Pipeline News August 2012

Page 1

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

August 2012

FREE

Canada Post Publication No. 40069240

Volume 5 Issue 3

Not in Short Supply Focusing on the oilfield supply shops

1 - on - 1 with Ed Dancsok Page A4

C&B OilÄeld a family business Page B1

erhard poggemiller the man in kerrobert Page C3

The green Ɵnted man, Alex Tino, is applying a powder coaƟng to the inside of a tubular pipe at the internal coaƟng shop at Rev Energy Services in Kerrobert. Photo by Geoī Lee

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PIPELINE NEWS August 2012

INSIDE SECTION A

4

1-on-1 with Ed Dancsok

19 Do All Acquires Hyduke

7

Opinion

20 Stay Safe In The Heat

9

MRC MidĮeld Making A Splash

22 Wil-Tech Taking High Road To Service 34 Sask. Divided On CCS

15 TS&M Supply Expanding

SECTION B 1

C&B - A Family Business

15 Diesel Fuel With Fry Oil

4

Workplace Safety Rollout

17 Shell's CCS Gets Green Light

8

Rigcharge By Revamp

19 FNRM Raising Capital

10 NOV Acquires CE Franklin

SECTION C 1

Apex SoluƟons

12 Partners In Compliance

3

Erhard Poggemiller The Man In Kerrobert

15 Kerrobert Town ProĮle

6

25 Lloydminster's Colonial Days

Rev Energy Ramping Up Business

10 Two Irishmen Land Jobs With Sandpiper

26 Gibson's Simulator

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

Sept. 2012 Focus

STIMULATION/THERMAL (DISTRIBUTED AT LLOYDMINSTER HEAVY OIL SHOW)

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Stacey Powell spowell@prairiepost.com

PIPELINE NEWS August 2012

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TOP NEWS

COADC cautiously optimistic with forecast By Geoff Lee Pipeline News Calgary – The Canadian Association of Drilling Contractors is cautiously optimistic it will meet its revised forecast activity numbers for the rest of 2012. Tight equity markets, global economic uncertainty and the price of oil are the three main wild cards that could affect how drilling plays out for CAODC member companies. “For the third quarter, we do see a bit of softening because of the junior and small cap companies – the equity markets are getting pretty tight and cash flow is tightening up,” said Nancy Malone, vice-president of operations. “We haven’t seen a significant amount of rigs being dropped, so we are cautiously optimistic in terms of the utilization numbers we are projecting in Q3. “Small companies don’t have a lot of production to fall back on. “The smaller companies do a significant amount of drilling. When you look at the number of companies there are, and the number of rigs in our fleet, they are a large part of our customer base.” The second quarter ended June 30 with a utilization rate of 22 per cent, slightly above the forecasted 20 per cent for Canada. Malone thinks the forecasted 53 per cent utilization rate for the current third quarter is also achievable.

“We are pretty early in Q3. Everyone is pretty comfortable with what they’ve got booked out in terms of their equipment,” she said. “We haven’t seen any significant signs of that being any different. It’s only July 12, so we have all of July, August and September to go.” The utilization rate in Alberta had already risen to 29 per cent at the beginning of the week of July 10, while Saskatchewan’s utilization rate was 49 per cent and climbing. Malone cautioned that the price of oil, which stood at $84 in mid-July, and the economic turmoil in Europe could make it tougher for the small drilling contractors to meet their forecast drilling targets for the year. “That’s where the bank part becomes part of the equation. They are looking at the bigger picture and being a little more cautious in terms of their dollars,” said Malone. On the bright side, drilling was ramping up quickly in July with the return of hot and dry weather, but will fall short of last year’s summer frenzy. “Last year, we actually had a tremendous Q3,” said Malone. “That was mostly due to last spring – there was so much rain. There was flooding everywhere in Saskatchewan and in Alberta then there were fires. “It was sort of the biblical year last year. If it wasn’t floods, it was fires and that prevented a lot of our rigs going to work in Q2, so a lot of that work got made up in Q3.

2012 Total Number of Wells Completed (Western Canada): 11,834 QUARTER

UTILIZATION

2011 Final Numbers

ACTIVE RIGS

FLEET

2012 - 1st***

540

798

68%

48,109

2012 - 2nd

161

805

20%

14,344

2012 - 3rd

433

817

53%

38,576

2012 - 4th

456

829

55%

Average 2012

398

812

49%

OPERATING DAYS*

2011 Total Numbers of Wells Completed (Western Canada): 16,071 2011 Total Numbers of Wells Rig Released (Western Canada): 12,877 QUARTER

ACTIVE RIGS

FLEET

UTILIZATION

OPERATING DAYS*

40,625

2011 - 1st***

534

788

68%

47,495

141,654

2011 - 2nd***

190

791

24%

16,339

2011 - 3rd***

454

798

57%

40,754

2011 - 4th***

489

804

61%

40,530

Average 2011

417

795

53%

145,118

Historical Utilization 2009

2010

2011

Drilling

Util.

Drilling

Util.

Drilling

Util.

219

26%

326

41%

417

53%

Wells Drilled Rig Release

Completed

Wells Drilled Rig

Completed

Released

8,360

9,342

12,145

12,877

2009

2010

Drilling

Util.

Wells

Drilling

Util.

Wells

Drilling

Util.

Wells

351

40%

16,844

219

26%

9,342

326

41%

13,566

Completed

Released

13,566

Historical Utilization 2008

Wells Drilled Rig

“We won’t see it as significantly as it was last year – June this year was very rainy.” CAODC is also sticking with its May 29 revised lower well count that was down to 11,834 from 12,672 due to the industry trend to drill increasingly complex horizontal wells. “We are cautiously optimistic. We dropped that number slightly from our original forecast, but I think that’s a reasonable target to be achieving,” said Malone. “As drilling contractors, we’re not necessarily as fixated on the well count number as we are on the operating days. “Because of the long reach and the long horizontal wells that we drill, the operating days are staying fairly stable.” CAODC expects to realize its prediction to accumulate 141,654 operating days by the end of 2012 despite a continued labour shortage. “We would still like to recruit back some of the experienced people we lost in the last downturn – the derrick hands and the drillers that are working in different careers now,” said Malone. “We had a good last year and through this past winter we had some good activity. “I think most of our contractors have staffed up and they are hoping by getting them back to work in the summer and the fall, we will see some stability in the workforce. “There is always a need for experienced people. Our contractors continually try to recruit them back into the patch.”

16,071

Drilling and Service Activity Online or on Your GPS Check the latest status of any rig in western Canada, hunt down leads for service or supply sales and know what your competitors are up to with the Rig Locator.

Subscribe today at riglocator.ca or call 1.800.387.2446 RIGLOCATOR.CA

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PIPELINE NEWS August 2012

BRIEFS Petrobank boosts Kerrobert THAI volumes in Q2

Petrobank Energy and Resources Ltd. reports second quarter 2012 production at its Kerrobert THAI project was 236 bbls of oil per day, up from ďŹ rst-quarter 2012 production of 193 bbls of oil per day. These production volumes represent actual sale volumes for each period reported, said Petrobank. Wet weather in June negatively impacted production by preventing movement of service rigs needed for workovers on several of the company’s wells. However, during this period, it was able to maintain steady THAI oil production. Petrobank expects that oil production will continue to rise as the company maintains its balanced approach of building out the THAI combustion front. As previously reported, Petrobank has identiďŹ ed multiple opportunities to use some of the existing wells on its Saskatchewan lands for conventional cold heavy oil production. The company expects to initiate this production on ďŹ ve wells by early August.

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Briefs courtesy Nickle’s Daily Oil Bulletin

There’s still a lot of land left to prove

As a general rule, roughly 80 per cent of leased lands return to the Crown after the primary term has expired. „ By Brian Zinchuk Pipeline News Regina - In 2008, Saskatchewan blew all previous land sales records out of the water with $1.12 billion in Crown land sales. The vast majority of that, $915.7 million, was in southeast Saskatchewan, driven by the push to explore and develop the Bakken play. During the 2011 Saskatchewan Oil and Gas Show, Oilman of the Year Scott Saxberg, CEO of Crescent Point Energy Corp., revealed that Crescent Point was behind $700 million of that year’s land acquisition, buying both Crown and freehold leases. In August 2011, Saskatchewan hit an active drilling rig record on 122 rigs. In the meantime, North Dakota’s Bakken play has seen its oil production shoot past all other states except Texas. Now, four years after those phenomenal land sales, the 2008 leases are nearing their expiries. In June, Pipeline News asked the Ministry of Economy what the results have been, and what to expect. Ed Dancsok, assistant deputy minister of petroleum and natural gas for the Saskatchewan Ministry of the Economy, spoke on behalf the ministry.

levels of oil well drilling activity in 2011 and to date in 2012 suggest the amount of land allowed to lapse at the end of the ďŹ ve-year term may be somewhat less than has historically been the case. For example, a review of drilling activity on those leases due to expire in 2014 shows that approximately 85 per cent of the leases at this point do not have a producing well and will be terminated unless they are drilled by March 31, 2014. With record land sale activity in 2008, obviously it would take record drilling to equal the 80 per cent historical average. However, we’re already at 85 per cent with 21 months still to go, so there’s a reasonable chance less land will be allowed to lapse than is normally the case. Time will tell. One mitigating factor to consider is the extent to which lessees conduct development drilling on leases that already have a producing well. Economics may dictate that lessees focus more drilling activity on leases that have a producing well on them rather than drilling higher risk leases. Ultimately, it’s the company’s decision to make – drill to continue leases, or drill on lands with proven reserves. ɸ Page A5

Ed Dancsok

Pipeline News: How much of the Crown land that was leased in 2008 has been proven up? Most? All? Half? Ed Dancsok: As a general rule, roughly 80 per cent of leased lands return to the Crown after the primary term has expired. That has been the historical trend. However, high

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PIPELINE NEWS August 2012 Éş Page A4 PN: The standard expiry on a lease is ďŹ ve years. If I am not mistaken, they have to drill one well per section to prove up a lease in that ďŹ ve years, correct? ED: There are two types of dispositions in the southeast – leases and exploration licences. Leases have a ďŹ ve-year primary term after which time an annual continuance review is conducted. Exploration licences have a two-year term in the southern portion of the province, and conversion to lease is based on the level of drilling activity. If the exploration license is converted to a lease, the lessee has ďŹ ve years before continuance review, meaning seven years in total for lands sold as exploration licences. There are a number of typical reasons for continuance beyond the primary term. However, in very simpliďŹ ed terms these include the appropriate level of drilling activity and achieving production. PN: How much land could potentially come up again in 2013 that was part of that 2008 grab? ED: Technically, the correct answer here is “none.â€? Leases sold during a given year are provided a term-start date of the following April 1. Therefore, those leases deďŹ ned as sold during 2008 would have a term-start date of April 1, 2009 and would not be reviewed until 2014. Applying the 80 per cent historical factor, an estimated 395,000 hectares may be returned to the Crown in 2014. However, it should be noted the high level of drilling activity may mean something less than the 80 per cent. It should also be noted that leases selected from exploration licences sold in 2008 will not be eligible to revert to the Crown until 2016. PN: How does one ďŹ nd out which land will be available to be bid upon, and when? ED: Companies can refer to the Oil and Gas InfoMap on the Energy & Resources website. This provides shapeďŹ les for disposed Crown mineral lands, or industry can consult third party software that displays disposed Crown mineral lands. More sophisticated software programs also provide available mineral rights. The ministry website is updated daily. Third party software vendors receive monthly updates on disposition status. PN: How common is it for land that has been leased to be allowed to lapse at the end of a lease because it has not been developed? ED: It is not uncommon. As noted earlier, historically roughly 80 per cent of leased lands revert to the Crown. How-

ever, given the level of drilling activity so far in 2012, the ďŹ gure may be something less than 80 per cent this year. PN: Does the ministry expect some sort of mad dash of drilling over this year to prove up land? Or have we already seen that? ED: First, a bit of perspective. Last year – 2011 – was Saskatchewan’s second best year on record for oil well drilling. There were 3,528 oil wells drilled last year, second only to 1997 when there were 3,608. To May 31, 2012 there have been 1,110 oil wells drilled in the province. This is ahead of the pace in 2011 when there were 1,014 oil wells drilled to May 31. These ďŹ gures would seem to support the hypothesis that industry is focused more on drilling than acquiring additional lands. If present trends continue, we would seem to be on track for an outstanding drilling year where oil is concerned. That said, it should be noted we’re only ďŹ ve months into the calendar year and a good deal can happen between now and December 31. Right now, it would appear the level of drilling in Saskatchewan suggests some priority is being given to proving up land. However, over the second half of 2012, industry may still elect to focus more drilling on lands with proven reserves, which would mean a higher probability of more lands reverting back to the province. Time will tell if industry chooses to emphasize drilling expiries or development wells. PN: As of June 13, Saskatchewan has 75 active drilling rigs. Is that about on track for what the ministry expects, given a somewhat wetter spring? According to Riglocator.ca, that’s almost exactly on par with 2011 and 2010 for this time of year. ED: The short answer would be yes, that’s roughly on track. A more complete answer would note that as of June 27, 2012 there were 68 active drilling rigs in Saskatchewan and a further 64 down for a total of 132. Our active percentage was 52 per cent, the highest ďŹ gure in Western Canada and well above the national average (35 per cent). There were 135 active service rigs in Saskatchewan to June 27 and a further 63 down for a total of 198. We had the highest percentage (68 per cent) of active service rigs in Western Canada, which suggests there may be an increase in the number of active drilling rigs in due course. These ďŹ gures change on a daily basis due to weather (e.g. heavy rainfall) and other factors. For example, the modest dip from June 13 to June 27 would be due to rainfall in the active drilling areas during those two weeks. However, I think it’s fair to say they’re roughly on par with what we saw in 2011 and 2010.

Applying the 80 per cent historical factor, an estimated 395,000 hectares may be returned to the Crown in 2014.

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BRIEFS NEB to hold hearing for Maple Creek pipeline abandonment The National Energy Board (NEB) will hold a written public hearing to consider an application by Enerplus Corporation to abandon the 2.53-kilometre long Maple Creek pipeline. The pipeline, which crosses the Alberta-Saskatchewan border, was constructed in 2005 and is located approximately 48 kilometres east/southeast of Medicine Hat and approximately three kilometres east/ northeast of Walsh, Alberta, on the Saskatchewan border. The 114.30-millimetre outside-diameter pipeline carries sweet gas from Alberta wells to facilities in the Maple Creek ďŹ eld in Saskatchewan. The wells associated with this pipeline are provincially licensed. In its application, Enerplus has indicated that these wells will be abandoned, and as a result, continued operation of the Maple Creek pipeline is no longer required. Among the issues the NEB will consider are public consultation, measures taken and proposed to abandon the facilities, and potential environmental and socio-economic eects of the abandonment. Members of the public can participate in the hearing in one of two ways: by seeking intervenor status or by ďŹ ling a letter of comment.

Any person wishing to intervene in the hearing or ďŹ le a letter of comment must ďŹ le the required documents with the NEB and serve a copy on Enerplus by Aug. 29, 2012. The board will then issue the list of parties and list of issues.

Briefs courtesy Nickle’s Daily Oil Bulletin

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PIPELINE NEWS August 2012

PIPELINE NEWS

EDITORIAL

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. Publisher: Brant Kersey - Estevan Ph: 1.306.634.2654 Fax: 1.306.634.3934 Editorial Contributions: SOUTHEAST Brian Zinchuk - Estevan 1.306.461.5599 SOUTHWEST Swift Current 1.306.461.5599 NORTHWEST Geoff Lee - Lloydminster 1.780.875.5865 Associate Advertising Consultants: SOUTHEAST • Estevan 1.306.634.2654 Cindy Beaulieu Candace Wheeler Kristen O’Handley Deanna Tarnes Teresa Hrywkiw CENTRAL Al Guthro 1.306.715.5078 al@prairieng.com SOUTHWEST • Swift Current 1.306.773.8260 Stacey Powell NORTHWEST • Lloydminster Randi Mast 1.780.808.3007 MANITOBA • Virden - Dianne Hanson 1.204.748.3931 • Estevan - Cindy Beaulieu 1.306.634.2654 CONTRIBUTORS • Estevan - Nadine Elson • Estevan - Jordan Baker 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. Subscribing to Pipeline News: Pipeline News is a free distribution newspaper, but is now available online at www.pipelinenews.ca Advertising in Pipeline News: Advertising in Pipeline News is a newer model created to make it as easy as possible for any business or individual. Pipeline News has a group of experienced staff working throughout Saskatchewan and parts of Manitoba, so please contact the sales representative for your area to assist you with your advertising needs. Special thanks to JuneWarren-Nickle’s Energy Group for their contributions and assistance with Pipeline News.

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

Health care, K-12 magnets for small towns It’s great to have a Tim Hortons and a new recreation facility in the town where you live, but what really attracts and retains workers and residents to small communities in Saskatchewan is a good health care and school system. That’s the case in the town of Kerrobert where construction is underway on the new $23 million Kerrobert & District Integrated Health Centre to replace aging facilities the community has outgrown. The new centre will provide 24/7 emergency medical services and a full range of communitybased services from long-term care and occupational therapy to physical therapy and mental health and addictions treatment. Having a state-of-the-art hospital is certainly a big draw for the growing oil and gas industry throughout the Kerrobert area. Questions about health care and schools top the list of relocation inquiries to the town office. Major companies such as Enbridge, Northern Blizzard, Alliance Pipeline and Penn West can operate more securely with the knowledge emergency medical services are close by to treat any work-related injury or illness. The new centre will also attract additional high paid health-care workers following the short term economic impact of having 200 construction workers living in hotels, motels, camps and rental housing. The biggest supporters of the new health-care centre are the residents and businesses in the area that have already raised more than $4 million of the $5 million portion of the cost to the town. The fundraising effort is also a reflection of new community pride as Kerrobert rides the crest of a new

economic boom driven by the oil and gas sector. The K-12 school combined with the new healthcare centre make it easier for the town to market itself to residents and new businesses that value health care and education for their families. Without the new hospital and health clinics, residents and mobile oil workers would be forced to make a 30 to 40 minute drive to Kindersley to the south or Unity to the north on Highway 21. The new centre will provide care for all ages including 30 long-term care beds for Kerrobert seniors. Excitement and optimism over the construction start of the health-care centre is spilling over to the upcoming grand opening of the new reverse osmosis water treatment plant on Aug. 3. Saskatchewan Economy Minister Bill Boyd, whose riding includes Kerrobert, has been invited to the opening. He will talk about what the new treatment plant will mean to economic growth in Kerrobert. Last year, Kerrobert celebrated its 100th anniversary and the community is already quickly moving to establish a solid economic base for the next 100 years, led by the oil and gas industry and infrastructure improvements. When the word gets out that Kerrobert has a new health-care facility and some of the cleanest water in the province, it won’t be long before the quintessential Tim Hortons comes to town. Improvements to the existing hockey arena, the hub of winter recreation, are also in the works which will help keep the town on an economic breakaway for months to come. It’s a game plan for other like-minded communities to follow.

PIPELINE NEWS August 2012

Lee Side of Lloyd

A7

OPINION

By Geoff Lee

Alberta pipeline spills ill timed

Three noteworthy oil pipeline spills in Alberta in May and June aren’t doing the industry’s reputation any good, let alone helping to sell the proposed Enbridge Northern Gateway pipeline to British Columbians. On June 18, approximately 230,000 litres of oil spilled from a pumping station on Enbridge’s Athabasca pipeline, 24 kilometres from Elk Point, Alta. Crews are still working to clean a spill of nearly 800,000 litres of oil on May 19 from a Pace Oil & Gas Ltd. well about 200 kilometres from the Northwest Territories border, and 160,000 to 480,000 litres of oil that spilled on June 7 from a Plains Midstream Canada pipeline that ruptured beneath the Red Deer River. Environmental groups seized the series of accidents, which includes a massive spill from a Plains pipe last year, to call for a review on pipeline safety in Alberta. New Alberta Energy Minister Ken Hughes was quoted in the Calgary Herald as he claimed the reputation of the province “is governed by how we respond when incidents like this happen, how industry responds, how responsible they are.”

He went on to state, “In that respect, Alberta has a very good reputation and has very high standards.” However, environmental groups and opponents of the Northern Gateway pipeline argue it doesn’t matter how well the province responds to spills because any spill proves no pipeline is safe, no matter how many regulations are in place. Enbridge blamed the Elk Point spill on the failure of a flange gasket in the pumping station, which goes to show laws and safety regulations alone cannot prevent a spill from a mechanical fault. In 2010, the province averaged nearly two pipeline failures a day, spilling 9,350 litres. Pipeline safety is a critical issue for Alberta as the province continues its efforts to convince people in the U.S. and British Columbia that the TransCanada Corporation Keystone XL and Northern Gateway pipeline proposals can be built without causing environmental damage. Polls consistently show the majority of B.C. residents are opposed to the pipeline, in part because they fear that leaks will damage the environment. Alberta’s arguments about economic benefits for Western Canada fall short in B.C., the province of the Green Party and staunch advocates of the environment.

As a former 10-year resident in B.C. including Kitimat, the end point of the Northern Gateway project, and a former employee of the B.C. Forest Service in Nelson, it’s clear to me that British Columbians value their environment above economic development. High unemployment all over B.C. has never been a reason to keep people from staying or migrating to that province. For many B.C. residents, pipelines and the environment are mutually exclusive with little or no room for compromise. For more than 10 years, environmental groups in B.C. fought to defeat the development of the remote Jumbo Pass ski resort near Invermere on the basis it was home to at least one grizzly bear. They lost that fight, but the point is that most B.C. residents live hundreds of miles from the proposed pipeline route. As with Jumbo, they can’t see what’s in it for them, other than the fear of oil spills that keep occurring in the province next door that will benefit the most. Promising to build a safe oil pipeline through hundreds of kilometers of mountainous terrain benefit is a very tough sell in a province with the slogan, Beautiful British Columbia.

Thoughts From My Fingers By Jordan Baker

Many people still to sway for Northern Gateway Enbridge’s Northern Gateway pipeline proposal is getting some interest following a report that heavily criticized the company’s handling of their pipeline leak that dumped three million litres of crude oil into the Kalamazoo River in Michigan in July 2010. The report by the U.S National Transportation Safety Board comes out as the public and government review process continues for the Northern Gateway project. Federal NDP Leader Thomas Mulcair, who has previously established himself as an opponent of Western Canada’s oil industry, has now predicted the end is nigh for the proposed pipeline. Mulcair said he will read the federal review of the Northern Gateway proposal but that it won’t change his “fundamental” view that it’s a bad project, and that’s where Mulcair crosses the line from reasonable skepticism to covering up his ears, closing his eyes and shouting, “I’m not listening!” His job is to read that document with an open mind. Maybe inside, all the problems have a solution and the proposal is bulletproof. By saying more information won’t change his mind he’s just being a blind politician. Even so, based on the contents of the safety board’s report, along with Enbridge’s reaction to it, it would be hard to believe the project could move forward. With Enbridge’s next CEO, Al Monaco, saying they made “lots of enhancements” in “various areas of our business,” he’s just talking like a politician, by saying nothing and blowing smoke up the undersides of the media and the public. The reports into Enbridge’s pipeline fiasco in Michigan found that not only was there a leak in the

pipe, but personnel took 17 hours to respond properly to the alarms alerting them to crude being pumped into the Kalamazoo River. If Monaco only speaks vaguely of enhancements in various areas, then public confidence in these systems can’t be very high. When I hear someone speak like that, it leads me to two conclusions: the first being that he doesn’t care what anybody thinks, Enbridge is his business and he’ll run their pipelines however he sees fit, and second, there are no enhancements at all. If he had concrete solutions to the failures of the older system, things that would actually put the public’s mind at ease, it would be a great PR move to let everybody know about those. When the public is protesting the installation of further pipelines, it’s kind of in Enbridge’s best interest to give out all the information that could sway support in their favour. Enbridge is a big company with smart engineers. They have people who could figure out solutions to the problems that arose from the previous spill. I don’t question the ability of their engineers to fix the problems, but meanwhile, there have been a number of other leaks in Albertan pipelines this year. Leaks are rare, but they happen. Enbridge needs to get into specifics about how they are minimizing the risk. If projects like the Northern Gateway pipeline or the Keystone XL pipeline are going to move forward, what are the specific “enhancements” or contingency plans that will prevent three million litres of crude oil to spill into Canada’s ecosystems? When people think back to BP’s Deepwater Horizon spill in 2010, they’re reminded that it wasn’t one failure but multiple failures. Well, what kind of failsafes will be enacted on this Northern Gateway pipe-

line that will stop a multiple-sy stem failure from occurring? With the leak into the Kalamazoo River, it wasn’t just one failure. It was multiple problems. Not only did the pipe leak, but the incompetent crew also decided the best course of action was to pump more oil through it. Twice they decided the best thing to do was to pump more oil. If that’s how their employees are acting in a time of crisis, perhaps there should be an enhancement to Enbridge’s hiring practices. That’s one of the enhancements they could let us know about. Maybe it wasn’t a hiring issue but a supervision issue. Tell the public what the enhancement to supervision is. The issue of informing the public is relevant because of how it is our environments that are affected when these companies have system failures. They have to earn public trust if they wish for their projects to be embraced by the entire country. When Mulcair said he can’t see the Northern Gateway going ahead, he’s probably only saying it because the issue has been politicized and that’s the stance the federal NDP have decided to take. But I have to agree, because unless I see some of the “enhancements” I’ve been hearing so much about, and know in what “various areas” of their business these enhancements have been made, there’s absolutely no way I could support the construction of a new pipeline that is just going to fall victim to the same errors a previous one did.

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

A8

PIPELINE NEWS August 2012

PetroBakken weathers tough spring Calgary — PetroBakken Energy Ltd. provided an update on their second quarter 2012 drilling activity and production, and the company is on pace to meet production and

capital guidance for the year. Their average production in the second quarter was 38,700 boepd, based on ďŹ eld estimates, comprised of more than 14,800

boepd from the Bakken business unit, more than 15,600 boepd from the Cardium business unit, and the remainder from their Saskatchewan Conventional and AB/ BC business units.

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PetroBakken noted in a press release that the month of June wasn’t an easy one for crews as spring breakup was a rocky time again this year. “Persistently wet weather in June caused extended road bans and limited service rig and truck access, which, combined with several plant and battery turnarounds throughout the month, resulted in additional shut-in production of approximately 2,000 boepd,â€? said the statement released by PetroBakken on July 9. “Second quarter production levels are after the 3,930 boepd of asset dispositions completed recently and reĂ ect additional shut-in production of approximately 2,300 boepd due to spring breakup conditions.â€?

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In June, PetroBakken’s estimated average production was 37,500 boepd, with an 84 per cent liquids weighting. In the second quarter they drilled 15 (nine net) wells and completed 24 (17 net) wells as indicated below: • 10 (six net) wells were drilled and nine (six net) wells were completed in the Bakken business unit, • Four (two net) wells were drilled and 13 (10 net) wells were completed in the Cardium business unit, and • One well was drilled and two (one net) wells were completed in their Saskatchewan Conventional business unit. Only six (three net) wells were brought on production in June, leaving 23 (15 net) wells in inventory that will be brought on as activity fully resumes over the summer. The release noted, “Field conditions are currently improving and we have 13 drilling rigs operating with extensive well servicing operations under way as well.â€? Facility investments continued in the Cardium business unit in the second quarter as PetroBakken brought a new battery online in west Pembina, allowing the company to tie-in associated gas production and provide central oil processing. “We remain active with our normal course issuer bid, purchasing approximately 2.5

million shares in the second quarter for a total investment of $30.8 million ($12.34/ share),� said the release. “Year-to-date we have purchased approximately 3.3 million shares for a total of $45.2 million ($13.56/share).� PetroBakken noted that those numbers are consistent with previous years, and the second half of the year will be their period of highest activity. “Our capital program has been slightly delayed by approximately three weeks, and we are well positioned to catch up prior to the end of the year.� They expect to have 15 drilling rigs operating for most of the second half of 2012, including seven rigs in the Cardium, drilling 57 net wells; six rigs in the Bakken, drilling 75 net wells; one rig in southeastern Saskatchewan, drilling 27 net wells; and one rig drilling four net wells in the emerging plays in Alberta. “Our balance sheet liquidity position remains exceptionally strong with approximately $1.1 billion of available capacity under our facility at June 30,� noted the company. “With approximately 75 per cent of our planned wells for 2012 yet to be drilled, we anticipate continued production growth during the second half of the year and reiterate our 2012 exit rate production guidance for 2012 of 52,000 to 56,000 boepd.�

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PIPELINE NEWS August 2012

A9

MRC trying to make splash in the Energy City trust your staff,” noted Chrest. “You make a mistake, it’s not good. You need them to give you a chance, to come in and see what you’ve got. From there you got to work hard to make sure you get them the right

stuff in a timely manner. “Because the store is fairly new in town, we’re just trying to break in. We’ve had a presence in Weyburn and Carlyle for a number of years and this kind of helps fill a gap between the

two.” As Estevan is geographically in the centre of those towns, the new store gives MRC a more complete presence in the oil-rich southeast. ɸ Page A10

MRC MidĮeld sales rep Taybrey White completes an order with a customer in the warehouse.

By Jordan Baker for Pipeline News Estevan — Building a base for oilfield supply sales isn’t the easiest thing to do, even in an area of the province where the oil industry shapes the day. But MRC Midfield set up shop in Estevan and has since been building a client list at a steady pace. Blaine Chrest, branch manager of Estevan location, said the operation has been coming into its own in the past few months, getting a foot in the door of the competitive retail side of the oilfield. “Whatever business you get into, you always want to see the business grow,” said Chrest. “We had our first milliondollar month in June. It was a pretty big step for our store, and our corporate people were pretty happy to see that. I told them, ‘Now that we have one, we want our second one, and hopefully by fall we get into the $2-million month.’ That’s my goal.”

He added that the staff was very proud of the milestone. “They took ownership in it, and they were proud of being involved in it. It’s very nice to see. We have a great staff here. They do take pride in their work.” Chrest commended Mel Fitzpatrick, the manager of the MRC branch in Carlyle, who got the store together in Estevan and hired the group that is in there now. Chrest has been managing the Estevan store since April. “It’s been a pretty easy transformation in here, and I’m trying to build on what he started,” Chrest said of his first quarter at the store. In order to build, the new group still needs to win some people over, but Chrest said they are still breaking in and collecting contracts from local companies. Building relationships with the oil companies in the area is the key to what they are

doing, as they are still in the early stages of getting known to the area’s players. “The biggest part of it is to get them to

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Milestones are being reached ɺ Page A9 “Being in the largest city in the area for activity, they needed to have a presence here,” Chrest said. “It’s been a slow rebuilding. We’re the small player on the street so far.” The street he referred to was Kensington Avenue, where they are set up almost right across from CE Franklin and within eyesight of TS&M, the Estevan-based behemoth. MRC Midfield has now had a presence in the Energy City since October 2011. Chrest noted that while they have their contract customers, they are still trying to open up into the non-contract business. They want to earn themselves a spot as an alternative to other supply stores in the area. “It’s easier now that it’s busy,” he said about establishing the company. “If it was a slow time, we’d be (struggling). We’ve got some key people here. We’ve got some key relationships that we’re trying to tap into.” Chrest may be a new manager for MRC in Estevan, but he isn’t new to the game. He’s worked sales for a number of years in the oilfield industry and has also spent time in the business of renting equipment for the oilpatch. Because of his time at other stores, including very close competitors, he intimately knows how well other companies can service their customers. “We know what we have to do to get to that level. We’ve got to offer that kind of service.” Chrest noted that it can be a tough business, and he’s seen instances where there is a mistake made at a store and the customer takes his business across MRC MidĮeld’s building in Estevan holds the pump shop, which employs two individuthe street. He added that isn’t something you hope for from your competition, als. MaƩ Kuentz manages the shop and is seen here charƟng part numbers. but if it does, it’s important to meet the customer’s needs in order to keep them for the future. “Since I’ve been here (in April), our inventory has grown over $1 million in three months. Mainly due to some key contracts, supplying rods, and we’ve had to bring in more. That’s a good thing.” He noted Estevan is one of MRC’s biggest inventory stores. In comparison to other stores in Customer service is our top priority and for more than 60 years Import Tool has been a leader the southeast and Manitoba’s southwest, they have in providing liner tool completions, stage cementing tools, casing packers, innerstring the most inventory at their fingertips. cementing service, float equipment and casing accessories to Canadian oil and gas Three-quarters of it is sucker rods. “That’s probably half our sales. We’ve had companies who demand the best. some key contracts come into place with some big customers. That’s what they want, so that’s what we supply,” said Chrest. Saskatchewan and Manitoba He added that they had just done a study on 306•634•2511 their sales and found they were about 50 per cent 78 Devonian Street ~ Estevan, Saskatchewan contract sales and 50 per cent non-contract, which surprised him a little. “That’s unusual. I thought we’d be 70/30. We want to look after those key customers but not forget that there are other people out there as well.” To get some more business outside of contracts, he said it just takes the sales team getting out and “beating the bushes.” Chrest said he was hoping to get out to make a few sales calls when he first started at MRC, but has found himself too busy with the administrative side of his job so far. He said they’d also like to get more involved in the sale of pipes, valves and fittings as well as getting into more building facilities supplies. ɸ Page A11

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A11

Éş Page A10 “That’s a market we’ve got to break into. We get them with our contract people, which is great, but we’ve got to reach out past the contract people and break into that market.â€? They have four inside sales reps, a couple of workers in their pump shop and a couple of administrative people. Chrest chuckled at how small their sta is with nine people, as others have anywhere from 20 to close to 100 people within the organization. (QMR\ XS WR IRXU EHGURRPV )(@ 4,(+6> 3(5+05. DQG VT IW RI OLYLQJ VSDFH He said their size isn’t an issue, as they are all able to handle the work7RZQKRXVHV SULFHG IURP LQ WKHVH JRUJHRXV ORFDOO\ EXLOW WRZQKRXVHV loads, but Chrest added that by the fall, he’s hoping they need to look for another body or two. And he isn’t concerned about ďŹ nding anybody with the 929 YARDLEY PLACE, ESTEVAN labour shortage experienced not just in the southeast but also across SasThis 3 bedroom, 2 bathroom 960 sq ft bungalow katchewan. “Finding people is not as hard as everybody thinks. Companies don’t take is situated in a great area! It has a large yard and rĂŠsumĂŠs and hire based on them. A lot of it is recruitment. Finding people, I includes a single detached garage. don’t think that will ever be a problem. There’s enough people in the industry, that are in dierent parts of the industry, that are always looking for changes.â€? MLS# 435985 $369,500 He said he has already had people he knows approach him and tell him if T&E T & EAcreage, Acreage,Torquay Torquay YOUNG ACREAGE, ESTEVAN he’s ever looking to hire, to keep them in mind. “The biggest thing is knowing people, talking to people,â€? he added. As far as expanding goes, Chrest said there isn’t a lot of room in the warehouse, but room can be made. They are still in the process of weeding out the products they don’t need to be selling, so over the next couple of months, their inventory will be reďŹ ned, and that may make room. CALL TODAY! This property won’t last long! He also said they could probably use a bigger yard. “But you have to work with what you got. There’s alternative ways like This well kept 4 bedroom, 3 bath home is located close to our warehouse set up with the palette racking. Yard wise, in this position here, Torquay and Rafferty Dam. Includes a beautiful kitchen and The Acreage of your dreams!! 2300 sq ft Home. 4 car heated garage 34’x78’. Work shop with we have no room for expansion. We’re going to have to handle it dierently. wood burning fireplace. The shop, barn and quonset are also radiant heat and 2 over head doors 48’x48’. Quonset for storage 35’x50’. Beautiful treed 10 acre yard. Paved lane way and driveway. Home has had many improvements in last year If we get enough clientele coming in that needs more, we’re going to have included. Extra 1/4 of land including windows, doors, deck, flooring, stone on exterior. Large oak kitchen, eating island available at additional cost!! with granite counter top. MLS# 428717 to look for something. If we get to that point, then good for us. That means MLS# 434153 www.teacreage.bhgress.ca we’re growing. Then we’ll search alternatives. The alternative may be to have www.sw3057w2nd.bhgress.ca $695,000 $619,000 another yard stocking our rods and pipe.â€? As far as space in the store is concerned, he said they are still able to tighten things up and add another rack or two. Chrest would certainly embrace any diďŹƒculties of growth. “If we ever get to that point, I hope so, but that would be a good problem to have.â€? There are avenues they can explore as other industries have yet to be tapped. While the oilďŹ eld reigns supreme, there are other industries that the MRC team can look to in order to grow. (VWHYDQ 6KRSSHUV 0DOO )25 9,(:,1* &217$&7 )25 9,(:,1* &217$&7 “We’re pretty much oilďŹ eld right now. We’re trying to get into that other 0 ,.( ‡ ‡ part because there is SaskPower and the mines. There’s a lot of others but we -$0,( '<(5 '(%58<1( ZZZ EKJUHVV FD haven’t gotten into that market yet. That’s what we’ve got to get into,â€? said &HOO Estevan Shoppers Mall &HOO Chrest. “The mines, they use all kinds of stu. Power, they’re always looking for stu. It’s a niche that we’re not (in) yet.â€? He added that reaching into those markets is still a little time away, as they are still working 35, 28 30 & 23 • 45,•35, 23 Ton TonPickers Pickers on maintaining their contracts. It’s important to • Bed Truck • Bed Truck him that they are able to give their customers the • Pipe Custodian • Pipe Custodians service they deserve. • Pipe Racks “We service our contract customers. 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PIPELINE NEWS August 2012

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C&N opened their supply store in the fall of 2010. Since then, the business has boomed as the secondary cog in the C&N OilÄŽeld wheel.

Addition of store leads to productivity gains

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„ By Jordan Baker Carndu — Every supply store needs a regular customer base, and when C&N OilďŹ eld moved across Highway 18 to add C&N Supply to its business, that’s exactly what they found. What Carndu had been lacking up until then, C&N OilďŹ eld was now going to supply. As one of the most easterly towns in Saskatchewan’s southeast, there was no outlet that supplied the tools and goods many in the area’s oilďŹ eld sector required. The gap was ďŹ lled when the maintenance business of 25 years decided to add the supply store in October 2010. Since that time, the store has boomed, and C&N’s customer base has exploded. Kris Carley, C&N OilďŹ eld and Supply operations manager, said the store has complemented their maintenance business, adding customers from several walks of life. OilďŹ eld workers, the Town of Carndu, golf courses and even farmers are now able to come into the store to pick up what they need. Without having to leave town to head to Oxbow, or at times even Estevan, having the site in Carndu is a major convenience. ɸ Page A13

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PIPELINE NEWS August 2012 Éş Page A12 “There’s really never been anything in Carndu,â€? said Carley. “Twenty-ďŹ ve years as a maintenance business, we’ve found ourselves driving back to Estevan or Oxbow for parts, not only for ourselves but for our customers too. If we’re working on trucks or something on our own, we couldn’t buy a two-inch ball valve. You couldn’t get oilďŹ eld ďŹ ttings.â€? Carley said they were very quick to establish themselves in the community. As the store was added in part to help their maintenance crews, they were originally one of the top companies taking advantage of the store. That’s not the case anymore. “When we opened up we were probably one of our best three or four customers. Now we’re probably not even in the top 10 anymore, because we’ve kind of developed our own customer base outside of ourselves.â€? Since the store has opened, they’ve managed to bring in entirely new customers, some of whom are competitors of their oilďŹ eld operations, while others they never would have reached with just the maintenance side of their business. “Guys who used to be our competition are now customers of ours on the store side. We still have the customers who we work for as far as operators. We get farmers in here for hoses, ďŹ ttings. The ďŹ re department gets stu, the golf course gets stu, customers that we never would have had before.â€? Where it has come the most in handy is for C&N OilďŹ eld itself. Carley said what the store has

done for production on their maintenance side has been incredible. Not only do they have the supplies they need right next to their shop, but they also deliver supplies with their maintenance crews as they are often heading out to a location for work. They can now get two things done in one trip. “Productivity for us (has improved greatly). Our guys are working on a project in the shop, they walk in the store and they grab everything they need. The convenience of it and just in manhours alone, it’s just great,â€? he said. They are storing six pressure trucks in the old shop right now. It was when they ďŹ rst started buying the pressure trucks that they ďŹ nally decided a store on-site, or at the very least in Carndu, was a necessity.

A13

“The big thing was when we started getting into the pressure truck side of it — we’ve got six pressure trucks now that we’re batching with — when we bought our ďŹ rst truck there were valves that would go on it, or a hydraulic hose or whatever that you needed.â€? They bought their second truck used and had to do a lot of work on it after they did a complete rebuild. “It seemed like every second day we were sending somebody to Oxbow to get ďŹ ttings to rebuild this pressure truck because there was nothing in town. We tried to plan ahead, but you’d be short a valve or something. Then we’re wasting time because I had to get in a truck and go to Oxbow and come back.â€? ɸ Page A14

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PIPELINE NEWS August 2012

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ɺ Page A13 Carley added that while they can now multitask different jobs, customers can also solve most of their problems with one phone call. “One thing that we’re doing now that wasn’t part of our business plan, but it sure became one right away, the guys now can phone us for the belts, or the shivs or the nipples, and they can get a crew in one phone call. So a lot of the stuff that we’re selling is going out on our trucks. I get lots of guys that call say, ‘you know, I’m just glad I can make one phone call and be done with it.’” The store has turned the Carnduff company into a kind of one-stop shop for oilfield supplies and maintenance. There are 35 trucks running with C&N Oilfield that are heading to locations all over the area for jobs, so Carley said they can throw a bag of fittings on the truck with the

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crew, and that kind of counts as their delivery service. Carley said they want the store to be customer driven, even though when they first opened their product lines mostly revolved around what their company needed for maintenance. While many of their products are day-to-day items that people need, they have done some larger sales. “We came in blind actually, because we had no history of what’s gonna sell, what isn’t. So we just brought in what we thought we needed, and then we let the customers drive it for us. One of our big philosophies when we started was if you come in the first time and we don’t have it, the next time you come in I want to make sure it’s on the shelf.” Within about two months of the store’s opening, they realized the store couldn’t be managed on a parttime basis by someone working out of C&N Oilfield. They decided to hire a store manager full time, and Colin McInnes has been manning the shop ever since. At the same time as hiring McInnes, they also found they needed more space in the store. Their in-store merchandise grew in those first few months as well. Where before they carried a couple of charts for retail, they now have more

than a dozen on hand. They first developed their inventory based on what they thought their customers would need, and as customers came in and requested other items, their inventory has expanded. “From three months after we opened until now, we’ve probably tripled our inventory in a year and a half, just to keep up with the demand and to make sure we got the stuff on the shelf.” When they built the store, they planned enough room so they had some space to grow and develop. They’ve added two new racks full of inventory since opening. They also have storage above the store. “If there ever does become a space issue, we still own our old building. We were building a new shop so we put the store in the new shop, but we still got the old shop across the highway there. If we ever needed to, we could always move in there and give ourselves some more space.” They are currently looking to expand further, with interest in setting up shop for C&N Oilfield in North Dakota. Carley said they are still looking to acquire some land, but noted they have a location in mind as they eye Stanley, a small town between Williston and Minot, for the expansion.

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PIPELINE NEWS August 2012

A15

Having a local head ofÀce offers unique view on oilpatch By Jordan Baker Estevan — The biggest oilfield supply company in Saskatchewan’s southeast is updating its headquarters, as TS&M Supply’s Estevan head office is scheduled for a big facelift. The company has been in business for almost 40 years, after beginning as a small store run by three local Estevan businessmen. It has grown into perhaps the biggest supply store in the province with about 80 employees in Estevan alone. Dan Pratt, regional manager for TS&M in Estevan, noted that the head office location is in the throes of getting even bigger. The end project will be the construction of a new 42,000 square foot building on their current site. Work has already started as an addition is under construction at the back of the south building on Kensington Avenue. Pratt said once that is complete, they will be able to move the people and operations out of the north building, which will be taken down. A new building will then be constructed on the site of the original structure. The update of their head office is an important thing for the store as they are an Estevan-based company. TS&M is unique as a supply store headquartered out of a small city in the heart of the Saskatchewan oil industry. “The biggest thing that sets us aside from those other companies in that regard,” said Pratt, “is that when your head office is in Calgary, it’s more office related, where we still consider ourselves, kind of, field guys at heart. (The field) is really where the work happens.” The ability to work directly with oilpatch workers out of their head office is an important part of who TS&M is, added Pratt. “That, I think, sets us aside because we’ve got our fingers on the pulse of the oilpatch,” he said. “No matter what technology is available, it will always be a hardworking-person’s industry. Any given morning, we’ve got crew guys coming into our head office to get a coffee right outside (my office). Staying close to that is certainly something that TS&M is very passionate about.” He added that it’s the construction crews as well, who he called the “heart and soul of the oilpatch,” who frequent the store and office. Above Pratt’s office door hangs a quote attributed to Mohandas Gandhi, reflecting on the relationship between the customer and the merchant. ɸ Page A16

A group of staī members gathered together in TS&M’s front oĸce. From leŌ: David Rooks, Arnold MarcoƩe, Ryan MiƩelholtz, Dallas Taillon, Blake MarƟn, Dan PraƩ, and Brad Bengert.

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A16

PIPELINE NEWS August 2012

Customers Ă€rst Éş Page A15 It reads, “A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption of our work. He is the purpose of it. He is not an outsider of our business. He is part of it. We are not doing him a favour by serving him. He is doing us a favour by giving us the opportunity to do so.â€? “I found that about four or ďŹ ve years ago, and he certainly hits the nail on the head that the only reason we’re in business is for our customers. I don’t make any of my decisions based on anything but them.â€? The connection between TS&M and their customers is a small-town approach, where the focus is on helping the client at every turn. “That’s something that we don’t want to lose sight of, no matter how big the company gets, that one person, that one individual type of need,â€? added Pratt. “We’re not looking at it as ‘you should shop here because we’re the biggest, you should shop here because I want to help you. You tell me what you need, and I can get it for you.’ That’s something that I repeat to the sta on a regular basis. One person, one customer, that’s what built this company.â€? It’s what the customer wants and what the customer needs, that he said

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drives their business. With their operations very localized, it gives them the opportunity to connect the customer and the corporation. “Certainly on the inventory side of it, our competitors keep a large portion of their inventory in Alberta, which, when the work is happening in Saskatchewan, it doesn’t do the people of Saskatchewan a lot of good.â€? Pratt noted they carry $21 million worth of inventory on-site at their Estevan location. He said that’s far higher than a lot of places will carry in Alberta, let alone Saskatchewan. Because their head oďŹƒce and warehouse share a location, he said, “We’re more adaptable, and there’s less (of a) trickle down eect.â€? Pratt said that when there is a question of stocking a new product because a customer is considering carrying it, the communication doesn’t have to jump from a salesperson to a manager, and then ďŹ nally to someone in Calgary or Edmonton. He said a salesperson at TS&M can get a call about a client looking for a new valve, and they can quickly go to management and get an answer on whether or not they will begin stocking that product. “We can make those decisions in real time. We can react quicker and respond to those ever-changing needs.â€? ɸ Page A17

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PIPELINE NEWS August 2012

A17

The aging building at the north side of TS&M’s complex on Kensington Avenue will be taken down so the new one be constructed on the original site.

TS&M Supply is the only supply store with a head oĸce in the Energy City.

ɺ Page A16 Pratt noted that Estevan is a small centre for a company to have a head office, but said it means that they know people. “That’s something I don’t think Estevan gets enough credit for. It is a gruff town. We’re an oil town and a mining town and a farming town, but when somebody gets sick or somebody is in need, we’re small enough that everybody knows everybody. We’re proud to be a part of that effort.” TS&M is owned by National Oilwell Varco, which recently purchased CE Franklin, a competitor, and one with a store that sits just a couple of doors down from TS&M’s head office in Estevan. “We don’t have a whole lot that I can tell you at this point,” he said, but added that the purchase speaks to the size of NOV. Pratt said the purchase has opened the door for even more opportunity, something that excites him now. He added that they’re going to be having some meetings about how things are going to move forward for the two companies. TS&M and CE Franklin have competing stores in Estevan and Shaunavon, while other centres have just one of them. Going forward, Pratt doesn’t know how those dynamics will continue. “How that plays out, I don’t know, but certainly just from looking at it right now, we always like to have

a lot of areas covered,” said Pratt. “I just think that being able to service more customers in different areas without having to start from scratch, that’s certainly something that would excite me if we end up going down that path. “One of our biggest advantages is that we still have that local feel, that mom and pop kind of mentality. Being that we are a National Oilwell Varco company, who own us, they allow us to run our own company within theirs. It’s nice to have a company of that size back you up.” There are 14 TS&M branches across the country. In Estevan, they have a separate store exclusively for pipes, valves and fittings, as well as the Estevan Fire and Safety division, which covers personal protective equipment and other safety products. They also have a fibreglass and multiplex division. “We like to consider ourselves a one-stop shop for people and for customers, so they can pick up everything they need here.” Pratt said a lot of their size and growth stems from being one of the first companies to provide these kinds of services in the Estevan area. “That’s one of things I’ve got to give credit to the guys that started this company, for their vision,” he said. “Those guys, at that time, put their own money out for inventory, borrowed money to start new branches. I consider

my job to be about a per cent as difficult as it was for them.” Pratt said he tries to remind himself of what their vision for the company was and to try to maintain those same values. Because he still sees them in the community regularly, he said it’s a testament to the kinds of men they are, as they built the company in a small city in southeast Saskatchewan and continue to have ties to the community long after they’ve stepped away from the business. Pratt noted the incredible amount of money that it would have taken to get into the business, especially because it’s not something you can only go half way in. “Something like sucker rods; you can’t get part way into

sucker rods. We carry $6 million worth of sucker inventory,” he said. “How do you start that? How do you cut that first purchase order to decide to get into that? It just blows me away.”

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PIPELINE NEWS August 2012

Enbridge Àned for 2010 oil spill Washington — Enbridge was slapped with the stiffest penalty ever imposed by the United States pipeline regulator, following an oil spill that contaminated stretches of the Kalamazoo River in Michigan. The company received a $3.7 million fine after the Transportation Department’s Pipeline and Hazardous Materials Safety Administration (PHMSA) said its probe uncovered about 25 regulation violations related to the July 2010 leak on Enbridge’s Line 6B near Marshall. Enbridge has 30 days to respond to the order and said they are reviewing the PHMSA’s finding.

“We will not comment specifically on the contents of the (notice of probable violation) until that analysis is complete,” the company said in a statement. The PHMSA said Enbridge attempted to bring the pipeline back into service despite receiving multiple leak alarms the night it ruptured, leading to the release of more oil. “We will hold pipeline operators accountable if they do not follow proper safety procedures to protect the environment and local communities,” said transportation secretary Ray LaHood in a July 1 press release.

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Enbridge’s 30-inch pipeline ultimately spilled more than 20,000 barrels of heavy crude and contaminated 60 kilometres of the Kalamazoo River. The accident shut down the pipeline for more than two months and spawned a massive clean up the company estimated will cost more than $700 million. It was this spill in 2010 that led to the Transportation Department enhancing its oversight of pipelines in 2011. The department is collecting more data on pipelines and closed 102 enforcement cases in 2011, its highest level for a single year. Last December, Congress passed a pipelinesafety bill that raised maximum fines and authorized an increase in the number of pipeline inspectors.

Natural Resources A pair of pumpjacks work away in a canola Įeld near Frobisher.

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PIPELINE NEWS August 2012

A19

Do All to acquire Hyduke for $34 million Estevan — Do All Industries Ltd. paid a big premium to acquire Hyduke Energy Services Inc. in June. The Estevan-based, oil and gas equipment and services company entered into an agreement with Hyduke to buy all the companies shares for $1.37 per share, a 109 per cent premium over the closing price of Hyduke shares for the 20 trading

are now accustomed to. It will also provide different venues to provide service from as well as adding much more square footage of manufacturing ability. “Business will continue as usual for all customers and employees. The acquisition of Hyduke's business by Do All will give the employees even more opportunity to grow within the organization.

Do All Industries, with its head oĸce in Estevan, recently purchased Hyduke for $34 million.

days ending on June 20. The stock price sat at $0.66 the day before the agreement was made for Do All to purchase the company for about $34 million. Myron Yurko, Hyduke board chairman, said, “This business combination will strengthen Hyduke's ability to continue to provide its customers with the life-cycle management that they

I believe that this is fair value for all shareholders and provides a liquidity event for the shareholders at more than twice the current trading value of the shares.� Do All's president Kordel Korf, said, “We are dedicated to continuing to provide quality products and services to both Hyduke's and Do All's customers. We plan to continue to

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conduct business with integrity and allow for the positive merger of these two successful organizations. We are excited about the immediate growth of our Canadian operations through this acquisition, and are looking forward to the new possibilities the Houston, Texas manufacturing facility has to oer. “The expansion of our organization through this acquisition will allow all employees the opportunity for further development and advancement within the organization. We are looking forward to working with Hyduke's highly-regarded team of professionals.â€? The arrangement is still subject to the approval of Hyduke’s shareholders. A special meeting of Hyduke security holders was scheduled for Aug. 8, with closing expected to be shortly thereafter. Under the arrangement agreement, it is a condition that all Hyduke options shall be exercised, surrendered or terminated. Hyduke is an integrated oilďŹ eld services company that manufactures, repairs and distributes oilďŹ eld equipment and supplies internationally. Hyduke

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PIPELINE NEWS August 2012

Travis Leeks, leŌ and MaƩ Ekkebus, of Lavoie Mobile Cleaning Ltd. cool each other oī using their pressure washer hoses. The pressure was lowered before they turned their lines on each other.

Heat a source of trouble in the summer By Jordan Baker In the winter it’s cold, and in the summer it’s hot. There isn’t much escape from the elements for oilfield workers. The southeast Saskatchewan summer has been hot and dry and the province’s oilfield workers have been dealing with some pretty extreme heat day in and day out. Safety is an important part of being on any rig or maintenance crew, and while there are enough hazards that workers know about, one that may get overlooked is the heat. The danger of the summer’s afternoon sun is very real. Health officials release a number of reminders to those working outside to take precautions against heat exposure. “We forever stress (heat exposure) in our safety meetings,” said Carrie Englot, of Flyin E Medical, who does safety training with oil companies. Her company’s ambulances now carry water in their trucks at all times. “It’s not a necessity, but it’s a necessity for us to take it, because those guys are going to run out water possibly out there. (One day) I guess they did run out of water, and they had a (Flyin E medic) working, and I guess she ran out of water in her unit from giving it to the guys. “I’ve seen that water is a big issue, and I said, ‘you know guys, we should take a flat of water in every unit.’ You stress the dehydration thing; you stress the heat stroke thing; you stress that if you’re feeling dizzy or if you’re feeling lightheaded, come over and pour water on your head and let it go down your neck. Cool your head down but not fast.” ɸ Page A21

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PIPELINE NEWS August 2012

No escape from elements for oilÀeld workers ɺ Page A20 Matt Ekkebus, who works at Lavoie Mobile Cleaning Ltd., said, “This beat the heat thing doesn’t work for us. We probably have the hottest job in the oilfield. You just get your work done as fast as you can and get out of there.” As a pressure washer, wearing heavy overalls, there is little chance of evading the heat. “You drink a ton of water,” he added. “It’s a good thing they have air conditioning in the trucks or we’d be screwed.” One other way for them to cool off is to tone down the pressure on their hoses and give their workmates a little shower. That’s one form of escape that not everybody has available to them. Englot advised against drinking cold water because it can lead to cramping. “That’s the first instinct to go drink cold water,” she said. “You don’t want to do that.” She noted that it’s important to stay ahead of heat-related health problems, especially for people working on rigs out in the country, as it will take some time for medical assistance to arrive if someone is suffering from heat stroke. “When you have heat stroke, you feel terrible. You are dizzy, you are nauseous,” added Englot. “Sometimes you are so dehydrated, and you can’t cool down. If you have a bath right away as soon as you feel it, that helps, but a lot of people don’t realize what’s happening to them, so they continue (to work).” Signs and symptoms to watch for include dizziness or fainting, headache, nausea, rapid breathing or a rapid heartbeat and/or thirst. People with these symptoms have to move out of the heat into shade and drink water. If untreated, the problems can lead to hospitalization. “Where if you pour a little water on your head, make your baseball cap wet, whatever, that cools you down,” said Englot. “(In the winter) keep a toque on your head because that keeps the heat in. Well in the summer, reverse it. Keep your hair wet and that will cool your body down.” Heat-related illnesses can be prevented by keeping the body cool and by avoiding dehydration in hot environments. When outside, wear light-coloured, lightweight, loose-fitting clothing and a hat. Take frequent breaks in the shade, and avoid consumption of coffee, colas, and alcohol, as they tend to dehydrate the body.

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A22

PIPELINE NEWS August 2012

Hydraulics and the high road of service By Jordan Baker Estevan — When the primary industry in the area is oil, it can be vital to find that niche that helps you stand out in the field. Wil-Tech Industries Ltd. has found its own way in the hydraulics side of the oilfield, selling and servicing hydraulic and pneumatic equipment. The business has been around for about 20 years, and while they started out as a local player, said Jim Wilson, Wil-Tech president, they’ve now become a regional player, handling jobs in southern Saskatchewan as well as Manitoba and Alberta. It was a few years ago that they diversified into the potash industry and that has helped keep everyone busy during slower periods in the oilfield. “One of the problems is when you get 20 technicians and the oilfield slows down, you better have a place for those technicians and some things for them to do,” said Wilson. “That’s one of the good things about Estevan, is that there are mines, power plants, and there is agriculture. We do do business in those areas.”

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They continue to look for growth opportunities, and one way of doing that is expanding their mobile services. “We have three service trucks capable of going out to the site and servicing the equipment on site,” added Wilson. “We have mobile trucks, hose doctors as we call them, and journeyman technicians that go out and service the equipment.” “One of the easier ways (to grow) we’ve figured is mobile trucks,” added Dustin Wilson, Estevan branch manager. “It’s easier than trying to cram everyone in the shop. If we can provide more mobile service, it’s a way of expanding.” The hose doctors are like a little shop on wheels, added Dustin, who said the crews are always busy on the road. They recently received a request to head to Thunder Bay, Ont. Jim said it didn’t make a whole lot of sense for them to go that far, but distance isn’t really an issue they consider when taking on jobs. “If it’s within our scope, as long as it’s not too far and getting into something we’re not comfort-

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able with, it’s usually not the distance that gives us a worry,” said Dustin. “It’s more getting out of our scope of things that we do.” He said they don’t want to get outside of the company’s comfort zone, as remaining focused on what services they do provide is important. “Our expansion has been within our industry and the fact that hydraulics are expanding in the oilfield,” said Jim. “What used to be chains and ropes are now hydraulic winches. What was a manual catwalk is now a hydraulic catwalk.” Dustin noted that their product lines haven’t changed as much as they’ve expanded. “It hasn’t so much changed from hose and fittings, but the expansion of the hose and fittings that we do supply has definitely gotten a lot bigger.” As much of the service equipment in the oilfield is hydraulic or pneumatic, they cater to the oilfield service industry more than drilling companies. “I’d call us the second layer of service,” said Jim. “We service the service companies.” They have the Parker store at their location, as the Parker Hannafin Corporation is their main supplier of parts and equipment. It has all the parts, equipment and components in a store atmosphere rather than a warehouse. Wil-Tech is set up that way in both Estevan and Regina. “It allows the customers to see what we distribute, as opposed to being back behind on shelves that they can’t see,” added Jim. Jim said they don’t deliver to the field as much as they service the field. “You don’t bring a drilling rig to us. We go to a drilling rig,” added Jim. ɸ Page A23

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PIPELINE NEWS August 2012

Éş Page A22 Dustin said that in some ways, they are their own best customer. “For the most part we deliver the service and the parts that come along with that,â€? said Dustin. “The service department would be the supply store’s biggest customer.â€? “Right,â€? added Jim, “we sell a lot of parts to our service department.â€? He noted they don’t sell a lot of the conventional things a store supplying the oilďŹ eld would carry, like suckers rods. “But we’re a very critical part of keeping the oilďŹ eld running. You can’t drill a well with a drilling rig that doesn’t work, and you can’t service a well without working (equipment).â€? Jim said they like quality over quantity, saying that they call it the “high-road concept.â€? “The high road is more diďŹƒcult, but there is less traďŹƒc and a better view. Quality resells itself.â€? While available labour is thin right now, Dustin noted they have people coming in through their apprenticeship program for heavy-duty mechanics. “We put one through just a couple of months ago, and we have about three or four going to school,â€? he said.

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PIPELINE NEWS August 2012

Safety store stays on edge of technology „ By Jordan Baker Weyburn — Safety is an important part of any work zone, and Edge Safety and Supply stays ahead of the game, carrying some items like hydrogen sulphide scrubbers that will soon be mandatory in the ďŹ eld. Darryl Seitz, Edge Safety and Supply manager, said that when selling safety supplies, one thing that has to be monitored is a product’s shelf life. Something that is unique to much of the safety equipment is the expiration dates. Many safety supplies have expirations dates that approach much quicker than that of a wrench. “It’s a matter of rotating stock,â€? said Seitz. He pointed to some gas tubes that handle dierent concentrations of gases, like hydrogen sulphide, CO2 and benzene. “They do have an expiry date on the back of them, so it’s kind of a (guess as to) how many you order in,â€? said Seitz. “We threw out I think 10 or 12 dierent ones here this spring, we went through and they were expired.â€? He noted there are other perishables in the safety-product line, like some alcohol-based products in the ďŹ rst-aid kits, eyewash solutions and the ďŹ re extinguishers. “You’ve got to watch when you get it in and look at the expiry date because shippers will ship you whatever they can ship you.â€? It’s also important for them to make customers aware that something like their ďŹ rst-aid kits, which may sit in a trunk, unneeded for months or even years, could expire. They also don’t want to sell a product like that which will expire shortly after the sale. He noted that for ďŹ re extinguishers, there is plenty of maintenance required over time. “There’s monthly maintenance, there’s annual maintenance, there’s six- and 12-year maintenance,â€? said Seitz, adding, “most people don’t realize that.â€?

Particularly when these products are being used for personal use through o-the-street traďŹƒc, he said it’s important that the consumer is aware of everything required for that piece of safety equipment. “Even for insurance, people may think ‘I put a ďŹ re extinguisher in my house, I’m good.’ Well if the ďŹ re marshal comes along and looks at this tag, if it isn’t signed and dated, would they refuse you insurance?â€? he asked. “They’d have a cause to.â€? Seitz said they do take on some liability for the products they sell. For a number of items he noted, “We have to be sure that if we send it out, it does have the ďŹ re-resistance (FR) rating on it.â€?

That can sometimes mean their products cost a lot more than what a customer thinks they should be paying. He has shown jackets to surveyors who are surprised by the price tag. He noted not everybody needs to have apparel that is FR certiďŹ ed, so there is more than one market they are trying to cater to. Because safety standards are highly regulated, and ever changing, they need to be aware of all the regulations to make sure the equipment they have in stock is up to those standards. He said that in Canada, the rule for a ďŹ re-resistant hoodie is that there must be a tear-away hood. ɸ Page A25

Darryl Seitz sets up one of the DM gas monitors and prepares it for calibraĆ&#x;on.

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PIPELINE NEWS August 2012 Éş Page A24 “We looked for two years to ďŹ nd a supplier for these hoodies,â€? said Seitz. “To ďŹ nd a manufacturer who was willing to make a tear-away hood, because not all oil companies demand it, (was diďŹƒcult to ďŹ nd). Now we’re trying to get into the niche market, trying to ďŹ nd a supplier that can supply it.â€? What Edge is also selling are drums that scrub out the hydrogen sulphide (H2S) gas at a well site so that is doesn’t have to be ared o. “Now they’re burning o the hydrogen sulphide. So now with this system, it’s neutralized so there’s no more ďŹ re, no more carbon dioxide,â€? he said. “It’s going to be mandatory, or some system like it, because they’re not going to allow them to do aring anymore.â€? Seitz said aring is only a last resort, adding

“ You’ve got to watch when you get it in and look at the expiry date because shippers will ship you whatever they can ship you.â€? - Darryl Seitz that, “You’re supposed to have control in your well.â€? The H2S drums come in several dierent sizes and Edge also services them. The drums vary in how long they can be used, typically depending on the size of the drum and the concentration of H2S gas that is coming out of the 400-barrel tank or whatever else might be the source of the gas. “It’s all based on the rate of gas and the concentration of H2S,â€? said Seitz. “The upstart price of it seems like a lot, but once you buy the barrel, now you’ve got it and all you have to do is replace the product in it.â€? The drums are good for a long time, said Seitz, noting that they are coated with an epoxy, and is long lasting as long it doesn’t get chipped down to the base metal, “that’s the ďŹ rst place (the chemical)

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is going to eat into.â€? He said whether to go with a large or small drum depends on the size of the battery and how much gas a crew is going through. “Where these (smaller drums) are real popular is where if you’ve got a well to drill close to a farmhouse. You can scrub the H2S out. There’s no smell, no odours, no landowner complaints.â€? He noted other places will order in the drums, but they stock them. Fire extinguishers are another big part of the Edge Safety business model. Not only do they sell them in almost any size, but they also service them, recharging the canisters when necessary. “We recharge them, inspect them.â€? Michael Lawrenz is Edge’s ďŹ re extinguisher technician and is certiďŹ ed to handle everything that is required for the units. Edge also stocks service rig supplies in their store so they don’t have to order everything in. “Other companies will order it in, but we try to keep all the popular stu, the stu that’s being used in the ďŹ eld,â€? said Seitz. “I’ve been here two years now, and it’s constantly changing.â€? He noted that they regularly have new customers who were originally working out of Alberta where things are done a little dierently. They want to stick with what they’ve been doing, so they require some dierent equipment. Every time that happens, new products come through the store, but it doesn’t mean the older products fall by the wayside. “Dierent clientele moves in, like from Alberta,

A25

and their equipment is set up dierent. Rigs come in and we stock (the store) as needed. The bigger stu, the high-end stu, we can get it within a day in from Alberta.â€? Seitz said many of their clients come in at the start of the week with their “wish lists.â€? “Some of our bigger clients, they’ll actually on a Monday, e-mail us ďŹ ve rigs worth of requisitions, they call it, or they’ll come Thursday or Friday and that will give us time to ďŹ ll their order (for Monday).â€? Seitz is now certiďŹ ed to handle DM gas monitors at their store. They monitor hydrogen sulphide, oxygen deďŹ ciency, lower-explosive limits and carbon monoxide. The monitors come in dierent conďŹ gurations and can have sensors for other gases like methane, which is frequent in mines. “We do recalibrations and repair,â€? said Seitz, who went to Calgary for a course earlier this year. Seitz said how the system works is that there is a calibration gas that mixes the four gases, and is run through the docking machine, which is hooked up to his laptop. “Every 180 days these monitors need to be recalibrated, which means you have to put the gas through and reset all the parameters in them,â€? added Seitz. It gets run through their machine and the computer prints out all the test results. They also have a rental program that allows a company to come in and rent them for a couple of days instead of buying them. The monitors are popular both on rigs and for facilities builders.

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A26

PIPELINE NEWS August 2012

Good on every dollar

Turnbull’s big move

The new locaĆ&#x;on for Turnbull ExcavaĆ&#x;ng in Estevan is well under construcĆ&#x;on, and the Estevan company is expected to be ready to move in to the site east of the Energy City oÄŤ Highway 18 some Ć&#x;me this fall.

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The Saskatchewan Research Council continues to be an economic driver for the province, providing a 36-times return on every dollar invested into the program. The research council released its numbers for the 2011-12 ďŹ scal year at the end of June, noting that their work meant $656 million in direct economic beneďŹ ts to the province. That makes the past year accounts for the largest impact the SRC has made since initiating their tracking method nine years ago. The press release said the SRC’s work contributed to the creation or maintenance of more than 1,800 jobs in Saskatchewan, valued at more than $118 million. “SRC has become a nation-wide leader in the areas of research and technology,â€? said Bill Boyd, the economy minister and minister responsible for the SRC. “I am pleased to see SRC's work make such a quantiďŹ able impact on the Saskatchewan economy.â€? Later this summer, the SRC will submit its corporate social responsibility (CSR) report to the Global Reporting Initiative for the second year in a row. The press release said the SRC's 2011-12 activities included more than $53 million in projects aimed at creating positive environmental and/ or social impacts, and SRC's work contributed to at least 22,343 tonnes of greenhouse gas emissions reduction or prevention and energy savings in excess of 43 million kWh/year. “SRC's mission is to deliver smart science solutions with unparalleled service to clients and colleagues that grow and strengthen our economy,â€? SRC president and CEO Dr. Laurier Schramm said. “These substantial numbers are a testament to the impactful organization SRC has become over its 65-year history.â€? Since 2003, SRC has measured $4.4 billion in combined economic and job impacts in Saskatchewan. In comparing the ďŹ gures from 2003 to 2012, the economic impact numbers have tripled. SRC is a leading Canadian provider of applied research, development and demonstration and technology commercialization. With 400 employees, more than $79 million in annual revenue and 65 years of research, development and demonstration experience, SRC provides services and products to its 1,900 clients around the world.

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PIPELINE NEWS August 2012

A27

New location means better supply... „ By Jordan Baker Weyburn — With Apex Distribution moved into more comfortable quarters, the Weyburn branch can now begin to give their customers more complete service. Larry Paterson, the Apex branch manager out of Weyburn, said they had been looking for a change since originally opening in late 2009. When Apex was ďŹ rst brought into the Weyburn area, there were few options for them to set up shop. Paterson was one of the original four individuals who decided to start the Weyburn branch. He was previously with two dierent competitors for about 20 years before opening the Apex location. He started in 1984 with a supply store in Lloydminster. The move to the new location on Ebel Road was a necessary one, because of the temporary space they had been working out of for the last two and a half years. “When we ďŹ rst opened it was basically temporary, but we couldn’t ďŹ nd anything here because there was just nothing large

enough to rent,â€? said Paterson. “So we just took what we could, and we were renting a portion of Regens Disposal. Really there were no oďŹƒces in there, and we were kind of right out in the wide open.â€? The situation was far from ideal for the team trying to make sales calls. “You opened up the overhead door and the dust and wind and snow ew in there. It wasn’t ideal at all, but sometimes you just deal with what you get.â€? He then got together with the regional manager and they decided it was a good time to make a move. After a little planning, Paterson said it was just time to expand and move into something bigger. That started in the spring of 2011, with a lot of the work being done last summer after they found a contrac-

tor that was prepared to handle the job of building the new oďŹƒce and warehouse. The move came just two years after the store ďŹ rst landed in Weyburn, and they were able to move everything in to the new space this past January. “It’s been great to have our own oďŹƒces and an actual reception area,â€? said Paterson. “People can come to the counter and actually take an order. We can take an order from them. It’s segregated from the warehouse. The warehouse is a substantial size and we have two overhead doors that we can load and unload from, so it makes quite a dierence.â€? The space they have for both their oďŹƒces and the warehouse is an incredible upgrade from where they were before. The warehouse is about 5,800 square feet. Even

with all that space, they have been able to ďŹ ll it. They will have to get creative if they ever need to stock more inventory. “We can install more shelving and palette racking,â€? Paterson noted. “It takes a little work to do that, but it’s pretty full already. We can tighten things up and put some new product in here, so we’re pretty good for now. “Technically we could expand out the back end, it’s just a

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metal-clad building, and I suppose we can add on if we have to, but I don’t know if that will ever take place.â€? He is deďŹ nitely happy with the size of their yard too, noting it’s the biggest one for a supply store that he has worked at. “The trucks can actually come in and turn around in our yard, and we have lots of room for our pipe racks outside. We have a Ccan in the back, which

we had over at the other place because we didn’t have enough warehouse space. We had that thing right full, and we actually have it full of product right now too, so that helps out a little bit.â€? The extra space has given them the room they needed to expand their product lines, and it allows them to sell the full range of products that Apex branches usually carry. ɸ Page A28

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A28

PIPELINE NEWS August 2012

... and a lot more of it

• Fluid Levels • Dynamometers • Pressure Surveys • Foam Depressions • Equiment Sales, Rentals & Repairs

Scott.........861-1001 Anita .........861-7305 Keith .........861-2243 Dave .........452-8401

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Ryan .........458-7790 Chantal .....861-9796 Brett ..........891-6303 Spare ........891-6966

Box 4 • Midale, SK S0C 1S0 Phone: (306) 458-2367 Fax: (306) 458-2373 email: 247enterprisesltd@sasktel.net

ɺ Page A27 “We have expanded our inventory, our product line as well,” Paterson said of what what they can carry now. “In both ways we’ve expanded with more inventory and a broader range of products.” They don’t stock just oilfield supplies, but with the extra space, they now stock items like coffee, sugar and other drinks. “We handle a full line of tools now that we didn’t have before because of the space we had.” In their previous location they dealt mostly in pipes, valves

and fittings. That may have led to the sales coming in slowly off the bat, as they were the new retailer. “Just being a new supply store in town it took awhile to get it going. Some people are pretty established with the other companies that they deal with,” noted Paterson. He said customers have been impressed with the new front office and added that the staff encourages them to go into the warehouse and do their own shopping. “Quite a few have enjoyed going up and

down the aisles looking for the stuff that they want. I think they’re quite happy with the larger warehouse where we can stock more supplies and bring in lots more stuff that they require.” Aside from the oilfield, they receive customers from the agricultural areas as well as some construction crews and gravel companies. Even with that outside business, however, it’s the oilfield that continues to carry Apex and other companies like them from day to day and month to month.

“An oil company will come in and start a new battery installation so there’s multiple items (they need), and it could carry on for a month or two months, where they come in daily to pick up what they need and go. The rig companies, they call it a wish list, they’ll send that in and you fill the order and have it sitting ready on the floor for them to pick it up daily or weekly.” With the oilpatch as busy as it is, stores being able to complete all those order allow the industry to keep moving at its present pace.

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PIPELINE NEWS August 2012

A29

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A cluster of pumpjacks dip beneath the Earth’s surface for oil oč Highway 18 near Oxbow.

Safety questioned Alberta — Provincial inspectors found more than double the number of high-risk concerns in 2011-12 than they did in the previous year among oil and gas facilities in Alberta. As part of the annual report by Alberta Energy, the Energy Resources and Conservation Board said it recorded 438 high-risk concerns during the annual inspections, compared with 239 the year before. Those numbers rose despite the ERCB conducting 513 fewer total inspections this past year. The infractions included 155 from pipelines alone. Pipeline safety has been brought to the forefront recently, following three crude oil spills in a little more than a month earlier this spring. Environmental and landowner groups have called for a review of the integrity of the 392,000 kilometres of pipelines in the province. For the year, incidents of high-risk noncompliance at facilities that include well sites, gas plants, oil batteries, waste sites and pipelines were recorded in 3.2 per cent of the ERCB’s 13,832 ďŹ eld inspections in 2011. That’s up from 1.7 per cent in 2010 and

2009, and 2.1 in 2008. The regulator has set a three per cent fail rate as its target. “In light of the fact they’ve exceeded the three per cent threshold they set, that should be some cause to look at the system,� said Dan Woynillowicz of the environmental group Pembina Institute. The ERCB oversees 179,400 operating oil and gas wells, 47,200 batteries and facilities, 54 oilsands plants and 12 coal plants in addition to pipelines. The report noted a

provincial regulatory enhancement project will be completed by summer 2013. “One major focus of this project is establishing a single regulator,â€? said Energy Minister Ken Hughes, citing safety as a primary area of focus with the amalgamation of Alberta Energy and ERCB. Woynillowicz called the review a chance to ensure Alberta has an approach to enforcement and inspection that inspires public conďŹ dence in the regulator.

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PIPELINE NEWS August 2012

High standards for oilÀeld safety Carrie Englot has been slowly growing Flyin E Medical since it Ďrst started in early 2011. They not only provide medical service, but now also handle safety training.

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„ By Jordan Baker Frobisher — The oilďŹ eld, like a football team, works best when employees aren’t sidelined by injuries. Flyin E Medical is Carrie Englot’s brainchild, based out of her house north of Frobisher. The company provides not only onsite medical assistance for rig companies but also safety training. They recently opened an oďŹƒce in Estevan for safety courses and have a location in Pierson, Man., as well. Flyin E, which is now doing safety audits for companies, also carries air trailers, shower trailers and a mobile testing unit that allows them to do audiometric testing as well as drug and alcohol testing. ɸ Page A31

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A31

Flyin E’s shower unit is used for acid jobs when there has been a chemical spill of some kind.

ɺ Page A30 They recently activated their mobile testing unit, which has been followed by a positive response, said Englot, who noted they are now out several times a week doing work with it. They do fit testing with an oxygen mask, as well as a fit-to-duty mobility testing as a pre-employment program. They can also do urine testing and drugs and alcohol testing to check an individual’s system from the last 24 hours. The safety training facility is in Estevan, but they will do training on-site for companies as well. “People come to us, but we’re mobile too,” said Englot. “With first aid and stuff, we’ll go out to them and train them out there.” Englot noted that they do safety training for everybody, not just oil and gas companies. She believes learning is best done in person with a handson approach, so she has made sure they have lots of people who can provide training. “I’ve trained up quite a few girls to teach first aid, so we can teach WHMIS too. You always learn better from somebody than you do a computer,” added Englot. “I know the modern technology is out there. I think they’re even putting first aid on computers. I don’t agree with that. Where are you going to get your practical from? Where are you going to get your skills from? “With first aid, there is a lot of hands-on learning and using the skills that you’re taught. It’s not just reading about it and then here you go. We’re actually teaching you. We have dummy dolls and they learn their skills on those. We have a lot of mocks.” She said they have also had mock training with the Estevan Fire Service. “You don’t learn just by reading and then never practising. Practise, practise, practise makes perfect.” Even her employees need to keep up to date and continue to practise their skills. She noted she recently sent some away for classes on high-angle rescue. “That’s a good course,” said Englot with a smile, adding that they will provide that training soon. “We haven’t got the high angle yet, but it is coming. I’m actually in the works with working possibly with a guy from Winnipeg who would come down and teach it through us.” She said it’s important to make the situational training relevant to what workers are going to be dealing with in the field. That means having the equipment to make sure people can train in realistic conditions. “You need to make it what they’re going to be dealing with out in the field. For the high angle, you need a tower.” But she added that the more training people get, the better and safer each job site will be. Englot said for something as interactive as a highangle rescue, they would need to do that training at their office. They are also looking at doing something with confined spaces and are building their own confined-space unit. They have to make sure all of the equipment that they build is legal and up to safety standards as well. “We’re not going to put anybody into a dangerous situation,” said Englot. With the high angle rescue training, she noted that people train on scaffolding that starts low to the ground but gets higher as the course goes on. When she did the training, they used a 185-pound dummy. “He was hanging, and you’d go down and pick him up and put him on

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the snap ring, and it was exciting. I really enjoyed it.” After taking the courses through the Flyin E crew, employees are then certified to perform rescues on jobsites. Englot said if there is a specific kind of training an employer is looking for, they would look into it and see if they can provide it. “We just don’t supply our medical services, but we try to supply the needs to the guys out there too,” said Englot. “I’m a firm believer that — they only have medical in some things — I think the medical should be in all parts like the drilling, the service, you know, because anything can happen out there. You know the hospital situations in our countryside. The EMS are busy, and you’re crucial time frame is if you’re bleeding out. ɸ Page A32

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A32

PIPELINE NEWS August 2012

Life savers Éş Page A31 “I had an amputation,â€? noted Jamie Cooper, an EMR with Flyin E, recalling a particular incident in the ďŹ eld. “Not to say he would have bled out, but if I wasn’t there, he was scared, he didn’t know what was going on. He was going into shock. To have some rig guy pal of yours going, ‘yeah, yeah, we’ll just take you to the hospital,’ is way dierent than having an educated medic there taking care of you and going with you to the hospital.â€? She recalled seeing the man a few weeks after the incident and he recognized her immediately. “There’s my medic,â€? she recalled him saying, calling her his lifesaver. Englot said when there is an incident on a rig where they help someone, their work isn’t soon forgotten. “He called me his favorite, and that’s the only thing I’ve ever done for him,â€? said Cooper. There is a lot of remote countryside, Englot noted, and that means it can take time before medical assistance arrives.

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A33

Boundary Dam Power StaĆ&#x;on near Estevan is currently undergoing a retroÄŽt of Unit 3 that will allow carbon capture for one stack at the coal-ÄŽred power plant. The project is the ÄŽrst commercial-sized project of its kind and is scheduled for compleĆ&#x;on in 2014.

No surprise here „ By Jordan Baker It shouldn’t come as much of a surprise, but it’s the residents of the southeast who are the most likely in Saskatchewan to believe there are beneďŹ ts in carbon capture and storage (CCS) technology. With the projects currently underway near Estevan, a $1.2 billion carbon capture project at Boundary Dam Power Station and the Aquistore project, this region of the province has received lots of exposure on how the carbon capture process works. ɸ Page A34

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PIPELINE NEWS August 2012

Saskatchewan divided on cleansing ability of CCS Éş Page A33 The International Performance Assessment Centre (IPAC) for geologic storage of Carbon Dioxide recently released the results of

their public opinion poll on public awareness and acceptance of carbon capture and storage in Saskatchewan. The 1,003 responses were collected between May

30 and June 8 by Insightrix Research, Inc. The results showed a division among Saskatchewan residents with respect to their beliefs and opinions

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on climate change and carbon capture and storage. There was also no consensus on what should be done to address climate change, nor was there agreement on what the main sources of greenhouse gas emissions are. Dr. Carmen Dybwad is the chief executive oďŹƒcer of IPAC and said there still seems to

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be confusion about the impact carbon dioxide has on the environment. “My big take-away from this is that there is an overwhelming number people who believe in climate change. That’s not an issue, but what they’re getting a whole bunch of mixed messages about is what’s causing it and that causes a certain amount of confusion,� said Dybwad. She explained that it’s important for people to know what they can do on an individual level, because the public often gets overwhelmed with the number of actions to take and then doesn’t take any measures. “There are so many things that people are faced with, there’s that feeling of impotence: ‘All these things are

happening and I don’t know what I can do about it.’ That causes a certain level of anxiety and frustration,â€? she added. She said she has the feeling people want to do what they can on an individual basis, but don’t know what they can do, feeling that, “I want to do something, but if I’m going to do it, damn it, it better be an eective thing.â€? Dybwad noted that polls for these opinions started last year, when the Eurobarometer did an extensive survey of public opinion in the European Union. IPAC’s ďŹ rst poll mirrored their questions so a comparison could be made with not just Canadian opinions, but speciďŹ cally Saskatchewan ones. ɸ Page A35

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PIPELINE NEWS August 2012 Éş Page A34 “To be able to match up what the attitudes were in Canada versus Europe, because we always tended to think Europe was so much more fashion forward (is important). If you’re going to be designing programs to talk to the public and to talk about such an important issue as climate change and CCS, you better understand the populations that you’re talking to.â€? This most recent poll is an update to the one done in Saskatchewan last year. Dybwad noted that one of the biggest changes between the two years is how residents of southeast Saskatchewan have become more comfortable with CO2 storage under the ground within ďŹ ve kilometres of their home. The number of worried residents decreased from 44 per cent to just 32 per cent. “That’s a big drop,â€? said Dybwad. “So in a few things, we see some substantial changes from one year to the other.â€? Dybwad said the surveys try to ďŹ gure out what people in Saskatchewan are hearing and how that information is inuencing the way they view their world and how they want to approach environmental policy issues. “In this world we’re always looking for quick ďŹ xes,â€? said Dybwad, “and I think part of the frustration, and why people are concerned about the eectiveness of CCS, is that they want the one silver bullet that’s going to solve everything. That just ain’t going to happen.â€? Dybwad noted the global increase in temperatures would be OK if there is no increase above 2 C, but added that the way things are going, the planet is looking at a 6 C increase. “The total amount

of carbon emissions that need to be reduced to make sure we stay in a two-degree world ‌ is 20 per cent, so you’ve got to do a whole bunch of things,â€? she said. “That might also be where the public might also be experiencing some frustration. They like to think that there is just one thing that they need to do, but this is going to take everybody’s concerted eort.â€? Dybwad added that it won’t simply be about deploying new technologies like CCS, but also technology centred around energy eďŹƒciency. “There’s going to have to be technology and other things around sustainable sources of renewable energy,â€? said Dybwad. “It ain’t a onesize-ďŹ ts-all. The problem is, we didn’t get to this problem overnight, and now we’re looking for solutions that are going to cure it overnight. That ain’t gonna happen.â€? The information gathered in the poll is important because it tells you what people are thinking about and what their issues are, said Dybwad, who added that companies and governments need to know what people are thinking so they know what issues need to be addressed. She said the discussions for things like environmental policy reform aren’t just about the global climate but also deal with people’s money. The information gathered in this poll, and others, helps governments and companies know what they still need to inform the public of. “This kind of information helps you craft the messages, not to pull the wool over people’s eyes, but to form the basis of having a real discussion.â€? She noted that the end goal is to ensure that everybody is informed about things like

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CCS, so everybody can make informed decisions about how they use their power. For the future of CCS, she noted there is some support for it in Europe, as support in Germany is rising, but it’s in Asia where the technology is fully being embraced. “The biggest proponent, where it looks like this technology is really going to take root, is China. The thing is they need that basic power right now, but they’re also putting in a whole lot of time and eort in CCS,â€? said Dybwad. “When they get that technology perfected, they just shut the other (power stations) down. They’re going to make a huge jump, and they will probably corner the market on this technology and then just sell it back to us. We can either do that or we can be a little bit more proactive and develop it ourselves.â€? The Boundary Dam CCS project in the southeast may be the test for the rest of the province and the country. Depending on the results when the carbon capture facility becomes operational in 2014, Saskatchewan could be a leader in CCS technology.

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PIPELINE NEWS August 2012

Shifting Gears

One Woman’s Perspective on Life, Liberty and the Pursuit of Land Locations By Nadine Elson It was promising to be a glorious day in beautiful British Columbia. The three of us sat around the table, drinking coee and reading the paper. My brother-in-law John, my husband Bruce, and I shared the Friday and Saturday editions of the Vancouver Sun. It was 6 a.m. on a Saturday in July. We had not needed an alarm; sleeping in was not an option. We were in the prime of life, well used to arising early to make a living and raise children. Even on holiday, we still woke early. John paged quickly through the sections looking for sports stories. Bruce was engrossed in a news story. He looked somber. I craned my neck around the table to see what was so newsworthy. “Kiss Freedom 55 goodbye and prepare to work harder, longerâ€? ran the headline of the page he was reading. I nodded sagely. I had read the article. The teaser headline on the front page of the previous day’s paper had read simply but boldly “Freedom 55 Delayed >>C3â€?. I had ignored the headlines about the Kootenay Lake landslide and immediately turned to C3. “What does it say?â€? I asked Bruce, already knowing the answer. “I am going to have to work until I’m 65 and

A37

Freedom 55? 2008 took care of that probably 67 before I can retire,â€? he replied glumly, relaying the content of the article. “But you knew that. Did you think I was lying?â€? I asked. “No, I didn’t think you were lying. It’s just depressing reading about it,â€? he replied. Last October, on the morning of his 55th birthday, I had wished him a happy birthday adding, “It’s Freedom 55 sweetie; the freedom to go to work and keep on working!â€? He had replied, “Thanks b*tch!â€? making it sound like a term of endearment by the aection in his voice. I had laughed; he had laughed; it was all good. That, however, was not the day he had ďŹ gured out that Freedom 55 was not “the planâ€? and was no longer even being advertised by the company that had made that phrase famous. That realization had occurred in 2008, following the global economic meltdown. We did not know it then, but the time would soon be known as the 2008 Financial Crisis “considered by many economists to be the worst ďŹ nancial crisis since the Great Depression of the 1930sâ€? according to Wikipedia. It was September 2008 that the world’s economy took a particularly sharp decline. I remember it well. Our RRSPs had declined at least 25 per cent in value in one month. Bruce had called on his coee break from work one day during that period. It was the hot topic of conversation with his fellow workers, many nearing retirement. “What are we going to do?â€? he asked. I had been the family’s money manager for years. Bruce said that he made the money and I spent it. I said that he would never divorce me because he didn’t know where I had stashed the cash. I had replied, “Nothing!â€? Despite the rapid spiral downward of our investment portfolio, we were in the same predicament as everyone else. The stocks were good stocks. We would just sit tight, I told

him, and continue to work and invest. It was in 2009 that the full eects of the global recession were felt in the oil and gas industry, with crude oil and gas prices going from a peak of US$133 per barrel in July 2008 to losing 80 per cent of their value on the market within a year. But it was late December 2008 that oil tanked in the $30 per barrel range, and my fairly new job as a hot shot driver with a company out of Weyburn tanked too. In 2009, according to statistics at www.nrcan. gc.ca, Canadian oil and gas drilling rates declined by half from the previous year, and global investment in the petroleum industry fell by 19 per cent, which explains my lack of employment in the patch that year. ɸ Page A38

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A38

PIPELINE NEWS August 2012

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Éş Page A37 In the last quarter of 2009, as world economies emerged from the recession and oil prices increased with the expectation that recovery would support higher oil demand, the price of crude rose and settled in the US$70-80 per barrel range. The local oilpatch started to get busier and in January 2010, I was hired by new company based in Estevan as a hot shot driver. I called it a contract position. My husband called it Freedom 55. That was optimistic. He hadn’t realized then that for four years after 2008 we would still be experiencing the eects, and more, of a world economic crisis. Bruce looked back at the newspaper article. “We’d better pick up spinach. In fact we’d better walk to get it. It says here that we need to ‘stay sharp by eating the right foods and getting exercise - it oxygenates the brain’. Seems I’ve heard that before,â€? he smiled referring to twice weekly lecture from me. I thought about the article. The ability to retire at 55 had evaporated, but we had plenty of other freedoms - the freedom to eat healthy; the freedom to work and keep on working; the freedom to go out without babysitters; the freedom to live in the greatest country in the world. Not bad. Maybe Freedom 55 still existed. Nadine lives in Estevan, with her husband and family, and works as a hot shot driver in the oilpatch regularly delivering goods in and around Estevan and Shaunavon, and Sinclair and Waskada, Man. 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 August 2012

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A39

A40

PIPELINE NEWS August 2012

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PIPELINE NEWS

SECTION B August 2012

Todd Folkerts, leŌ, and brother Aaron stand on C&B’s newly purchased picker truck with the fourth generaƟon of Folkerts. At the far leŌ are Cassy and Madison, Todd’s daughters, and standing with Aaron are his sons, Carter and Grayden.

Three generations make C&B one of the area’s oldest family-run oil businesses By Jordan Baker Frobisher — This long-standing oil business has been all in the family, as the Folkerts of Frobisher have been entwined in the Saskatchewan oil industry for more than 50 years. Today it’s known as C&B Oilfield Services, but it could also go by the oilfield maintenance company previously known as C&B Pump Maintenance or before that WL Wireline. C&B is now owned by the third-generation of Folkerts, as Aaron Folkerts bought the business from his father Bernie in 2009. It was Aaron’s grandfather who started in the business out of Frobisher in the 1950s, first with the company WL Wireline. It wasn’t until 1970 that he split from there to start C&B Pump Maintenance, setting the groundwork for the next two generations of the family. “They would more or less go and de-wax the wells, because there were no pumpjacks on them,”

said Aaron of his grandfather’s early work. “Then in the late ’50s when they started putting pumpjacks on, that’s kind of how my grandfather got into doing pumpjacks.” “He started with (WL) in about 1956, and he didn’t do pumpjack work, because all the oil wells around here flowed naturally,” said Bernie. “Then about 1958, the pressure decreased under the ground and they started using pumpjacks to pump oil to the surface.” After working for that business for awhile, the Folkerts’ grandfather started his own business, C&B Pump Maintenance in 1970. “I helped him with his business,” said Bernie. “We always had about six to eight employees and three to four crew trucks.” In 1980, Bernie started running the operation, later buying it from his father in 1984. After a number of years he began having medical issues with his back, so Aaron took over in 1999. In 2009,

Aaron bought the company from his father. “All they strictly did was pumpjacks,” said Aaron. “Then when I got involved in it, we started doing turnarounds, like facility work and that sort of thing, and I changed the name to C&B Oilfield.” Now they handle tanks, treaters, pumpjacks and other pipe fitting, but he noted they aren’t involved with any pipelining. The Folkerts’ original concept of a family-run oilfield maintenance company remains true today. “It’s three generations, but like my dad always used to tell me, it’s meant to be nothing more than a family environment,” said Bernie. “We had lots of good employees, but they would work with us for awhile until their life led them down into whatever they are doing now.” A lot of their labour came right out of Frobisher itself. Bernie said there was one family with four sons, and every one of them had a stint working at C&B. ɸ Page B2

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B2

PIPELINE NEWS August 2012

"This is what our family does" Éş Page B1 “It’s nice to have local people because, after all, we grew up here.â€? The family has long been established in the Frobisher area, but the demographics in the village have changed, even if the Folkerts have always remained a constant. “I grew up here my whole life, and I maybe know 10 people in town (now),â€? said Aaron. “When you’re a kid, you know everybody, and everybody knows who you are too.â€? In a village the size of Frobisher, with a population under 200 people, they aren’t the only operation in town. There are three other pumpjack service companies as well. Despite that, there is far too much work to go around to make the competition very cutthroat. “Nobody can keep up,â€? said Aaron. “Nobody’s trying to steal the other guy’s work because we wouldn’t be able to do it anyway.â€? “We kind of work together in way,â€? added Todd Folkerts, Aaron’s brother who recently came back to work for C&B. “Prairie Gold (Pumpjack Services), they hired me in the

picker to cue their pumpjack. But we have history with them; they’re kind of like family. We grew up together as kids. They’ve got their company, and we’ve got ours. We work together, and it’s nice.â€? Prairie Gold has been around for the last couple of years. “We are one of the original (companies) here,â€? said Bernie. “The one my dad worked for was the original one. There are other people who worked there also, and then they started their own business. Two of our old employees started their own business.â€? “There’s been two spino businesses,â€? said Todd. “Our grandfather was the original pumpjack man.â€? Their grandfather learned the trade when an Esso employee came around from Calgary to show them what to do when ďŹ xing a pumpjack. He showed them how to clamp the rods o and all the steps, and that’s how they learned the tricks of the trade, said Bernie. Because he’s been around the oil industry so long, Bernie has seen the booms as well as the slow periods. He

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The Folkerts have been running their pumpjack maintenance business for more than 40 years. From leĹŒ is Todd Folkerts, father Bernie and Aaron, the current owner of C&B OilÄŽeld Services.

said the problems would often either arise when there was a change in Saskatchewan’s government or because of the volatility of the price of oil. “I remember 15 times when we were struggling because the price of oil fell o. I can remember once, it was down to $12 a barrel, and it was probably lower than that at times because in the old years oil wasn’t really that valuable.â€? The high prices in those days were about $18 per barrel, so the drops to $10 or $12 meant about a 40 per cent drop in the commodity’s price. “To say there were never any struggles would be telling a lie, because there was a struggle just about constantly,â€? added Bernie. “I often wish I could go back to work now, because you can actually make some pretty good money in the oilpatch now.â€? “I think one of the biggest things I’ve noticed and experienced,â€? said Todd, “is when oil was up and booming when I was younger, you could do the work and we always had the manpower it seemed like. Now it’s a shortage. That’s what I’ve seen. The last four or ďŹ ve years has been a shortage of workers.â€? Bernie got into the business at a very early age, as his dad wanted him to be out doing something during his breaks from school.

“When I was a kid and my dad had this pumpjack job, he used to get me a job there in the summer holidays,â€? said Bernie. “When I was 12 years old, I was ďŹ xing pumpjacks, because I was always kind of a big kid and he said, ‘Well, you’re not lying around all summer. You’re 12 years old. You’re big. I’ll get you a job.’â€? In some ways, there was no escape from the family business because of how immersed everyone was in the trade while growing up. “I was going to be a dentist, but then I thought I’ll just (stick with C&B),â€? Aaron said with a laugh. He was never forced into the work, but it was still something of an inevitability because he and his brother grew up around pumpjacks. “This has been my life,â€? said Bernie, “and I think these guys (Aaron and Todd) would tell you the same thing. This is what we do. This is what our family does.â€? That may be what they do, but Bernie stressed that it wasn’t something he forced on either of his sons. He wanted them to go out and ďŹ nd their own way. What they happened to ďŹ nd was the family business. The jury is still out on whether or not the fourth generation of Folkerts will take over the business at all. Again, Bernie said, it’s going to be up to them. ɸ Page B3

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PIPELINE NEWS August 2012

B3

The family-owned C&B OilĮeld recently purchased a picker truck, which helped bring owner Aaron Folkerts’ brother Todd back into the company. Todd had been running trucks like this for other companies, but now that the family had one, he decided to come back and work for them.

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ɺ Page B2 “I think they’ll let you know whether they’re interested or not,” added Aaron about his sons, Carter and Grayden. C&B is now running four crew trucks as well as a picker truck that they purchased near the end of 2011. That brought Todd back into the fold, as he was working with other companies operating cranes and lifting equipment. Todd said, “Where I come in is I worked for Dad in the summer holidays. He’d take me out to do the lighter maintenance, oil changes, and then I’d try and help him setting the pumpjack, but I always thought the guy running the picker was the cool guy. I paid attention to that.” He went off working for other companies as a crane operator. He and Aaron had talked for a long time about buying a picker truck so he could come back and work for the family. One

day they just decided to do it, and the addition of the truck has only meant good things for the business so far. “I would say the crew trucks help the picker and the picker helps the crew trucks,” said Aaron, commenting on how the addition of the picker truck complements the rest of their business. “When you go to set up new pumpjacks, it’s nice that you can provide the picker and the crew to do it.” “Aaron would be out and need a picker,” said Todd. “You phone around and you phone around and you’re waiting, whereas here it’s a good chance (it will be available).” As long as it isn’t tied up at one of the other crews’ locations, it will be ready to go. Because they are one of the few companies in Frobisher with a picker, they can rent it out with Todd at the wheel. Bernie noted that they used to depend on other contractors

for their picker trucks, so he said it should be a valuable asset to the business. With their crews, they are able to cover from Radville to Stoughton and down to the United States border. Though it can be tough to find more labour, the Folkerts aren’t against adding a couple more bodies for another crew. Todd said, “You can always use another crew. We can spin our heads around and go, ‘what were we thinking?’ but that’s the way it is now.”

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PIPELINE NEWS August 2012

Workplace safety rollout starts New OccupaĆ&#x;onal Health and Safety Act amendments take eÄŤect in Saskatchewan Sept. 3. One of the amendments requires a business owner to designate a prime contractor in charge of the safety of all workers from mulĆ&#x;ple employers and contractors, etc. on a work site such as this house constructed in 2011 in Kindersley. InformaĆ&#x;on sessions are being held throughout the province for all industry sectors. File Photo

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„ By Geo Lee Regina – Amendments to the Occupational Health and Safety Act that come into force Sept. 3 are aimed at improving Saskatchewan’s record as the province with the second highest injury rate. Saskatchewan’s total injury rate increased from 8.7 per cent in 2010 to 8.73 per cent in 2011 with 14 fatalities reported to the Workers’ Compensation Board in the ďŹ rst half of 2011. The amendments include a doubling of existing ďŹ nes and an increase in the maximum

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penalty of for a serious workplace injury or fatality from $300,000 to $1.5 million. They also establish a list of enhanced duties pertaining to occupational health and safety fo employers, supervisors, workers, contractors, suppliers and owners. One of the key amendments requires prescribed business owners to designate a prime contractor to co-ordinate work site safety where there are multiple employers or self-employed workers on location. “That’s an increasing phenomenon in Saskatchewan in all jurisdictions,� said Rita Coshan, acting executive director of the Occupational Health and Safety Division. “You have many trades coming on to a site. If they act completely independently, the work of one employer’s workers can impact the others as well. “It has become

clear that you need some sort of an overseeing role in a complex work site where you have multiple selfemployed persons with small employers working side by side.â€? That’s often the practice at many oilďŹ eld construction sites or maintenance turnarounds. “The large oil companies have a choice whether to use their own resources or hire outside people to act on their behalf or an agent,â€? said Coshan. “I can’t really comment on how they are going to address this – whether they are going to use their own sta or outsource it.â€? OďŹƒcials from the Ministry of Labour Relations and Workplace Safety will explain all of the new roles and responsibilities of the amendments and how they aect industry sectors during a series of information sessions being held throughout the province. ɸ Page B5

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ɺ Page B4 “I think the government is taking its role very seriously in terms of showing a commitment to addressing the high injury rate,” said Coshan about the amendments. “This is one of a number of initiatives that are being taken on the enforcement side. “We also work on a broader prevention initiative with WCB called WorkSafe Saskatchewan. It goes beyond enforcement.” WorkSafe aims to promote positive safety culture in Saskatchewan workplaces. “It also deals with education social mar-

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keting those sorts of things. In recent times the government is taking the injury rate very seriously,” said Coshan. Officials kicked off the information sessions in Swift Current on June 25, although the bulk of the sessions will take place in the fall. “We’ve had surprising attendance – a lot greater than we expected,” said Coshan regarding the first four summer sessions that wrapped up in Prince Alberta on June 28. “We have been booking large venues to accommodate a large number of people. There is definitely an interest from the oil and gas sector as well as the

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other sectors.” There will be 30 sessions in all including two in Lloydminster on Sept. 26 and Dec. 4 at the Barr Colony Heritage Centre, and two in Estevan on Oct. 10 and Nov. 14 at the Super 8. Meetings will be held in other oilpatch communities such as Weyburn, Kindersley and North Battleford. The information meetings run through

a layman’s explanation of the amendments in a 60-page Interpretive Guide given to each participant at the sessions. “They are very interactive. They are four-hour sessions and they are very lively in terms of the discussions and the questions,” said Coshan. “We are sort of keeping track of those questions. These are useful sessions. They raise the kind of questions that we need to be prepared to answer.” The Interpretive Guide is also available online at the Labour Relations and Workplace Safety site for those who can’t attend one of the meetings. The amendments to the Occupational Health and Safety Act were passed by the leg-

islature in May following consultations and review by the Ministry of Labour Relations and Workplace Safety’s Occupational Health and Safety Council. “The amendments address prime contractor responsibilities. It’s a responsibility that already exists in a lot of the other western provinces,” said Coshan. “There is a lot of interest in that because it is a new approach. “What the prime contractor does is to establish those roles and responsibilities on complex work sites where you have more than one employer. “They have a responsibility to come up with a written plan than insures all the employers on site have procedures and safe work practices in place.”

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PIPELINE NEWS August 2012

STARS lottery ticket a safe bet Regina – It pays to support STARS air ambulances in Saskatchewan. Just ask Cecile Curran of Regina who is the early bird winner in the ďŹ rst ever STARS Lottery in the province. Curran won a $90,880 prize package that includes a 2012 Mercedes SLK350, a Las Vegas vacation including four nights for two adults at the Bellagio Hotel and $5,000 cash in the July 11 draw. Tickets are still available for a chance to win over 2,200 prizes worth more than $3.4 million in the grand prize draw on Aug. 15 STARS Foundation executive vice-president Rod Gantefoer said the draw marks the ďŹ rst of many wonderful STARS milestones to come in the province. “The STARS Lottery will see many prize winners, but the true winner is the patient who was positively impacted because of the funds we raise to help keep STARS in the sky,â€? said Gantefoer. STARS began providing helicopter air ambulance services for critically ill and injured patients in southern Saskatchewan on April 30. Several major donors have provided contributions to the STARS Saskatchewan program including Crescent Point Energy, Mosaic, PotashCorp, Enbridge, Enerplus, Husky Energy and Rawlco

Ron Dufresne, vice-president of STARS Saskatchewan OperaĆ&#x;ons, reaches into the draw drum to pull the lucky Ć&#x;cket in the STARS LoĆŠery early bird draw on July 11. The loĆŠery followed the April opening of STARS in Regina with the opening of a second base in Saskatoon this fall. Photo submiĆŠted

Radio. STARS signed a service agreement with the government of Saskatchewan in April 2011 to provide helicopter air ambulance services from bases in Regina and Saskatoon. Since then, STARS has been working closely with government, corporate donors, and partners in health care and emergency services to facilitate the

launch of both bases. The Regina base was the ďŹ rst to open in the province, with the Saskatoon base set to open in the fall of 2012. “Together with our partners in emergency services and health care, we will work to enhance access for critically ill and injured patients,â€? said Andrea Robertson, STARS president and CEO at the Regina base opening. STARS is currently operates at the Regina base from 7 a.m. to 7 p.m., and is moving toward 24 hours a day service later this summer. STARS has own nearly 23,000 missions since 1985, and operates from ďŹ ve bases in Alberta, Saskatchewan and Manitoba. The STARS Lottery wrapped up in Alberta on April 12 with the same type of prize pool to that oered in the Saskatchewan grand prize draw. The three grand prizes include a Regina home worth $1.2 million, a Saskatoon home worth $1 million and a home-away-from-home truck and trailer package worth over $194,000. The last day to buy tickets is Wednesday, July 18 at midnight. Single tickets are $60 each, or two for $100 and six for $250.

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PIPELINE NEWS August 2012

B7

Two kids master the art of energy Regina – Two Saskatchewan students have turned the science of energy and the environment into an art form that has them jumping with joy. Sabrina Moshenko, a Regina Grade 5 student from Wilfred Hunt Elementary School, and Dylan Paquette, a Grade 5 student at Caronport Elementary School, took ďŹ rst and second place provincial honours respectively in this year’s national Energy and the Environment Art Contest. Awards and prize packages were presented to the winning stu-

dents in their respective schools while the ďŹ rstplace winner’s school resource centre also received a $300 donation. Moshenko placed ďŹ rst from more than 400 provincial entries for her alternative energy drawing while Paquette’s work of art features an environmentally friendly superhero. “Students these days are very knowledgeable about energy resources and energy conservation,â€? said Minister responsible for Energy and Resources Tim McMillan. “That knowledge is

clearly exhibited in both Sabrina and Dylan’s artwork, and I congratulate the two of them and their fellow students on their creativity.â€? Saskatchewan elementary school students have been participating in the Energy and the Environment Art Contest since 1991. The OďŹƒce of Energy EďŹƒciency at Natural Resources Canada manages the contest at the federal level and the Ministry of the Economy co-ordinates on the provincial level. Provincial and territorial winners from across Canada, including Saskatchewan’s ďŹ rstplace winner, can be viewed on the Natural

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PIPELINE NEWS August 2012

Rigcharge developers amped by apps „ By Geo Lee Edmonton – Revamp Industries Ltd., an electrical contractor specializing in oilďŹ eld construction and services, anticipates a high voltage sales reaction to its new Rigcharge battery maintenance system for drilling rigs, service rigs and heavy equipment. The Edmonton-based company launched Rigcharge in June at the Global Petroleum show in Calgary. Rigcharge is a green energy product that can extend the life of pricey oilďŹ eld batteries and keep them out of the landďŹ ll. “The main goal of Rigcharge is to make your batteries last up to ďŹ ve times longer through de-sulphation,â€? said Marc Bouclin, operations manager and master electrician. “Lead acid batteries have a natural breakdown. Sulphation is probably public enemy number one for lead acid batteries.â€? The electro-chemical reaction that occurs between the lead plates and sulphuric acid to generate electricity causes lead sulphate buildup that reduces available battery power during load demand and reduces recharging capacity. The end result is shortened lifespan for lead acid batteries. “What our product does is use a pulsing frequency that stops that process and breaks down sulphation that has already happened in the battery,â€? said Bouclin. The science of pulse technology works by gently vibrating the sulphur atoms electronically, breaking the bond of the lead sulphate crystals, and redissolving the sulphur into the sulphuric acid electrolyte. The Rigcharge also eliminates winter battery kill and o-load voltage and

Marc Bouclin, leĹŒ, and Jason Brown from Revamp Industries in Edmonton have developed a new division and product called Rigcharge, which uses solar panels and pulse technology to conĆ&#x;nually charge the baĆŠeries of drilling rigs, service rigs and heavy equipment. Bouclin holds up a ÄŽve-waĆŠ solar system for recharging 12V baĆŠeries. The larger unit can charge a 24V baĆŠery and comes with a light weight aluminum mounĆ&#x;ng frame. Both systems are fully customizable including the aĆŠachments.

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provides a constant trickle charge that improves equipment reliability and productivity. “Once winter kill happens, that battery loses its charge – sulphation sets in and the battery will never be the same. You’ll be lucky to get back 60 per cent of life through charging,â€? said Bouclin. A typical conventional drilling rig can have up to eight batteries with two 12-volt batteries in a series to provide 24 volts of power at a cost of $600 to $1,000 a pair to replace. “If you buy one, you are looking at the cost of two batteries for the cost of our unit, so you can deďŹ nitely see the savings,â€? said Bouclin. “One of the biggest problems out in the ďŹ eld is the downtime that companies occur – guys going out to pull equipment that’s been sitting for awhile,â€? said Bouclin. ɸ Page B9

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PIPELINE NEWS August 2012 Éş Page B8 “Before you know it, you’ve got guys standing around, and you’ve got hotshots and new batteries and batteries going to the landďŹ ll. It’s just all around, a bad situation. “In Calgary, we had a great reaction. Everyone loved our product. One of the biggest selling points is the green factor. With our product, there is going to be fewer batteries going to the landďŹ ll every year.â€? The 24V Rigcharge consists of two, ďŹ ve-watt solar panels built to military standards with an aluminum and stainless steel housing. The 12v system includes one, ďŹ ve-watt solar power that also uses the pulse technology. “It takes the power of the sun and it gives you the beneďŹ t of charging your battery to take care of key o-load as well as the pulse technology to extend your battery life up to ďŹ ve times,â€? said Bouclin. The 24V system for rigs is mounted on a small customizable magnetic stand made of aluminum. “It’s very light weight and corrosion resistant and stands up to the harsh environments of Alberta weather in the wintertime and the harsh environment of an oilďŹ eld drilling site,â€? said manager Jason Brown, who is a Red Seal electrician. The basic unit comes with oilďŹ eld spec cable that connects from the unit to the batteries and comes with a cable anchor to secure it to the equipment. “It’s very easy to hook up. We’ve designed a turnkey plug and play system where anybody can install it on the roof of their building, hook it up to their batteries, and pretty much forget all about it,â€? said Brown. “We predict big things for this, especially as

Marc said, with the green factor and the cost savings of buying new batteries every year. “We see a deďŹ nite environmental impact.â€? Revamp formed a Rigcharge division under the management of Jordy Stewart with the product receiving strong interest from the Middle East for distribution and marketing rights. “We are ready to ship internationally,â€? said Brown. “We only see positive growth, and we’d like to have positive growth every year and basically build a large customer base. “There is unlimited potential here. We just have to get the word out.â€? Revamp custom designs and fabricates Rigcharge systems to suit customer needs at its fabrication shop in Edmonton. Several plate style 12V panels can be put together to accommodate multiple battery equipment with pipe and square tubing brackets available for

B9

most industry applications. “If it’s new construction, we can actually weld the brackets in,â€? said Brown. “Our system is fully customizable. When a customer comes to us with a speciďŹ c purpose, we have a close look at it, draw something up, send it back to the customer for approval, and we send it to our fabrication facility to come up with a prototype. “Every piece of equipment and every application is dierent out there. We are ready to ďŹ t anyone’s needs. “The company plans to take the demo units to the Oil Sands Trade Show & Conference in Fort McMurray Sept. 10-12. “Winter will be coming then, and in Fort Mac with the big players up there, a lot of it is about the green factor,â€? said Brown. “Everyone is trying to help out the environment and do their part.â€?

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B10

PIPELINE NEWS August 2012

CE Franklin completes vote on NOV offer Houston – National Oilwell Varco (NOV), a U.S. owned oilfield equipment maker officially completed its C$240 million purchase offer of oilfield production equipment distrib-

utor CE Franklin Ltd. on July 19. Oilfield production equipment distributor CE Franklin Ltd. held a special shareholders meeting in mid-July to vote on the purchase

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of the deal when it was announced on May 30. “The addition of CE Franklin to NOV’s Canadian distribution operations will broaden our product offering and customer base, while strengthening our combined abilities to serve all of our customers,” said Pete Miller, NOV’s chairman, president and CEO in a news release. “We look forward to welcoming the CE Franklin team of professionals to National Oilwell Varco. “We expect CE Franklin’s high level of service and support to enhance our opportunities to provide a wide range of products to the

growing Canadian marketplace, for the benefit of both our customers and employees.” CE Franklin has been a leading supplier of products and services to the energy industry for more than 75 years in Western Canada and has a market value of approximately C$176 million. CE Franklin distributes more than 25,000 products including pipes, valves, flanges, fittings, production equipment, tubular products and other general industrial supplies, sourced from over 2,000 suppliers. The Calgary-based company has 39 branches situated throughout Western Canada and a central distribution centre in Edmonton. National Oilwell had been waiting for CE Franklin shareholders to approve the acquistion through their NOV Distribution Services Group based in Calgary in order to officially close the sale. Local officials from NOV in Lloydminster were unavailable for comment as the deal closed after our press deadline. NOV’s offer represents a 36 per cent premium to the closing price for CE Franklin shares when the offer was submitted. “This transaction brings our shareholders significant value and the opportunity for our organization to integrate with a global leader to provide a strong platform for enhanced client service

and expanded opportunities for our employees,” said Michael West, president and CEO of CE Franklin. Under terms of the purchase offer through NOV’s Distribution Services Group, CE Franklin had agreed to pay a termination fee of C$7.5 million if it accepted a superior offer. NOV was given the right to match any competing superior proposal for CE Franklin in the event such a proposal was made. CE Franklin’s largest shareholder, Schlumberger NV, previously reported that it agreed to vote for the buyout. The deal is the second one between Schlumberger and National Oilwell in the past few months. The world’s largest oilfield services company last month sold its piping and fitting unit to NOV for an undisclosed amount. NOV is valued at approximately $30 billion, with its core focus on providing the oil industry with the highest quality products and service. The company has more than 200 worldwide manufacturing and service centre locations. The NOV Distribution Services Group has more than 40 service centre locations across Canada focused on providing supply chain integration services to the upstream oil and gas industry and industrial customers in mining, chemicals, pulp and paper, forestry and food services.

PIPELINE NEWS August 2012

B11

New West deal ends triple Ă€ling Regina– Business registration in Saskatchewan, Alberta and British Columbia has moved to a one size ďŹ ts all approach under New West Partnership rules that took eect on July 1. The New West Partnership Trade Agreement is a far-reaching economic partnership between the three provinces. It is designed to promote prosperity in Western Canada through meaningful interprovincial collaboration. Under the latest agreement rules, businesses registering as a corporation will no longer need to register separately in each of the three jurisdictions as extra-provincial registration will be facilitated by the home province. Corporations will be asked to provide additional information to their home province to have their extra-provincial registration take eect in the remaining jurisdictions. No additional fees will be required for extra-provincial registration in the two other provinces. The partnership removes the need for corporations to ďŹ le their annual ďŹ ling requirement in all three provinces. Instead, corporations will now be able to ďŹ le once in their home province. “Through collaboration with Alberta and British Columbia, we are facilitating greater ease for Saskatchewan businesses to expand to new markets and attract international investors,â€? said Don McMorris, Saskatchewan minister responsible for Information Services Corporation. “The New West Partnership will make Saskatchewan and our neighbours the most competitive and attractive place to do business in North America.â€? “When Alberta businesses thrive, Albertans thrive,â€? noted Manmeet Bhullar, Service Alberta minister. “Reducing red tape and creating a more open

and competitive marketplace with British Columbia and Saskatchewan will help Alberta business expand their markets and attract new clients. These actions help secure our province’s economic prosperity,� Bhullar said. “Through the BC Jobs Plan, our government is aggressively targeting new investment that will create jobs for British Columbians,� said Pat Bell,

British Columbia minister of Jobs, Tourism and Innovation. “By working with Saskatchewan and Alberta through the New West Partnership, we can help break down barriers and needless red tape, signaling that the West is open for business. That will not only beneďŹ t B.C., but will provide opportunities across our provinces.â€?

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PIPELINE NEWS August 2012

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B13

Alberta crude output up seven per cent in 2011 Edmonton – Alberta’s crude oil production rose seven per cent in 2011 from 2010, the first increase since 1985, thanks to higher production rates of horizontal wells. In 2011, Alberta’s crude oil production totalled 490,000 barrels of oil per day with a yearly total of 179 million barrels. The record-breaking news came with the release of the latest supply and demand report by the Energy Resources Conservation Board (ERCB) on June 20. Alberta’s Energy Reserves 2011 and Supply/Demand Outlook 2012–2021 outlines the state of reserves and the supply and demand outlook for Alberta’s crude bitumen, crude oil, natural gas, natural gas liquids, coal, and sulphur resources. The reserves of Athabasca Upper, Middle, and Lower Grand Rapids deposits and the Athabasca Nisku deposits were reassessed for year-end 2011. The review of the three Grand Rapids deposits resulted in a seven per cent increase of the total in-place crude bitumen resource to 58.4 billion barrels, which is attributed to an increased number of wells drilled in the area. The reassessment of the Nisku deposit resulted in a 57 per cent increase of the in-place resource to 102 billion barrels, which is attributed to an increase in average thickness and an expansion of the delineated resource area. In 2011, Alberta produced 1.7 million barrels per day of raw crude bitumen from the oilsands for a yearly total of 637 million barrels or an 8 per cent increase over Alberta’s 2010 oilsands production. The ERCB forecasts Alberta’s annual raw crude bitumen production will total 3.7 million bpd for a total of 1.35 billion barrels per year by 2021. The report notes that, since 1967, Alberta has produced about 8.1 billion barrels of raw crude bitumen from the oilsands and has produced about 16.5 billion barrels) of crude oil since 1914. The report also estimated Alberta’s total remaining established crude bitumen and crude oil reserves to be 170.2 billion barrels, consisting of 168.6 billion barrels of crude bitumen and 1.5 billion barrels of crude oil. The remaining established crude oil reserves increased by a net four per

cent, similar to the increase last year, as the cumulative result of reserves additions from 2011 drilling, reserve revisions, and production The province’s remaining established marketable conventional gas reserves stood at 33.5 trillion cubic feet, a decrease of eight per cent from 2010. Remaining established reserves of natural gas liquids stood at 1.6 billion barrels, down three per cent from 2010. Alberta’s remaining established coal reserves are down very slightly and stand at 33 billion tonnes.

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PIPELINE NEWS August 2012

SaskPower to pass costs to consumers Regina – SaskPower has applied for a 4.9 per cent rate hike to oset the capital cost of building major projects such as the carbon capture and storage project at Boundary Dam Power Station and the 200 megawatt expansion of Queen Elizabeth Power Station in 2013. The Crown-owned utility has submitted an application to the Saskatchewan Rate Review Panel to increase rates eective Jan. 1, 2013 to fund investments in the province’s electrical system and maintain electri-

cal reliability. Saskatchewan residential customers will see their bills increase by between $4-6 per month starting next year. “This rate increase is needed to fund investments into the province’s electrical system to ensure our customers continue to beneďŹ t from a safe, reliable and sustainable power supply,â€? said SaskPower president and CEO Robert Watson. “Demand for power is expected to grow by 2.9 per cent per year from

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2011-2021, and we need to be ready for that growth.â€? The ongoing replacement and refurbishment of the electrical system, along with the need to reduce greenhouse gas emissions, factor into the need to increase electricity rates. The $1.24 billion carbon capture and storage project will transform Unit 3 at SaskPower is seeking a 4.9 per cent rate hike in 2013 to Boundary Dam Power help fund the cost of construcĆ&#x;ng mega projects such as Station near Estevan into the one at Boundary Dam Power StaĆ&#x;on near Estevan. File photo a long-term producer of 100 megawatts of clean ments will involve the installation of base-load electricity. 500,000 so-called smart meters by the The project will also reduce end of 2014. greenhouse gas emissions by capturThe meters came to light with the ing one-million tonnes of carbon news SaskPower had restored power dioxide per year. to more than 200,000 customers in SaskPower will also invest more Meadow Lake, North Battleford and than $550 million to add 200MW Prince Albert who lost power when of natural gas generation at Queen Elizabeth Power Station in Saskatoon severe thunderstorms swept through the region on June 25. to keep up with demand. The meters won’t stop outages Over the next 10 years, Saskfrom happening, but they will help Power plans to spend $10 billion on SaskPower determine where the outthe province’s electrical system, plus ages occur more accurately. another $5 billion on commitments SaskPower maintains and operto the company’s Power Purchase ates more than 157,000 kilometres of Agreements. power line in the province. One of the system invest-

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Diesel fuel sold with fry oil Regina – Would you like fries with your diesel fuel? Waste cooking oil is included in the mix of Saskatchewan’s Renewable Diesel Mandate that establishes an average of two per cent renewable content in diesel fuel sold in the province. The renewable diesel content rules came into effect on July 1, and could reduce greenhouse gas emissions the equivalent to taking 5,000 cars off the road annually. Renewable diesel is a diesel fuel substitute made from renewable materials which include vegetable oil, waste cooking oil, animal fat and fish oil, or feedstock from agricultural or forest biomass. The program also provides an incentive of 13 cents per litre of eligible renewable diesel to qualifying producers in Saskatchewan to support the production of renewable diesel in the province The incentive program began April 1, 2011, and terminates March 31, 2016. “The new mandate was developed in consultation with the industry,” said Economy Minister Bill Boyd said. “To support the mandate, our government introduced the Renewable Diesel program in the 2011-2012 budget which provides incentive for the production of renewable diesel in the province.” There will be an average-based system that will have a compliance period that runs until Dec. 31, 2014. The mandate does not apply to diesel marketed in Northern Saskatchewan or to aviation fuel. “The new Saskatchewan mandate will ensure participation and count toward compliance under the national mandate,” Boyd said. “There is an emerging market for new fuels, it’s good for our environment and at the same time benefits our economy.” The mandate and the incentive were recommended by the Enterprise Saskatchewan Biofuels and Bio-Products sector team and the ES board of directors. Renewable diesel differs from biodiesel that generally refers to vegetable oil or animal fat-based diesel fuel consisting of long-chain alkyl (methyl, propyl or ethyl-esters). Canola-based biodiesel, for example, is typically produced as canola oil derived fatty-acid methyl ester.

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B16

PIPELINE NEWS August 2012

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Setting new standards for performance Since it was established in late 2008, CanElson Drilling Inc. has grown quickly to become one of Canada’s premier drilling contractors. In addition to building its own drilling rigs, the company is expanding its Àeet of drilling and service rigs through acquisition. CanElson now operates a Àeet of 37 rigs (34 net). With operations in Western Canada, West Texas, North Dakota and Mexico, CanElson Drilling Inc. is setting new standards for rig utilization. With right-sized, purpose-built rigs built for horizontal and resource play drilling and experienced, well trained crews, the company is achieving new records for cost-effective, ef¿cient drilling operations.

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PIPELINE NEWS August 2012

B17

Shell’s CCS project gets the go-ahead Calgary – Alberta’s primary energy regulator has approved Shell Canada’s carbon capture and storage project north of Edmonton with 23 conditions that include additional data collection, analysis, and reporting. Shell must also obtain separate approvals for any additions to the project. Shell said it welcomed the approval, but noted the company and its partners in the Athabasca Oil Sands Project are still working on feasibility studies on the project. A decision on whether to proceed won’t be made until later this year. “This is a really important and exciting milestone for the project and takes us one step closer to implementing the ďŹ rst CCS project for an oilsands operation,â€? said John Abbott, Shell’s executive vice-president, heavy oil, said in a news report. An Energy Resources Conservation Board hearing panel issued its gohead on July 11 after determining it is in the public interest to proceed with the project. The $1.35 billion Quest project would remove one million tonnes of carbon dioxide emissions from Shell’s Scotford bitumen upgrader and route it two kilometres into the ground at an injection site about 80 km north of Fort Saskatchewan. Regulatory applications for the Quest project were submitted in November 2010 with the governments of Alberta and Canada agreeing to provide the project with $865 million in July 2011.

The project would be the ďŹ rst of its kind for the Athabasca Oil Sands. Construction of the project would take three years followed by project commissioning and starting. In making its decision, the ERCB noted the proposed reservoir is a suitable location for the long-term storage of carbon dioxide. In addition it concluded the combination of geological conditions, engineering design, operational practices, and extensive monitoring program will mitigate any potential risks the project might pose. The ERCB held a hearing in Redwater, Alta. from March 6-9, 2012 to consider the applications and any concerns from interveners. Prior to issuing its ďŹ nal approval, the ERCB is required to refer the application to Alberta Environment and Sustainable Resource Development for review. Alberta Environment and Sustainable Resource Development may impose additional conditions with respect to the environment, which will be added to the ERCB’s approval.

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PIPELINE NEWS August 2012

Trican suffers loss after rocky spring Calgary — Trican Well Service Ltd. had to prepare for a second quarter loss, after wet spring conditions and pricing declines left the company down more than $20 million by rosy estimates. In a July 3 press release, Trican estimated a diluted loss per share between $0.32 and $0.42 and an operating loss of between $24 and $34 million. The release noted that the ďŹ gures are subject to the completion and approval of their second quarter interim ďŹ nancial report, which was expected on July 30. “Wet weather in May and June led to lower industry activity levels throughout Western Canada and had a negative impact on our second quarter Canadian results,â€? said the release. “We are currently evaluating our options and will consider parking crews that are experiencing low utili-

zation and low operating margins.â€? Trican noted a large Horn River project was expected to start in early June but was delayed until the end of the month because of the wet weather. They said that as customers have reduced their budgets and new pressure pumping equipment enters the market, they expect pricing to decline in the second half of the year, leading to reduced operating margins in Canada. “However, we expect demand to remain strong and support solid utilization levels and operating margins for our Canadian operations during the second half of 2012,â€? said the company’s statement. “We will continue to monitor the capital budgets and cash ows of our customers in light of low gas prices and the recent weakness in oil prices. We expect that any additional reductions

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in capital spending by our customers will decrease Canadian rig counts and place further pricing pressure on the Canadian pressure pumping market.� Trican also noted their U.S. operations would have an operating loss in the second quarter due to pricing declines and continued increases in guar costs. Pricing in the second quarter decreased by about 10 per cent as new pressure pumping equipment continued to enter the American market. “In addition, average guar costs increased sequentially in the second quarter and we were largely unable to pass these costs on to our customers due to the competitive pricing environment.� The company said they have initiated a number of cost-cutting measures to reduce the cost of their products but would not see any ben-

eďŹ t until the second half of 2012. “These measures include the introduction of a new hybrid uid system that is expected to reduce guar usage,â€? said Trican. “We have started to see a reduction in guar prices and we expect guar prices to continue to decrease throughout the remainder of 2012 as a result of the development of hybrid systems and guar substitutes, and the new guar crop that is expected to increase supply later in 2012.â€? Second quarter results for Trican’s international operations are expected to be below their expectations due to delays in their Russian customers' work programs. They expect operating results to improve in the second half of 2012, but annual results for their international operations are expected to be slightly below expectations due to weaker-than-expected results during the ďŹ rst half of the year.

Saskatchewan wages Regina – In Saskatchewan, you reap what you sow and that includes a cash crop of well paid workers attracted to the province by the strong economy and job market. Saskatchewan had the third highest average weekly earnings in the nation in April, according to Statistics Canada. Saskatchewan’s average weekly wage for April was $912.78, a four per cent increase over last year and the second highest percentage increase among the provinces. “Wages in Saskatchewan have surpassed what is happening on the national scene for more than nine straight months,� said Economy

Minister Bill Boyd. “It is a good signal that our economy is moving forward, and another good economic indicator to support steady growth into our future.� Average weekly earnings in the province have been on the rise, exceeding the national average since August 2011 according to Statistics Canada. “This is all about Saskatchewan people having more take-home pay every week, which means money that improves quality of life,� said Boyd. “The improvement in average weekly earnings is simply good news all around.�

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B19

Scrounging up capital for the province’s oil wells The unit holders receive ow-through tax beneďŹ ts, as well as quarterly cash distributions from production that comes o the well. “So they have actual ownership in the oil and gas well,â€? Karalash noted, “because of the limited partnership structure, it takes the liability away from the limited partnership unit holder.â€? They raise capital for about three months for each fund before it is closed. The capital is then deployed, the wells produce the money and that goes back in quarterly distributions. There are also ow-through tax beneďŹ ts through a three-year hold period. They have the three-year period so the wells have time to mature and they can see what the wells are owing and stabilizing at. The oil well continues to produce, so there is much less volatility in their security price , noted Richard Wingate, CEO of FNRM. “People are getting paid to wait; they are getting distribution from the oil well, he said.“Getting paid to wait is very important for the proceeds to come back to the investor so they can feel comfortable that they have a nice cash ow in today’s world.â€? “They do have liquidity at the end of three years. How we’re going to do that will depend on the market and timing,â€? said Karalash. They are focused on development drilling, not exploration drilling. The oil companies run the drilling programs. FNRM just provides capital for development drilling, which has an 85 per cent success rate. “They are in the development stage and past the

exploration stage, so that risk is taken out,� she said. The June Crown land sale included 133 lease parcels that brought in $9.4 million in bonus bids and three petroleum and natural gas exploration licences that sold for $1.1 million. The southeast sector remained strong as the Weyburn-Estevan area received the largest chunk of the bids, with sales of $4 million. The next sale of Crown petroleum and natural gas dispositions will be Aug. 13.

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Saskatoon - For junior oil companies looking for some capital funding, the limited partnerships offered through a Saskatoon-based asset management company is a way to get the funding and maintain control over their drilling programs. FNR Asset Management Inc. (FNRM) connects with junior oil companies that need some capital to get a well going. FNRM raises capital through its products FNR Energy Limited Partnerships, which oer junior oil companies funding for oil well development drilling, and oer unit holders direct investments in wells rather than the oil company. The ďŹ rst limited partnership they did was in July 2011 and they have completed two more since that time, said Jessica Karalash, who handles communications and investor relations for the company. She noted that so far, they have raised about $15 million in their three limited partnership funds, which closed in July 2011, December 2011, and June 2012 respectively. She was unable to say when the next limited partnership would begin, but noted they plan on holding two each year.. After their ďŹ rst public oering, the funds raised were sent to private operators in Saskatchewan, with one company drilling two wells at Alida and Tilston, Man., and another drilling three wells at Frobisher. The third operator completed ďŹ ve wells in the Kindersley Viking formation. The investors own limited-partnership units, which are similar to shares, but the limited partnership funds are ow-through. “The cash that we raise, we raise it and then deploy it on private and public oil and gas development drill programs through various companies.

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PIPELINE NEWS August 2012

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PIPELINE SECTION C NEWS Apex Solutions to push top sellers August 2012

Story and photos by Geoff Lee Lloydminster – Apex Advanced Solutions Inc. will be brochure ready to support the features and benefits of their core endless rod and progressing cavity pump products and services at the 2012 Lloydminster Heavy Oil Show Sept 12-13. The company will also be exhibiting and marketing some new technologies and a rod transport and repair unit at outdoor booths 395 and 397. This year, more than 6,000 visitors are expected to tour the show that Apex views as a key opportunity

to promote their growing list of integrated advanced solutions for light and heavy oil applications. “I feel the show is really important because it’s a chance to show the industry what we have to offer and to meet with other guys in the industry,” said Jeff Taylor, operations manager, field services in Lloydminster. “Our leading products are related to artificial lifts including endless rod as part of our products and services offering.” Apex is the authorized distributor of Moore Endless Rod that is manufactured in Nisku for a

Jeī Taylor operaƟons manager for Apex Advanced SoluƟons in Lloydminster displays a cutaway of a model 8 PC pump for heavy oil designed in-house by Ryan Rowan, vice-president of technology. Rowan’s pumps are designed for increased inŇow capacity in heavy oil applicaƟons.

variety of well conditions in reciprocating or rotary pumping applications. Endless rod joins a top drive unit to a downhole pump with only one top and bottom threaded coupling required, compared to conventional 25-foot lengths of sucker rod with couplings every 25 feet. “Endless rod is used in heavy oil and light oil applications. Now, with horizontal wells, it addresses rod and tubing wear,” said Taylor. “The benefits are you can spread wear throughout the well rather than it being concentrated at every 25-feet section. Also, you are getting more fluid to the surface with less flow restriction while reducing torque. “Endless rod around here has been a widely used product for a number of years. There is more in the ground in Lloydminster and area than anywhere else in the world.” “Rod wear and viscosity are the main problems around Lloyd. You can get into other areas where there is CO2 and H2S. “There are different grades and sizes that you can put into those applications that resist corrosion,” said Taylor. Moore manufactures everything from a DGrade carbon alloy steel rod for non-corrosive environments to an NS-Grade high strength nickelchrome molly alloy steel endless rod where a higher strength product is required. The Lloydminster operation is benefiting from the startup of a micro plant to provide custom pin to pin string fabrication based on customer needs for their wells. The micro plant was set up two months ago and similar operations are in the works for other key locations in Western Canada in the coming months. The Lloydminster shop has a fleet of 12 truckmounted grippers to provide service on any brand of endless rod, and endless rod field welders for splicing and welding pin ends and conducting rod repairs on location. “We have a full fleet of service options along with a rod transport and repair unit. We’ve got one on the road and three more coming in August and September,” said Taylor. “We continue expanding our service fleet. We try and find new and better ways to better serve the customer. “We have been in the endless rod business for five years now and we are going to keep focusing on that. “Five years ago, I came here and actually starting running the first gripper unit. “To see the business grow, it’s been interesting. We’ve got a good group of guys here. The price of oil has been fairly steady and looks good for the future.” ɸ Page C2

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PIPELINE NEWS August 2012

Apex serving clients throughout Western Canada

Apex Advanced SoluĆ&#x;ons took delivery of this new spool of endless rod manufactured by Moore Endless Rod in Nisku. The company has 12 truck mounted grippers for installaĆ&#x;on in the ÄŽeld.

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Éş Page C1 Apex Advanced Solutions is based in Edmonton with branches in Lloydminster, Calgary, Bonnyville and Swift Current. The company is partnered with Apex Distribution Inc. that operates in various locations throughout Western Canada, including an outlet in Lloydminster. “We tie in nicely with them because they are a pipe, valve and ďŹ ttings business. The

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customer can make one phone call instead of many, so I think that’s a beneďŹ t,â€? said Taylor. In the U.S., customers are served by Apex Remington. The Apex Advanced shop in Lloydminster has a test bench for testing their premium line of NETZSCH PC pumps for light to heavy oil applications. Light oil pump geometries incorporate a reduction in elastomer volume resulting is less elastomer swell and heat

buildup. The heavy oil geometry pumps are designed for maximum inow capacity with a simple threaded conďŹ guration. “The PC pumps are matched for speciďŹ c applications, so we do have pumps that will pump more sand and pumps that will pump more water, so it all depends on the application,â€? said Taylor. The company’s oil show booth will also showcase some of the innovative PC pumps

for heavy oil that are designed by Ryan Rowan, vice-president of technology. Rowan’s heavy oil PC pump Models 8,11,15 and 18 are optimized with more cross sectional inow and better ďŹ ts on compression. “His goal was to design a better PC pump, using his industry leading experience, giving us a product that would beneďŹ t the customer and try to build our business that way,â€? said Taylor. With the innovative theme of the heavy oil show in mind, Taylor said if you don’t stay competitive, you end up by the wayside. “You have to invest in equipment and products and R&D to stay ahead of the game because it’s a constantly evolving industry,â€? he said. “Lloydminster is a real hub of innovation. Many products that are manufactured in Lloydminster make it all over

the world. That says a lot about the people and businesses in our community. “They products and services coming from Lloydminster set the bar, so the show is a unique way to network with those people.� The Apex booth will also attract attention with a linear rod pump. The pumping unit is

designed with simple mechanics and variable speed well control. It is also touted to provide signiďŹ cant cost and performance advantages over traditional pumping systems. For a complete list of products and services oered by Apex, pick up a copy of their 27-page catalogue at booth 395 or 397.

Welder Rino Jionee manufactures a new endless rod spool. Apex Advanced SoluĆ&#x;ons plans to exhibit some of its endless rod product at the Lloydminster Heavy Oil Show Sept. 12-13.

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Erhard Poggemiller and his wife Evelyn are in the market to sell their KEP Industries supply and manufacturing business and reƟre. Erhard is the mayor of Kerrobert who has to wear two hats behind the counter juggling shop and town business.

KEP boss wears two hats in Kerrobert By Geoff Lee Kerrobert – KEP Industries Ltd. in Kerrobert is a supply shop like few others. The business is owned by Erhard Poggemiller, the mayor of Kerrobert along with his wife Evelyn, which can make for an interesting mix of conversation behind the counter. “This is kind of my town office as well as a shop office,” said Poggemiller. “We hear a lot of things going on out there in the oilpatch and who’s doing what – and all of a sudden someone is changing names or someone is buying someone out.” This is Poggemiller’s third term as the mayor and he knows the value of public relations wearing two hats. “If someone has a complaint, you will get it down here. If someone comes in with a complaint from your service work, they come in here, so you get it from both ends,” he joked. “Most of the time, people have legitimate complaints and they’ve got issues to talk about, and most of them we can resolve.” There is plenty of stock to talk about at the shop that is formally described as “manufacturers and dealers of agricultural and industrial products” on the business card. “You could call us the general store without groceries,” said Poggemiller. “We carry parts here for the ag industry, the trucking industry, and we carry lawn and garden equipment. “We do vehicle inspections for larger trucks and tractors and trailers and so on. We do a lot of repairs on those kinds of vehicles. We also do lot of ‘one-of ’ custom fabrication within the shop.

“We supply raw iron – nuts, bolts and hardware and all that kind of thing. We have everything but groceries here.” KEP also sells and services recycled air filters, auto air conditioning and provides oilfield repairs and custom manufacturing to a growing base of oilfield clients. “Our business, when we first came to Kerrobert in 1978, was 85 to 90 per cent agriculture related. “Over the years that has changed to where we are now – I would say 75 per cent oil related and 25 per cent ag and whatever else. “If you are not prepared to change, you die – you are not in business. You have to change with the market,” said Poggemiller. “It’s the same with the town. Anyone who has a proposal or a plan – we don’t have a rigid rule. You can always come to council and we will sit down and have a meeting with you.

“If you have an idea you want to promote within the community or you have a business you want to set up, or are looking for property and can’t find what you really need, you are always welcome to come and talk to us.” Exterran-Canada and Agora Construction, now under construction, are among the new businesses in town that fall into the growing oilfield service category. Rev Energy, Enbridge, Plains Midstream Canada, Penn West Petroleum, Northern Blizzard, Alliance Pipeline and Weatherford are some of the major oilfield companies in the area that have come to rely on KEP for parts and fabrication. “Oil and gas come here pretty consistently to do work with hydraulics and buying hardware items – nuts or bolts or whatever – a lot of ‘one-of ’ things,” said Poggemiller. ɸ Page C4

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PIPELINE NEWS August 2012

The nuts and bolts Éş Page C3 “In the oil and industry, it’s nuts and bolts and bearings and metal and custom fabricated items, ďŹ lters and chain.â€? KEP is a stereotypical small town shop ďŹ lled with hundreds of old product boxes stacked to the rafters, begging the question how do ďŹ nd everything? “It may be frustrating for a newcomer, but we’ve been here long enough that we know what we’ve got and where it is,â€? laughed Poggemiller, who may have to share his inventory know-how with a new buyer. “I would sell the business if I could ďŹ nd someone who can take it over and run it as this business, because I think it is a very needed business in the community. Someone can make a good living,â€? he said. “We are at the age where we would like to retire from the business. There are a lot of other things I could do. I would really encourage someone who is interested in this kind of thing – this is a great start.â€? Poggemiller, who is 60, held the mayor’s seat until 2006. He was re-elected in a byelection in 2010, with a new hospital and a completed water treatment facility and expanded lagoon system as his legacy projects. Construction began on the $23 million Kerrobert & District Integrated Health Centre in June and the grand opening of the new reverse osmosis treatment facility will take place Aug. 3. As for running again, he said, “I haven’t deďŹ -

Erhard Poggemiller directs truck driver Ken McMahon from Con Alexander Trucking Ltd. in Unity to his shop for a minor engine repair. KEP is a mom and pop shop with one service shop employee as Erhard and his wife Evelyn near reĆ&#x;rement.

nitely conďŹ rmed at this point in time. A politician always weaves his way in and out of this thing, so I am not going to say yes or no.â€? Poggemiller is unsure at this point what he will do in retirement, but he won’t be kicking back in a rocking chair. “I would retire from this and probably do something that is less physically demanding on a person. I would always be involved,â€? he said. “If you lie down and quit, then you might as well not be here.â€?

Selling the business and falling into another routine with his wife after all these years of working at the shop together will be tougher than it sounds. “I think you are always going to miss it. I sometimes have apprehensions – this is what I have done all my life other than when I ďŹ rst started out in life (when) I taught school for a few years. Then I bought this business and this is basically what I’ve done all my life,â€? he said. “It’s the same as everyone else. You do that all your life, and then you leave – you miss it.â€?

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Lloyd heavy oil show adds pizzazz Lloydminster – Technology and illusions will vie for attention at the 2012 Lloydminster Heavy Oil Show and Technical Symposium Sept 12-13. Organizers of the show, known for exhibiting new technology and innovation, have booked an illusionist for the opening night social entertainment at the Lloydminster Exhibition Grounds venue. It is not know if the performer will produce a barrel of heavy oil out of thin air, but the act should inspire some creative thinking and discussion that can lead to new technology in the field. “The Lloyd region has an international reputation how to produce heavy oil,” said Mike McIntosh, chairman of the 18-person Oilfield Technical Society organizing committee. “People come here to see what the innovation is. The value added to the exhibitor is that it’s a great forum to exchange and experience innovation and technology. “It’s a great way for the exhibitor and the visitor to talk about what are the issues, and what needs to be overcome.”

Advance tickets are required to attend the opening ceremonies on Sept. 11, beginning with supper at 5:30 p.m. followed by comments by guest speaker Kevin Casper, vice-president of production with Devon Energy in Calgary. McIntosh said Casper would likely word his presentation to fit the informal theme of the future of heavy oil in the global marketplace. “We don’t have a formal theme this year, but informally we have been telling people – world supply and demand – how does heavy oil fit into that picture?” said McIntosh. “It’s world supply and demand, heavy oil’s future.” The OTS committee is also adding two luncheon speakers in the Prairie Room this year with presentations that fit the informal theme of heavy oil’s outlook. The Sept. 12 luncheon will feature a presentation by Jeff rey Newton, president of Aleph Sciences Group in New York, titled, A Discussion on Converting Well head Gases to Liquids and Chemicals. Paul Zorgdrager, Husky Energy’s vice-president of Lloydminster production operations – heavy oil,

is expected to speak about local technology during his Sept. 13 luncheon talk. There will be a nominal fee to attend each luncheon and tickets will also be on sale for the illusionist social. More than 6,000 visitors are expected to attend this year’s show to be held in conjunction with the technical symposium. All 368 inside and outside booths sold out early to 214 exhibitors with just over a month to go before the doors open to the newly renovated exhibition grounds that were under construction during the previous show in 2010. “We are getting lots of people calling wanting in. It’s a pretty popular show in the region for sure,” said McIntosh. “It’s an opportunity to talk to your customers. If we go back and look at the informal theme of the future of heavy oil as supply gets tighter and demand keeps growing, heavy oil has to continue to play a bigger and bigger role.” Check the heavy oil show website at www. lhos.ca in the coming days for more details on the speakers and their abstracts.

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PIPELINE NEWS August 2012

Rev steps on the expansion pedal Kerrobert – Rev Energy Services Ltd. in Kerrobert is on an expansion tear, adding two new divisions and a huge 31,000 square foot shop in a second location fronting Highway 21 south in just over a year. The local company is diversifying its core business in oilďŹ eld construction and maintenance, and pipeline maintenance in Western Canada, with an eye to national and international markets. The building houses the new Rev Internal

Coatings division for tubular pipe. Space for the Energy Process System division for oilďŹ eld fabrication is currently located at the old shop in town. The building features oďŹƒces, vehicle parking, a maintenance bay, a wash bay and the internal coating shop with room to relocate the fabrication shop. “It’s just the growth in the province – trying to meet the demands of the oil companies,â€? said majority owner Brian Burgardt about the ratio-

nale for expansion. “Our main focus was on completions, but we added the new coatings division just over a year ago. “Nobody does powder coatings in Saskatchewan. The closest shop was Wainwright and they were getting too busy, so we just thought we’d start our own. It’s getting busy.â€? Rev’s other services include everything from line lowering, integrity digs and ďŹ eld welding, to external pipe coatings and internal and external tank coatings. The internal coatings for pipe and anges that are used for batteries and facilities are completed in the new Rev coating shop while external coatings for corroded buried pipeline are conducted in the ďŹ eld. The coating shop occupies 6,000 sq. ft. of space in the new building and is equipped with a blast bay, two ovens and a coating booth to apply Scotchkote 134 powder coating to pipe from two-inch to 10-inch diameter. “The purpose of the coating is for longevity. A lot of what comes out of the ground is very corrosiveâ€? said Dan Chapman, manager of Energy Process Systems, who led a tour of the coating facility. ɸ Page C7 Rev Energy Services opened its new 31,000 sq. ĹŒ. shop last May to diversify and add two new divisions: Rev Internal CoaĆ&#x;ngs for pipe coaĆ&#x;ngs and Energy Process Systems for oilÄŽeld fabricaĆ&#x;on. Their core business is oilÄŽeld construcĆ&#x;on and maintenance, and pipeline maintenance.

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ɺ Page C6 “This process Scotchkote 134 adds a buffer between the product and the steel pipe itself and promotes longevity. Quality control is critical in this process. Some manual labour is required to profile the pipe and grind the roots down to round edges because the coating won’t adhere to a rough edge. The pipe is then put into the oven and preheated to open the pores. “During the preheat process, you have to sandblast it to get a certain profile so the powder coat will adhere to it,” explained Chapman. “Then it’s into the oven and into the powder coat booth right away and the powder coat is applied and put back into the oven where it’s cured for 15 minutes.” The internal coating division was set up last July and Chapman said it has met their expectations so far. “It’s good. We are seeing a demand for it, and we are eventually going to work toward an automated process within the powder coating itself.” Internal and external pipe coatings are managed by Darryl Burgardt, who was on hand to talk about integrity digs for repairs to the external pipelines that require external coatings. “If there’s too much corrosion, they have to repair that part of the pipe,” he said. “Usually that boils down to putting a sleeve on to reinforce that pipe, so if there ever is a break, you won’t get a leak. A sleeve is put on and then it’s coated afterwards.” Crews usually pre-blast the pipe after it has been exposed with a trackhoe and hydrovac to enable the pipeline utility to check for damage. “There has to be clean pipe for them to do their checks properly. If a sleeve is put on, it has to be blasted again and coated,” said Darryl, who noted business is good right now for external coatings. “Enbridge has got a lot of work on the go. This year alone they’re doing around 600 digs in Western Canada, so it’s supposed to be busy like that for the next three to five years.” ɸ Page C8

Keith Richards conducts a quality control check on the thickness of a powder coaƟng applied to some Ňanges.

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PIPELINE NEWS August 2012

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ɺ Page C7 Darryl and his brother Brian and their other partners, Barry Schreiber and Scott Kissock, got into the internal coatings business last year in order to diversify. “There’s a big potential for that and we’re seeing that – with the internal side of things it will take right off. It’s just getting that much busier with it. “There are a lot of different companies around the area doing a lot of drilling, and a lot of those facilities need the internal coating.” There is also lots of potential internationally for the company’s Energy Process systems, an integrated design and fabrication shop that builds everything from piping skids and vessels to mud tanks and debris catchers. “As of this April, we are an ASME (American Society of Mechanical Engineers) credited shop,” said Chapman. “Prior to that we could build piping and pressure vessels for anyone in the British Commonwealth and now we can build piping and pressure vessels for anywhere in the world. “We can build anywhere from eight-inch scrubbers to nine-foot diameter by 30-foot seam to seam storage tanks.” Local and international fabrication business is being driven by clients such as Northern Blizzard, Penn West, Reform Energy, ColCan CNRL, and Enbridge. “Diversification is exactly what we want to do,” said Chapman. “We built this 30,000 sq. ft. facility for that reason. In order to be a provider for all parts of Saskatchewan, this is what we felt we needed to do.” He said Northern Blizzard is taking advantage of what the province has to offer with a drilling program that he thinks will target 60 wells in 2012 – from one to seven well pads, and keep Rev Energy flush with work. “That means not only maintenance to tie in all these facilities and equipment, but also the welding end of things for the fabrication shop – all the welded manifolds and piping that they need,” he said. “Penn West is similar. A lot of their facilities and what they have in central Saskatchewan already exist, so they would need a lot of maintenance shutdowns and a few upgrades.” Rev currently has a staff of about 70 employees, up from 50 a couple of years ago and more new hires are in the works. “We are absolutely in an aggressive growth mode,” said Chapman.

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PIPELINE NEWS August 2012

Irish lucked out with Sandpiper jobs Vermilion – The luck of the Irish holds true for Donal Murphy and Kevin Murphy. Both men, who are not related, arrived in Canada from Ireland with their families on June 16 and 18 respectively, to start well paying jobs driving oilfield trucks for Sandpiper Truck Services Ltd. in Lloydminster. They were both laid off from their long-term driving jobs in Ireland where the economy is in a deep funk. The new drivers were recruited by Sandpiper owner, Lorne Olson, and chief operating officer, Doug Gray, who took part in recruitment fairs in Dublin and Cork during a March 2012 mission to Ireland involving 27 Saskatchewan employers. The government of Saskatchewan provided on-the-ground advice to Saskatchewan employers and assistance to potential candidates. The two Irish drivers were among 280 skilled workers offered posi-

tions by recruiters at the job fairs. They came to Canada through the Saskatchewan Immigrant Nominee Program. Donal hails from Wexford and Kevin from Fethard in South Tipperary. Their first week of orientation, under the direction of safety co-ordinator Dwayne Keichinger, included a visit to the Gibson’s Driving Simulator at the Vermilion Vehicle Inspection Station on June 21. That was the site of the third annual Alberta Motor Vehicle Transport Association’s truck driver appreciation event where Keichinger was thrilled to introduce his new drivers and talk about the need for skilled labour. “I think every company is in need of good workers – drivers in particular. It’s good to see some good quality guys come over,” he said. “We have five from Ireland so far and probably another 10 to 15 com-

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Kevin Murphy gets his Įrst test of driving a truck on the right hand side of the road on the Gibson’s Driving Simulator set up at the Vermilion Vehicle InspecƟon StaƟon. He was recruited from Ireland, along with Donal Murphy, who were both invited to the simulator for the annual Alberta Motor Transport AssociaƟon driver appreciaƟon day.

ing. “We are a very diverse group. We have people from all over the world working for us and from North America as well. We welcome these gentlemen over to work for this company.” Sandpiper has about 60 oilfield trucks for its Lloydminster operations including the semi vacs, pressure trucks, body vacs and flushby units that the new arrivals will be operating as part of a growing body of nearly 85 drivers on the payroll. “We put them through our driving training and through our in-house company orientation,” said Keichinger. “We put them out with people – we have a very intense training program to make sure that we are comfortable, and they are comfortable, before they go out on their own.

“Some of other foreign recruits, we put them through English as a second language so we can understand each other a whole lot better. “Having these gentlemen from Ireland, their native tongue is English. That really helps.” Donal said he first thought it was strange to come all this way and be talking with other Irish guys at work. “It should be fun,” he said, adding his finds everyone very friendly and helpful so far. He is also relieved to be working again (he is here on a two-year permit) to support his wife and two young children who are settling into new Sandpiper housing in Lloydminster. “I was laid off in February, and under the current climate over there, there is very little work around,” he said about Ireland. ɸ Page C11

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PIPELINE NEWS August 2012 ɺ Page C10 “Canada gave me the opportunity to come over here, so I am curious to see what it’s like.” Donal was hauling flour in Northern Ireland for James Whitty Transport, and brings more than 15 years of driving experience with him to his new oilfield job at Sandpiper. Both of the Murphys will swap their Irish licences for a Class 5 to drive a car, then bone up for their Class 1 test in order to drive an oilfield truck. Their chance to drive safely on the right hand side of the road for the first time was inside the Gibson simulator from which they emerged with confident smiles and no fender benders to report. “The initial period will be a little strange, but I am confident that after a couple of days it will be fine,” said Donal who looks forward to adapting to local driving conditions. Kevin said driving on the other side of the road in Canada is just like anything else that’s

new. “Once you’ve done it a few times, it becomes natural to you. Once you practise it, you pick it up,” he said. Kevin drove a truck for five years for Bulmers Original Cider until his job became redundant in the economic downturn. “There’s been huge layoffs in Ireland at the moment with the recession,” he said. He said the job fairs in Ireland were well promoted and he drove from Tipperary to Cork for an interview with the Sandpiper executives who offered him the job based on his experience. “There are a lot of truck drivers looking for work,” said Kevin. “The jobs that are existing. you wouldn’t be able to run your house with the pay that they are offering with the recession.” He is not surprised by the higher wages paid in the oilfield, but he is pleased to be able to make a decent living for his wife and two youngsters who came with him.

“You need a reasonable wage to have a reasonable standard of living, so that’s what it provides hopefully,” he said about his new job Asked if Alberta was a culture shock from his native Ireland, Kevin laughed and said his first impression was it “looks like in the movies.” Those movies included several highwayand off-road driving challenges on the virtual driving video simulator that was set up for visitors during the AMTA truck driver barbecue that Sandpiper supports. “We have been involved in it for a number of years,” said Keichinger. “I go to the AMTA meetings, and I think it is a very good event to

showcase that drivers in this country are ap-

preciated. We do want to thank them for all

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of their hard work,” he said.

Sandpiper safety co-ordinator Dwayne Keichinger, leŌ, was pleased to introduce the company’s latest Irish truck driver recruits, Kevin Murphy and Donal Murphy, during their Įrst orientaƟon week and aƩendance at the Alberta Motor Transport AssociaƟon driver appreciaƟon day that was held in partnership with the Vermilion Vehicle InspecƟon StaƟon. Both recruits passed a simulated driving test at the Gibson’s Driving Simulator on June 21.

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PIPELINE NEWS August 2012

PIC trucks to bypass highway scales Vermilion – Peer pressure is helping trucking companies in Alberta become safer while saving them time and money through membership in Partners in Compliance, or PIC for short. The Carrier Excellence rating that PIC provides to member carriers is about to permit yellow PIC plated trucks with transponders to bypass some Vehicle Inspection Stations in the province. “The one big change that we see are coming hasn’t happened yet, but we just signed the paper work to move to a 99 per cent bypass at Alberta’s busiest scales,” said Kim Hrushenski, senior coordinator. Hrushenski announced the agreement with International Road Dynamics Inc., a Saskatoon-based leader in the Intelligent Transportation Systems industry during the Alberta Motor Transportation Association truck driver appreciation day at the Vermilion Vehicle Inspection Station on June 21. PIC carriers will be equipped with ITS transponders to bypass stations in Leduc, Balzac and Whitecourt – but not Vermilion which sees just one-third as many trucks per day as the busiest Leduc station.

“Our carriers report all of their own efforts and take care of their own business, and enforcement doesn’t see a need to continue with the 98 per cent bypass – 99 per cent is sufficient,” said Hrushenski. “The one per cent report rate is enough to capture that random check that is necessary.” Hrushenski said savings estimates from being able to bypass just one scale per day range from $5 to $10 based on the time it takes to slow for the scale and the fuel associated with it. “It’s a tremendous benefit for highway carriers,” he said. “There are occasions where a driver may see six or eight scales in a day, depending on the nature of their run. Often, it is one to three scales a day.” “It really takes 12 to 15 minutes out of your day to pull into a scale, cross the pad and continue. “If they are able to bypass based on their own safety efforts, then they’ve really gained.” Hruskenski greeted each driver at the Vermilion scale and handed out information kits about the features and benefits of membership, along with pens and notepads. Some current oilfield PIC members include

Kim Hrushenski from Partners in Compliance, or PIC, greeted truck drivers at the Vermilion Vehicle InspecƟon StaƟon with an informaƟon kit on the PIC safety program during driver appreciaƟon day.

Stinger Wellhead Protection, Petrohaul, Miller Oilfield Varco and B&R Eckels Transport. PIC is available to anyone with a national safety code number. PIC establishes safety benchmarks and mandatory ongoing monitoring to ensure that member companies maintain the qualifications and commitment required of all PIC carriers. “The carriers that come to us that are able and eligible have already done all the heavy lifting,” said Hrushenski. “They’re doing the safety and compliance in very definite terms before they come to us. “There is a small membership fee. The largest carriers are paying $1,500 a year, so it’s very small nominal fee. “I think by far, the greatest benefit of the program is a move to an excellent rating on their Alberta Safety Fitness Certificate. “There are only 44 carriers in Alberta out of 24,000 that have that excellent rating.” “The PIC membership depends on internal reporting as well as reporting to our system,” said Hrushenski. ɸ Page C13

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PIPELINE NEWS August 2012 ɺ Page C12 “They have to have a low risk or R factor value on their carrier profile. The character profile is the same idea as your abstract for your driver’s licence, only this reports the entire carrier. “Then they have to a have a national safety code audit prior to entry and they also need to have a Certificate of Recognition, or COR audit, through the Worker’s Compensation Board of Alberta,” he said. PIC is a joint venture of Alberta Transportation, WCB Alberta Enforcement and the transportation industry. Bison Transport, based in Manitoba, is the only out-of province PIC member with licensed trucks operating throughout Alberta. “Recognition in other jurisdictions is something that we are still working on,” said Hrushenski. “British Columbia has given us a 95 per cent bypass at their scale system and their Weighin-Motion program which is the highest rate of bypass there. “Saskatchewan hasn’t given us any privilege yet. They are aware of the program.” Saskatchewan, Alberta and B.C. are members of the New West Partnership that aims to set consistent regulations and policies governing

Stan Vickers from the Alberta Motor Transport AssociaƟon helped to hand out goodie bags to truck drivers at the Vehicle InspecƟon StaƟon in Vermilion during the AMTA driver appreciaƟon day on June 21.

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the operation of large transport trucks, without compromising safety. Uniform rules about the size and weights of vehicles and other aspects of trucking operations came into effect July 1, 2011 allowing trucks to operate more efficiently between provinces. Hrushenski is buoyed by the fact the goal of the partnership is to have one set of rules that will apply from the eastern border of Saskatchewan and across Alberta to the coast of B.C. “We have also been in discussion with the Northwest Territories. We are moving it abroad. It’s very much an Alberta legacy program,” he said. “The carriers involved in our group are definitely the safest out there. They are the ones

making the best effort. It isn’t a program of perfection; it’s a program of excellence. They are the carriers that are working the hardest to make it go well. “During two different quarters in the last two years, we have had zero out of service in our entire carrier group for the reporting quarter – a pretty tremendous result – we have almost 10,000 units in the program now.” PIC members range from carriers with just three trucks to more than 1,200 units including two bus companies and two counties. “The County of Parkland just joined us and the County of St. Paul has been with us for several months now. It’s quite a diverse group,” said Hrushenski.

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PIPELINE NEWS August 2012

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Kerrobert to shine with health care “Agriculture is important in the area, however, it has become where smaller farmers are selling out and the large operators are buying up or else it is venture companies buying up land, then leasing it back to these large operators.” Poggemiller credits the oil and gas industry for helping the town turn the sod for the Kerrobert & District Integrated Health Centre during its centennial year celebration day last July 23. The new centre, being built by Ellis Don, will provide acute care and longterm care beds, public health, mental health and addictions services, and 24/7 emergency medical coverage. “The oil and gas industry had a huge impact on us getting that facility because of the large oil and gas development right around the area – just for the emergency sake,” said Poggemiller. The closest hospitals to Kerrobert are located in Unity or Kindersley on Highway 21 and require at least 30 to 40 minutes of driving time to get there. ɸ Page C16

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Kerrobert Mayor Erhard Poggemiller, unrolls a development map at his desk at KEP Industries Ltd., a business that he and his wife Evelyn have owned and operated for years. Strong oil and gas acƟvity in the area is driving the demand for new housing and development lots.

Kerrobert – The town Kerrobert has a new, younger vibe to it thanks to surging oil and gas activity in the area that has fuelled the construction start of a new $23 million integrated health centre. “The activity is huge. It’s increased quite a bit from last year,” said Mayor Erhard Poggemiller. “The weather is against us right now as far moisture goes for the rigs to get out, but there’s a vast number of new rigs out and new companies drilling holes. “I would say the bulk of activity is between Coleville and just north of Luseland, and then going east and west of Kerrobert up to the Kelfield Coulee near Tramping Lake, then over to the Alberta border.” Rev Energy, Enbridge, Plains Midstream Canada, Penn West Petroleum, Northern Blizzard, Alliance Pipeline and Weatherford are among the largest employers that are bringing new families and prosperity to the area. “We have a large gamut of oil and gas related industries. I think oil and gas is going to be a big factor in our development of this community,” said Poggemiller. “We’ve had a lot of support for the health-care facility from the oil and gas industry. “If we can maintain the relationship we have with the industry as well as with the service industries, I think that will contribute to our development a lot more.

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PIPELINE NEWS August 2012

Health Care important Kerry Ward, the town’s Class 1 water operator, restarts the reverse osmosis facility aĹŒer a power outage on June 26. Saskatchewan’s minister of the Economy, Bill Boyd, is expected to aĆŠend the grand opening of Kerrobert’s new water treatment plant on Aug. 3.

Éş Page C15 “The time-span and the life-saving capabilities for having this facility are huge,â€? added Poggemiller. Having access to health care in surrounding rural communities where most of the oilďŹ eld activity is taking place helps keep young families in town, boosts enrolment at the K-12 Kerrobert Composite School and encourages businesses to expand. “It means the viability of the town will continue to exist and expand,â€? said Poggemiller in reference to the new facility. “A lot of the younger people who are looking at moving to the town – ask two questions, ‘is there is a school K-12? and ‘do you have any health care facilities?’â€? The new integrated health centre, located at the junction of Highway 21 and Manitoba Avenue on the south side of town, will also accommodate 38 beds, of which 30 will be designated for long-term

care residents. “With a new health-care facility such as that with a lab and all those kinds of amenities, it’s deďŹ nitely an attraction for people to come to town,â€? said Poggemiller. The funding formula requires Kerrobert to raise $5 million or 20 per cent of the cost with fundraising led by Kerrobert, Luseland and District (KLD) Wellness Foundation chair Stew Seversen. “The KLD Wellness Foundation, in conjunction with Heartland Health Region, has worked

very hard to see this new integrated health facility start,â€? said Seversen in the oďŹƒcial project sod-turning announcement last July. “Our corporate partners, municipalities and residents have looked forward to this day. We thank all our stakeholders who made this happen.â€? The KLD has raised more than $4 million with another million to go to furnish the facility. ɸ Page C17

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PIPELINE NEWS August 2012 Éş Page C16 Kerrobert lies in the riding of Saskatchewan minister of the Economy Bill Boyd, who is expected to oďŹƒciate at the grand opening of the town’s $5 million reverse osmosis water treatment facility on Aug. 3. “One of the things the town was always noted for over many years was brown water. We now have a reverse osmosis system, and we have totally cleaned up the water,â€? said Poggemiller. Poggemiller ďŹ gures the new water system and a recent expansion of the town’s lagoon size could allow the population to grow from approximately 1,100 today to well over 1,500. “Our next biggest challenge is to change the waterline within the town, then repave the town,â€? he added. Kerrobert plans to replace waterlines next summer on six blocks along the main thoroughfare where Highways 51, 31 and 21 conjoin – with a recent traďŹƒc count of 700 to 800 large vehicles a day. “We’ve been doing a fair bit of lobbying to try to get Highway 51 improved going east and west of town just because of the vast number of oilďŹ eld related activities going, and the heavy loads going through town,â€? said Poggemiller who expects the paving will happen in 2014. The robust oil and gas economy in the area has brought new businesses to town along with the usual shortages of available housing or development lots. “It’s almost impossible to ďŹ nd rental space. We have been out trying to lure some developers to town to develop entry level housing,â€? said Poggemiller. Local businesswoman and life-long resident, Lori Parnitsky has opened up a portable open

camp in town for workers or visitors. Called Kelordan Camp, it goes with her new Kelordan Grill family restaurant. “Hotels are booked pretty consistently. The campground is pretty well full, so it’s really tough,â€? said Poggemiller when referring to the accommodations situation. The Town has an inventory of residential building lots with new lots selling for up to $25,000 on a break-even basis to cover the cost of servicing. Some existing serviced lots are priced from as low as $1,500 to $5,000. More information on residential, commercial and industrial lots is available on the Town’s new website that includes a business directory updated by the Chamber of Commerce. The update includes the recent addition to the directory of Exterran-Canada, a provider of natural gas compression products and services along with equipment and solutions for processing, production, air emissions and water treatment. The next listing could be Agora Construction that has begun construction of a new cabinet making shop in the old downtown core as interest in investing in Kerrobert keeps pace with oil and gas activity. “We updated the proďŹ les on the town and the council, so when people come to town they know who they’re talking to. They also have access to information about our health-care system,â€? said Poggemiller. “It’s phenomenal the number of hits we’ve had to the website since we’ve upgraded it. “It’s very important, because for a lot of people, the ďŹ rst point of contact with a community nowadays is through the Internet. It’s very important that you keep your information current,â€? he said.

C17

Kerrobert naĆ&#x;ve Lori Parnitsky recently moved her Kelordan open camp to a new locaĆ&#x;on on her own lot in town to accommodate transient oil and construcĆ&#x;on workers in the area. She also launched her Kelordan Grill Family Restaurant to cater to overnight guests and mobile oilÄŽeld workers.

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PIPELINE NEWS August 2012

Fountain Tire scores points in Vermilion Vermilion – The rubber and the road came together for Fountain Tire and oilďŹ eld truckers at the annual Alberta Motor Transport Association driver appreciation event at the Vehicle Inspection Station near Vermilion. Skip Krake, outside sales representative for Fountain Tire in Lloydminster, came to the June 21 event to mix burgers, handshakes and tire products with a large gathering of truckers. “The goal is to just be visible and talk to the guys, and of course, there are a lot of our customers coming through here,â€? said Krake. “We don’t do an awful lot with long haulers, but there’s the crude haulers stopping in for a burger today, and we’re just wishing them well and basically saying thanks for the business. “About 80 per cent of our business is oil related. We sell an awful lot of trailer tires for crude haulers and we specialize in Goodyear and Dunlop tires. “There’s a variance of tires. We have a lot of dierent models for dierent reasons and dierent conditions. “So really, we just don’t sell one type – there are several type of tread designs to accommodate the conditions the guys are driving in,â€? Krake said. The AMTA appreciation event was the perfect opportunity for Fountain Tire to roll out Goodyear’s new G741 truck tire engineered for oilďŹ eld, mining, logging and construction applications. The tire made with a cut and chip resistant tread compound was launched this year and Krake said, “We hope it’s going to work out, and I think it will. “It’s a very good grip tire, yet has high mileage.â€? The G741 also has an innovative side wall design that allows truckers to place winter chains about the tread blocks for enhanced traction and

grip. “There’s always changes being made,â€? said Krake about tire products and technology. “There is one thing we have that nobody else has, and it’s called Goodyear DuraSeal. It’s like another liner. You have several plies of steel in a tire, and this is just another layer.â€? DuraSeal is billed as the world’s ďŹ rst built-in tire sealant for commercial truck tires that instantly seals tread punctures. “It will seal a hole puncture up to a quarter inch,â€? said Krake. “If you put a quarter-inch bolt or nail through it, you won’t lose any air. It’s quite an amazing invention.â€? Fountain Tire oers a wide range of car, pickup, commercial truck and specialty tires, as well as custom wheels. Tires sales for crude hauling trailers lead the way in a strong heavy oilďŹ eld truck market in Lloydminster. “It’s been pretty good for the last while. There’s no question about that – very appreciative, yes, indeed,â€? said Krake about sales in recent months. Fountain Tire also oers product repair services, and complete automotive service for any make and model of vehicle. “Service is a huge part of our industry. Nobody changes tires themselves anymore,â€? said Krake. “We have after-hours 24-hours-a-day service. It’s a huge part. We just have to service what we sell for our customers. “Downtime is hugely important for customers. They want it done; they need it done and they need it done now. Our service guys are at their beck and call 24 hours a day. “We’ve got 20 guys in all, busting tires and

working up front behind the counter.â€? Krake said the company is not alone in its need to attract new, experienced manpower to the workforce, but he notes they are able to keep up with needs of their customers. ɸ Page C19

Fountain Tire sales rep, Skip Krake, brought the new Goodyear G741 on/oÄŤ road high mileage oilÄŽeld truck Ć&#x;re to the Vermilion Vehicle StaĆ&#x;on for the annual truck driver appreciaĆ&#x;on day on June 21. The appreciaĆ&#x;on day was presented by the Alberta Motor Vehicle InspecĆ&#x;on StaĆ&#x;on.

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PIPELINE NEWS August 2012 Éş Page C18 “We’ve been very fortunate – we have a good core of people that we’ve retained over the years and

Skip Krake, an outside sales rep for Fountain Tire in Lloydminster, is framed by the doughnut of this new Goodyear G741 oilÄŽeld truck Ć&#x;re as he checks the Ć&#x;re pressure on his company pickup. The day before the event, Fountain Tire sponsored the second annual Hartnell & MacArthur Golf Classic in Lloydminster featuring locally developed NHLers ScoĆŠ Hartnell from the Philadelphia Flyers along with Clarke MacArthur of the Toronto Maple Leafs. Krake played for three NHL teams in the 1960s and ‘70s, the Boston Bruins, Los Angeles Kings and the BuÄŤalo Sabres.

have been around for a long time,â€? he said. Krake describes himself as being part of a team at Fountain Tire, which is ďŹ tting, given that he played for three NHL teams between 1963-64 and 1970-71. Kent Staniforth, the general manager, is the coach of the Lloydminster Border Kings senior men’s hockey club and franchise owner, Brant Wheeler, is a major advocate of local youth and adult hockey. “When we get time, of course – we’ve never shirked our duty – but we do talk a little hockey,â€? joked Krake. “Kent is a very avid hockey fan as well as a coach, and he’s done an awful good job in Lloydminster, coaching Junior Bs and the Border Kings, so we are very proud to have him working for us. “It’s a good scene. We learned some teamwork along the way and it continues at Fountain Tire.â€? Krake played 68 games for the Boston Bruins in the ďŹ rst 1967-68 NHL expansion year. He is over the moon with Lloydminster being chosen to celebrate Hockey Day in Canada in February, 2013. Activities associated with Scotiabank Hockey Day in Canada get under way on Feb. 5, and on Feb. 9, CBC Hockey Night In Canada commentator Ron McLean will host a live broadcast to culminate a week of community activities and events celebrating the game across Lloydminster. “It’s absolutely priceless. You have to be awful fortunate to get it,â€? said Krake. “Mayor ( Je ) Mulligan and a whole lot of other people did an awful good sell job on it. They have promoted the city tremendously well – with CBC being out here. “ Fountain Tire was also the sponsor of the annual Hartnell & MacArthur Celebrity Golf Classic held this year in Lloydminster, the day before the AMTA event.

“We just had the Fountain Tire celebrity golf classic yesterday ( June 20). There were probably 40 young guys out of the National Hockey League here,â€? said Krake. Philadelphia Flyers left winger Scott Hartnell, along with Toronto Maple Leaf Clarke MacArthur, turned up at the opening charity barbecue at Fountain Tire on June 19, the proceeds of which go to the Lloydminster and District SPCA. “CBC was even here to cover the event. We will get a lot of publicity for the city of Lloydminster come February,â€? said Krake Krake expects Fountain Tire will play a role in Hockey Day in Canada along with every other business in town hoping to put the city and its hockey sponsors on the map. “We will need the whole town to get the job get done, for sure,â€? he said. Krake has no argument with the notion that hockey and the oilpatch go hand in hand, especially in Lloydminster. “I think you’ll ďŹ nd an awful lot of the guys that run the businesses in town are pretty much all hockey fans. It just seems to be the way of the world in Canada,â€? he said. Fountain Tire has recruited employees who play for the local Junior B Bandits and Junior A Bobcats along with the senior men’s Border Kings who played in this year’s Allan Cup held in Lloydminster. Krake said he has always worked in the tire business, but he said he came close to working in the oilďŹ eld while playing hockey for the Estevan Bruins in the 1960s. “I was awful close to it. I just about, as a 17 or 18 year-old, went to work on the rigs, but instead I got into sales that summer,â€? he said, noting that selling tires is a great job. “You bet. I get to see a lot of good people.â€?

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Syl Tateson: 403-793-4616

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PIPELINE NEWS August 2012

PIPELINE NEWS August 2012

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

Come see us h t o o B S O H L at 353 and 354

2012 Kenworth T470 Daycab Roll Off

2012 Kenworth T370

Universal Handling Equipment 60,000 lb Single Stage Roll Off Hoist -

Spec’d for Knuckle Boom Picker Crane - slated for Full Tilt rig-up - slot allocated, Chassis is professionally spec’d to receive Fassi 150, 170 or 210 size-class

23’ 6� bed, 45 Degree Tilting Angle, Paccar PX 8 330 HP Engine, Allison 3000 Rugged Duty Series 6 Speed Automatic Transmission, Dana Spicer 20K Front axle with 18K taperleaf front spring suspension, Dana Spicer 40K Rear axles with Primaax EX air suspension, forward and rear axle lock-up, Air brakes with ABS, 10 5/8� x 5/16� Frame Rails with full steel insert, 100 Gallon fuel tank, Alcoa front wheels with Painted white rear wheels, Bridgestone M844F Steer tires and Goodyear G182 Drive tires, Split fender sloped hood design and radiator mounted grill, Summit cab interior equipped with Kenworth Driver Information Center, A/C, Cruise, Tilt and Telescoping Steering wheel, air suspension gauge, ammeter gauge, PTO hour meter, am/fm/cd radio, Daylite cab door design with peeper window, Electric door locks, Powered RHS window manual LHS window, Mid-rise back vinyl drivers seat with air suspension and Mid-rise back vinyl passengers seat with toolbox, Polished stainless steel lighted and heated mirrors with convex mirrors, 2 piece curved glass roped in windshield with integral marker light exterior sun visor, Quiet cab package, Dual halogen head lamps and circuit breaker style electrical system

Knuckleboom picker and Standard deck package arrangement at Full Tilt, Paccar PX 8 350 HP Engine, Allison 3000 Rugged Duty Series 6 speed automatic transmission, Dana Spicer 14.6K Front axle with taperleaf spring suspension, Dana Spicer 23K Rear axle with differential lock and Hendrickson HAS230L air suspension, Air brakes with ABS, 10 5/8� x 5/16� steel frame rails, 56 gallon fuel tank, Accuride Painted Black Rims with Goodyear front and rear tires, Aerodynamic sloped front hood, Pinnacle cab interior equipped with Kenworth Driver Information Center, A/C, Cruise, Tilt and Telescopic steer wheel, Power windows and door locks, AM/FM/CD radio, Daylite cab door design with peeper window, glove box, air suspension gauge, Dash switch and wiring for PTO done at factory, High back vinyl air suspension driver and passenger seats, Polished stainless steel heated mirrors with convex mirrors, curved glass windshield with stainless steel exterior sun visor, Dual halogen head lamps, switch and wiring installed at factory for beacon lights, circuit breaker style electrical system, Full truck air equipment install at end of frame

2012 KENWORTH T800 with 62" Flat Top sleeper - Rigged and Ready to Haul Oil Paccar MX 485 HP Engine with 18 speed Super 18 Transmission, Dana Spicer 13.2K front axle, Dana Spicer 46K Rear Axles and Suspension. 10 3/4" x 3/8" Steel Frame Rails with Chrome tapered steel front bumper. Two 120 Gallon fuel tanks with 7" polished straps. Cab interior is equipped with full gauge package, air, tilt / telescopic steering, cruise, am/fm/cd/sirius stereo, Cobra CB, power windows and door locks with remote keyless entry, heated leather premium high back drivers seat and high back vinyl passenger seat with toolbox. Lighted, heated mirrors, stainless steel sun tvisor and sloped aerodynamic hood. Comes Equipped with G-Force T&E 4100 hydraulic Pump rig-up.

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2013 Kenworth T370 Daycab Mechanics Body Spec Chassis Full Tilt Dominator Mechanics body with sliding roof and barn doors, interior lights, front and rear work lights, back-up alarm, posi lock system, heavy duty tie down. 10,500 lb Max 6025 crane with lift to 26’ 7�, Hydraulic drive reciprocating air compressor 35 CFM @ 100 psi, Paccar PX8 300 HP Engine , Allison 3500 RDS 6 speed with PTO provision, Dana Spicer 14.6K Front axle, Dana Spicer 23K Rear axle with diff lock and Hendrickson HAS230L rear air suspension, Air brakes with ABS, 10 5/8� x 5/16 Frame rail with removable front tow hooks, 56 gallon fuel tank, Accuride painted white rims with Goodyear tires front and rear locations, Aerodynamic sloped front hood, Pinnacle cab interior equipped with Kenworth Driver Information Center, A/C, Tilt and telescopic steering wheel, air suspension gauge, am/fm/cd radio, daylight cab door design with peeper window, glove box, High back vinyl air suspension drivers seat and high back vinyl passenger battery box., Heated and polished stainless steel mirrors with convex mirrors, power LH and RH window lifts, Curved glass windshield with stainless steel exterior sun visor, Dual halogen head lamps, Full truck air kit for trailer, May not be exactly as shown.

2012 Kenworth T370 Daycab Gravel Box Used 2009 Kenworth T170 Daycab Chassis Ideal for Flat Deck, Van Body, OilďŹ eld Service body w/small Fassi 95 picker size crane - white in color, Paccar PX 6 300 HP engine, NEW Eaton Fuller FSO6406A 6 Speed Synchro manual transmission, Dana Spicer 8K front axle with taperleaf spring suspension, Dana Spicer 13.5K rear axle with limited slip 3.73 gear ratio differential and Reyco taperleaf rear spring suspension, Hydraulic brakes with ABS, 9 7/8" x 1/4" Steel Frame Rails, 176" Wheelbase - 108" Cab to axle, Low proďŹ le Bridgestone tire with Painted white rims, Aerodynamic sloped front hood, Am/FM/cd, A/C, cruise and tilt telescopic steering, Power and locks, daylight cab door design with peeper window, glove box, High back vinyl air suspension driver’s seat with high back vinyl toolbox passengers seat, Curved glass windshield with stainless steel exterior sun visor, Dual halogen head lamps, 66,200 kms

15 Foot Midland SK1000 Gravel box with pintle plate and electric tarp - Full Truck kit for pup trailer, Paccar PX 8 350 HP Engine, Allison 3000 Rugged Duty Series 6 speed automatic transmission, Dana Spicer 14.6K Front axle with taperleaf spring suspension, Dana Spicer 40K Rear axles with HAS402 air suspension, forward and rear axle lock-up differential, Air brakes with ABS, 10 5/8� x 5/16� Frame rail, 100 gallon fuel tank, Accuride painted white rims with Bridgestone steer tires and Goodyear drive tires, Aerodynamic sloped front hood, Pinnacle Cab Interior equipped with Kenworth Driver Information Center, A/C, Cruise, Tilt and Telescopic steering wheel, power windows and door locks, am/fm Radio, daylite cab design doors with peeper window, glove box, air suspension and air application gauges, High back vinyl air cushion drivers seat and high back vinyl toolbox passenger seat, Polished stainless steel heated mirrors with convex mirrors, curved glass windshield with stainless steel exterior sun visor, Dual halogen head lamps, dual amber strobe lights centered over doors, circuit breakers style electrical system

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PIPELINE NEWS August 2012

Camp and grill serves all

Lori Parnitsky, who with two out-of-town partners owns the Kelordan Grill Family Restaurant and the Kelordan Camp in Kerrobert, is pictured at the restaurant with her husband Allan who owns Kerrobert Sand & Gravel.

Kerrobert – Lori Parnitsky went from being a stay-at-home mom in Kerrobert to owning and operating a busy open camp and restaurant catering to oilfield and construction crews in the last three years. That helps to explain why she took off the first week in July for a vacation after working seven days a week at her Kelordan Open Camp and her Keloran Grill Family Restaurant located kitty-corner to each other at the junction of Highways 51, 21 and 31. “It’s been great especially this last four weeks. I am going on a week’s holiday next week, and I think I deserve it,” said Parnitsky who does everything from cooking and waitressing to booking available rooms.

“Trying to find staff is impossible. It’s a lot of hours. I love the people. That’s what keeps me coming back.” Parnitsky owns the 42-rom camp and nearby grill with two other out-oftown investors. The camp is currently home to construction crews that started building the $23 million Kerrobert & District Integrated Health Centre in June, and is popular with seasonal and overnight workers and travellers looking for a bargain. The camp and grill go together like a bun and burger. “When they take a room at the camp, they have a choice of either getting food included with their room or just the room,” said Parnitsky. “The guys that are working at the hospital are getting their food included, so that’s three meals a day, and they come in to get snacks in the afternoon or whatever. “About 25 of them came in for supper last night. Tonight they asked for pizza. We usually don’t have pizza on the menu, but we are catering to them. It makes them happy. Thursday, they have asked for lasagna.” “I don’t run it like a typical camp. It’s kind of a like a little mini hotel, so that they don’t have to bring their own bedding,” said Parnitsky. Each room is equipped with a TV, a DVD player and wireless Internet, and furnished with a desk, a wardrobe and a bed. There are mini fridges in some suites. Overnight guests have access to washers and dryers and two of the rooms have been converted to a coffee room and an office. “I have actually brought in barbecues now and then if guys want a barbecue down there,” said Parntisky, who spoke about her ventures during her break at the Kelordan Grill. “I waitressed for 18 years – I was a stay-at-home mom and ended up buying the camp and this. It wasn’t exactly in my plan, but it’s working out so far.” She said she bought the camp three years ago in October and the restaurant last January. The purchases were based on need. “There weren’t enough places in town. There were guys coming with their camper trailers. They were staying on farms in the last boom,” said Parnitsky. “We kind of missed the end of that when we bought the camp, so it was a little bit slow for the first year. Now it’s starting to kick off again, which is very nice. ɸ Page C23

PIPELINE NEWS August 2012

Kelordan Open Camp is owned and operated by Lori Parnitsky who recently moved the camp from a rented lot to this purchased property kiĆŠy-corner to her Kelordan Grill. The camp oÄŤers rooms for $55 a night or a room with three meals a day for $125.

Éş Page C22 “It was pretty slow in the spring when it rained and we didn’t have anybody. When they all come in now – it’s crazy. “There wasn’t a restaurant to cater to them, so I had to buy this also. “I am hearing from Northern Blizzard and Penn West and Enbridge. Enbridge does a lot with catering and such. It’s an excellent company to deal with. “They’ve all said the next three to ďŹ ve years

should be good.â€? Rev Energy, Plains Midstream Canada, Northern Blizzard, Alliance Pipeline and Weatherford are some of the other the major employers that are boosting economic development in the area. “I’ve been hearing that it’s not going to slow down anytime soon - like for the next three years, which makes me happy,â€? said Parnitsky. Her husband Allan owns Kerrobert Sand &Gravel, a company that specializes in oilďŹ eld construction. Parnitsky’s father, Stew Seversen, is the chair of the Kerrobert, Luseland and District (KLD) Wellness Foundation that so far has raised more than $4 million of the town’s $5 million portion of the new health centre cost. “We are kind of out in the boonies here. If something was to happen, even having to drive a half hour to Kindersley could be disastrous,â€? said Parnitsky about the need for the hospital. The hospital construction crews are helping to ďŹ ll the camp, which had about 50 per cent occupancy rate in early July. The spring and fall are the busiest seasons for oilďŹ eld overnighters. “Spring is when they ďŹ rst come in, and then they get established as to what they are going to do for the year,â€? said Parnitsky. “With all this rain we got pushed back quite far. In the fall, they want to get everything done before snowfall.â€? “I’ve got some guys that have been in and out of the camp for that last two years. They just pop in, sleep the night, and go down their way to seismic or whatever. Seismic ďŹ lls it for two days solid.â€? The trailer-style camp was originally located next to the Kelordan Grill fronting Highway 21 south on rented land, but was moved recently to its new location on land purchased from the town.

C23

The key to the business is the Kelordan Grill, with homemade burgers such as the Betty Boop and the Chuck Berry Chicken burger bringing in the hungry-man crowd for three squares a day. “I’ve got three really good cooks and I am trying to keep them,� said Parnitsky. “They are hearing the oil jobs are better and they want to go and work up in camp, so I’ve had to sweeten the deal every once in awhile. “I told them they are working at a camp. You can be a camp kitchen manager here.� “I kind of got thrown into this quite quickly. We bought the camp three years ago. I was a stay at home mom. There wasn’t a restaurant to cater to them so I had to buy this also,� said Parnitsky.

The backbone of the Kelordan Grill is the cooking staÄŤ. Pictured during the busy lunch period are leĹŒ to right: Sarah Ward, Sadie Schan and Pamela Greschner.

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C24

PIPELINE NEWS August 2012

New industrial cleaning method taking off and paying off in oil fields

F

ive years ago the term dry ice blasting was virtually unheard of in the oil and gas industry. Today, however, the process is rapidly becoming the preferred method of cleaning among the industrial, commercial, utility, and environmental sectors. Regina-based Medius Industrial is now bringing the technology to Saskatchewan oil fields. So, how does it work? And why is it so quickly replacing previous cleaning techniques?

Dry Ice Blasting at a glance Tiny CO2 (ice) pellets are blasted at supersonic speeds through a jet of compressed air at -78 degrees C or -109.3 degrees F. Upon contact with the ice, contaminants shrink and lose adhesion from subsurfaces. The dry ice is then converted back into carbon dioxide gas and evaporates into thin air. The process effectively and efficiently removes contaminants such as bitumen, corrosion, chemicals, acids, and heavy oils without causing any damage to the underlying surface or creating any secondary waste.

efficient cleaning and restoration methods. The oil and gas sector, in particular, has seen a spike in the use of this new technology. Because the process allows for equipment to be cleaned hot whilst online, there is no need for disassembly or shutdown. This equates to less downtime and greater profitability. Dry ice blasting is also non-toxic, non-abrasive, non-conductive and environmentally responsible.

BEFORE

Greater profits The benefits of CO2 blasting are many, leading more and more industries to move away from traditional less

AFTER Photos courtesy of Cold Jet

More versatility Chris Krasowski, General Manager for Medius Industrial says, the possibilities with their dry ice blasting service are virtually limitless, “One of the greatest advantages to our dry ice blasting process is its extreme versatility. Clients can use it to clean piping, wellheads, valves, vessel interiors and, well... pretty much anything they need cleaned.” Those in the oil and gas sector find the system particularly attractive as it reduces the chance of foreign materials such as sand or debris from entering and damaging process equipment. With oil drilling set to increase by 6% in Saskatchewan during 2012, dry ice blasting will undoubtedly be an option more will be considering.

“Unlike hydro-blasting, we can use CO2 blasting 12 months of the year, as cold weather does not hinder its effectiveness.” - Chris Krasowski, General Manager, Medius Industrial

For more information about Dry Ice Blasting, contact Medius Industrial toll-free at 1.800.675.5771, in Regina at 306.565.3395, or in Yorkton at 306.620.6632. Visit them online at mediusindustrial.ca.

industrial HE AV Y DUT Y RESTOR ATION

PIPELINE NEWS August 2012

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Lloydminster's Colonial Days July 11 Photos by GeoÄŤ Lee

Halliburton was one of several oil and gas companies to enter an oilĎeld vehicle or a Ňoat in the parade.

Moody’s Equipment in Lloydminster drove a slew of farm and construcĆ&#x;on equipment under sunny skies.

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PIPELINE NEWS August 2012

Gibson simulator steers safer drivers Vermilion – The worst thing that can happen during a virtual oilďŹ eld trucking accident is a bruised ego or a tongue lashing from the instructor. That’s the beauty of the Gibsons Driving Simulator that is designed to evaluate and improve decision making skills and driving behaviours with programmable driving scenarios on a digital roadway. The simulator was a popular attraction during the annual Alberta Motor Transport Association driver appreciation day at the Vermilion Vehicle Inspection Station on June 21. “We utilize it for education and some training. We throw dierent scenarios at drivers and we educate them on what they may experience in the real world,â€? said Fred Pendleton, Gibson Energy’s health and safety specialist who is based in Lloydminster. “If they roll the unit here or crash it here, we educate them on the dierent types of things they can do dierently out there, so they can prevent the rollovers and the crashes and that sort of thing.â€? Pendleton can control every scenario the driver sees on screen from dierent weather conditions and mechanical failures such as a tire or break failures to threats from oncoming vehicles crossing the centre line or wildlife in harm’s way. The simulator helps Gibson to provide defensive driving skills for their huge eet of owner operator trucks including up to 80 oilďŹ eld haulers in the Lloydminster area and 1,500 corporate wide vehicles. Gibson contract carriers who transport crude oil, asphalt and propane/ butane and sulphur products in the company’s Western Canadian operations undergo safety training in the simulator. “It’s for new drivers, old drivers – anybody that has been involved in a collision or an accident,â€? said Pendleton. “We bring them in and we run them through that scenario just to see where things went wrong, and try to educate them to prevent it from re-occurring. “It’s meant for Gibson employees, but we do a lot of charity work I guess you could say. We take it out to schools and events like this AMTA barbecue.â€? Driver safety and appreciation was the theme of the event that attracted Rod Shopland to welcome drivers as a local member of the AMTA board of directors and the owner of Night Hawk Truck Lines in Lloydminster. “We are just here to shake a few hands and say thank you to the guys,â€? said Shopland, who is pleased to support the growing number of oilďŹ eld related trucks on the road with safety training from the AMTA.

Fred Pendleton operates small and large vehicle driving scenarios for visitors inside the Gibsons Driving Simulator at the AMTA driver appreciaĆ&#x;on day at the Vermilion Vehicle InspecĆ&#x;on StaĆ&#x;on on June 21.

“We specialize in driving training and oering courses for the dierent needs that even the oilpatch has,â€? he said. “We provide mostly driver safety training – personal driver improvement programs. We oer ďŹ rst aid and dangerous goods and things like that. “We have a COR program (certiďŹ cate of recognition) for safety as well, which is for the trucking industry. If drivers from the oilďŹ eld want to use our COR, it’s available to them. “Anybody who is a part of WCB is automatically an associate member of the AMTA.â€? More than 300 trucks drivers were expected to pull into the inspection station for a burger, many of whom were waiting for a turn in the driver’s seat of the Gibson simulator. The simulator includes scenarios for o-road oilďŹ eld driving with hills and curves to challenge drivers. ɸ Page C27

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PIPELINE NEWS August 2012

The Gibsons Driving Simulator, managed by Gibson health and safety specialist Fred Pendleton, features simulated driving condiƟons and scenarios that can teach defensive driving skills and how to react to threats such as blow Ɵres and wildlife.

ɺ Page C26 “When we throw in rain, we want to see if they adjust their driving speed, and if they require a tire change, to maintain their control on the roadway,” said Pendleton. Pendleton said the value of the simulator to Gibson is that it teaches drivers how to react safely to avoid accidents or prevent another one from occurring. “We had one driver heading up to Bonnyville and he blew a steering tire. He remembered what he learned in the simulator about maintaining control and slowing down, and he didn’t end up in the ditch,” said Pendleton. The majority of oilfield driving accidents are rollovers that Pendleton said can be prevented with simulated driving lessons. “That’s due to guys, when they drop their steering tire off the road, the natural reaction is to pull it back,” said Pendleton. “We educate our guys that when you feel that wheel drop off, maintain control and put it straight in the ditch. This way you won’t roll. “You won’t have that fluid slosh around and cause you to roll over. We can off-load you and pull you out – less damage that way.” Vehicle safety can also be an issue, so Gibson stays on top of maintenance with an in-house program using a third party inspection program similar to what a Department of Transport officer would conduct. Shopland said the AMTA driver appreciation event is a great forum to talk with drivers and to find out what out “what’s happening out there?” on the road. Some of the feedback is a general thumbs-up to the move to harmonize trucking regulations across Saskatchewan, Alberta and British Columbia through the New West Partnership economic pact signed by the three provinces in 2010.

C27

Uniform rules about the size and weights of vehicles and other aspects of trucking operations came into effect July 1, 2011, allowing trucks to operate more efficiently between provinces. “That’s been a marvelous thing for the trucking industry,” said Shopland. “The more harmonized things are, the more streamlined our industry is. You just load your loads for your province, and you are good for the other ones.” The rules are good for Night Hawk, a company that specializes in the long haul of building products and some oilfield equipment hauling with an active fleet of flat decks and vans. “It’s been busy. It’s been a good year and it looks like it’s going to be a really good summer and fall,” said Shopland. SLH Transport Inc. from Calgary came to the AMTA event to recruit new drivers, a situation that also concerns Shopland at Night Hawk. “We have a pretty good bunch of loyal guys who have been with us for years,” said Shopland “but we are the same as everybody else. “We are fussy about who we hire because of the repercussion of what can happen with bad drivers, so you want to find good ones.”

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PIPELINE NEWS August 2012

PIPELINE NEWS August 2012

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Twin Butte offers $88.9 million for Avalon Calgary – Twin Butte Energy Ltd. will become a bigger force in the Lloydminster heavy oil play with its $88.9 million purchase offer of privately-held Avalon Exploration Ltd. Avalon shareholders are expected to approve the sale in late August on the basis of 1.1 common shares of Twin Butte for each outstanding Avalon share. At closing, Twin Butte will acquire Avalon’s production of approximately 1,920 barrels of conventional heavy oil per day and more than 85,000 net acres of undeveloped land in the Lloydminster area The Avalon lands are contiguous to Twin Butte’s and effectively double Twin Butte’s net undeveloped land position in the Lloydminster heavy oil fairway to 162,000 acres from approximately 77,000 acres. Twin Butte will also receive a significant seismic database of 556 kilometres of proprietary data and 2,271 kilometres of trade data. The acquisition further establishes Twin Butte as a significant operator in the area. The Calgary based company estimates that approximately 75 per cent of its current production comes from the Greater Lloydminster area and that could be more than 80 per cent by the end of 2012 with the Avalon acquisition. “As a larger, stronger company, Twin Butte will use its financial flexibility to capitalize on its expanded low risk drilling inventory,” said the company in a news release. Twin Butte and Avalon believe the strategic transaction offers an exceptional opportunity to create substantial value for their respective companies and shareholders. “The transaction will provide Avalon shareholders liquidity and the opportunity to participate in a much larger, well capitalized and hedged company,” said David Bredy, Avalon’s president and chief executive officer. “In addition, the Avalon shareholders will be able to participate in Twin Butte’s monthly dividend stream. Avalon’s assets are an excellent fit with Twin Butte and they will definitely benefit from Twin Butte’s strong technical team and greater access to capital.” It is anticipated that Twin Butte’s credit facility will be increased to $240 million from the current $205 million upon closing. Twin Butte believes the acquisition will be a significant operational and strategic fit with their Lloydminster heavy oil operations and plans. Twin Butte’s growth is focused in the heavy oil area from Frog Lake, Alberta to Primate, Saskatchewan and is directing 100 per cent their 2012 capital

budget to this area. The buyout will give Twin Butte a low risk, high rate of return portfolio of over 85 development heavy oil drilling locations in areas that have seen low recovery factors to date as well as over 20 exploratory targets providing significant upside potential for long term reserve appreciation. The acquisition includes Avalon’s proved reserves of 3.29 million barrels of oil equivalent and proved plus probable reserves of 5.19 million boepd based on an independent reserve report for the year ended Dec. 31, 2011. The pre-tax present value of the proved plus probable reserves at the report date was $136.3 million. The deal will also generate an estimated annual general and administrative savings in excess of $2.3 million.

In November 2011, Richard McKenzkie, leŌ, Avalon’s vice-president engineering was congratulated by Joe Bowser, manager of Automated Tank Manufacturing in Kitscoty for purchasing the 1000th 1,000-barrel tank made by ATM. Avalon also purchased the very Įrst 1,000 barrel tank produced by ATM in 2008. Avalon shareholders are expected to approve the sale of their company in August to Twin BuƩe ExploraƟon which operates in the Lloydminster heavy oil area. File photo

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PIPELINE NEWS August 2012

CCEMC funds $46M for carbon cuts Edmonton – Husky Energy is one of six companies selected to receive a share of $46 million from the Climate Change and Emissions Management Corporation to support six new clean technology projects. The CCEMC funded projects have a combined value of more than $327 million. Husky Energy will receive $2.9 million for its CO2 demonstration project in Lashburn, just east of Lloydminster. Cenovus Energy Inc. will be allocated $10 million in CCEMC funds for a 10MW pilot chemical looping steam generator at Christina Lake near Fort McMurray. “The CCEMC is supporting industry eorts to reduce greenhouse gas emissions from fossil fuels while helping to ensure Alberta can continue to be a global energy leader, even as we transition to other sources,â€? said CCEMC

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The Climate Change and Emissions Management (CCEMC) CorporaĆ&#x;on announced $46 million in funding to support six new projects. ParĆ&#x;cipants included (l-r) Glenn ScoĆŠ, senior vice-president, Imperial Oil; Alexander SĆ&#x;ckler, VP commercial aÄŤairs, NSolv CorporaĆ&#x;on; BreĆŠ Henkel, co-founder and VP operaĆ&#x;ons, Inventys Thermal Technologies Inc.; Diana McQueen, minister of Environment and Sustainable Resource Development; CCEMC chair Eric Newell; Brad Bellows, director of communicaĆ&#x;ons, MEG Energy and Song P. Sit, technical adviser, Cenovus Energy. Photo submiĆŠed

chair Eric Newell in July 12 announcement. “By addressing challenges facing Alberta’s large emitters, we are funding projects that have tremendous potential to reduce Alberta’s greenhouse gas emissions over the long term.â€? Other fund recipients include Imperial Oil that will get $10 million for a cyclic solvent process pilot project at Cold Lake. Inventys Thermal Technologies Inc. will be funded $3 million for the VeloxoTherm CO2 capture project at Jo re. ɸ Page C31

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PIPELINE NEWS August 2012 Éş Page C30 MEG Energy Corp. will receive funding of $10 million for heavy crude quality improvement in the Alberta Industrial Heartland Region. N-Solv Corporation will receive $10 million for its N-Solv BEST pilot plant at Suncor Dover in Fort McMurray. “These innovative projects continue to demonstrate how Alberta leads the way in supporting and developing responsible, clean-energy technology,â€? said Alberta Environment and Sustainable Resource Development Minister Diana McQueen. “I’m conďŹ dent that continued innovation by industry will help Alberta demonstrate leadership in environmental management while meeting growing global energy demand.â€? CCEMC estimates these six projects will combine to reduce emissions by more than 183,000 tonnes over 10 years, and that does not consider further emissions reductions as technology is commercialized. The potential emissions reductions that could be realized through build out and commercialization of these technologies is estimated at ďŹ ve megatonnes by 2021. For every dollar CCEMC invests in these projects, about another $7 are also invested. The six projects are from the CCEMC’s fourth round of funding that was announced in April 2011. The maximum CCEMC funding per project for this round is $10 million. With this announcement, CCEMC has announced plans to support 31 projects with a total commitment of more than $156 million. In total, these 31 projects are valued at more than $828 million. Combined, the CCEMC estimates they will reduce emissions by nearly eight megatonnes over 10 years in Alberta. In addition, the organization has also announced support for biological and adaptation projects. The CCEMC focuses on stimulating transformative change. Enabled through regulation, the CCEMC is an independent not-for-proďŹ t organization that provides ongoing, dedicated funds to support the discovery, development and deployment of innovative clean technology. Funding for CCEMC is collected from industry. Since 2007, Alberta

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companies that annually produce more than 100,000 tonnes of greenhouse gas emissions over a baseline are legally required to reduce their greenhouse gas intensity by 12 per cent. Companies have three options to meet their reduction target: improve the eďŹƒciency of their operations, buy carbon credits in the Alberta-based oset system or pay $15 into the Climate Change and Emissions Management Fund for every tonne over the reduction limit. The CCEMC invests the money collected in clean technology. By the end of the 2011/12 operating year, the CCEMC expects to be involved in close to $1 billion of active projects that reduce emissions and spur innovation in clean technology and help our world move toward more sustainable practices.

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PIPELINE NEWS August 2012

Oil patch Jobzilla could wreak havoc Calgary – The demand for skilled workers by Canadian oil and gas companies is becoming a scary monster on the loose, especially in Alberta. Not even the lowest natural gas prices and global economic uncertainty can bring Jobzilla to its knees. That’s the consensus of the Petroleum HR Council’s survey of 37 petroleum companies representing 60,000 employees in the upstream and midstream sectors. The survey is the basis of the council’s labour report on labour market conditions and human resource trends

titled The HR Trends and Insights: A Look at Current and Short-Term Workforce Trends within the Canadian Petroleum Industry for Q1-Q2 2012. Growth in Alberta’s oilsands, shifts to unconventional and liquids-rich gas plays and proposed infrastructure investments in pipelines and liquefied natural gas (LNG) combined with an aging workforce continue to fuel the human capital needs of the petroleum sector. Additionally, competition for similar skill sets and jobs across sectors and geographic regions places additional

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strain on recruitment and continues to feed an employee-driven labour market. “Despite global economic uncertainty, a slow recovery in the U.S., and low gas prices, 91 per cent of respondents reported that they are currently hiring,” said Cheryl Knight, executive director and CEO of the council. “This is a seven per cent increase from Q3/Q4 2011 and reflects increased hiring activity in certain petroleum industry sectors, and the direct impact of high turnover, retirements and changing demographics across the industry. “The majority of respondents indicated that attraction and retention of workers in hard-to-recruit locations is their top workforce challenge. “Other challenges identified in the survey were labour and skill shortages, employee turnover and retention, and the increasing level of turnover amongst new hires,” Knight added. These workforce challenges and trends have increased the need for industry knowledge/experience, specialized skills and general business decision making. Broader support roles such as supply chain management, business intelligence managers, procurement professionals, finance professionals and project managers are in demand. How is the industry rising to these workforce challenges? According to

the survey, respondents reported recruitment and training as the two key human resource strategies. The report includes details on recruitment and training practices, emerging trends and innovative human resource strategies. One plan is to partner with community programs that target underrepresented groups in the petroleum industry such as women, Aboriginals, immigrants and youth. Another strategy is to initiate training programs that help employees move into leadership roles, and respond to industry growth, new technologies, and evolving environmental and regulatory requirements.

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Global Steel Ltd. is a private corporation founded in 1990. From modest beginnings Global Steel has grown to become one of North America’s most trusted distributors of premium Canadian Manufactured Oil Country Tubular Goods (OCTG). Today, this Calgary-based company enjoys an unmatched reputation for product quality, innovation and customer service.

Global Steel maintains key relationships with several major domestic steel mills. Strategic alliances with each mill guarantee reliable and secure access to a full range of high-quality ERW OCTG, Seamless OCTG and Line Pipe products. We are committed to providing oil and gas producers with exceptional service, high-quality oil Àeld tubular goods and personalized logistical support.

Cheryl Knight from the Petroleum HR Council released the latest quarterly workforce trends in the oil and gas industry that notes the demand for skilled workers remains high despite low natural gas prices and global economic turmoil. File photo

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PIPELINE NEWS August 2012

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Southern PaciÀc steams on Canada Day Calgary – Southern Pacific Resources Corp. may have celebrated Canada Day by throwing their hard hats into the air. The July 1 holiday heralded the start of steam circulating through the steam assisted gravity drainage or SAGD wellbores at the STP-McKay thermal project in the Alberta oil sands. The first steam at STP-McKay is an historic event for Southern Pacific as it represents the completion of the construction, commissioning and start-up of the company’s first major in-situ undertaking. Steam will now be circulated through the SAGD wellbores for a period of three to four months, after which bitumen production is scheduled to begin. Southern Pacific is engaged in the exploration, development and production of in-situ thermal heavy oil and bitumen production in the Athabasca oilsands of Alberta and in Senlac, Saskatchewan east of Macklin. Phase 1 of the STP-McKay project is now officially in the production stage after 18 months of construction that began in December 2010. The original application for a 12,000 barrel per day facility received regulatory approval from Alberta in October 2010. Southern Pacific has subsequently filed an application for expansions at STP-McKay totalling an additional 24,000 bpd, split between an expansion in Phase 1 and a new facility at Phase 2. The application is well advanced and approval is expected in late 2013. Southern Pacific projects the final capital cost for Phase 1 to be $468 mil-

AB jobs blitz targets Seattle Edmonton – Welcome to the “U.S. of eh” in Northern Alberta where Americans are being sought to help fill a shortage of skilled workers for oilfield and construction jobs. The Edmonton Economic Development Corporation (EEDC) is recruiting in Seattle for heavy-equipment technicians, welders, steamfitters/pipefitters, power engineers and construction staff professionals. “Our economy is expanding and we need more workers,” said Mike Wo, EEDC executive director of economic development and growth. “We are looking for hard-working individuals who are considering working in Alberta for a few years while economic conditions rebound in the U.S.” The recruitment drive is running in July through online, mobile and radio advertisements, and a roving community cruiser at local events promoting a www.opportunityawaits. com website. The website allows individuals to view position details, find out more about Alberta and submit applications. Shortlisted candidates will be

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invited to in-person interviews in mid-August. The campaign follows news that U.S. firms created only 80,000 new jobs in June, leaving the job rate untouched at 8.2 per cent. Canada added 7,300 jobs in June, slightly better than modest expectations, with Alberta having the lowest unemployment rate in the nation at 4.6 per cent. To put Alberta’s economic growth into context for Americans, around $193 billion of major investments are underway or in the works, equivalent to 211 CenturyLink Fields or 175 Hoover Dams. “For those in search of opportunities, Alberta offers some of North America’s highest wages and standards of living,” said Wo. “Newcomers can expect to be welcomed with one of the Englishspeaking world’s best education systems, leading-edge health care and a quality of life coveted by many.” Recruitment is one EEDC initiative to develop the workforce. Other efforts underway include increasing productivity and innovation, and increasing investment in workplace literacy.

lion, four per cent over the original budget of $450 million. The cost includes an additional $15 million of scope changes designed to improve reliability and decrease operating costs. Based on the incurred capital to the end of the first calendar quarter of 2012, Southern Pacific expected to finish the project slightly under budget. The Calgary-based company cited increased industry activity in the second quarter for affecting the module fabrication costs and delivery schedules, which resulted in increased construction costs in order to meet the project schedule. The company reports that with steam start-up, clean-up of the site and demobilization of crews and equipment will be occurring over the next several weeks. The construction site reported a safety record of only one minor lost-time accident during the entire drilling and construction period, well below the industry average.

C34

PIPELINE NEWS August 2012

CAREER Gu×de Canyon is the fastest growing fracturing company in North America. We deliver quality customized pressure pumping and service solutions to the oil and gas industry, improving our industry one job at a time. If you’re looking for a career with a leading organization that promotes Integrity, Relationships, Innovation and Success, then we’re looking for you. Now hiring Canyon Champions for the following positions:

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Operators: Fracturing, Nitrogen, Coil, Cement & Acid Class 1 or 3 Drivers Supervisors: Fracturing, Nitrogen, Coil, Cement & Acid Applicant Requirements: f Self-motivated f Willing to work flexible hours f Safety-focused

Why Canyon?

f Dynamic and rapidly growing company f Premium compensation package f New equipment f 3 weeks vacation to start

f Team oriented f Oil & Gas related experience is preferred f Clean drivers abstract

f Paid technical and leadership training f Career advancement opportunities f Paid flights for rotational program (22/13) f 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

PIPELINE NEWS August 2012

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EMPLOYMENT OPPORTUNITY PERMANENT FULL-TIME HYDROVAC OPERATORS • Require class 3 or class 1 licence • Safety tickets HYDROVAC SWAMPERS • Require safety tickets Offering competitive wages, benefits available after 3 months. Offering living accomodations.

Email resumes to: extremeexcavating@hotmail.com or fax to: 306•483•2082

Oilfield Construction Limited

COME JOIN OUR TEAM!

• CONSTRUCTION MANAGER

We’re hiring for various projects throughout Southern Saskatchewan

• FIELD SAFETY ADVISOR

Over 50 years strong, Arnett & Burgess Oilfield Construction Limited safely provides quality pipeline construction, facility installation, pipeline integrity, custom fabrication, maintenance and related construction services to the energy industry.

- Candidates must have previous leadership/managerial experience within the Pipeline Construction industry (mainly underground lines max 16�). This position’s home base is in Regina. - The ideal candidate will have a CSO designation. This position will oversee pipeline construction projects in southern sk with a home base in Regina

• PIPELINE CONSTRUCTION LABOURERS • FOREMEN • HEAVY EQUIPMENT OPERATORS

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Driver’s License Ground Disturbance – (Heavy Equipment Operators only)

Please submit your resume to : For more details and other career opportunities please visit: email: hr@abpipeliners.com • Fax:403.265.0922 www.abpipeliners.com For Inquiries please call: 780.384.4050

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C36

PIPELINE NEWS August 2012

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PIPELINE NEWS August 2012

Journeymen Electricians and Apprentices PowerTech Industries Ltd. in Estevan is seeking Journeymen Electricians and Apprentices for work in the Estevan and Carnduff areas. Experience: Safety Certificates are needed. 1st Aid/CPR, H2S. Applicants must have a valid driver’s license. 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.

We require the following:

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Glen Peterson Construction Ltd. 314 - 6th Street, Estevan, SK S4A-2V7 Ph: 306•634•2741 Fax: 306•634•4643 or E-mail construction@glenpeterson.ca

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C38

PIPELINE NEWS August 2012

RESOURCE GuĂ—de 4XDOLW\

/$0,&2,'6 PHWDO FDEOH WDJV (IĂ€FLHQW 6HUYLFH

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

Your best choice for accommodations

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Aviation Co. Inc. Carlyle, SK

in Carlyle, Sk. • Full kitchen and upscale extended stay • Complimentary continental hot breakfast • Free high speed internet • Meeting room

John Erickson Cell: (306) 575-7316 john.erickson@sasktel.net

Reservations: 306-453-2686

• Hot Shot Service • Flight Training • Chartered Flights • Sightseeing Tours

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

BIG D’S LEASE SERVICE Backhoe Towing Mowing Fencing Snow Removal Road Grader Gravel Supplies & Hauling

P.O. Box 544 Stoughton, Sask. S0G 4T0

Lloyd Lavigne • Kirk Clarkson Owners/Managers 6506 - 50th Avenue Lloydminster, AB

Phone: (780) 875-6880

(306) 457-7033 (306) 457-7673

5315 - 37th Street Provost, AB T0B 3S0

Phone: (780) 753-6449

Fax: (780) 875-7076

24 Hour Service Specializing in Industrial & Oilfield Motors

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

M.E.T. OILFIELD CONST. LTD. “All Your Construction and Maintenance Needs� SPECIALIZING IN: ENGINES, PUMP UNITS, UNIT INSPECTIONS, PIPE FITTING, TREATERS AND PRESSURE TICKET WELDING

Canada's leading distributor of industrial, Ă eet and safety products.

Proud to provide selection, quality and excellence to our customers.

Box 1605, Estevan, Sk. S4A 2L7 Cell. (306) 421-3174, (306) 421-6410, (306) 421-2059 Fax: (306) 634-1273

516 Nesbitt Drive, Estevan • 634-2631 (Behind Power Dodge)

Dwight G. Blomander, CFP, CLU, CH.F.C., CHS

Cordell Janssen District Manager Downhole

• Life Insurance • Disability Insurance • Critical Illness Insurance • Employee BeneÀt Plans Tel: (306) 359-2015 • Fax: (306) 359-3034 E-mail: dwight@dgbcanada.ca Toll Free: 1-855-359-2015 • Cellular: (306) 421-1935

93 Panteluk Street, Kensington Avenue N Estevan, Saskatchewan PHONE: 306-634-8828 • FAX: 306-634-7747

Great-West Life

cordell.janssen@nov.com • www.nov.com

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

Life Licence sponsored by The

ASSURANCE COMPANY

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

PIPELINE NEWS August 2012

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PIPELINE NEWS August 2012

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