have good GPS equipment and a good understanding

of it.â&#x20AC;?

Bodnarâ&#x20AC;&#x2122;s safety message follows the Oct. 7 death of a 35 year old seismic worker from Choiceland, Sask., who was killed when the drilling unit he was operating near Turin, Alta., hit a rock and ďŹ&#x201A;ipped over on top of him.

A 22 year-old helper reportedly suďŹ&#x20AC;ered some minor injuries when he was thrown clear of the unit and was quickly released from hospital. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a terrible situation,â&#x20AC;? said Bod-

nar. â&#x20AC;&#x153;That was a situation where he wasnâ&#x20AC;&#x2122;t in the bush. â&#x20AC;&#x153;He was in the open, but that type of thing can happen in the bush too.

We want to make sure the drills and the wire guys have a safe line to walk on and drive on. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s really important to have the proper machines and the units to scout lines and check lines. We call it QC (quality control). Lines are checked then they are mulched.â&#x20AC;?

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PIPELINE NEWS December 2011

Husky hungriest for low salt diet recipe

By Geoff Lee Lloydminster – There were a lot of Husky Energy employees in attendance at the November technical lunch of the Lloydminster chapter of the Society of Petroleum Engineers.

Their interest was piqued by guest speaker Richard McFarlane from Alberta Innovates Technology Futures and his topic titled, Low Salt Diet for Heavy Oil and Bitumen Upgraders and Refineries.

His topic was derived from his discoveries from a Suncor-sponsored research project aimed at developing a more effective way to desalt bitumen.

McFarlane is a team leader for the petroleum processing group at Alberta Innovates and he is the inventor of a new non-aqueous desalting technology for Suncor.

The desalting of crude oil is an important first step for the reliable and safe operation at all upgraders and refineries.

“Salts are a great source for corrosion in refineries so when you have corrosion, you have the danger that a pipe or a tank will perforate, fluid will leak out

Heavy oil and oilsands research scientist Richard McFarlane from Alberta Innovates - Technology Futures came to Lloydminster in November to speak about his research for Suncor on a desalting alternative to water to remove salt chlorides from bitumen.

and cause a fire or explosion and loss of life,” said McFarlane.

Chloride salts, such as sodium chloride present in crude oil even at five parts per million, can lead to plugging of downstream equipment and high pressure drops.

The conventional method of desalting light oil, heavy oil and bitumen is to basically wash the oil with fresh water to extract the salty water droplets from the crude oil.

“We want to remove these droplets containing sodium chloride and other dissolved chlorides because they have the potential to cause corrosion in tankage, pipelines and upgraders and refineries,” said McFarlane.

The salts can also plug exchangers and cause catalyst fouling and poisoning at refineries.

The objective of desalting is to meet the basic sediment and water specifications for separating produced water from oil to meet pipeline shipping specifications.

“When the oil gets to the refiner or upgrader, the objective there is to protect the plant from corrosion. So absolutely, you have to get the salt and chloride down to a manageable level,” said McFarlane. ɸ Page C15

M

y r r e

s i r Ch

s a tm

PIPELINE NEWS December 2011

C15

Methanol the key ingredient to replace water ɺ Page C14 something different. Water is not The effectiveness of convenworking. What else do we have tional desalting with water is not around that we can use? as good with heavy oil and bi“We tried a whole bunch of tumen as it is with light oil for different things, and eventually good reason, said McFarlane. that led us to using methanol.”

“It is tough to desalt heavy The list of solvents tested oil because in the conventional includes glycerol, ethylene glyprocess that uses water, the wacol, ethanol, propanol, butanol ter and the bitumen have about and pentanol in diluted bitumen the same density, so you can’t use called dilbit. gravity to separate them very ef“Methanol is great because ficiently. it has a large density difference “Also heavy oil has much compared to heavy oil and bituhigher viscosities than light oil,” men,” said McFarlane. said McFarlane, who noted the “It also doesn’t have the tenwater washing method was dedency to form a nice ‘salad dressveloped for light oil then tweaked ing’ type emulsion the same way for heavy oil and bitumen. water does.

“As well, water has a ten- Mike McIntosh, left, chair of the Lloydminster chapter of the Society of Petroleum En“The advantage of methanol dency to become an emulsion gineers, presents a gift to Richard McFarlane who delivered a technical presentation. is that as far as we can see, it is a with heavy oil and bitumen just McFarlane was the guest speaker at the November technical lunch. His presentation very robust solvent for desalting like your vinegar oil salad dress- focused on new bitumen desalting research he headed for a Suncor-sponsored proj- heavy crude and bitumen. ing can form an emulsion that ect at Fort McMurray.

“It seems to work under all doesn’t separate very quickly. the conditions that tend to trip “The main problem with heavy oils is that they to settle.” up water based desalting process. It seems to have contain things like naphthenic acids. These are preThese observations led to McFarlane’s research a wide range of operating conditions – temperature cursors to surfactants and surfactants are things that to find a solvent other than water that would desalt and pressure and different types of crude oil,” he stabilize water in oil in that emulsion,” he explained. bitumen and heavy oil more effectively, with the re- said.

“You also have lots of asphaltenes and fine solids sult being methanol.

McFarlane says methanol is typically produced that both act as films around the water droplets. The “We didn’t latch onto it right away,” said Mc- from natural gas that Suncor can readily source if the droplets never coalesce or grow to a significant size Farlane. “We just said to ourselves, we have to try project becomes commercially viable. ɸ Page C16

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C16

PIPELINE NEWS December 2011

Capital infrastructure needed to recover and recycle methanol ɺ Page C15 “One converts natural gas, which is essentially methane in a steam methane reformer, to synthesis gas and then converts that synthesis gas to methanol,” explained McFarlane.

“Suncor has steam methane reformers which they use to produce

hydrogen, so they know how steam methane reformers work. They are producing synthesis gas right now on their way to producing hydrogen.

“All they would need to do is put in a reformer to produce methanol and they are away,” said McFarlane.

On the downside, methanol is costly to produce and must be recov-

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ered and recycled to be cost effective on a commercial scale.

“You need a capital infrastructure.

To do the recovery process, it costs energy to recover it and recycle it,” he said.

McFarlane notes his research into methanol is applicable to heavy oil refineries in more ways than just being a replacement for conventional desalting with water.

“The second way is in applications where one is trying to reduce the acidity of crude oil and crude oil fractions.

That means taking acids out of the crude,” he said.

“Another way is taking dissolved hydrogen sulphide and mercaptans (sulphur containing organic chemical substances) that give you that stinky smell in crude oil – for example kerosene and jet fuel.

“It is not desirable that they have high levels of naphthenic acids or to

have a strong odour.

“Using methanol with caustic to wash these crudes appears to be more effective than using water and caustic to wash these crudes,” said McFarlane.

A simple caustic wash does not work. The naphthenate salts are too soluble in the crude oil.

McFarlane says he is excited about the technology and looks forward to a decision by Suncor to fund the next phase of development and continue his research.

“It’s in their hands now to begin to move this forward,” he said.

“They have some preliminary work to do internally. We are just waiting on how they want to move this forward.

“I think this project we are working will be one of their aces in a hole down the road when they start to look at managing the salt within their refinery and upgrader.”

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C17

MicroSeismic’s frac data links to 3-D modeler Denver, Colo. – Two heads are better than one.

That adage prompted MicroSeismic Inc. (MSI) and NSI Technologies LLC to collaborate on a cost effective engineering and software solution to better monitor hydraulic fracking in unconventional oil and gas developments – with many Canadian clients onboard.

Both U.S. based companies believe their collaborative effort could shift the standard unconventional oil and gas development paradigm from “horizontally drill and frac” to “horizontally drill, design, frac and monitor.”

By following this new business model, operators can incorporate microseismic fracking data acquired through MicroSeismic’s proprietary BuriedArray technology with NSI’s 3-D fracture software modelling tool called StimPlan to better manage their frac programs.

“For the fracturing monitoring, NSI has a lot of expertise they can apply to the data that we’ve selected,” said Chris Neale, MicroSeismic vice-president of business development.

Neale was attending the SPE Annual Technical Conference and Exhibition in Denver, Colorado where he was contacted by phone on Nov. 1.

“The industry is pushing to see more than where the microseismic events are occurring, but to try to understand what these events are telling us about the frac, and how it’s interacting with the formation,” he explained.

MicroSeismic has a Calgary office where it manages frac monitoring activities primarily in shale gas plays such as the Horn River basin in northern British Columbia.

“We have a permanent array up there that we are doing frac monitoring with, and we are doing temporary jobs in the Bakken and the Montney,” said

Neale.

The Montney shale gas play is located in northeastern B.C., but the monitoring technology being used by MicroSeismic and NSI can also be used in light oil applications with horizontal well fracking.

“Our first job that we did with NSI actually was in the Bakken (U.S.). We took a well that we had frac monitored.

“They did the stimulation work to try to discern more information on flow paths and drainage areas,” said Neale.

“We are active in all of the unconventional active basins that are being tested throughout Canada.”

Neale says the major cost benefit of the collaborative technology with NSI is being able to conduct microseismic monitoring for hydraulic fracturing over a large area very cost effectively.

“Our competitors generally have to have a well bore close to the well that is being fracked in order to monitor it, whereas, we can go out with either a temporary surface array or a permanent buried array,” said Neale.

“It’s very cost effective relative to the competition which is why we have become the largest microseismic monitoring company in the world by revenue.”

MicroSeismic’s technology provides real-time information on fracture location and geometry, helping operators increase production and recovery while decreasing cost and risk.

NSI is a global technology company providing software, training and engineering solutions for the design and analysis of well stimulation programs.

Through the application of its innovative solutions, NSI helps operators worldwide to maximize their well performance while lowering expenditures Chris Neale, vice-president, business development for MicroSeismic Inc. and reducing their environmental footprint.

Photo submitted

ɸ Page C18

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C18

PIPELINE NEWS December 2011

This is an illustration of a MicroSeismic Inc.’s BuriedArray installation that collects data from a geophone array and processes it to show how fractures are propagating during the frac job in real time. MicroSeismic has teamed up with NSI Technologies LCC on an engineering and software solution to better monitor hydraulic fracking in unconventional oil and gas developments.

Image submitted

Watching a frac in real time ɺ Page C17 Combining MicroSeismic and NSI technologies will enable oil and gas companies to integrate their completions engineering, production modelling and microseismic monitoring data in order to optimize their completions programs and significantly enhance recovery.

“How much does it cost to frac a well – about $2.5 million – so companies are realizing if they don’t monitor it, they don’t know if their fracs are working right,” added Kelly Weber, MicroSeismic’s director of online marketing, who was speaking at the Denver event.

“They don’t know if they are getting it done correctly. If you monitor it, you can actually see where there are going.

“What we are planning to do is allow clients to take advantage of their microseismic data and apply that to StimPlan to see the results of their lateral frac.”

The partnership approach will allow NSI to substitute bottom hole pressure data that is missing with lateral horizontal fracs with MicroSeismic’s seismic data into NSI’s 3-D modeling of fracs in horizontals wells.

“The historic basis for hydraulic fracking calibration, for lack of a better word, for fracking models has been the use of bottom hole pressure data,” said Michael Smith, NSI’s chief technical officer and cofounder who was also in Denver.

“But the mechanics of horizontal wells with fractures crossing the horizontal well pretty much invalidate the pressure data.

“So we are somewhat running our models blindly. We are just having to come with various properties that go into the model and trust that we are right.

“You need some verification, and an historical verification is being denied. There’s where the buried microseismic approach comes in,” said Smith.

MSI’s BuriedArray microseismic data acquisition service is touted as being ideal for operators who need to monitor multiple wells and need monitoring over a longer period of time.

The ability to monitor large areas can lead to more strategic field planning and development.

“The BuriedArray technology gives us multiple chances to do this so we are not dependent on one single event – we can get several that we can hopefully use throughout an area,” said Smith. ɸ Page C19

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C19

Monitoring fractures can save money ɺ Page C18 “Now we have a good solid basis for taking this geologic model and extending it over a broad area.”

MicroSeismic’s, BuriedArray microseismic data service employs an array of geophones permanently installed and buried near the surface to monitor areas ranging from 40 to 1,300 square-kilometres.

This monitoring service uses the company’s proprietary Passive Seismic Emission Tomography, or PSET technology, which collects data from the geophone array and processes it to show in real time how fractures are propagating during the frac job.

“We are monitoring the sounds of rock as they break during stimulation,” said Weber.

“We can see exactly where they are going. One of the benefits of that is knowing how far they are they extending from the wellbore, and if they going anywhere near anything that might be an environmentally sensitive area.”

Weber says more Canadian companies are seeing the benefits of microseismic monitoring with proven results coming from the U.S. “There are tremendous amounts of unconventional shale plays up there. Monitoring your fractures can save money,” she added.

Smith thinks NSI’s collaborative solution with MicroSeismic can be extended to any application of horizontal wells including the Bakken light oil play in southeastern Saskatchewan.

The company already has several large clients like Apache, Devon and Shell in Canada.

“I don’t think it’s particularly applicable to shale gas but to any area being exploited using horizontal wells and fracking,” he said.

“The application for us is any area where we are denied our pressure data.”

MicroSeismic Inc. ran presentations at their company booth at the SPE Annual Technical Conference and Exhibition in Denver, Colorado Oct. 28 to Nov. 1. The U.S. company has had an ofÀce in Calgary for the past three years and a steady volume of work in Western Canada, primarily in the Horn River shale gas play in northern British Columbia.

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PIPELINE NEWS December 2011

Allstar, Rallyemont issue

By Geoff Lee Saskatoon – Tom McNeill, CEO of 49 North Resources Inc. based in Saskatoon, could be bang on when he said North Battleford’s position in the provincial oil boom would be “enormous” in a feature report about his company’s activities in the area for Saskatchewan Oil Report 2011.

Allstar Energy Ltd., a private subsidiary of 49 North, brought five net heavy oil wells onto production in October on the Red Pheasant First Nation lands south of the city.

The company has now successfully drilled six vertical wells at its Red Pheasant properties covered by its Indian Oil and Gas Canada subsurface permit.

“The recent wells at Red Pheasant were a huge success in continuing to prove our theory that the Manville sands in the area are regionally extensive,” said Ashley Drobot, president and CEO of Allstar

Energy in an Oct. 28 operational update.

Allstar has an agreement with Red Pheasant granting it exclusivity to explore and drill over 32 sections of highly prospective heavy oil land.

The Saskatoon-based company reports it also successfully drilled and completed five (3.5 net) new horizontal Viking light oil wells in the Kindersley area since its previous update.

“We are extremely happy with the continued success at Kindersley and the results are consistently meeting or exceeding our expectations,” said Drobot.

49 North also has an equity stake in Rallyemont Energy Inc., that has wrapped up its extensive exploration program at Prince near North Battleford and has submitted an Environmental Project Proposal to the Saskatchewan government for a 5,000 to 10,000 steam assisted gravity drainage (SAGD) project.

The next steps include detailed engineering, de-

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sign and development.

This news follows a McDaniel & Associates Consultants Inc. estimate of Rallyemont’s proven plus probable (2P) reserves at 20.1 million barrels on its 100 per cent owned and operated property at Prince.

The McDaniel report on Sept. 30 also indicates 53.5 million barrels of Best Estimate contingent resources, an increase of 86 per cent from the previous estimate in 2010.

Taking into account both the 2P reserves and the estimate of contingent resources, Rallyemont was able to increase its so-called P50 estimates by 157 per cent from the previous year’s report.

The industry defines P50 reserves as those are estimated to have a better than 50 chance of being technically and economically producible.

The latest evaluation took into account Rallyemont’s entire land package of approximately 83 sections of land with a 99 per cent working interest.

McDaniel reviewed approximately 115 historic drill holes in and around the company’s lands that contained core and/or log information.

In addition, McDaniel used new geological information collected by Rallyemont at the Prince property, including 21 new drill holes, 132 kilometres of 2D seismic and 34 square-kilometres of 3D seismic.

McDaniel also consulted trade seismic and numerous geological, environmental, and engineering studies.

Rallyemont will continue to explore its development options to facilitate a SAGD project including internal developments, joint venturing, or divestment. ɸ Page C21

New oil and gas production operator graduates coming on stream in December

Oil and Gas Production Operator CertiÀcate The oil and gas industry is expanding in Saskatchewan and SIAST can help prepare your future employees. SIAST partnered with the Northern Alberta Institute of Technology (NAIT) and CANSAFE to offer oil-and-gas related skills and occupational health and safety training, employment readiness tutorials, job search techniques, resume writing, interview skills and communication skills. Upon completion, graduates receive

a NAIT Oil and Gas Production Operator Level 1 certiÀ cate, eleven OH&S certiÀ cates including H2S, First Aid/CPR, WHMIS, ConÀ ned Space – Levels 1 and 2, TDG, BISK, Ground Disturbance, Fire Extinguisher Level 1, Fall Arrests, Defensive Driving and a SIAST Statement of Attendance. Graduates from our 2009 and 2010 programs are successfully working in the industry throughout Saskatchewan and Alberta.

For more information, contact: Les Erikson: (306) 765-1719 or erikson@siast.sk.ca SIAST encourages applications from people of Aboriginal ancestry, people with disabilities, visible minorities and women interested in non-traditional occupations. SIAST is pleased to partner with:

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PIPELINE NEWS December 2011

C21

breakthrough news Éş Page C20 For internal development, Rallyemont has completed preliminary engineering work, including a scoping level study for a 5,000 to 10,000 barrel per day capacity SAGD plant, as well as reservoir and rail transportation modelling.

Rallyemont is a private Saskatoonbased heavy oil company engaged in the exploration and development of thermal enhanced oil recovery projects in west-central Saskatchewan.

Allstar meanwhile, has acquired two provincial exploration licences covering 9,600 and 5,760 acres respectively, with various rights from the surface to Precambrian in west central Saskatchewan.

Allstar now controls approximately 31,486 acres of land with 100 per cent of the rights to explore for, and develop petroleum and natural gas.

The company also has approximately 640 acres of land with 50 per cent ownership of the natural gas rights.

Automated Tank Manufacturing is please to announce the employment and appointment of

Blaine Ross as Vice President of Operations.

Blaine brings with him in excess of 35 years experience in the oil patch and fabrication industry.

Tempco Drilling in Nisku, under the direction of general manager Eric Lang, has done a lot of exploration drilling for Allstar Energy Ltd. at Red Pheasant First Nation south of North Battleford and for Rallyemont Energy Inc. at Prince, north of North Battleford. Allstar now has six vertical producing wells at Red Pheasant. Rallyemont has submitted an Environmental Project Proposal to the Saskatchewan government to facilitate the development of a 5,000 to 10,000 barrel a day SAGD project.

File photo

Automated Tank Manufacturing Inc.

4601 49th Ave. Kitscoty Phone: 780.846.2231 1.866.616.2271

www.autotanks.ca

C22

PIPELINE NEWS December 2011

ATM parties with its milestone client Story and photos

by Geoff Lee Kitscoty, Alta. – Loyalty has its rewards.

For purchasing the first 1,000 barrel tank made by Automated Tank Manufacturing Inc. in July 2008, Avalon Exploration Ltd. from Calgary was given the opportunity to buy the

1,000th such tank this November.

The production milestone triggered a party at ATM’s tank plant in Kitscoty on Nov. 22 hosted by general manager Joe Bowser with Richard McKenzie, vice-president engineering for Avalon as the guest of honour.

“Avalon was my very first customer,” said Bowser. “They came to us on a phone call, and I had an opportunity to go to Calgary and sit down and meet Richard and ask him to give us a chance to prove ourselves and he took the chance.

“He has just been an incredible client all the

With Gratitude we want to Thank You for your Business and offer our Warmest Wishes for a blessed Holiday Season and a Prosperous New Year

way through ever since.

His company has grown along with our company.”

Avalon has purchased more than 70 tanks from ATM, but the 1,000th tank was a special edition ready for delivery featuring Avalon’s logo and a silver coloured enviro-vault and gold coloured taps for oil, water and sand hauling.

“It’s looks great,” said McKenzie. It’s got some pretty good looking jewelry in there in too.”

Avalon is a privately owned company with a total production of about 2,200 barrels of heavy oil a day from its core properties in and around Lloydminster, Lashburn and Maidstone.

The company produces about 350 bpd in the Lloydminster area and 1,200 bpd near Lashburn with a new growth property at Soda Lake south of Maidstone currently producing about 440 bpd.

McKenzie says he likes ATM’s just-in-time automated manufacturing and delivery process and Bowser’s personal commitment to customers like him.

“We are a tiny shop.

We are four guys and three women in Calgary.

When we needed him, he’d be there,” McKenzie said.

“Often we don’t have time to plan exactly when we need tanks like larger companies do, and we are flying by the seat of our pants from time to time.

“When I pick up the phone and Joe answers the call, they’ve always got one of two tanks for us.”

McKenzie paid nearly the same $45,000 price for the 1,000th tank that he paid for the first tank that ATM produced on July 18, 2008.

“It’s cheaper today probably by 20 per cent,” said Bowser, who relies on automatic tank manufacturing using robotic welders for cost saving.

“While steel and pipe and other costs have gone up, we have been able to save significant amounts of money and labour, and negotiate significant savings on volume buying of pipe and valves.”

ATM will build more than 900 tanks this year in 750, 1,000 and 2000 barrel sizes with the help of robots.

“Our forte is 750s and 1000s. We build 2000s when we have time and the opportunity. Right now we are dead out building 750 and 1,000 barrel tanks,” said Bowser.

Production is expected to increase with the addition of a new plate shop and a crane in February or March in 2012 and the ongoing redesign of the justin-time manufacturing process.

“It’s like everything.

Automation used to be a thing of the future and now it’s a reality of the present,” said Bowser. ɸ Page C23

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Robotic plasma cutting ɺ Page C22 “In the present, we can’t stop revisiting the automation that we have and improve on it and develop new techniques that are going to take us further with better production and a higher level of quality.”

ATM plans to make a partial technology changeover to robotic

plasma cutting on a CAD based system that will feed blueprint information to the robot for defined cuts and positioning on each tank.

“I just came back from Chicago and finished negotiating with three different companies for the type of equipment that we want to integrate,” said Bowser.

“OTC Daihen is a big part of that technology, along with Hypertherm.

“These companies will be working with us on the equipment and the robotics. In-house we design everything ourselves to create the efficiency based on what we’ve learned from the past.” ɸ Page C25

ATM general manager Joe Bowser holds the paid invoice of the Àrst 1,000 barrel oil tank produced and paid for by Avalon Exploration in Calgary in July 2008. ATM threw a party on Nov. 22 to mark the production and sale of its one-thousandth 1,000 barrel tank – to Avalon.

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PIPELINE NEWS December 2011

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PIPELINE NEWS December 2011

C25

Something special for 1000th tank Richard McKenzie, vice-president engineering for Avalon Exploration, left, shakes hands with ATM general manager Joe Bowser during the milestone delivery of this 1,000 barrel tank bearing Avalon’s name. Avalon bought the very Àrst 1,000 barrel tank produced by ATM in July 2008.

ɺ Page C23 ATM made just 68 tanks in its first year of manual production in 2008 and 171 in the second year when the automated manufacturing process went into operation.

“It was a crawl at the front end. We were building this plant when the economy was going backwards,” said Bowser.

“We continued to accelerate and go forward based on what we thought was right.

“We had lots of difficulties and struggles in the engineering, design and development of what we were doing as people were saying it couldn’t be done.

“Needless to say, 21 months ago, we went into full automation. Those that said it couldn’t be done are now looking at us and saying ’um,” said Bowser.

ATM started with just six employees and has grown to more than 54 shop and production workers operating on three 24/7 shifts six days a week.

“The market is very strong for us right now. It’s been strong for us over the past 20 months because of the type of company we are,” said Bowser.

“We manufacture just-in-time which means we work to other companies’ drill programs rather than build them and store them on our facilities.

“As we produce them, they leave our lot and go directly to new drills where we build them as replacement tanks or we build them as storage tanks.”

Bowser says he called McKenzie two and a half months ago with word the production and delivery of the one-thousandth 1,000 barrel tank could be timed for Avalon’s drilling and production program.

“He was punching a hole this week, and I had the 1,000th tank just finished getting painted and insulated outside,” said Bowser.

“We did that up a little special for him because it is the 1000th.

“It’s built as well as every other tank we have built on our site. We’ve stuck their name on this one.

To us, it’s a special day and a special moment.

“Avalon is a good account and a good client and special people because they were with us at the very beginning.”

Thank You to Our Customers.

We Wish You and Yours a Joyous Holiday Season

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C26

PIPELINE NEWS December 2011

PIPELINE NEWS December 2011

Equal sells non-core assets Equal Energy Ltd. has entered into definitive agreements to sell several non-core properties in Canada for a total cash consideration of $49.35 million.

Proceeds from the asset dispositions will be used to reduce outstanding debt.

“We are pleased to advance the sale of non-core assets with the intention of improving our balance sheet and providing additional financial flexibility for Equal,” Don Klapko, president and CEO, said in a news release. “The assets are not the focus of further development by Equal. Equal will continue to develop its key oil plays in the Alliance Viking and Lochend Cardium in Canada, and its liquids-rich gas play in the Hunton formation of Oklahoma."

The definitive agreements relating to the asset dispositions are subject to normal risks of closure and adjustments to price under conventional terms typical of this type of sale. The asset dispositions are anticipated to be completed by Dec. 1, 2011.

The asset dispositions include properties in Alberta, Saskatchewan and British Columbia and compromise total current production of about 2,100 boepd, of which 51 per cent is natural gas.

Upon closure of the transactions, Equal expects to realize lower operating costs and interest expense resulting in improved cash netbacks per unit of production on the remainder of its assets. Equal estimates that its net asset value will be approximately the same after the completion of the asset dispositions. The company anticipates its second half 2011 production to range between 9,200 to 9,700 boepd, after taking into consideration the dispositions.

During 2011 Equal drilled nine oil wells in the Alliance Viking play, three oil wells in the Lochend Cardium play, and is currently drilling the last of 13 wells in the Hunton liquids-rich gas play (six horizontal and seven vertical wells). All wells are either on production or will be before year end.

Drilling in Canada is expected to resume in late December and in Oklahoma in January 2012.

The company said the core areas of Alliance Viking, Lochend Cardium and Oklahoma Hunton will continue to be the focus of its capital program during 2012.

Additionally, Equal said it has amassed a significant acreage position on a new Mississippian light oil play in Oklahoma that exists on acreage held by production from certain of its Hunton fields. The company plans to continue consolidating acreage prospective for the Mississippian while it considers options to begin development of the play during 2012.

Titan Production Testing is hiring day and night supervisors to operate test vessels for work in Southeast Saskatchewan and Southwest Manitoba. Titan is a fast growing company in an exciting area of oil production. We offer competitive wages and group benefits.

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C27

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PIPELINE NEWS December 2011

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PIPELINE NEWS Saskatchewanâ&#x20AC;&#x2122;sPetroleum Petroleum Monthly Monthly Saskatchewanâ&#x20AC;&#x2122;s

Advertising Sales Manager Lloydminster OfĂ&#x20AC;ce Deadline: December 15, 2011 Remuneration: B.O.E. Pipeline News is seeking an energetic self-motivated person to lead its Lloydminster ofĂ&#x20AC;ce. Pipeline News is a provincial monthly oil and gas newspaper with circulation of over 28,000.

Job Description: - Advertising Sales - Client Visits - Cold Calling - After Sales Support - Working with Graphics Department - ProoĂ&#x20AC;ng - Ensuring Proper Booking Dates - Ensuring Overall Client Satisfaction - Pre Press - Ensuring All Advertisers Are Accounted For - Giving Okay To Pre Press - OfĂ&#x20AC;ce Duties - P.O.S. Machine - Subscription Sales - Managerial Duties - Monthly Conference Calls - Developing Sales Strategies - Revenue Growth Job Requirements: The winning candidate will have the following: Previous Advertising Sales Experience - Great attitude - Enthusiasm - Self-Motivation - Professional Appearance - Valid Driverâ&#x20AC;&#x2122;s License - Reliable Vehicle Pipeline News offers a competitive salary or commission based remuneration program complete with health and dental beneĂ&#x20AC;ts.

If you are interested in this position please email your resume, complete with cover letter and references to: Brant Kersey Email: brant_kersey@yahoo.ca Subject Line: Pipeline News Ad Manager Position

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Dynamic and rapidly growing company Premium compensation package New equipment 3 weeks vacation to start

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Safety-focused Team oriented Clean Class 1 license an asset. Must have Class 3 or 5 (training provided)

Paid technical and leadership training Career advancement opportunities Paid flights for rotational program Seasonal work programs available

We thank all applicants; however only those selected for an initial interview will be contacted.

How to apply: email: hr@canyontech.ca fax: (306) 637-3379 website: www.canyontech.ca

Construction Supervisors!!!

Jerry Mainil Ltd is an oilĂ&#x20AC;eld construction company that services Southeast Saskatchewan, and is currently looking for a CONSTRUCTION SUPERVISOR We are looking for a team oriented employee who has a clear understanding of facility construction and/or pipelining.

This employee would be responsible for: - Leading a team of crews, operators, and labourers - Liaising with customers to determine their needs and requirements - Ensuring our employees adhere to company and customer rules, policies, and procedures - Ensure all work is performed safely and Regulations are being adhered to The successful candidate would have: - Experience in pipeline construction and/or facility construction/ maintenance - Strong organizational skills to align manpower, tools, equipment, and project resources - The ability to multi-task.

- Understanding of the Saskatchewan Boiler Branch regulations and Z662 would be an asset.

We will offer a wage based upon experience and ability, a charge out bonus, as well as a group beneĂ&#x20AC;ts package and pension plan. You will also be home every night, along with a rotating weekend schedule.

If youâ&#x20AC;&#x2122;re interested in applying for this position, please email your resume to jon@jmlc.ca, or fax (306) 842-6560.

You can check out our website at www.jerrymainilltd.com

PIPELINE NEWS December 2011

Oilfield Battery Operator Local oilfield company looking for experienced Battery Operator in Estevan/ Weyburn area.

Career Opportunities

Must have current safety tickets and clean drivers abstract.

Environmentally safe working environment.

Competitive Wages.

Resumes held in strict confidence.

Mail resume to: Box 730B Estevan, SK, S4A 2A6

Warehouse/Shippers Receiver Loader Operator/Yard Person Duties include: Receiving and shipping of oilfield material. Delivery of materials to company locations. A valid class 5 driverâ&#x20AC;&#x2122;s license with a clean drivers abstract is required. Willing to train motivated individuals. Overtime required.

Candidates must have: - A proven track record of achievement.

- A passion to become a partner in a growing company.

- A ability to excel in a fast-paced, creative environment.

- Experience an asset but willing to train.

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Call John or Ginette 1-888-875-8111 or Send Resume to Fax: 780-846-0005 Email: actiontowinglloyd@hotmail.com

Interested applicants please forward resumes Attention: Ken Wallewein Fax: 306-634-2797 E-mail: ken.wallewein@apexdistribution.com

Exciting Opportunity in one of Canadaâ&#x20AC;&#x2122;s 50 Best Manages Companies.

Apex Distribution Inc. is a dynamic, employee owned oilfield supply and service company nationally recognized as one of Canadaâ&#x20AC;&#x2122;s 50 Best managed companies. We are committed to providing superior customer service to the oilfield markets of Western Canada. We are looking to fill the following positions in Estevan, SK. Apex Distribution is focus on producing dramatic results for our investors, customers and manufacturers. The organization has developed a technically diverse team recognized for high levels of customer service.

We expand our business as market conditions dictate and pursue opportunities that best fit all our stakeholders.

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Now Hiring

JOURNEYMAN AND APPRENTICE ELECTRICIANS Also hiring helpers with no experience. Will train and apprentice those interested in becoming an electrician Call, fax or email to apply: Brad Grimes Lampman Electricic LTD. P.O. Box 277, 114 Main Street Lampman, SK, S0C 1N0 Phone: 306-487-3273 Lampman â&#x20AC;˘ 306-637-2512 Estevan Fax: 306-487-3276 Bradâ&#x20AC;&#x2122;s cell: 306-487-7770 Email: bradgrimes@sasktel.net

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

Experience: 1 year (preferred) Safety Certificates are needed. 1st Aid/CPR, H2S, WHMIS. Applicants must have a valid driverâ&#x20AC;&#x2122;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.

International Employment

D&D

Location: Middle East

OILFIELD RENTALS

For the following positions:

Field Supervisors, TMX Operators, & Flushby Operators

A vibrant & growing company Is hiring for the following positions at our Weyburn SK location:

Coil Operators Coil Helpers Essential Coil & Stimulation Services is a company recognized for safety and excellence within the oil & gas industry.

We currently provide services throughout Alberta & Southern Saskatchewan. Class 1 driverâ&#x20AC;&#x2122;s license is preferred, but all class of drivers are welcome to apply. Previous oil Ă&#x20AC;eld experience & valid tickets are an asset.

Essential offers above average wages, job bonuses, employee savings plan, group beneĂ&#x20AC;t plan, scheduled days off & training will be provided for the right candidates.

Great employees are Essentialâ&#x20AC;Ścome see what we have to offer!

Fax, email or drop off your resume & current drivers abstract jtimko@essentialcoil.com Fax: 403-580-8906

Minimum QualiÂżcations Field Supervisor: â&#x20AC;˘ 10 Years Well-Servicing Experience â&#x20AC;˘ 5 Years Coiled Rod Experience â&#x20AC;˘ Strong computer skills â&#x20AC;&#x201C; MS OfÂżce Flush-By Operators: â&#x20AC;˘ 5 Years experience of hands on PCP and reciprocating artiÂżcial lift systems â&#x20AC;˘ 2 years in a supervisory or lead role â&#x20AC;˘ Good mechanical aptitude â&#x20AC;˘ Strong computer Skills â&#x20AC;&#x201C; MS OfÂżce TMX Operators: â&#x20AC;˘ 2 years coiled rod experience â&#x20AC;˘ 5years OilÂżeld Service experience All positions: â&#x20AC;˘ Require & possess a valid passport â&#x20AC;˘ Willing to work rotation in a isolated environment â&#x20AC;˘ Able to adapt in a multi-cultural environment Rotation: 28 days in/ 28 days out Salary: Dependant on experience

Contact: AGrimley@NPSDover.com Only those contacted for an interview will be considered

D&D Oilfield Rentals is an oilfield equipment and tool rental company operating out of Alberta and Saskatchewan. D&D offers an array of equipment and services derived from customers and industry requirements.

D&D is currently looking for a Pump Runner/Truck Driver out of Weyburn, SK. This position safely participates in all transportation and other operations of the company, including, but not limited to: Â&#x2021; .HHSLQJ D GDLO\ GULYHUV ORJ Â&#x2021; /RDGLQJ XQORDGLQJ HTXLSPHQW Â&#x2021; 3LFN XS DQG GHOLYHU VXSSOLHV DV QHHGHG Â&#x2021; 'DLO\ PDLQWHQDQFH JUHDVLQJ FKHFNLQJ topping fluid levels) Â&#x2021; $VVLVW LQ UHSDLUV IXHOLQJ XS DQG PRUH The successful candidate will possess the following: Â&#x2021; $ELOLW\ WR SURYLGH H[FHOOHQW FXVWRPHU VHUYLFH Â&#x2021; 'HDGOLQH GULYHQ ZLWK JRRG WLPH PDQDJHPHQW VNLOOV Â&#x2021; $ELOLW\ WR EH ´RQ FDOOÂľ ZRUN ZHHNHQGV RU RYHUWLPH when required Â&#x2021; \HDUV UHODWHG H[SHULHQFH Â&#x2021; +LJK 6FKRRO GLSORPD RU HTXLYDOHQW Â&#x2021; $ FOHDQ GULYHU¡V DEVWUDFW DQG YDOLG GULYHU¡V OLFHQVH &ODVV RU

D&D offers competitive wages, a comprehensive benefits package effective on your first day of work, and an RRSP contribution program.

Search jobs and submit your resume Online at: http://savanna.appone.com Email to: savannacareers@savannaenergy.com

C30

PIPELINE NEWS December 2011

Wanted Immediately

Precision Well Servicing in Estevan is currently looking for a dynamic individual to the fill the position of:

Personnel Recruiter Working in a fast paced environment, primary duties include interviewing, screening candidates and conducting orientations for employment on well servicing rigs. This involves communicating both in person and over the phone.

The ideal candidate will enjoy working with people, excel in a team atmosphere, work well under pressure and have exceptional multi-tasking, communication and data entry skills.

To apply for this position: Fax your resume to 1-403-206-2503, email to LTriffo@precisionwellservicing.com or apply online at www.precisiondrilling.com

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

Contract Production Operator Advantage Oil and Gas Ltd. is an intermediate oil and natural gas corporation with properties located in Western Canada. The Company’s head office is located in Calgary, Alberta, Canada.

Advantage Oil & Gas Limited is currently seeking a permanent full time contract operator to work in the Estevan area. The successful candidate will work closely with the Production Foreman/Superintendent and Production Engineer to optimize Oil and Gas production and minimize the cost of operations as well as adhere to our Health and Safety Program. This position reports directly to the Production Foreman.

Key Responsibilities: • Supervising service companies.

• Evaluate daily production volumes.

• Developing a good working relationship with internal departments.

• Providing support to ensure corporate and government regulations are followed.

• Preparing documentation for daily and weekly production reporting.

• Participate in our Safety program including our “Hazard Identification” program.

Driver/Operator for a Mix on Site Cement Truck Must hold a valid Class 1A or 3A license and valid safety certificates. Class 1A preferred.

Good starting wage and competitive benefits package.

Fax or e-mail resumes to: 306-634-9123 prairierathole@sasktel.net

Employment Opportunity

Qualifications: • A minimum of 5 years’ experience required in oilfield operations.

• Applicants require mandatory safety training.

• Comprehensive working knowledge of producing oil wells and surface equipment.

• Well-developed communication skills and project management skills are a must.

• Applicants must possess a valid driver’s license.

is an industry leader in Safety Services and is currently seeking

Safety Personnel to keep up with increasing customer demands.

If you are interested in becoming part of the Target Team and enjoying our growth with us, let us know!

Qualified applicants should direct their resume in confidence to: Attn: Darren Delorme Advantage Oil & Gas Ltd. Fax: (306) 842-1004 or Email: ddelorme@advantageog.com We thank all applicants for their interest in this position; however, only those candidates selected for an interview will be contacted.

Please forward resume with copies of tickets to: resumes@targetsafety.ca or fax to 780-870-5359

INSPECTORS NEEDED Precision Rentals in Estevan is currently looking for an:

We have been awarded the opportunity to supply a number of Inspectors to upcoming Main Line Pipeline Projects.

Equipment Service Technician Responsible for performing maintenance on surface equipment and well site units. You’ll be involved in pipefitting, minor welding, small plumbing, electrical repairs and minor carpentry. Requirements: Valid Class 5 Drivers Licence with current Drivers Abstract, hard working and positive attitude with an interest in the drilling industry.

Precision offers competitive pay, excellent benefits and progression opportunity.

Please apply by phone (306) 634.8050; in person at 97 Panteluk Street to Kevin Bowey, or email resume to KBowey@precisiondrilling.com or visit the Careers section of our website at:

www.precisiondrilling.com

We are looking for all levels of Facility and Pipeline Inspectors. Please email your resume to: PERMANENT FULL TIME POSITIONS AVAILABLE • Picker Operator • Picker Helpers • Truck Driver Requirements 1A License (Class 5 for helpers) Drivers Abstract OilÀeld Tickets an Asset Submit resume and drivers abstract to: Email: grimessales@sasktel.net Fax: 306-487-2560

info@tircanada.com

We are currently looking for • Chief Inspectors

• Utility Inspectors

• Senior Inspectors

• Civil Inspectors

• Welding Inspectors • Coating Inspectors • Electrical & Instrumentation Inspectors TIR Canada Inc. Suite 501 - 5920 Macleod Trail SW Calgary, AB T2H 0K2 Office: 403•263•3929 Fax: 403•258•0444 Email: info@tircanada.com

Construction Management Inspection Safety

PIPELINE NEWS December 2011

Career

now hiring TRUCK DRIVER (WINCH EXPERIENCE AN ASSET)

PICKER OPERATOR SWAMPER INQUIRIES CALL: 306-487-8120 FAX RESUME TO: 306-487-2296

HUTT’S

TRUCKING LTD.

C31

Opportunities Fax: (780) 872-5239

Career opportunity Grit Industries Inc. following position:

Welder “B” Pressure Job Duties (amongst others): • Weld on pressure vessels and pressure piping, • Weld pressure components, • Conduct repairs, modiÀcations and retroÀts • Fabricate specialty projects, • Meet and maintain company quality standards, Requirements (amongst others): • Alberta or Interprovincial CertiÀed Journeyman Welder • B Pressure CertiÀcation • Valid driver’s license, • Able to read and follow fabrication drawings • Small bore: all position, max thickness ticket for smaw welding process We offer above average wages

Please send resume and salary expectations to: Janice Van Berkel, Human Resources Manager via email at: jvanberkel@gritindustries.com, or via fax at: (780) 808.8415 We thank all applicants for your interest.

However, only those considered for an interview will be contacted.

WWW.GRITINDUSTRIES.COM

is seeking a

MACHINIST / CNC OPERATOR

Do you want to work for a progressive company that takes safety seriously and uses today’s newest technologically advanced equipment? If your answer is “yes”, we are interested in talking to you!

We are currently seeking to fill the following positions in the Provost, Consort and Lloydminster areas.

Well Servicing Division

Slant Rig Crew for Contract Work All applicants must have a valid driver’s license, as well as all of the required industry training for the position they are applying for.

We offer higher than industry standard wages, an exceptional employee benefits package, several employee incentive programs and unlimited opportunity for advancement.

If you want to grow with a company where you are known by your name and not your employee number, please forward your resume to:

CWC WELL SERVICES Box 1360 3803 52nd Ave Provost, AB T0B 3S0 E-mail: vanessahahn@cwcwellservices.com

Quality people delivering quality service.

Irwin’s Machining & Welding is a progressive, growth orientated company located in Oxbow, (southeast) Saskatchewan that provides manufacturing and repair services to the oilÀeld and agricultural industries.

We offer:

* Competitive Wages & Commission * Comprehensive BeneÀts Package: Life & Disability Insurance, Medical including Prescription drugs, Dental & Eye coverage. * RRSP retirement plan * Annual Fitness allowance * Quality focused & Team environment * Performance based bonus system * New CNC machines to work with

QualiÀcations:

* Minimum Level 2 Apprentice; Journeyman an asset. * Pipe cutting & CNC experience preferred * Valid Driver’s licence We require people who possess a positive attitude, excellent work ethic and are able to problem solve and use critical thinking skills in a team orientated environment.

Interested candidates submit resumes with references

by January 6, 2012 to: Human Resource Manager

Email: michelle@irwinsmachine.com

C32

PIPELINE NEWS December 2011

NOW HIRING

Career Opportunities Permanent Full Time Positions

CREW FOREMAN/PIPELINE FOREMAN Wage negotiable depending on experience and qualifications. Safety certificates required (H2S, Confined Space, First Aid/CPR, TDG, Ground Disturbance Level 2). Minimum 5 years oilfield experience.

EQUIPMENT OPERATOR Class 1A license would be an asset. Applicants should be familiar with oilfield work/construction. Applicants must have safety tickets - H2S, Confined Space, First Aid/CPR, TDG. In this position you will operate trackhoes, backhoes, graders, cats, etc.

LABOURERS Wages negotiable. Safety tickets required (H2S, Confined Space, TDG, CPR and First Aid) Interested applicants can apply in person, mail or fax resumes to:

McGILLICKY OILFIELD PARTNERSHIP #6 Hwy 39 East, Box 843, Estevan, Sk. S4A 2A7 â&#x20AC;˘ Fax: 634-4575 No phone inquires please.

Frontier Peterbilt Sales Ltd. Lloydminster

Estevan

View All Careers at: www.frontierpeterbilt.com Frontier Peterbilt Sales Ltd. is an enterprising truck dealership with operations in Saskatoon, Regina Lloydminster and Estevan. Our ongoing development and phenomenal growth in the Truck Sales industry are evidence of the company's commitment to offering customers a comprehensive range of products which perform at optimum efficiency and provide valuable benefits.

We have built a high level of customer trust and satisfaction through our new and used truck inventory and parts availability and reliability, strong geographic presence, premium service, and unparalleled value. We have a strong mandate to continue to grow in the marketplace and to provide quality service for sales, repairs, and maintenance.

Frontier Peterbilt Sales Ltd. continually offer opportunities for our employees' career development, we have created an organization and a working environment aimed to attract, empower, reward, and retain the most dedicated, talented, and passionate individuals.

Lloydminster

xHeavy Duty Technician Estevan

xHeavy Duty/Truck & Transport Technician xUsed Truck Representative xService Manager xNew Truck Sales Representative

These positions offer a competitive and comprehensive compensation package.

Apply online today at: www.frontierpeterbilt.com While Frontier Peterbilt appreciates all applications received, we advise that only candidates under consideration will be contacted. Thank you for your interest for employment with Frontier Peterbilt Sales.

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

Rotational Opportunities Weâ&#x20AC;&#x2122;re hiring rotational employees for our Western Canada operations.

3-weeks-in, 2-weeks-out field positions:

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2-weeks-in, 2-weeks-out maintenance positions:

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PIPELINE NEWS December 2011

C33

Career Opportunities WE ARE EXPANDING

L & C Trucking “Serving the Oil Patch for 55 Years”

Picker Operators • Bed Truck Operators • Truck Drivers • Swampers Competitive wages, health plan, safety tickets an asset, but will train.

Apply in person with resume or fax or email to:

24 Hwy 39 E Estevan Attention: Norm Mack Fax: 634-8699 Email: LCNorm@sasktel.net Resumes held in strict confidence

REQUIRED IMMEDIATELY -Rig Managers -Operators -Derrickhands -Floorhands

We are a leader in the industry offering ABOVE-AVERAGE WAGES, pay structure increases for 1A/3A license, performance/safety incentive bonuses, excellent benefits package, training and career advancement.

Class 1A/3A license, safety certifications are required.

Fax your resume to (306) 842-3402 or submit your resume to t.morken@southernrange.ca Box 895, Weyburn, SK S4H2L1 Phone: (306) 842-3401 www.southernrange.ca

HEATER OPERATORS Needed for high volume frac Åuid heating company.

Competitive base salary, job bonus and living allowance.

Clean driver’s abstact, H2S and First Aid required Class 1A or 3A License required Please phone John (306) 861-6065 or Fax resume to (306) 842-1251

We are taking applications for a

FULL RIG CREW

WORK BASED OUT OF ESTEVAN - BENEFITS AVAILABLE - WAGES ABOVE INDUSTRY STANDARD

-

APPLY TODAY! In person: 1009A 6th Street, Estevan Fax: 634-7754 Email: cliff@grimeswell.com www.grimeswell.com

C34

PIPELINE NEWS December 2011

Resources Guide

Quality

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

Call Linda for more information TERRY DODDS (24 hrs.) (306) 634-7599 Cell. (306) 421-0316

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

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

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

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

lancew@aspentrailer.com www.aspentrailer.com

Cordell Janssen District Manager Downhole

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

Lance Wotherspoon Regional Sales Manager

[T] 403 236 2244 [F] 403 236 8829 [C] 403 813 6319 [Toll Free] 877 236 2244

93 Panteluk Street, Kensington Avenue N Estevan, Saskatchewan PHONE: 306-634-8828 â&#x20AC;˘ FAX: 306-634-7747

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cordell.janssen@nov.com â&#x20AC;˘ www.nov.com

Lloyd Lavigne â&#x20AC;˘ Kirk Clarkson Owners/Managers 5315 - 37th Street Provost, AB T0B 3S0

6506 - 50th Avenue Lloydminster, AB

Phone: (780) 875-6880

Phone: (780) 753-6449

Fax: (780) 875-7076

A S E E L SERVICE S â&#x20AC;&#x2122; D G I B Backhoe Towing Mowing Fencing Snow Removal Road Grader Gravel Supplies & Hauling

24 Hour Service Specializing in Industrial & Oilfield Motors

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

P.O. Box 544 Stoughton, Sask. S0G 4T0

(306) 457-7033 (306) 457-7673

Dwight G. Blomander, 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

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

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

Life Licence sponsored by The

Great-West Life ASSURANCE COMPANY

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

NorseStar Ventures Inc.

LECLAIR TRANSPORT General OilďŹ eld Hauling

Light OilĂ&#x20AC;eld Hot Shot Steam Truck Services Box 208

(306) 621-7621 (306) 457-8283

Estevan, SK

S4A 2A3

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

Lyle Leclair Cell: 306-421-7060

PIPELINE NEWS December 2011

C35

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 Steamer truck available immediately. Air, cruise, tilt / telescoping steering, air ride drivers vinyl seat and RHS vinyl toolbox seat, Paccar PX8 300 HP engine, Allison 6 speed 3500 Rugged Duty Series transmission, 13.2K front (Limited 3 year axle warranty), 40K rear air suspension, 5.57 gear ratio, air brakes, suspension gauge, two piece roped in windshield, polished Alcoa wheels, 100 gallon LHS fuel tank, 75 gallon RHS fuel tank. Chassis may not be exactly as shown, completion - mid January.

2011 Kenworth T170 OilďŹ eld Service Truck - air, cruise, tilt / telescopic steering, Paccar PX6 300 HP engine, 6 speed Allison 1000 Rugged Duty Series Transmission, 8 K front suspension (Limited 3 year axle warranty), 13.5K rear spring suspension with limited slip diff. 4.56 gear ratio, polished Alcoa wheels, 45 gallon fuel tank, vinyl air cushion driver seat, riders seat is vinyl with toolbox, am/fm/cd radio, power RHS door window, manual LHS door window, dual halogen projector style headlights.

Fully rigged with ITB 24' Van Body with Pumps and Pressures Interior rigging, call for more details. Full Tilt Deck package included - c/w Fassi 80 crane.

$112,500

2011 Kenworth T370 Septic Truck - Air, Cruise, Tilt / telescopic steering, heated mirrors, air brakes, cloth seats, am/fm radio, polished aluminum wheels, power RHS window - manual LHS window, Halogen projector style headlamps, air horn, 196" W.B., PACCAR 300 HP PX8 Engine, 10 speed Eaton manual transmission, 12K front and 21K rear air suspension, 4.78 gear ratio.

- Fully rigged with Edmonton trailer 1600 Gallon septic tank with Wallenstein 753 HRVAP pump system

2012 Kenworth T370 Mechanics Body Truck - Available approx. 1st week of January. Air, Tilt / telescoping steering, heated mirrors, am/fm - cd radio, power windows LH and RH, vinyl air drivers seat, PACCAR PX8 300 HP engine, Allison 6 speed Rugged duty series transmission, 14.6K front (limited 3year warranty), 23K rear air suspension, air brakes, Painted white heavy duty rims, 56 gallon fuel tank, stainless steel sunvisor, halogen projector style headlights. Fully rigged with Full Tilt Dominator 2 Mechanics body with 10,500 lb crane and reciprocating hydraulic drive 35 CFM air compressor.

d l so 2012 Kenworth T800 - 62" ACF ďŹ&#x201A;at top sleeper, Red in color, Cummins 525 HP Engine, 18 Speed Eaton transmission, 13.2K Front suspension, 46K AG460 rear air suspension, 3.91 gear ratio, 224" W.B. Diff locks - fwd and rear axles, polished Alcoa wheels, 100 gallon LHS and 120 gallon RHS fuel tanks with polished 7" tank straps, premium air cushion high back cloth drivers seat, sun-roof, remote keyless entry, moto heated mirrors, LED stop / turn / tail lights.

2012 Kenworth W900L Tractor - 72" ,Blue in color, Aerocab Aerodyne Sleeper - VIT interior sleeper with refrigerator, TV, sofabed, am/fm/cd,satellite, Cobra CB, - Cummins 525 HP Engine, Eaton 18 speed manual transmission, 12K front suspension, 46K rear air suspension, 3.91 gear ratio, forward and rear axle diff locks, 244 W.B. polished Alcoa wheels, 135 gallon LH tank, 110 gallon RH tank, 4 spoke leather steering wheel, Sears Atlas Ultraleather air suspension driver and passenger seats and sunroof.

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

780.871.0950

Happy Holidays from the Management and Staff of Kenworth Lloydminster WE AT KENWORTH LLOYDMINSTER ARE PROUD TO BE PART OF THE HEAVY OIL INDUSTRY.

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PIPELINE NEWS December 2011

One of the Real Joys of the Holiday Season is the Opportunity to say

Thank You to our Loyal Customers

We Wish E veryone The Very Best In The New Year!

Drill Collar & Drill Pipe Recuts

WELLHEAD FLANGES REAMER SUBS

Thread & Rethread of Casing C-VICES

FAVA FLOW SURE VALVE

TUBING DRAINS

ROD BREAKER

BOP TOP PLATES

BAILER BITS

· Wellhead Equipment Design,Manufacturing and Repair · Thread and Re-thread Casing, Tubing and Line Pipe · Drill Pipe and Collar Storage and Inspection · General and Custom Welding and Manufacturing · C.A.D Library of Parts · Complete Assemblies · Product Development · Rotary Connection Manufacture and Repair · Down Hole Production and Fishing Equipment Construction · Phosphate Coating Available For Finished Parts · MIG, TIG and B Pressure and Aluminum · Service and Drilling Rig Stocked Parts · Custom and Production Machining · Rapid Prototyping

ABSA Registered Conforming to ISO and API Standards • 24hr Service

780 - 875 - 6535 www.metaltekmachining.com