Pipeline News August 2017

Page 1

PIPELINE NEWS Saskatchewan’s Petroleum Monthly

August 2017

Canada Post Publication No. 40069240

www.pipelinenews.ca

Volume 10 Issue 3

VIRDEN

Oil Capital of Manitoba One year after Husky spill A2 Corex plans for two rigs working steady A2 Exclusive: Tundra Oil & Gas Ltd. CEO A3

Tundra Oil & Gas Limited employs well over half the Manitoba oilpatch. Here, Virden-based CD Oilwell Servicing Ltd. Rig 4 works for Tundra in their Sinclair field, south of Cromer. Virden is Manitoba’s oil capital, where most of its oilpatch is based. Photo by Brian Zinchuk

First Year University Classes

It’s not too late to register for

FIRST YEAR UNIVERSITY OF REGINA CLASSES

at Southeast College!

Contact our student advisor at 306.634.4795 for more information


A2

PIPELINE NEWS August 2017

Husky not yet ready to restart Saskatchewan pipeline following oil spill into river last year By Elsie Ross (Daily Oil Bulletin) Calgary – Husky Energy Inc. recently received approval to repair a section of its Saskatchewan Gathering System which ruptured a year ago, spilling heavy oil and diluent into the North Saskatchewan River, the company’s chief executive said July 21. “We have a little more work to do with all the authorities before we are all comfortable — ourselves included — that we want to restart it,” Rob Peabody, chief executive officer, said in a conference call to discuss second quarter 2017 results. About 40 per cent of the 1,400 bbls that leaked from the pipeline in the July 20, 2016 incident ended up in the river, affecting the water

supply of First Nations and other communities downstream from the spill. As of the end of 2016, the Husky Midstream Limited Partnership, the owner of the pipeline, had incurred a total cost for the pipeline spill of about $107 million, which largely accounts for all the costs, said Rob Symonds, Husky’s chief operating officer. Peabody said the question is what Husky and the industry as a whole learned in order to respond even faster to an anomaly in the pipeline operation. “The short answer is, as my mother used to tell me, learn from your mistakes and don’t do it again and make sure that other people also learn from your mistakes if possible

so everybody cannot do it again.” Husky and other groups have been doing extensive investigations and “we are trying to learn from everything that everybody is doing here,” he said. “We went through a very significant investigation of all the incidents that occurred and we transferred the learnings particularly on slope stability to all of our operations and have shared them,” added Symonds. Earlier this year, the Saskatchewan Ministry of the Economy released the results of its investigation into the spill. It concluded that the cause of the pipeline break was due to mechanical cracking in a buckle in the pipeline which was caused by ground move-

ment on the slope which occurred over many years and was not a sudden, one-time event. “There’s a lot of changes that are going to take place there, including changes to design and to monitoring equipment,” said Peabody. For the repairs to the pipeline, Husky has added a number of enhancements, particularly on monitoring movement on the line, including putting fibre optics on the pipeline and inclinometers to measure the ground to “make sure we are on top of ground movement,” said Symonds. “We monitor it because ground movement is an unpredictable thing and we are transferring that learning everywhere.” The repaired pipe-

line also will have higher grades of steel and a thicker walled pipe. “What’s interesting is that this wasn’t a pipeline without monitoring equipment,” said Peabody. “This actually had two leak detection systems on it already.” It’s not that the leak detectors failed but that there wasn’t an unambiguous message coming from the system, he said. “Pipeline systems are dynamic and things are happening in them all the time so if you are looking at pressure and flow data it’s always fluctuating to some degree so that any leak detection system is trying to find anomalies in a fluctuating and dynamic system.” The additional monitoring systems are to focus more locally on

high risk areas so that there is a better chance of getting an immediate indication of a leak, according to Peabody. “We certainly realize that spill had an impact on communities and the First Nations downstream and we are certainly grateful for the support and co-operation we received,” he said. “We had more than 1,000 people involved in the cleanup effort including more than 450 First Nations members who did an outstanding job.” While Husky certainly doesn’t want to have another such incident, “there was a silver lining in this in that it really did allow us to build closer relationships with both the community and First Nations,” according to Symonds.

Corex Resources plans steady growth By Brian Zinchuk Calgary, Virden, Man. – For several years, Corex Resources Ltd. has been the number 2 oil producer in Manitoba. The company is now on a steady growth trend, having resumed drilling this year. Monty Bowers, CEO and president of Corex, spoke to Pipeline News via phone from Calgary on July 18. He noted the company is privately held, with five major shareholders who have around 95 per cent of the company, and about 100-plus shareholders who hold the remainder. The major shareholders include one firm from Calgary, one from Quebec, and three from the United States. “We’ve got a bunch of production coming on right now, but we’re probably in the order of 4,500 barrels a day right now,” Bowers said. “We expect to be, at the end of the year, around 6,000

barrels per day-plus.” Part of the initial 4,500 bpd is from an acquisition earlier this year, but further growth is expected to all come through the drill bit. The company currently employs two drilling rigs working in southwest Manitoba. As of July 21, one was working northeast of Virden, and the second was just south of Cromer. Nearly all their production is in Manitoba. They have a small fraction of production that came from the origins of the company. The Corex name has been around since 2012. For one year prior to that it was known as Amarone Oil & Gas Limited. Amarone was split into gas-weighted Successor Resources and oil-weighted Corex. Corex was recapitalized, and through a series of Manitoba acquisitions and drilling, the company’s production peaked at

Corex Resources Ltd. is expanding this battery facility on Manitoba Highway 256, north of Cromer. They will be adding a free water knockout to contend with water cuts. Corex’s Manitoba operations are based in Virden. Photo by Brian Zinchuk

around 5,000 bpd in the first quarter of 2015. The downturn of the commodity price cycle meant restrained spending. “We pulled in the reins for the last three years or so. We’ve picked up our drilling activity here just recently,” Bowers said. Leading up to the downturn, Corex usually had two drilling rigs going, and on occasion one or two more. Now they are back to a two-rig program. “We picked it up in

Q1 of 2017 drilling 16 gross wells, 12 net wells. Subject to commodity price, as obviously the activity picks up or slows down due to our revenue stream, our intentions are to drill 58 net wells in total in 2017.” Corex did something that is rather remarkable in that they bought out their major partner in the Daly-Virden area in Q2 of 2017. That partner was Crescent Point. Generally speaking, Crescent Point Energy Corp. rarely sells

assets. “It took a long time to get them there,” he said, when asked about the acquisition. “Effectively, we bought their unit production in the Daly-Virden area.” Business plan “Basically, our business plan is to ultimately continue to grow production in the area through the end of 2019, 2020 or thereabouts, then evaluate what we’re going to do corporately at that point in time,” Bow-

ers said. “By then, we’ll probably be in the 8,500 to 10,000 barrel per day range, or thereabouts. “Our original strategy was three to five years from 2012, but effectively we lost about 2 ½ to three years through the downturn in the commodity price cycle. So that’s been extended by that 2 ½ to three years.” “The challenge right now is the historical buyers, in the low commodity price, are not buyers. ► Page A7

Crescent Point is proud to be part of your community. crescentpointenergy.com

Sharing The Energy


PIPELINE NEWS August 2017

A3

TOP NEWS

Tundra Oil & Gas employs more than half of Manitoba’s oilpatch By Brian Zinchuk Winnipeg, Virden – It would be no exaggeration to say that Tundra Oil & Gas Limited employs in excess of half of the Manitoba oilpatch. Over the years, largely through organic growth, but more recently through some key acquisitions, Tundra is by far the largest producer in the province, being the most active driller and employing the most people. On July 17, Tundra Oil & Gas Limited president and CEO Ken Neufeld spoke to Pipeline News by phone from Winnipeg. He started with the company in 1989, and was its chief financial officer for a number of years prior to his current appointment. Tundra Oil & Gas stands out from many of its industry peers in that it is privately owned. It is owned by the Richardson family through James Richardson & Sons, Limited which is part of

the same business conglomerate that includes Richardson International, Pioneer Grain, and Tundra Energy Marketing Limited (TEML). “As of July 1, we removed the Partnership label and moved back to being Tundra Oil & Gas Limited,” Neufeld said, “Also, effective July 1, Tundra Energy Marketing Limited, is no longer a subsidiary of Tundra Oil & Gas and now reports directly to its parent company, James Richardson & Sons, Limited. “While we have a common shareholder, we are two separate businesses with two separate board structures.” Company-wide, Tundra Oil & Gas employs just over 300 people. Principle operations are based in Virden, Man., where it directly employs roughly 200 people. It has a technical office in Calgary, consisting of reservoir engineers, geologists, geophysicists

General Well Servicing was working on a Tundra site south of Cromer on July 19. Photo by Brian Zinchuk

and land admin people. Their head office resides in Winnipeg. And make no mistake about it, there’s a reason Tundra’s not headquartered in Calgary. The company very much has a Manitoba focus and commitment. Roughly 85 per cent of their production is in southwest Manitoba, with the remainder in southeast Saskatchewan. Indeed, several oilfield service companies over the years have told Pipeline News that if they

wanted to do business with Tundra in Manitoba, they were strongly encouraged to set up shop there, something Neufeld acknowledged. “We prefer to work with suppliers that have a local presence,” he said, adding that it makes for much better contact and face-to-face service. Product delivery times are shorter. It also means shorter travel for crews, which can also be a safety consideration. “We just think it’s a better way to

Now Available In 25” Tall For Multi-Pad Well Setups New Walk Through Access Door - patent pending

100% Canadian owned and operated

THE QUICKEST WAY AROUND

PATENT # 2362105

C O N TA I N M E N T S LT D .

Williston Basin Conference have shown that, historically, Tundra has been, by far, the largest player in Manitoba. Neufeld said, “And with acquisitions in 2014, 2015 and 2016, today probably more so.” Waskada area acquisitions In the past few years, Tundra acquired much of the Waskada field from the two dominant players in the area – EOG Resources and Penn West ► Page A6

conduct our business.” “We have a lot of technical people in our field office in Virden as well.” Tundra is an intermediate producer. “We’ve been as high as 30,000 barrels per day, but with a reduced drilling program over 2015 and 2016, we’re producing approximately 25,000 barrels per day right now.” Presentations given over the last decade by the Manitoba Petroleum Branch to the annual

Suretuf Containments Galvanized Wall

www.suretuf.com

CROSS OVER STAIRS

Suretuf containment packages are a patented (patent #2362105) and P. Eng. certified design. Suretuf containment packages meet or exceed all D-055 (Alberta) and S-O1 (Saskatchewan) secondary containment requirements. Suretuf has been manufacturing containment packages for over 15 years. All package components past and present are compatible with one another – no dead stock. The light weight easy to handle drop pin connecting panels with new single slide in leg design do not require nuts and bolts for assembly providing safe, quick and easy installation or complete package relocation without special tools. Further the slide in leg design allows the entire containment system to float with ground heaving while maintaining wall integrity. Suretuf containment packages are a zero ground disturbance system.

45º Corners No Extra Cost

Sting Doors

No caulking or gaskets required to attach the liner to the containment wall or to attach the walls together. The top mount liner with square top cap eliminates sharp hazardous edges providing greater safety when working near or around the wall.

P.eng. Stamped, Patented Design Free standing, zero ground disturbance • Slide in legs and pin together system No bolted legs or panels • Available in 25”, 36” & 44” heights Quickest to assemble and re-locate • No gaskets or caulking required • Top mount liner

*CUTS DOWN ON TIME.

Accessories: Sting Doors • crossover stairs • Walk through Door Geotextile • All type & sizes of liner available. Fire retardant coating available

(C.O.R Certified set up crews are available)

WE WILL BUILD TO SUIT OUR CUSTOMER NEEDS • OILFIELD • MINING • AGRICULTURE • WE DO IT ALL! Contact Greg Gessner:

Phone: (780) 875-0032 • Cell: (780) 214-7808 Fax: (780) 808-2273 • Email: greg@suretuf.com


A4

PIPELINE NEWS August 2017

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.

Editorial Contributions:

PUBLISHER Rick Sadick - Estevan 1.306.634.2654 EDITOR Brian Zinchuk - Estevan 1.306.461.5599 Associate Advertising Consultants:

SASKATCHEWAN & MANITOBA • Estevan 1.306.634.2654 Deanna Tarnes - Advertising Manager Candace Wheeler Teresa Hrywkiw • Carlyle 1.306.453.2525 Alison Dunning NORTHWEST SASK. & ALBERTA • 1.306.460.7416 Harland Lesyk Production:

• Estevan 1.306.634.2654 Jihyun Choi Ashley Taylor

68 Souris Avenue N, Estevan, SK S4A 2M3 1 (306) 634-2654

www.pipelinenews.ca

To submit a stories or ideas: Pipelines News is always looking for stories or ideas from our readers. To contribute please contact your local contributing reporter. Subscribing to Pipeline News: Pipeline News is a free distribution newspaper, and 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.

Oh, if only it were so On July 19, The Financial Post’s Claudia Cattaneo wrote a piece entitled “Saskatchewan advantage means oil activity surges while Alberta lags.” Maybe we missed something while on summer holidays. Apparently the Financial Post knows more than we do about the Saskatchewan oilpatch. Surely, they do, because we run into them all the time at oil shows, petroleum conferences, on leases, rights-of-way and in oilfield service company offices. Surely Ms. Cattaneo has been to all these venues in the past four months, right? She’d know what’s going on here? Oh wait. We never saw her at any of those places we’ve been to, here, on the ground. Apparently she’s received a National Newspaper Award for her 2015 coverage of the oil price collapse. But does she ever get out, on the ground, in coveralls, boots and hardhat? Since BlackPearl Resources is going ahead with a SAGD project at Onion Lake Cree Nation, apparently we’re seeing a surge in activity. “A surge in interest in Saskatchewan oil by companies like BlackPearl, motivated to get back to work after an extended oil price downturn, means the province is experiencing a healthy rebound in activity this year, while Alberta’s oilpatch continues to struggle as capital and companies move elsewhere,” she wrote. “According to the Canadian Association of Petroleum Producers,

capital spending in Saskatchewan will bounce back to an estimated $6.1 billion in 2017, from $3.5 billion in 2016, $4.2 billion in 2015 and $6.7 billion in 2014.” Must be all good now, right? Come on, with around 47 drilling rigs working through much of July, roughly half of what we would see in July from 2008 to 2014, we must be surging. Or maybe it’s a surge because we’re only down by half, this year, compared to last year, whereas we were down by 85 per cent to 15 rigs working on July 12, 2016. Maybe that’s the surge. Perhaps the plethora of three and four drilling rig companies that only have one rig working is the surge. She must be including the drilling companies who don’t have any rigs working at all in her surge, too. Never mind that those drilling rigs took four rounds of cuts to their day rates, and most are working for rates that are more than a third less than their 2014 rates. Could the surge be in the continued consolidation of fracking companies? Or maybe the other oilfield services companies, who have started to gingerly hire a few more people in the last six months, are the surge. Never mind their staffing levels were down by half, on average, compared to 2014. Maybe it’s all the money these oilfield service companies are making. This summer they might be able to pay the power bill for the office.

But buy new equipment this year? Or next year? Or even the year after that? That might be pretty tough, based on the rates the oil companies are willing to pay at present. So the surge in equipment capital expenditures must be what she was talking about. And the salaries those companies are paying, down substantially for nearly every person in the oilpatch. Maybe they’re the surge. As expected, Minister of Energy and Resources Dustin Duncan said nice things to the Financial Post. But that’s what he has to do, no matter what. Up until the most recent land sale, Crown land sales have been abysmal, yet the minister had to say something nice about it. The surge must, therefore, be in the number of job postings. But most people who we’ve spoken to have said they can’t pay nearly what they used to, and they expect it will be hard to fill jobs because such a huge number of people have left the oilpatch and are not coming back. Don’t get us wrong. This paper has spent nine years cheerleading every bit of good news we could find on the Saskatchewan oilpatch. But the Financial Post’s piece was a little rich. So we invite Ms. Cattaneo to come to Estevan. Lloydminster might be a bit tough, because, well, the mileage budget these days is pretty sparse. But we’ll give her a tour, and search for this surge of hers.


PIPELINE NEWS August 2017

OPINION

Reset the usual craziness and maybe we can attract more workers There is an increasingly common thread I’m hearing from oilfield service companies: we are seeing the start of a labour shortage. Talk to pretty much anyone in the service rig business, and you’ll hear it’s hard to find workers. But that extends to many other sectors as well. Almost universally, people are telling me about the large numbers of people who have left the oilpatch, followed by the statement, “And they’re not coming back.” The oilpatch has seen downturns before, eventually followed by surges. And people have come back, usually for the high wages offered. But right now, no oil company or oilfield services company is really in a position to offer the

big bucks again. And therein lies the problem. People will work long, hard, crazy hours when there’s a big paycheque attached. But without that huge paycheque, is all the craziness really worth it? One of the most brutally honest interviews I’ve done was with Kelly Lafrentz, when he and his wife Arlene sold off their equipment and shut down their trucking and rental businesses after 27 years. They got out during the height of the boom, in 2012. Back then, Kelly said, “The oilfield will be in this crisis for people until they get rid of the panic mentality. The rest of the world works five to six days a week, 10hour days. On Saturday, they want to stay in bed with their wife.”

Kelly noted the younger generation is willing to work 12 hour days, but doesn’t want to work 24/7. “The oilfield still doesn’t get it. “It doesn’t look to me like we would get out of this labour situation anytime soon. “The big players are the ones who don’t understand. We’ve worked for some great people, who give you two to four days notice. Scheduling can be done. “The big machine has to start scheduling this as a regular job. They do in the U.S. They go home at the end of the day.” Step forward to 2017, and I’ve had several conversations with oilfield services companies who are feeling the same frustration that Kelly was back then.

A5

FROM THE TOP OF THE PILE

By Brian Zinchuk

They’re tired, bone tired, of the middle-of-thenight calls, carrying two cell phones and being expected to answer them 24/7. Their workers are feeling the same way. It’s hard to get people who are willing to go out at three in the morning. When there was big money involved, sure, people were more willing to do that. But for the leaner wages now on offer? Perhaps not so much. A related common thread has been the desire for “slow and steady.” I heard that same phrase three times in one day, from different people. It’s clear there’s a desire for this. This idea of ramping up activity all of a sudden, then, just as quickly, shutting down, plays havoc with staff-

ing, never mind stress levels. Who wants that? And who’s willing to leave a steady-Eddie job, which may pay less, to go work for a few months and then get laid off again? Our next generation of workers are the millennials, who appear to be a different kettle of fish compared to anyone who has come before. Will they put up with the craziness of the patch? Is this shortage a direct reflection of that? Perhaps the key to attracting new labour is to try to make this industry just a little closer to a normal 9 to 5 gig, with weekends off. Schedule things ahead of time, and eliminate the middle of the night callouts as much as possible. Yes, many aspects of the oilpatch

will always be 24/7, i.e. an overfull tank alarm. But not everything truly needs to be. A more relaxed pace is attainable in many sectors. But that can only happen if the oil companies take the lead. Their shareholders may want the most efficient 24/7 operation possible, but how can it function if there’s no one to do the job? I realize this is all likely a pipe dream. As one person told me, “That will never happen.” He was probably right. But if we want to attract people to our way of life, maybe we have to make it a little more liveable. Brian Zinchuk is editor of Pipeline News. He can be reached at brian. zinchuk@sasktel.net.

SAVE TIME, MONEY & THE ENVIRONMENT PEPATE ND NT IN G

THE JK JUNIOR CONTAINMENT CLEANS UP THOSE UNSIGHTLY LEAKING STUFFING BOXES AND IS:

 Self Contained

 Fluid Levels Are Easily Monitored

 Easily Installed On The Wellhead

 Offers Easy Access For Drainage & Packing Replacement

 Takes Up Minimal Space

 Polish Rod & Packing Life Expectancy is Maximized

 Simple & Effective

 Can Hold Over 100,000 lbs. Of Weight

NO MORE UNSIGHTLY SPILLS ….SO NO MORE CLEAN-UPS!

FOR MORE INFORMATION OR TO ORDER:

JAYSON KING

306.736.9169

jk1@sasktel.net

DESIGNED WITH

PA TE

NT

OPTIMIZED SIZING QUICK SET UP

ED

ENVIRONMENTAL SECURITY GOVERNMENT REGULATIONS IN-MIND ONE PIECE MEETS ER S-01 STANDARDS TO HOLD OILFIELD TANKS EASY TO MOVE

2 SIZES AVAILABLE 1) Holds two 400 barrel tanks 2) Holds Three 400 barrel tanks or two 750 barrel tanks

306.457.7205

STOUGHTON, SK

When your well site, lease or tankage requires containment, call JK Containment...We will save you time and money!

JAYSON KING 306-736-9169

SE SASKATCHEWAN BRAD ALLAN 306-457-7028

EMAIL:

JKCONTAINMENTS@LIVE.CA

www.jkcontainments.com


A6

PIPELINE NEWS August 2017

Tundra made several acquisitions during downturn Page A3

Exploration. A few years earlier, EOG had built a pipeline from Waskada to the Enbridge mainline terminal at Cromer, Man., and PennWest used another line, of which Tundra had a share. “It was a combination of opportunities,” Neufeld said, noting that in the fall of 2014, oil prices declined from US$100 per barrel for WTI to US$50 per barrel, almost overnight. “EOG, which is Houston-based, for a number of reasons, had started their exit from Canada, selling all of their Canadian oil and gas properties prior to the price collapse. We weren’t interested in the properties they had further west which was out of our wheelhouse of expertise. But we did tell them we’d be interested in the Manitoba assets. “We gave them a number. It took them a couple months to get back to us, to say, ‘Okay, we actually have a buyer for the non-Manitoba assets, so if you’re interested, let’s talk.’ “We concluded a deal in late 2014. It was a bit opportunistic, in a sense. Prices were coming off and everyone was a little gunshy in terms of taking a longer-

term view and stepping up. But also, Manitoba doesn’t have a lot competitors; it’s not an area of operations for many oil and gas companies. “It was the biggest transaction to date in the history of Tundra.” The acquisition added roughly 6,000 bpd at the time. EOG’s pipeline was purchased by TEML prior to Tundra Oil & Gas’s purchase of their Manitoba production. It was TEML’s first acquisition of a pipeline from a third party and, together with the Waskada pipeline and Tundra’s own Sinclair pipeline, got TEML going as a significant pipeline operator in the province. The EOG purchase closed in November 2014. By July 1, 2015, Tundra closed the acquisition of the PennWest Waskada properties at a time when PennWest was rapidly shedding assets to deal with its debt issue. That created an opportunity for Tundra, which added roughly 1,800 bpd at the time. In 2016, Tundra purchased Arc Resources’ property at Goodlands, east of Waskada. That brought in an additional 1,000 bpd of production. With the downturn, drilling in the Waskada area all but came to a

ANNER BIT SERVICE SURFACE BIT RENTAL QUALITY RERUN & RETIP 24 HR SERVICE CHAD FROESE

CELL: 306-421-3726 OFFICE: 306-388-2941

Level Best Technologies Ltd. • Fluid Levels • Dynamometers • Build-Ups • Fall-Offs • Foam Depressions • Casing Compressors

Dave: 306-461-4322 Pat: 306-861-9986 Nolan: 306-461-4323

halt, but Neufeld said they are more active there this year, having drilled seven wells to date of a total of a dozen planned for this year. “We’re starting to understand the reservoir a little better. We do see it as an opportunity through unitization and waterflood projects.” Sinclair Field Each year, when recently-retired director of the Manitoba Petroleum Branch, Keith Lowdon, would make a presentation to the Williston Basin Petroleum Conference, he would typically show a series of slides showing the phenomenal growth of the Sinclair-Daly oilfield which runs just east of the Manitoba/Saskatchewan border and centres around Cromer. Cromer just happens to be the oil hub that receives southeast Saskatchewan and southwester Manitoba oil for shipment on the Enbridge Mainline. “Sinclair was certainly our biggest discovery, that came about in 2004. A lot of it has since been unitized. While Sinclair remains our largest single area, the Daly field is also important to us and, with the acquisitions from PennWest, EOG and Arc, the Spearfish play in Waskada is significant as well. However, the Sinclair field remains dominant. It changed who

Tundra Oil & Gas made a $5,000 contribution to Virden’s Goulter School in June for their Medicine Wheel Garden. Photo submitted.

we were and our growth trajectory like nothing else has, but I wouldn’t consider us a one-trick pony,” Neufeld said. Drilling During the heady days of the oil boom, Tundra had as many as seven drilling rigs going at a time, but more commonly five or six, according to Neufeld. As of July 17, they had two Trinidad Drilling rigs working for them at Sinclair and Hargrave. “I think we’re going to be able to execute our (drilling) program for the year with just two rigs.” He noted 120 wells are planned this year. That’s down slightly from 145 wells originally planned due to two recent acquisitions in the Daly area – Interwest and Paradise Petroleum.

As Tundra is committed to managing within its cashflow, funds allocated to those acquisitions resulted in a small reduction in its drilling program. The Sinclair field is largely Bakken and Lodgepole production. At Waskada, the target formation is the Spearfish, also referred to as the Lower Amaranth by the Manitoba Petroleum Branch. As southwest Manitoba is the edge of the Williston Basin, well depths are generally shallower than what you would see in southeast Saskatchewan and much more shallow than North Dakota. While this means reduced drilling costs, it also means less reward. Tundra’s wells in the Sinclair-Daly field

are often around 900 metres deep. A Bakken well in the Viewfield area, in comparison will run around 1,600 metres deep. “As you get further updip, towards the edge of the reservoir, you’ve got less reservoir energy and maybe less oil in place,” he said. Effectively, it costs less to drill, but you get less as well. Drilling efficiency has also been key in dealing with lower oil prices. Horizontal wells that used to take eight days now take four days to drill. Dealing with downturn When the downturn hit and oil prices fell, the way the industry was drilling wells and conducting business wasn’t profitable with the lower

► Page A9


MS RS

PIPELINE NEWS August 2017

A7

Two drilling rigs expected to continue drilling for Corex for foreseeable future ▲

Page A2 “Most of their share prices are well under what they last issued equity at. So, if you go out today, most of the traditional buyers of assets are not in the position to be buyers of assets. In the short term, there’s probably not a large suite of buyers that are out there. That’s why we will grow production and look at the universe around us to decide what we need to do.” He noted they could continue on, and become the acquirer. They could turn it into a dividend paying model. They could sell. They could follow a growth model. Bowers pointed out their assets are very good assets for a dividend-paying model because overall they’re a low-decline asset. “If you asked anyone in 2012 what was going to happen in 2014, most people would say they didn’t see that coming. If you ask me what’s going to happen in 2019, 2020, all we can do is we can build the best company possible in the short

term, make sure we have the lowest cost structure possible. If there is a universe of buyers that we are appealing to we may sell, or we may consider other business strategies at that point in time,” he said. Bowers was born in Estevan, grew up Saskatoon, and attended the University of Saskatchewan where he graduated with his geological engineering degree in 1978. Asked about the geological formations Corex targets, he said, “The majority of the production we have comes from the Lodgepole. We have a minor amount of production from the Bakken.” Community impact Bowers said, “We take pride in being involved in the community. When you run two rigs, you’ve got an awful lot of folks out there when you consider the rigs themselves, the pipelines, the frac crews and the whole bit. We believe we have a significant impact in the community in terms of the folks we employ

there, and we take pride in being part of the community. “We directly employ 42 full-time people, 19 are in the field. That’s full-time staff, that doesn’t consider contract folks that we have.” With contract people, the number is greater than 50 on any given day. They have a field office just north of Virden. As so many people have left the oilpatch, Pipeline News is hearing increasingly about a shortage of labour in the region. Asked about this, Bowers said, “The one area that we got impacted in, significantly, was on the fracking side. During the downturn, with the consolidation of the various fracking companies, we ended up with not getting to nine wells before spring breakup. But seven of the nine have been fracked on the other

ultants

ecialists

This Ensign Drilling rig was working south of Cromer for Corex Resources Ltd. on July 19. Photo by Brian Zinchuk

side of spring breakup. “So, for us, it’s not impacting us on the ability to have operators, it’s more the service companies that it’s a significant issue, and mainly on the fracking side.” Vendor rates Oilfield services saw multiple rounds of cuts in

rates during the downturn. Asked when oilfield services can expect to see some movement of their rates, and how the oil companies can help keep service companies alive, Bowers said, “We look to make longer-term commitments with them. Right now, as a junior

operating in that area from 2012 to the end of 2016, we were sort of the tail on the dog. The Crescent Points and others who had continuous programs going were able to set price, if you will. Whatever it was that we needed, we didn’t have a ► Page A8

JACK!

IT’S ABOUT TIME

ng

CUSTOMS BROKERS

nal Small e Forwarders & Consultants Custom Clearance Specialists EDI Networking Check out our International Small Package Service DAILY DELIVERIES INTO ESTEVAN

S INTO HEAD OFFICE

North Portal (306) 927- 2165 Estevan (306) 634- 5454

Regina ................... (306) 352-2662 Saskatoon..............(306) 244-4847 Regway....................(306) 969-2126

Nationwide Services

www.percydavis.com Email: info@percydavis.com

Jack knows time is money PAYS FOR ITSELF

INSTALLATION

YOUR TIME

The increase in oil/gas production is immediately measureable not only in time, but real dollars.

It only takes a few hours to have your compressor up and running, practically eliminating production downtime.

Our safety qualified installers will perform maintenance checks when required, onsite, saving you the trip in.

– 4 WEEKS

– ZERO

– 1 DAY

www.annugas.com Toll Free

1.866.ANNUGAS

COMPRESSION

CONSULTING

LTD.

ANNUGAS ANNUGAS PRODUCTION PRODUCTION ENHANCER ENHANCER ®


A8

PIPELINE NEWS August 2017

Changing the landscape, in their own way By Brian Zinchuk Virden, Man. – Over the last decade or so, a drive down Highway 256 around Cromer, Man., looked a lot like many of the highways in southeast Saskatchewan, especially around Stoughton. You would often see multiwell pads with four or five curved-walking beam pumpjacks in a row. But in recent years, that’s slowly been changing. Where there was once five curved walking beam pumpjacks, now there were four, and one hydraulic jack. Then there were three and two. Slowly but surely, the landscape has been changing towards the usage of these new hydraulic jacks. The Sinclair-Daly field around Cromer is dominated by Tundra

Oil & Gas Limited, and they have been, over time, switching out many of their walking beam pumpjacks to hydraulic jacks. Asked about this on July 18, Eric Bjornsson, Tundra vice-president of development operations, said, “They’re hydraulic IJACKs.” “We tried hydraulic jacks about 10 years ago. They didn’t work very well. The first generation didn’t work as good as we hoped. Two or three years ago we started with IJACK, with their latest generation of hydraulic jacks.” “We use them just because they are most convenient,” said Craig Lane, who looks after operations with Tundra. He noted that with their

decline on their wells, with control similar to a VFD (variable frequency drive) controller, it’s possible to dial them down, from five strokes a minute to one stroke a minute. Bjornsson said, “It’s the versatility versus walking beam jacks. Each walking beam jack will have a range of operating parameters, a much narrower range than a hydraulic jack. A hydraulic jack can be adjusted to go very slow or very fast, without having to change the equipment out. It’s a much broader range of operating parameters, so as a well declines, as production starts to come off, you can turn these jacks down quite significantly, and you don’t have to change out the equipment to a smaller size.

Over time, it saves quite a bit in equipment costs.” He added they are able to set them through breakup and when conditions are soft. You don’t need a large picker to set them, as a crew truck knuckle picker will do. As it turns out, these

hydraulic jacks are manufactured locally, just down Highway 1 in Wapella, Sask. IJACK Technologies Inc. started in 2010, according to Steve Henry, vice-president of sales. He works out of Virden, and met Pipeline News there on July 18. He

noted that Dan McCarthy is the president of the company, and had worked through several prototypes. “We entered the market in 2014,” Henry said. Initially the IJACK was sold through a ► Page A14

opposed to the incremental. That’s happened with us on fracking, that’s happened on drilling rigs. “What we’re looking to is not always the lowest price. We’re looking at the quality folks can deliver at the price that’s reasonable, but not outrageous. “The one thing I

will say is that in 2014, the cost structure got stupid. At US$100 oil, it was dumb. I think the downturn was probably necessary for the whole industry to recalibrate, not just service companies. What’s the expression? ‘Turkeys will fly in high wind.’ There were a lot of turkeys in E&P companies.”

Bowers recognizes it will be hard for service companies to attract people to come back to the oilpatch for shortterm work, so they are setting themselves up to drill continuously. “Keep it steady, and keep growing it,” he said. Noting how Calgary now has very high vacancy rates in its

downtown office, home of most oil companies in Canada, he pointed out it’s been rough. There were stages where banks were dictating assets sales and the like. “Now, for the first time this spring, it felt like we were getting people to stick their noses up, out of the gopher hole, for lack of a better term, and look around and say, ‘Oh, the sun’s shining. Maybe we can start to do stuff.’” He added that oil was rising up to US$50, but then dropped to US$42. “You go back in the other direction pretty quickly,” Bowers said. “Unfortunately, if the price takes off, and

the cost structure takes off, and the economics go south again, you’ll see people pulling back.” “The folks who take it on the chin initially are the service companies. If we stop drilling, we still have cash flow coming in, because we still have production. But the service companies, when you stop drilling, don’t, because they’re getting paid for every job they do, as opposed to having a production side. They tend to be the ones that get whipsawed the most. So, as price goes up and takes off, they’re the ones that jump on the bandwagon.”

Corex will keep it steady Page A7

continuous drilling program going, so we were continually having to wait on services. “We, as a company today, are in much better shape. We know we’re going to be running two rigs continuously. There’s an appetite, by the service companies. We become the base, as

R.FRENCH TRANSPORT

Where multi-well pads like this in the Manitoba Sinclair-Daly field once had all curvedbeam pumpjacks, they are now being supplanted over time by the tall, thin JACK UNO hydraulic jacks. Photo by Brian Zinchuk

R.FRENCH TRANSPORT

Oil & Salt Water

Clean Fresh Water

Transfers

Tankers

Delivered Fresh Water: Cold or Heated

Licensed Fresh Water Well

• Clean Fresh Water Tankers • Licensed Fresh Water Well • ServiceFrac Work Insulated & Lined Service Work Oil & Salt Water Clean Fresh Water • SGI Safety Station • Oil & Salt Water Transfers 3 110m SGI• Tankers SafetyFresh Station Delivered Water: Cold or HeatedTanks • Insulated & Lined Frac Transfers

Tanks 110m3

Delivered Fresh Water: LicensedSE Fresh Serving Saskatchewan and SW Manitoba Service Work

Cold or Heated Office/Dispatch Insulated & Lined Frac

SGI Safety Station

Tanks Arcola and110m Forget, SK

Water Well

The Safety Association for Candada’s Upstream Oil and Gas Industry

R. French Transport Ltd.

(306) 455-3774 3

Serving SE Saskatchewan and SW Manitoba www.frenchtransport.ca has developed, implemented and audited a

Health & Safety afety Management Ma g System ys

Office/Dispatch

A DIVISION OF JJ TRUCKING LTD.

COR certified ê Gravel Hauling ê All Types of Aggregate including Pipeline Sand ê Sealed Trailers for Hauling Contaminated Waste ê Environmental Clean Ups ê Grading ê Directional Drilling ê Heavy Equipment Hauling ê Excavating ê Lease Preparation and Reclamation

Dispatch: (306) 421-9295 Chris Johnston: (306) 621-6002 • Shop: (306) 433-2059 Office/Fax: (306) 433-2069 • Toll Free: 1-888-532-5526 Creelman, SK • ldallan.jjtrucking@outlook.com


PIPELINE NEWS August 2017

A9

120 wells planned for this year, says Tundra CEO Page A6 oil prices. “The whole industry had to re-gear. The reason we could run a different business at US$100 is because virtually all drilling was profitable at that point. But when things change, you have to look at all aspects of your operations to deliver profit to your shareholders. “It forced everyone to tighten up. I think there was room to do that. The profit margins were good on the supply side. Services were in demand, with very little surplus capacity in the drilling and completions area, which meant suppliers could charge extra. At the time, E&P companies like ourselves could afford to pay it, so that’s how the business ran. But when we ran into the wall in 2014, we said, ‘Hang on here, we can’t be the only ones taking a hit.’ “In order to continue our programs, like many of our peers, we approached our suppliers with the message that they, too, had to share in the downturn.” Neufeld added, “I think you always want to be aware of the fact that these are relationships,

and they’re longer term. We still need competition among suppliers. So to starve these folks, there’s no benefit in that. We have to be in this together.” He noted that they had some long-term drilling contracts when the downturn hit, but the driller was willing to work with Tundra to get through the slowdown and keep as many rigs working as possible. “We saw a number of responses like that that made us feel we had good alignment, and mutual goals to keep the iron moving, so that we’d both be there when things picked up again,” Neufeld said. Asked when vendors can start increasing rates, Neufeld said that’s a tough one to answer. “I would say suppliers are going to need to increase price when there’s enough activity where they need to retool and re-attract labour and can justify the costs involved. If they have equipment they’ve always had on hand, that’s kind of a sunk cost. If they have the rig people, the operators, the labour… Clearly,

Ken Neufeld is president and CEO of Tundra Oil & Gas Limited. Photo submitted

in 2016, with US$26 oil in February … when the price was slow, just about everyone pulled back on their drilling programs. Tundra went from 200 wells a year to 38 wells last year. So nobody was busy and everyone was looking at a way to pay the rent. “So, when is that going to reverse itself? I guess, when we see sustained activity. It’s still a bit choppy; it’s still volatile. There’s still a lot of E&P companies that aren’t really making any money. Some are growing. Some have value in the public market place, but profitability is really not there. “I think we’ve got to recognize we’re in a new day and everyone has to

find ways to be more efficient and survive at these prices,” Neufeld said. He feels a sustained US$50 price for WTI is a tipping point for more activity, both economically and psychologically. That applies to their company as well. Community commitment Tundra’s community project support is typically done through the Richardson Foundation. “We were a major contributor to the Virden Rec Centre in the past, which carries our name. We thought that was a big win for the larger region. It can host major tournaments and events. It wasn’t just about Virden, but also about surrounding communities,” he said. In 2016, Tundra, through the foundation, made nine donations totalling $99,000 in the region, and 10 donations, to date in 2017, totalling $131,500. Around the time they bought the EOG property in Waskada, they also contributed to the rink rebuild there. “We try to be a good corporate participant on many fronts,” he said. For

instance, Tundra has been extremely active during the downturn, abandoning wells and cleaning up uneconomic sites. Many of these were inherited as part of recent acquisitions. Tundra is committed to cleaning up these properties and restoring the land to its original condition. “In 2016, we would have done close to

200 downhole abandonments; a record number for Tundra. We also completed and obtained landowner signed offs on over 100 site restorations. We’re proud of those things too, even though they don’t add a lot to the bottom line. They’re a reflection of our long-term commitment to sustainability.”

Tundra moves forward with CO₂ pilot Back in 2008, Tundra Oil & Gas first started a pilot project injecting CO2 into a well in the Sinclair field. This year they’ve taken the next step and expanded the program. “We have a full-section pilot going on right now. As of this spring, we’ve expanded it to recapturing and recycling CO2,” said Ken Neufeld, president and CEO. They source their CO2 from a fertilizer plant in Brandon. “It’s not cost-effective on a commercial scale, but that’s what we’ve been doing during the pilot phase,” he said. “We’ve gone through the WAG (water alternating gas) process and now we’re trying to expand it to gain a higher level of confidence in terms of executability in the field and improved production.”

NOW SERVICING THE ESTEVAN AREA

Magnum’s Precision Cement Mixing/Pumping – Single Celebrating 9 years of cementing services in Western Canada. Remedial and Primary Cementing Services 24/7 Dispatch magnumcement.ca

“Service with Integrity”

1-855-901-5997


A10

PIPELINE NEWS August 2017

Jim Longney, left, and David Weir are managers of Premier Oilfield Services Ltd. in Virden, Man. Photo by Brian Zinchuk

Premier Oilfield started at the beginning of the downturn, and it grew By Brian Zinchuk Virden, Man. – Virden, -based Premier Oilfield Services Ltd. started in May 2014, just before the big oil downturn took hold. Despite tough timing, the company has grown since then into a diversified fleet servicing southwest Manitoba. Premier is a sister-

company to Precise Well Servicing, and operates out of a different shop on the same farmyard, just south of Virden. (See related story on Precise, Page A11) Parry Chapman is one of four partners in Premier. He said, “We ended up with a few more trucks than we planned

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

• Life Insurance • Disability Insurance • Critical Illness Insurance • Employee Benefit Plans E-mail: dwight@dgbcanada.ca Toll Free: 1-844-352-5659 • Cell: (306) 421-1935 Office: (306) 352-5659 • Fax: (306) 352-5660

on, but we grew with demand. “Most of our business is fracking related on the trucking side, so we trying to get more production work so you’re not quite as seasonal,” he said. “Last year, with our acid trucks, we were following some frac strings as far as into Alberta. Things were busy there.” Jim Longney is the general manager and Davide Weir is his number 2. They all spoke to Pipeline News on July 18. “It’s been pretty good, considering the market,” Longney said.

Their staffing fluctuates from four during breakup to 24 people, including swampers, at the height of the season, according to Weir. Longney said they started off specializing in vac services and two tri-drive vacs. Then they added a semi vac. “We decided to start slow and keep it somewhat small. After six months, that went out the window. In the past three years, we expanded to 22 power units.” They moved into fluid hauling with tank trucks. Then they bought

a hydrovac and a second semi-vac. Two more tridrive body-job vacs were next. There’s also a combo unit. “We specialized in completions, without trying to,” Longney said. Then a year ago they purchased two acid trucks with pups. Two more tanker trailers were added for acid. Along the way they got a couple steamers, too. In other words, it snowballed. But amid all this growth, they were also contending with the downturn that has been

brutal on the industry. “It changed our whole outlook on revenue,” Longney said, noting they tried to move more to the production side and expand their customer list. “It’s affected pricing. We’ve had one big cut, basically, beginning 2016.” There’s been marginal increase in rates since then. “I think it’s a bargain, doing wells,” he said. One of the ways Premier has coped has been doing as much of their own maintenance and safety work on their units as possible.

Life Licence sponsored by The

Great-West Life ASSURANCE COMPANY

300-1150 Rose St., Regina, SK. S4R 1Z6

Redi-Mix Concrete Versatile Sustainable Durable Economical

Building Material

Find Us: 817 6th Avenue Reston, MB R0M 1X0

Contact Us: 204-877-3087 sales@vancortm.ca

vancortm.ca Ready-to-Move Homes • Building Materials On Site Builds • Commercial Builds • Tiles Setting Renovations • Structural Insulated Panels $3,000.00 appliance package with purchase of a new RTM home.

Mid Western Redi-Mix Concrete

204.748.1592 • Virden, MB

VanCo Building Supplies

VanCo SIPs

VanCo Construction


PIPELINE NEWS August 2017

A11

Precise Well Servicing feels the labour pinch By Brian Zinchuk Virden, Man. – When you drive into Precise Well Servicing Inc.’s yard south of Virden, Man., you’d be forgiven if you thought it was a decent sized farm. Well, it is, and Precise, along with sister com-

pany Premier Oilfield, located across the yard, are both outgrowths of that farm. That’s according to Parry Chapman, who is one of four partners in the outfit. The others are Darren Chapman, Rob Chapman and Jeff Elliot.

(See related story on Premier on Page A10.) They’re not very picky on titles, but Parry fills the role of chief financial officer. “It derives from our large family farm,” he said. “It grew to a point where labour became an issue because of the oilfield, so we started investing in companies in the oilfield as a side investment.” Precise started out as a power tong outfit, Precise Tong Services Inc., but is now primarily a service rig company. They had five power tongs trucks with Precise Tong Services Inc., but most are now parked and just one is active occasionally. Precise is now run as one entity, Chapman added. As top-drive units

like advanced drilling rigs became more common, Champman said they got into the service rig side. “We knew power tongs were not going to be as busy as they once were.” Precise Well Servicing worked almost exclusively in southwest Manitoba, but it does occasionally go to southeast Saskatchewan. “We do quite a bit of work in the Cromer area, and Waskada area, and in Two Creeks,” said Greg Alberts, operations manager with Precise. Two Creeks is along Highway 83, north of Highway 1. They operate two service rigs with 13 people, including one on the tong side. Alberts said, “I’m a service rig hand, pretty

much from the jump. I worked in Estevan, in Alberta, northern Alberta, and all over. I’d land on another rig and just keep on it.” He joined Precise for the opportunity to be the rig manager on its first rig, and his responsibility has grown from there. Both of Precise’s rigs are singles. Alberts said, “We’re looking forward to getting some doubles. That’s a place we’d like to get to.” “We do service rig work – completions, workovers, abandonments,” Alberts said. “Last year we did a ton of abandonments.” Those abandonments were primarily in the Waskada area. Regarding living

with the downturn, Chapman said, “It’s a different pace. I guess a person’s got to adapt. This is probably the new reality, with oil prices where they’re at. For us, this is probably the first downturn we’ve encountered. We’ve learned lots.” Asked what that might be, he responded they learned to be a lot quicker in dropping rates. “When oil prices dropped, it seemed to be the rig rate, the hourly rate, was more important than the efficiencies. The accountants take over more for the big businesses. They don’t realize that one five-man crew can be more productive than another five-man crew.” ► Page A12

www.estevanmeter.com (306) 634-5304

Greg Alberts is operations manager with Precise Well Servicing Inc. in Virden. Here he’s posing on their old 1977 Kenworth tandem-tandem pump truck. “That truck’s the real deal,” he said, noting it has a lot of character. Photo by Brian Zinchuk

FOR SALE OR LEASE Prime Location - Estevan

Sales & Service For: PUMPS / METERS / VALVES / CONTROLS / SWITCHES Instrumentation Service

Combustion Service

PLC/RTU Programming

SCADA Services

Treater Parts

PSV Service

Shop & Field Calibrations

Shop & Field Repairs ISO 9001:2008 Certified

3 – 5 acres landscaped and fenced Will build to suit

306-634-9733

Estevan, Saskatchewan 321 Imperial Avenue Tel: 306-634-5304

Virden, Manitoba 130 Anson Road Tel: 204-748-3704

WORK HARD. REST WELL. • • • • • • •

Comfortable Spacious Rooms Kitchenettes Available Complimentary Hot Continental Breakfast Free High Speed Wi-Fi Coin Operated Laundry On-Site Business Centre Fitness Centre

Prairie Moon Unity 103-2nd Ave South Unity, SK 1 (306) 228-3333

Prairie Moon Macklin 4809 Sentinel Road Macklin, SK 1 (306) 753-3020

Prairie Moon Consort 5006-43 Street Consort, AB 1 (403) 577-2770

Work Crews Leisure Travellers Groups Teams

OPENING SOON!! Prairie Moon Lodge Kerrobert, SK

www.estevanmeter.com


A12

PIPELINE NEWS August 2017

Rates took a huge cut of profit there, but that’s not the reality. “It was pretty cutthroat.” Service rig companies throughout the region are feeling the pinch when it comes to manpower, something Alberts said is affecting them. “We feel that exact same thing. I don’t think there’s a guy in the oilfield today whose not feeling the same pinch or crunch. We left a lot of guys behind, guys with experience. Those

10-year and 12-year guys, they’ve made different choices. They’re doing other things, now.” As for recruiting, he said, “I look for the best I can get for any one position.” But that may mean shaping people for those positions via training and mentorship. Chapman said, “We’re surviving. There’s always room for more work. We’re probably doing better for manpower

on the well servicing side. On the trucking side, you’ve either got six too many drivers, or you’re six short,” Chapman said. With green hands, he noted training programs need to be top notch to continue to provide quality service to the customer. The difficult thing is one rig is running steady, but the second rig is running with 50 to 60 per cent utilization. While they keep the staff

working around the yard, they’re not making the money they would if their rig was active all the time. “A lot of people have left the oil industry for jobs that are a little more stable,” Chapman said. Alberts said, “There’s definitely a missing amount of experience with the guys around. Lots of guys made a different choice.” “Until rates get back up to where they’re getting better pay…” Chap-

man said. “For us, trucking is even harder, finding local bodies. Right now, probably 40 per cent of our drivers are local. The rest are coming from two or three hours-plus away, so you’re supplying accommodations for them. We have housing, and we’re in the process of setting up a camp for our own employees.” Asked about plans for the future, Chapman said, “Survive and maintain.”

Virden, Man. – Diversification has been an important strategy for Virden, Man.-based Safety Source and its sister company, Discovery Safety. Safety Source focuses on retail safety equipment sales and safety training. Discovery Safety provides field services like medics and air trailers. “The big thing for our company, anyone who had a good business plan kept their debts to a minimum and watched their payroll and tried to be as efficient as we can,”

said Dale Lewis, owner. “We also started diversifying into other industries. That’s one of the advantages we have in the safety world. We don’t just have to deal with oil and gas.” That includes working with power utilities and agriculture. Before the downturn, oil and gas was probably 85 per cent of their business. Now it’s about 70 per cent. They had also started to work on turnaround, which was a big boost for Discovery Safety. Industrial med-

ics working on drilling rigs had curtailed sharply when drilling dropped off. “Nobody could have foreseen what was going to happen in 2014. Things were going well for everybody. The industry seemed to have been going at a steady pace, then out of nowhere, look what happened with OPEC and throughout the world,” Lewis said. “It was definitely tough on a lot of people.” Since the last quarter of 2016, business has been fairly steady, doing lots of different

things. “It’s been a good eight months, for sure. I wouldn’t say it was as good as 2014, but it doesn’t necessarily have to be that busy, either. Sometimes slow and steady wins the race,” said Lewis. Lewis put some of their day-rate people on salary so as to guarantee them a wage. “One thing I was pretty proud of is I didn’t have any actual layoffs. I stayed pretty whole, with my staff. Any cuts with staff were by their own accord, people leaving by attrition,” he

said. They had a large casual staff base, but as things slowed down, they had to find work elsewhere. But full-time people were kept. Currently there are seven employees on the Safety Source side, including two in their Redvers store. There are six full-time staff and nine casual staff working with Discovery Safety. It’s been a tough couple years in Redvers, but things are starting to rebound there, too. Echoing statements

made by nearly everyone Pipeline News had spoken to in Virden, Lewis said, “It’s tough to find people who will want to work in the industry. They don’t know what’s going to happen. The crash is pretty fresh. Until we see a good run here, it’s going to be tough for people to find staff, not just on our side, but the drilling side and trucking side. To that end, he said, “We’re looking for more casual staff, possibly a couple more full-time people, but it has to be the right person.”

Page A11 Consultants might see that, but the accountants, not so much. While they’ve survived the downturn, Chapman said, “Anybody who says they haven’t had equity eroded is lying. Some of the rates some of our competitors were running at … one of our classes of trucks went from $150 an hour to one of our competitors went to under $60 per hour. I’d like to say there was $90

Safety Source diversified into other sectors

l a n o i cept

n o i t u c e

Ex

Online Ordering Now Available On Brockwhite.ca!

Ex B

IEN R E P X E ON UILDING

Canadian Plains offers a full range of services in the following areas: · · · ·

Pipeline Facility Fabrication Maintenance

CE

Canadian Plains Energy Services

is a Saskatchewan based company and leader in construction and maintenance services to the oil and gas, midstream, transportation, mining, and utility industries across central Canada. With locations in Saskatchewan and Manitoba, Canadian Plains is committed to servicing energy and resource customers.

Build with the best. Brock White is your source for a full range of construction materials. From Geotextiles & Erosion Control, Masonry and Jobsite Tools to Insulation, Roofing and Building Envelope Products, we have the products you need to get the job done. Contact the branch near you or shop online on BrockWhite.ca.

REGINA

1025-A Wellings Road Regina, SK Phone – 306-352-3400 Fax - 306-352-3455 Email – info@cpenergy.ca

CARLYLE

208 North Service Road Carlyle, SK Phone – 306-453-3400 Fax - 306-453-3401 Email – info@cpenergy.ca

WWW.CPENERGY.CA

VIRDEN

130 Commonwealth Virden, Manitoba Phone – 204-748-2962 Fax - 204-748-3251 Email – info@cpenergy.ca

REGINA 306-721-9333

SASKATOON 306-931-9255

LLOYDMINSTER 780-875-6860

BROCKWHITE.CA


PIPELINE NEWS August 2017

CD Oilwell’s looking for people By Brian Zinchuk Virden, Man. – Thirty-three-year-old CD Oilwell Servicing Ltd., based in Virden, Man. is looking for workers, according to Adam Gonty, field supervisor. Most service rig companies Pipeline News has spoken to in the last four months have noted a shortage of workers. CD Oilwell is in the same boat. “It’s tough to find people right now,” Gonty said. “We’ve started the hiring process, but it’s not as easy as it was when things were booming. People have moved on, in the downturn, and it’s going to take some time to get them back. Some of the people we’ve laid off, we’ve hired back. Some of them have moved on to something else. We might see them in the future.” The company has four rigs, one double and three singles. “They all seem to have their place. Singles are used for more maintenance-type jobs, but they can still be used on deep wells. The company has 26 employees. Asked if they’ve been busy, Gonty

said, “We’ve been lucky.” They had some layoffs in the downturn, and hours were reduced, but he considers CD Oilwell fortunate. The company works almost entirely in southwest Manitoba, but a few times a year they go into Saskatchewan. Currently,

all four of their rigs are working for Tundra Oil & Gas Limited, but in the past they have done work for other companies. “We’ve nicely just crawled out of our spring breakup,” he said on July 18. “I’m hearing it’s supposed to be busy, and just hoping it stays steady.”

Virden-based CD Oilwell Servicing Ltd. has four service rigs working in southwest Manitoba, as seen here south of Cromer. Photo by Brian Zinchuk

 Flowline Jetting  Frac Fluid Heating  Back Pressure Trucks  Steam Heaters  Hot Oiling  Flowline Cleaning  Tank Cleaning

 Dry Steamer Boiler  Vac Trucks  Water Hauling  Oilfield Turnaround Maintenance  Hydrovacs  Vapour Phasing  TDG

(306) 634-4797 (306) 634-7334 www.cedagroup.com

A13


A14

PIPELINE NEWS August 2017

Hydraulic jacks giving curved walking beam pumpjacks a run for their money Page A8

distributor, but they changed course and chose to sell it directly. “We had a focus of what we can do, finding the fit for the application,” Henry said. “We are local. We live, we breathe the local market.” Asked what sets their hydraulic jack apart, Henry replied, “The element of automation is key for us. We’re basically a built-in automated

system with hydraulics. “We can easily cover two to three different pumpjack sizes in southwest Manitoba with one unit. We cover those three sizes with one purchase, one setup.” As an example, he said, “We’re lifting from 5,000 pounds to 18,000 pounds. You can go lighter or heavier than that.” Henry added they have a built-in computer

similar to a VFD, not an add-on unit. It will produce a pump card on screen which allows for evaluation and optimization. “Our stoke speed feature is fully automatic,” Henry said, explaining the unit detects if the well is going strong, and adjusts it for a faster stroke speed. As the well tapers off, it reduced stroke speed. It can go as slow as half a stroke per

minute, with an add-on feature, allowing for continuous pumping with slower stroke speeds as opposed to the on-again, off-again patterns of a pump off controller. The unit uses patentpending technology including pressure and positioning sensors to calculate well characteristics and make adjustments on the go. It’s even capable of doing a light tap automatically to deal

with gas locking of the bottomhole pump. A conventional pumpjack requires a cement pad, and sometimes piles under that pad. A sleeper pad goes in front. The IJACK requires none of that. It bolts directly to the wellhead. That also results in a much smaller footprint on the wellsite. “A smaller footprint is huge,” he said paradoxically. It means more room for service rigs, for instance. And when it comes to well servicing, the whole IJACK is laid down, typically with a knuckle-boom picker. “We’ve got a lot of local producers on board,” he said. Southwest Manitoba’s oilfields are the shallowest in the Williston Basin, essentially ringing the northeast edge of the basin. “This fits a shallow well with decent production rates,” Henry said of the IJACK. The Kindersley area also has wells of a similar depth, but they haven’t gone there yet. “New markets are on the agenda, for sure,” Henry said. New products are also in the works. Cellular-based

The IJack UNO hydraulic jack, built in Wapella, has made major inroads in the Manitoba oilpatch, as seen here near Cromer. Photo by Brian Zinchuk

remote communication is also available, if the client desires to use it. “We service and support what we sell,” he said, adding they have a full inventory of parts and provide equipment and technicians for installations.

EQUIPMENT

RENTAL Locally Owned & Operated

· Full-service Brokerage / Auction Firm · Surplus Sales as well as Sourcing Equipment Specialists · Equipment Appraisal · S.I.R.S (Surplus Inventory Reduction Services) · 10 years Servicing the Oil Industry · World Wide Reach · Canadian Owned and Operated

 403.815.2016 Visit our website for full equipment list at www.energyauctions.ca

Man lifts Scissor Lifts Skid Steers Straight Boom Articulating Boom Zoom Boom For Lifts Diesel Tampers Diesel Heaters 85 Foot Boom

PICK UP or DELIVERY

Municipalities Contractors The Oilfield Home Owners

G.T.&H HOLDINGS INC.

Chad (306) 421-1896 | Garry (306) 421-0529 info@gtandhholdings.ca | www.gtandhholdings.ca


PIPELINE NEWS August 2017

A15

Diversified Oilfield Services is a fitting name Virden, Man. – In the back corner of Fontana’s Trucking north Virden yard, three men steadily processed tubing as it was inspected. Most earned a yellow band, meaning it can still be used, but occasionally, one would get a red stripe, meaning it was toast. And that is precisely why inspections are done on pipe, to weed out the good from the bad. Doing the inspection was Diversified Oilfield Services, and their name is an accurate description. They do a lot of different things, according to president Dale Lewis. Lewis also owns Safety

Source and Discovery Safety in Virden (see story Page A12). This is a separate venture. Tom Whittle and Rod Price are Lewis’ partners. The company offers tubing inspection in the yard and field. It also shoots fluid levels of oilwells. Ultrasonic and mag particle inspection are other specialties. They inspect coatings on tanks and vessels. The company even fixes Arrow motors, propane power plants for skid engine packages. Diversified, indeed. Started in 2010, they began by shooting fluid levels, Price’s area of expertise. When Whittle joined they

expanded into tubing inspection. “We’ve expanded, come up with ideas that are new,” Lewis said on July 19. Since Diversified’s work focused on the maintenance side, it didn’t see the same hit many other oilfield services did with the big oil downturn in recent years. But they did feel it on the rates they can charge, just as others had. One of their services is a portable glycol heater they’ve developed for wellheads and battery load lines. It uses a rubber hose with hot glycol to heat frozen items. Lewis said it provides constant heat, but with no moisture.

Tristen Cross puts caps on pipe after it has been inspected. Photo by Brian Zinchuk

Keep Your Business Strategy in Fighting Form As a player in Canada’s volatile oilpatch you’re as tough as they get. Agile, hard-working, able to move forward in prosperity or adversity. To stay on top of this highly competitive industry, you need to focus on what you can control and have a strong team behind you. MNP’s Oilfield Services team delivers the financial management, analysis and business advisory tools you need to keep your margins up. We offer hands-on oilfield management and operational expertise in every producing region in Western Canada to help you stay sustainable - no matter where the markets go. Contact your local MNP Oilfield Services consultant or visit www.mnp.ca WEYBURN Melissa Swayze, CPA, CA T: 306.842.8915 E: melissa.swayze@mnp.ca

ESTEVAN David Hammermeister, CPA, CA T: 306.637.2310 E: david.hammermeister@mnp.ca

SWIFT CURRENT Jeremy Rondeau, CPA, CA T: 306.770.3679 E: jeremy.rondeau@mnp.ca

ESTEVAN Daryl Donovan, CPA, CA T: 306.637.2325 E: daryl.donovan@mnp.ca

Chris Price of Diversified Oilfield Services cleans pipe using a high temperature, high pressure system. Photo by Brian Zinchuk

• Fire Extinguisher Services / Sales / Rentals • Gas Detection Sales / Service / Rentals • Breathing Air Refills & Hydro Testing • Scba/Saba Air Equipment Sales / Service • Rentals • Fit Testing • Safety Air Trailers And Safety Personal • Calibration Gases & Accessories Sales • New & Reconditioned Equipment • First Aid, Eyewash & Burn Kit Services • Signage • Call For All Other Safety Services e ces Not o Listed s ed

BREATHING APPARATUS

New & Reconditioned *Pick up & Delivery available upon request. TROYE CARSON Manager/Owner Cell: 306-421-3603 tcarsonsafety@sasktel.net

LLOYDMINSTER Michael Freeman, CPA, CGA T: 306.825.9855 E: michael.freeman@mnp.ca

MNP.ca

PRESTON MAJERAN Sales & Service Technician Cell: 306-421-6609 pmajeransafety@sasktel.net

Hwy 361 West • South Yard P.O. Box 518 • Lampman, SK S0C 1N0 Main Office: (306) 487-1611


A16

PIPELINE NEWS August 2017

Ron Wanner is a Southeast Saskatchewan Legend Weyburn – On June 7, Estevan’s Ronald J. Wanner was inducted as a Southeast Saskatchewan Legend during the Saskatchewan Oil

• • • • • •

and Gas Show. Minister of Energy and Resources Dustin Duncan read the following biography during the induction ceremony:

Pool/Waterslide Exercise room Wi-fi Free hot breakfast 60 guest rooms Meeting room

For reservations call (204) 707-6020 380 Frontage road West, virden, MB

CAREERS

Supervisors & Assistants Demon Oilfield is looking for day shift supervisors, night shift supervisors and operational assistants for our Saskatchewan based operations.

Send resume to: info@demonoilfield.com

Ronald J. Wanner is the patriarch behind Viking Oilfield Surplus Ltd. and its several affiliated companies. Over the years, the group grew to be a nearly completely vertically integrated oilfield operation that included an oil producing company, T. Bird Oil, Venture Well Servicing, with its own service rigs and drilling rig, Viking Trucking, and Viking Oilfield Surplus. There’s even a holding company for the real estate and some farm land, where he would occasionally drive tractor. His customer base included 600 companies spanning three Canadian provinces and 10 oil producing states in the USA. Ron Wanner grew up on a farm, eight miles south of Macoun and started working at the OK Economy hauling groceries in 1961, right after graduating high school. The following February, he went to school in Regina for a bookkeeping course. That was the start of one of his first commercial ventures. Since he came home every weekend to work at the OK Economy, he would haul schoolmates back with him in his car for $5 each. That’s how he put himself through school. From September to December, 1962, he was working at a local Auto Electric and his mother and father phoned to tell

Ron Wanner, centre, is flanked by oil show chair Del Mondor, left, and Minister of Energy and Resources Dustin Duncan, on June 7, when he was named a Southeast Saskatchewan Legend. It’s a new honour, debuting at this year’s Saskatchewan Oil and Gas Show in Weyburn. Photo by Brian Zinchuk

him British American Oil was looking for an accountant in Estevan. Ron applied and was chosen out of 100 applicants. Over the next 10 years, he worked in many departments, including oil accounting, accounts payable and purchasing. In 1966, a farm friend and schoolmate, Ron Stregger, and Ron bought a new backhoe together. Stregger would run it during the week and Wanner would run it on weekends and statutory holidays. Three years later when the partnership split Wanner bought an old backhoe from Peterson Construction, and hired a neighbour, Calvin Johnson, and Vern Erickson. He now had two backhoes running, a gravel truck, and a little loader. The work included farm and town work, along with a bit of oilfield trenching. Eventually the business grew to the point

where Gulf (who had bought out British American) told him to choose work for them, or work on his own. On May 1, 1972, he struck out fully on his own, operating under Ron’s Trenching and Hauling. Ron’s did water and sewer work in the city, as well as subdivision projects. But at the start of a key contract, a few key people went out on their own, which Wanner described as a letdown. He quit Ron’s Trenching and Hauling, sold off the equipment, and moved the remaining staff to Viking Surplus. In 1972, he started Viking Surplus Oilfield Equipment. Gulf, who had 10 surplus treaters for sale but didn’t get one bid. To get these surplus treaters off their books, they accepted the token amount of $100 each from Viking. When moving these 10 treaters into the Viking yard near the east-side

overpass a stroke of good fortune occurred. As they were unloading the treaters, a fellow dressed in cowboy boots and a cowboy hat drove up in a half-tonne with Montana plates on it. Due to a strike in the United States pressure vessel manufacturing industry, there was a pronounced shortage south of the border. The man made him an offer of $3,000 each for them and walked to his truck, and cut a cheque for $3,000 and $500 to ship it to Cutbank, Montana. On the trip down Ron stopped at National Tank in Williston, N.D. and asked if they were looking for treaters. The response was “We’re looking for treaters in any condition.” Wanner responded that he had no money. The man gave him a check, telling him, “You’re my man. You will ► Page A17

MOBILE & SHOP

SERVICES

WANTED HYDROVAC OPERATORS HYDROVAC SWAMPERS y Offering excellent hourly wages

 WELDING

y Excellent benefit package available

 SANDBLASTING

y Willing to train y Safety tickets H2S Alive, First Aid and Ground Disturbance required y Operators must possess at least class 3A driver’s licence Email resume to: extremeexcavating@hotmail.com or Fax to: 306-483-2082

 PAINTING/COATING  SPRAY FOAMING

306.421.8598 20 YEARS EXPERIENCE


PIPELINE NEWS August 2017

A17

Fontana’s Trucking Oil company, service rigs, trucking saw things pick up this year ▲

Page A16 buy them.” After that they hauled approximately 100 treaters to Gillette, Montana. They cleaned out Estevan, Virden, Kindersley and Swift Current of all the old vessels. The local boiler inspector was glad to be rid of them. The treater shortage would be followed by a sucker rod shortage in the early 1980s, and then a “huge engine shortage” in the late 1980s. Along the way, Viking Surplus got into machining, rebuilding pump unit parts, drill pipe, tubing, casing, and pump unit parts. Viking also had three or four picker trucks, and used to haul their own equipment until 1997, when Wanner’s two sons, Kelly and Cory bought it out. Other family members have also been involved in various Wanner businesses. Daughter Debbie Henders and wife Dorothy were highly active in an RV and boat dealership known as Sun City Sales that operated in the 1990s. Wanner Holdings is a private real estate company that holds the various properties for the other business entities, plus 440 acres of farmland. One of Viking’s initial big customers was Midale Petroleums.

By Brian Zinchuk Virden, Man. – Eleven years ago, Bruce Bailey sold Fontana’s Trucking (2006) Ltd. to Dennis and Larry Day. He intended to stick around for six months. More than a decade later, he’s still running the show. “I bought the business in December 1983. I sold Sept. 1, 2006 to Dennis and Larry. It’s owned by them outright, and it’s nothing to do with Fast Trucking.” Fast Trucking is the lead company in a group of companies owned by the Day family of Carnduff. Fontana’s has been in existence since 1964. Hauling pipe, tubing, moving tanks and “anything to do with the maintenance and production of oilfield equipment,” is how Bailey described their operations. “Hauling pipe and tubing to the drilling and service rigs is our main job.” “We work with the drilling rigs, too, but when the drilling rigs aren’t working, we’re with the service rigs. We’re always with the service rigs, moving tubing around, when they're doing abandon-

ments, or workovers on wells. We supply tubing,” he said. They act as a pipe custodian, and oil companies stockpile their pipe in Fontana’s yard. They have a large pipe yard on the north end of Virden, near the airport, and their shop is on the service road along Highway 1, on the east side of Virden. “The pipe supply companies put pipe in our yard and sell it to the oil companies. The oil companies also own some of it and store it in our yard,” he said. Occasionally they will assist Carnduffbased Fast Trucking, which has common ownership, as needed. Fontana’s has 30, 40 and 45-tonne pickers, winch tractors, Texas bed trucks, as well as straight tractors for hauling pipe. In all, they operate 18 power units. “We specialize in what we’ve done. We’re very efficient,” Bailey said. “We’ve stayed in this little niche and have gotten good at it. We’ve built a very good business.” Nearly all their work ► Page A19

TIRE SHOP

NOW OPEN

Viking sold them equipment and also went into partnership with them on drilling of new wells. After a time, T. Bird Oil was started in 1982. Soon T. Bird would be drilling its own wells, at first as an offshoot of Viking, sharing staff, and later it became a standalone company in 1999. T.Bird Oil later sold to Crescent Point Energy Corp. Since T. Bird was a small company, it was hard to get a service rig in the early years. The wait could be as long as six weeks to two months. Midale Petroleums needed access to another service rig, so in the late 80’s, with some employees, Wanner bought a service rig

to complement Midale’s existing rig. The industry went from very busy in early 1986 to a sudden crash when oil then plummeted to $10 a barrel in a very short time. The rig sat on location for a month with nowhere to go. The partners bailed, and Viking ended up making the payments on the rig. The company persevered as Venture Well Servicing and eventually grew to seven rigs, including a purchase of Plains Well Servicing of Oxbow in the late 1990s. In 2010 Venture Well Servicing’s five rigs were sold to Certified Energy Services. Ron always said his ability was limited and a disadvantage that was

made up for with hard work. His attitude that everyone deserves the same price made it his mission to help serve every small or large company who needed his help or service. He never tired in hiring staff he may not have been able to afford or invest in projects to help an endless number of people in the industry for over 50 years. Ron worked tirelessly serving his family and peers in the industry until his near fatal stroke in 2014. Today he advises his family and works at getting physically better to find some comfort for his hard work. Congratulations Ron.

INDUSTRIAL LOTS FOR SALE VIRDEN, MB • Airport Industrial Park Lots for Sale • Some lots with possible Taxiway/Runway access • RTAC rated Highway access • Located within 2 minutes of the TransCanada Highway Contact:

ED BRETHOUR

TOWN OF VIRDEN 204-748-2440 • virden_edm@mymts.net

Visit us at the Weyburn Oil Show - Booth #261 & #262

Expertise when the pressure is on. Metra Equipment Inc. is now part of Weir Oil & Gas. Our products and services address the industry’s most pressing operational and economic challenges. Sales New and remanufactured wellhead equipment and valves

Your One Stop for

Oil changes Cars - TruCks FleeT / serviCe TruCks semis - Heavy equipmenT

One of SE Sask’s Only Eco-Friendly Shop

306.457.1215 ·• Stoughton, SK

Now offering sucker rod guiding capabilities Services Wellhead and frac tree installations Rentals • Frac trees, 3", 4" and 5", 10,000# • Gate valves, 2", 3", 4", 5" and 7", 2,000–10,000# • Miscellaneous wellhead equipment

Oil & Gas 116 Supreme Street Estevan, SK 306 634 6325


A18

PIPELINE NEWS August 2017

No, it’s not a rocket engine BUT A FLAME DOES GO INSIDE

Weyburn – Walking past Total Combustion Inc.’s booth at the Saskatchewan Oil and Gas Show, you could be forgiven if you thought they knabbed two engines from a Saturn V rocket, put them on a trailer, and pointed them to the sky. Indeed, the interior of these bell-shaped units does contain a flame while in operation, but that’s because they’re incinerators, used to burn off waste gas. Professional engineer Hans Kolb, manager of engineering, was on hand to answer questions on June 8. “That’s what most people think they are,” he said, when asked about their resemblance to rocket engines. “It’s a waste gas incinerator. It’s a more environmentally-friendly way of burning waste gases,

rather than flaring it.” “The combustion takes place entirely within the cylinder, with no smoke or flaming coming from the top. They had two units mounted on one trailer, with a capacity of five million standard cubic feet a day of waste gas. The unit on display was for their rental fleet, and would typically be used for well testing or well completions. “If someone had a well producing a lot of gas, and, at present, had no use for that gas, they would use this unit until tied into a pipeline and tied into a gas plant.” He noted flaring is definitely cheaper, but it’s annoying to locals. “Another reason is you get a 99.8 per cent combustion efficiency, which is a lot higher than a flare

stack,” he said. They’re built in Red Deer, Alta. They have a few in Saskatchewan in the Oxbow area. The company has been in business since the 1990s. The design is meant to not be affected by winds and rain. The cylinders tilt for transport. “Wind, on a flare stack, you can get up to 10 to 20 per cent of the gas never actually going to the flame. It just gets blown off,” Kolb said. The incinerator has several tiers, each ringed with dozens of burners with venturis that aid the combustion. More or fewer rings can be used as needed. “We like to see about 40 per cent, or more, combustible,” he said of the gas flowing through. If it’s lower than that, they can supplement with

A family owned and operated business committed to safety and to providing you with quality products.

We Deliver To Your Location SAND & GRAVEL Crushed Screened Material Testing Lab

LANDSCAPE PRODUCTS Topsoil & Sand Large Decorative Feature Rocks

510 Maplewind Rd, Stoughton, SK S0G 4T0

Excavation Demolition & Trenching Site Preparation Loading & Hauling Concrete Recycling

(306) 457-3131

er Service Ltd. k c i P s ’ y l r u C Mark T.ke(Curly) Hirsch S r e r c v i ice Ltd. P s ’ y l r u C Mark T. (Curly) Hirsch

natural gas or propane fuel, but that, of course, costs money. An incinerator like this is much more complicated than a simple flare stack, and, as such, would

OUR TEAM Charles O. Meighen Warren G. Barber

AREAS OF LAW

Blair J. Filyk Elia C. Arraf Karen A. Beauchamp Derek D. Cullen David E. Swayze Ashley T. Joyce Trent B. Sholdice Laura J. McDougald-Williams

W. Bryan Webber Josh R. Dyck

1595 Dieppe Cres. Secor Certied Backhoe Available Estevan, Sask. Service Cell: (306) 461-5898 1595 Dieppe Cres. Secor Certi ed S4A 1W8 Fax: (306) 634-6690 Estevan, Sask. Cell: (306) 461-5898 S4A 1W8 Fax: (306) 634-6690

Devoting our energy to finding solutions to advance our clients’ goals. From the simple purchase of a house to the complex undertaking of a corporate reorganization or dividing family property.

Patricia L. Fraser

Patrick D. Sullivan

®

volume of gas confidential. He pointed out there are published equations to calculate the flow of a well based on the length of its flare and the size of the system.

No, those aren’t the engines from a Saturn V rocket, but they to create a flame inside. These are incinerators, from Total Combustion Inc., as show by Hans Kolb. Photo by Brian Zinchuk

Karla L. Dane

&

cost more. Asked why they would be used, Kolb noted public relations between the oil company and its neighbours are one reason, While testing a well, it’s useful to keep the

Connor J. Smith

 Business & Finance Bankruptcy, Insolvency & Restructuring Corporate, Commercial & Business Real Estate Agribusiness Oil & Gas Law  Litigation Civil Litigation & Administrative Law Labour and Employment Construction  Intellectual Property & Technology  Municipal Law  Family Law  Wills & Estates  Criminal Law Your Law Firm in Southwest Manitoba

Stacy A. Senkbeil Brandon Souris Killarney Melita Glenboro Wawanesa

204-727-8461 204-483-1556 204-523-4671 204-522-3225 204-827-2009 204-824-2071

Baldur Deloraine Virden Reston Cypress River

www.mhlaw.ca

204-535-2205 204-747-2258 204-748-2284 204-877-3581 204-743-2181


PIPELINE NEWS August 2017

Darwyn English, right, and Travis Flemming, with back turned, handle pipe in the Fontana’s Trucking Yard. Photo by Brian Zinchuk

A19

Bruce Bailey sold Fontana’s Trucking 11 years ago, and intended to stay on for six months. He’s still running the show all these years later. Photo by Brian Zinchuk

Fontana's kept costs under control Page A17

is in southwest Manitoba, but they occasionally venture into Saskatchewan as needed. Fontana’s employs 27 people, including office staff. “We were down to 18 people. Our top, in 2014, we were at about 36 people,” Bailey said. Most of those that have been hired recently have returned to the company. “People who were working elsewhere, or not at all, came back after two years,” Bailey said. It

meant they needed refresher training, but didn’t need to be trained from scratch. Fontana’s hired an additional four-man crew for its pipe yard, and all those were people who came back. “It got really busy in January,” Bailey noted. He said on Dec. 15, 2016, they were planning for a couple of drilling rigs and some service rigs going. By Jan. 5, 2017, the oil companies started with a bang. There were seven drilling rigs

going in the area and over 20 service rigs. “I’ve been in it for 34 years. It’s been up and down. We’re fortunate to get that much right now.” He continued, “How we survived, number one, the company has always controlled our costs. Since 2004, when Tundra started drilling more than just 10 wells a year, we’ve grown steadily. We controlled what we did. If there was millions of dollars coming in the door, we didn’t go out and spend it because it

was there. We maintained what we had. Steady growth, and we kept our costs under control.” There were no places left to cut because they were operating efficiently as they were. It meant using up equity built up over 10 years. They weren’t high debt and their costs weren’t exorbitant. Unfortunately, they had to lay off staff and cut wages. “The people who are with me, we all worked together to survive,” Bailey said.

As for current activity, he said, “It’s not slow. It’s okay. The biggest thing is people seem to change direction quickly.” Plans for the number of wells drilled or the number of services to be employed changes rapidly. “It doesn’t take much for people to put on the brakes, or change directions quickly. Us, as a service company, gear up for what we think is happening, then, all of a sudden, it doesn’t happen. It puts a strain on our services

because we’ve already prepared for what we think is going to happen. And if you don’t prepare, you don’t get the jobs. The oil company doesn’t say, ‘Two weeks from now, we need 10 trucks.’ They phone up tomorrow morning and say, ‘We need five trucks now.’” Most of their hiring is done through word of mouth. They haven’t had a shortage of people to hire, but Bailey says there is a shortage of labour out there.

Tough tires for a rough business. In this business you visit some of the roughest places around. At Fountain Tire, we have the tires that can get you in... and out.

RIG MOVING Serving the Oil & Gas Industry for

60 Years.

We have a modern fleet of trucks including class 5 pickups, pickers ranging from 30-50 tons, bed trucks up to 8 x 8.

Visit your Fountain Tire retailer today for tough tire solutions from Goodyear, Dunlop and Kelly. We’ve got the answer.

1 HIGHWAY  VIRDEN

204.748.2466 Box 700 Carnduff, SK | 306-482-3244

24 HOUR EMERGENCY SERVICE  1-800-661-TIRE (8473)


A20

PIPELINE NEWS August 2017

Think of a Prius, for light towers IT’S KIND OF A SOLAR-POWERED FLASHLIGHT, TOO

Weyburn – What happens when you combine a solar-powered flashlight with a Prius hybrid car, build it into a trailer, and deploy it on a lease? Those concepts are clearly evident in one of the more curious exhibits at the Saskatchewan Oil and Gas Show in Weyburn June 7-8, in CLEANTEK Industries’ booth in the centre of Crescent Point Place. The light tower sported solar panels, LED lights on the tower, and an engine. It quite literally is a solar powered light tower. Kristine McPhail is the sales manager and

director of marketing, but as a small company, she noted everyone wears a lot of hats. They are based at Balzac, just north of Calgary, behind the Crossiron Mills Mall. “We started as Horizon Oilfield Solutions in 2009,” McPhail said. “We rebranded last year to CLEANTEK Industries to make our name more synonymous with what we do, especially since we branched outside of just oil and gas. With the downturn, we needed to find other ways to generate revenue that wasn’t tied to the drill bit, so we moved into construction, as well.”

“It has lithium-ion batteries, a nine-kilowatt Kubota generator, solar panels, and LED lights we make in-house,” she said. “This puts out twice the light of a standard metalhalide.” The key is the large lithium ion battery pack in their newest generation of light towers, the SolarHybrid.Li. The original SolarHybrid used lead acid batteries. Since lithium-ion batteries don’t work so well in -50 C weather, there’s metal plates between the batteries that keep it 20 C, all year round. “It’s completely climate controlled,”

McPhail said. “We also have a fuel filter heater, to make sure it fires up reliably. One of the problems with standard light towers

is at -30, -40, you just keep them running because you’re not sure if they’re going to start up. We had to make sure this will start

up after being idle for six hours with the engine off. We kind of thought of everything.”

► Page A21

HOTELS FOR REAL LIFE www.suburbanhotels.com

1.800.4.CHOICE

More than just a standard hotel, each of our studio or one bedroom suites feature fully equipped kitchenettes.

The box is a lithium-ion battery pack. Photo by Brian Zinchuk

• Vacuum Trucks • Water Trucks • Steamers • Hydrovac Truck • Fire Truck

ESTEVAN LOCATION

404 Kensington Avenue. Box 1486 Estevan, SK S4A 2L7

Call: 306-634-8332

www.choicehotels.ca/cn923

MOOSE JAW LOCATION 323 Diefenbaker Drive. Moose Jaw, SK. S6J 1C0

Call: 306-972-2980

www.choicehotels.ca/cn998

24 Hour Service

306-483-8697

KINDERSLEY LOCATION

700 - 12th Avenue East. Box 1946 Kindersley, SK S0L 1S0

Call: 306-463-5000

www.choicehotels.ca/cn996

With the amenities and great service you receive from our highly trained staff, it's no wonder Suburban Hotels are fast becoming the "home away from home" hotel of Choice!

Randy McCannell Owner (306) 485-9940

Kevin Grad Assistant Manager (306) 539-7020

Complete Rod Pumping Design, Supply, Optimization & Field Services

Complete Rod Pumping Design, Supply, Optimization & Field Services -Specializing in Rod Pumping System Design - Directional, Horizontal & Vertical

-Full line of API, High Strength Steel & Fiberglass Sucker Rods - Specializing in Rod Pumping System Design—Directional, Horizontal &Proposals Vertical -Complete Dynamometer & Fluid Level Services including Optimization

-Automation Services including- SAM WellofManagers, XspocSucker Web Based Full line API, HighWermac/Yaskawa Strength Steel &VFDs, Fiberglass Rods SCADA Packages

- Complete Dynamometer & Fluid Level Services including Optimization Proposals

Phone: (306) 634-7399

- Automation Services including SAM Well Managers, Wermac/Yaskawa VFDs, Xspoc WebFax: Based(306) SCADA634-6989 Packages

E-mail: Estevan@pentarods.com Yvonne:S4A (yserver@pentarods.com) Phone: (306) 634-7399 58 Devonian Street, Estevan, Saskatchewan 2A6 Cell: 306-421-5842 Fax: (306) 634-6989 www.pentarods.com Joel: E-Mail: Estevan@pentarods.com (jmilligan@pentarods.com) 58 Devonian Street Estevan, Saskatchewan

Cell: 306-421-6845


PIPELINE NEWS August 2017

A21

Generator only runs briefly, as needed. ▲

Page A20 In the middle of the winter, in northern Saskatchewan or Alberta, there’s not a lot of solar power to be had, which is why, she said, solar light towers haven’t been as successful. “They can’t put out a lot of light, the light is dim, they don’t last for very long. That’s where we had to supplement with the generator. In the summer, you’re going to get a lot more solar power. If you took this to California, you’d get tons of solar power. But up here, you’re not getting a lot, so it’s mostly the intelligent control system in the unit that turns the generator on when the battery gets low.” It’s got plug-ins, too. “For the first time ever, in a light tower, you can power auxiliary equipment without the generator turning on,” she added. “They call it solar priority. If there’s one single drop of solar power available, it’s going out the receptacles.” In southeast Saskatchewan, in the summer time, the generator has to run for one 45-minute period to charge the batteries enough to run the lights a whole night. “The solar’s going to go into

it during the day. The lights will go on around 9. Probably around 2, 3 o’clock in the morning, the generator’s going to kick on for 45 minutes to top up the batteries, and turn off. It likely won’t turn back on, unless you’re drawing intense auxiliary power, for the rest of the night.” McPhail said, “It’s the only light tower that has a DC gen set in it, so we are able to put the energy into the batteries and pull directly from the batteries, rather than having to pull it from the generator.” There’s 44 units out there. “As fast as we can manufacture them, they’re going out to work,” she said. The original unit came out in 2012. The took 18 months of the downturn to rework the unit into the second generation, the lithium-ion unit. The first lithium-ion units came off the line in late 2016. “Because the engine is only going to run 500 hours a year, you don’t even have to change the oil every year. You only have to change the oil every 750 hours,” according to McPhail, adding one should still change the oil to match the season.

A standard light tower might run 4,000 to 5,000 hours a year. “We’re about 10 per cent of that,” she said of the generator motor. McPhail said the fuel savings is “massive, almost 17,000 litres of fuel savings a year.” In addition to that is the labour cost – having someone go out and fuelling the unit consistently. The tower is powered for deployment. “I did it in 120 seconds, in heels,” McPhail said. “We manage our whole fleet in Western Canada. We track these via GPS, so most times, we know if there’s something wrong before our customers do. Our field technician comes out here once a month and manages the towers. We deliver them ourselves.” They’re in the process of developing a local presence in Saskatchewan. “Anything with solar panels on it, the optics of it is amazing. People like being green,” McPhail said. “If you give them green options that saves them money, and it's green, and it save them operational time – if we can do that, and they’re saving money, it’s almost a no-brainer.”

Prairie Mud Service “Fluid Solutions thru Experience and Technology”

Head Office: Estevan, SK Tel: 306-634-3411 Fax: 306-634-7310 Ray Frehlick, President Cell: 306-421-1880

Calgary Sales Office: Tel: 403-237-7323 Fax: 403-263-7355 Chuck Haines, Technical Sales Cell: 403-860-4660 Environmental Division: Tel: 306-634-3411 Fax: 306-634-1951 Darwin Frehlick, Manager Cell: 306-421-0491

Kristine McPhail shows of a hybrid light tower at the Saskatchewan Oil and Gas Show on June 7. Photo by Brian Zinchuk

POWDER COATING Skid Snowmobile & Motorcycle

Any Colour Ornamental

Mud Technicians: Gerald Smith Cell: 306-421-2408 Ian Scott Cell: 306-421-6662

Owned and Operated Warehouses: Estevan: Jay Burback - Cell: 306-421-0101 Swift Current: Evan Myers - Cell: 306-741-2447 Lacombe: Darcy Dayday - Cell: 403-597-6694 Kindersley:

Kevin Codd - Cell: 306-430-7102

3rd Party Warehousing Across Western Canada and North Dakota

Dry, clean, highly durable nish Extended life = cost savings All Colours, Textures and Finishes

Rims


A22

PIPELINE NEWS August 2017

GAP Disposal back under original ownership, with a partner By Brian Zinchuk Weyburn – Way out at the western edge of the southeast Saskatchewan oilfield, southwest of Lake Alma, is an industrial landfill known as GAP Disposal. Chris LaBossiere, one of the partners in the company, explained, “Glenn Petterson founded the landfill in 2001. He sold it in 2003 to a company I was vice-president of, Waste Services. We bought it. It was owned by them, who was then acquired by Progressive Waste who was then acquired by Waste Connections.” He noted that the landfill wasn’t a fit for those owners, so Glenn Petterson and his son, Cory, who had been working at the landfill for 15 years, reached back to Chris and, together, they would buy it back and run it as a family-owned business. LaBossiere said, “We just built a new cell. We spent almost a million dollars building another permitted landfill cell. We’ve probably got about 80 to 100 years worth of air there, but under

construction, we now have about four years of space, which gives us lots of runway.” The landfill is still serving southern Saskatchewan and northern Montana, he noted. The facility is also relatively close to the Flat Lake play, which is in the Torquay and Oungre areas. Flat Lake is one of the most active plays in Saskatchewan’s oilpatch. “It’s as busy at it’s ever been,” LaBossiere said. “It’s cyclical, knock on wood, so we don’t take anything for granted. You can have good and bad months and good and bad years. “I think the difference between us, as owners, and bigger companies is we’re more patient. This is Glenn’s ninth oil show. He’s been there that long. We’re open seven days a week for people, if they need us to be. We’re open the next day, if you have a big spill. It’s different, when you’re working with the owners and operators at the same time,” LaBossiere said. Does more regulation mean more business for them?

This is the new cell, recently construction at GAP Disposal. Photo submitted “I think so. It’s a double edge sword. We need to stay on top of regulations, so it increases costs, from our perspective. Our landfill is highly engineered, obviously. This new cell we built is engineered, compacted clay liner with a geosynthetic liner on top of it, internalized leachate collection systems, and all that. “That’s keeping us

having to innovate, but it also drives volume into our site. “Our goal is to look at different waste streams in and expand our geographic footprint, as much as we can. It’s tough. There’s lots of competition out there,” he said. There are similar, competitive sites at Colgate and Heward. “Nobody’s going to be driving by those sites to

get to our site. This business is about geography, but it’s also about service. We have a long-term provider of auto-fluff coming out of a scrap metal company in Regina – huge, huge volumes. Auto fluff is, when they shred up a car, it’s basically everything but the metal. You think about seats and plastics and metals, it all gets shredded into little pieces.” They have a long-

term contract, and their flexibility in receiving it is a big factor. Glenn is still living near the site. “We’re still out there. We like what we do. We don’t figure on leaving.” “We sold it in 2004, and I’ve been running it ever since. The opportunity to came up. The new company that amalgamated with us, we didn’t fit into their plans.

► Page A23

Financial Statement and Tax Preparation Bookkeeping and Payroll Tax Planning and Consulting CRA Assistance Estate and Trust

N.M. MCMAHON

Chartered Professional Accountant 604 Government Rd. S • Weyburn, Saskatchewan S4H 2B4 Phone: (306) 842-5344 • Fax: (306) 842-5345 McMahon@McMahonCPA.ca

Kim Leipert

Ph: 306.825.5355 • Cell: 306.821.2880 Fax: 306.825.5356 peddlerconsignment@sasktel.net

$285,000 Stk#434344

$495,000 Stk#BN7667

1997 PETERBILT 378 C-15 Caterpillar Engine 475 hp; Diesel; Air Trac Suspension; Tandem Axle; 18 Spd OD; Engine Brake; 385/65r22.5 75% rear 11r24.5 75% Tires 2013 FREIGHTLINER CORONADO 122 SD DD15 Detroit Engine 500 hp; Diesel; 18 Spd OD; AirLiner Suspension; Tri Axle; Engine Brake; FRONT 425/65R22.5 REAR 11R24.5 Tires; All Aluminum $34,900

$24,900 Stk#17702

$52,900 Stk#944001

1979 INTERNATIONAL PAYSTAR 5000 3208 Caterpillar Engine; Diesel; Spring Suspension; Tandem Axle; Automatic; Engine Brake; front 385/65r22.5 new rear 10:00x20 75% Tires; Spoke Wheels 1997 WESTERN STAR 4964F C-15 Caterpillar Engine 475 hp; Diesel Fuel Type; 18 Spd OD; Neway Suspension; Tandem Axle; Engine Brake; 11r24.5 Tires; Aluminum/Steel Wheels $34,900

NEW LOCATION! Corner of Hwy. 16 & Upgrader Road, Lloydminster

Serving Southeast Saskatchewan for 35 years

• We have cranes ranging from Spyder crane (small enough to fit through a doorway) to 245 Ton Mobile and RT Cranes • 27- 45 Ton Pickers • Tractor trailer units • Pile Driving • Telehandler • Office trailer rentals

245 Ton Terex-Demag 5800 Explorer with a tip height to 350’ Call dispatch for additional specifications and pricing

306.634.5555


PIPELINE NEWS August 2017

Ken Spearing is a Southeast Saskatchewan Legend Weyburn – Long-time trucking company owner Ken Spearing of Oxbow was awarded the honour of being a Southeast Saskatchewan Legend during the Saskatchewan Oil and Gas Show in Weyburn on June 7. Minister of Energy and Resources Dustin Duncan read the following biography during Spearing’s induction: Ken was born June 29, 1931 in Oxbow, Sask. to Harold and Mammie Spearing. He was the youngest of four boys, Dale, Buddie, Allan, and one sister, Isabelle. Ken went to school at Arthur public school and then to high school in Outram to Grade 10. He worked on the family farm growing up and spent the winter of 1951 working in the bush in B.C Ken grew up with a love for trucks, as he had a good one for his sand box when he was a child. At 12 years old he graduated to a Pontiac truck and hauled grain from the combine at harvest time. He also hauled for the RM with a 1946 Ford three-tonne farm truck to gravel the roads. Ken started his oilfield career working seismograph out of Carlyle in 1953 and in 1954 he went to work for Frye Construction building leases for the newly found oil in southeast Saskatchewan. On his days off he worked as a roughneck on the drilling rigs. In 1956 Ken purchased a tank truck from Ernie Bowman and in 1957 he and Ernie formed Bowman & Spearing Trucking. During the Bowman & Spearing partnership they bought out:

Ken Spearing was named a Southeast Saskatchewan Legend on June 7. Photo by Brian Zinchuk • Hammel & Mesham Trucking out of Frobisher, they bought five trucks for $20,000. • A few years later they bought P&B Trucking of Frobisher, a four-truck company. • Later they bought John Shillet Trucking of Oxbow, a six-truck company. • And then Trans X Oilfield Construction of Virden, Man., a company of eight trucks. This partnership lasted until 1978 at

which Ken bought out Bowman and the company became Spearing Services Ltd. In the early '60s Ken had a small plane. Since the two-way radios in the trucks were less than satisfactory, Ken occasionally dispatched notes to his truckers by flying over and dropping notes to get information to his employees. He would put notes into a sucker rod collar, so they were heavy enough to drop to the ground. In 1950 Ken married his sweetheart, Beverly Underhill, and from this union they raised a family of three boys, Brian, Donald and Trevor, and one girl, Tracey. In 1979, when interest rates went to 18 per cent borrowing for more trucks was very difficult. The banker lowered his rate to 12 per cent; from then on Ken never looked back. In the coming years, Ken along with his sons built this company into one of the largest tank trucking companies in southeast Saskatchewan. One employee that stood out for Ken was Ted Wardrope. He was one of the drivers that drove from his high school days until retirement at 65. The Spearing Family sold out in 2006 and Ken retired. The company still operates as Spearing Services. The blue and white trucks can be seen on almost every road and highway in southeast Saskatchewan. Ken went through many hardships along the way but survived and was able to make a good living for him and his family as well as his employees. Congratulations Ken on being a SE Saskatchewan Legend.

NOW WITH TWO LOCATIONS TO SERVE YOU!

It's always about service ◄ Page A22 We were small and not generating the kind of income they were used to. We decided we didn’t want anyone else around. We own all the land around it, so we bought it back. We wanted to have it go in a different direction. We have lots of different ideas we’d like to try.” The ideas include the aforementioned new cell, as well as a leachate evaporation pond. That eliminates the need to haul leachate to disposal wells. “We’re going to put an aerator on that will kick in automatically,” he added. LaBossiere said they’re also looking at a treatment pad. “For us, we’re trying to play the long play. We might diversify into other services as well,” he added. “It will be what makes sense vertically. We want to service multi-markets.” LaBossiere owns a waste collection company in Edmonton as well as a technology company called Yardstick. Last December it bought Danatec, which focuses on online training. Danatec was also an an exhibitor at the show. “When you get to the face of the business, it’s always about service. If you stood at our scale shack and saw the drivers come in, it’s all about service, friendliness, timeliness, respecting their time, respecting their safety. It’s really about relationships, doing what you say you’re going to do,” he said.

(306) 462-2130 nankivelltruckingltd@signaldirect.ca nankivelltrucking.ca

ESTEVAN & LAMPMAN! 306-634-8120 306-487-8120 Estevan Dispatch:

A23

• Lampman Dispatch:

You Call We Haul 24 Hour Service BOX 123 KISBEY, SK S0C 1L0

We have added 2 new Hydraulic Tank Trailers Texas Beds • Highboys • Stepdecks • Rig Matting Double Drop Trailers • Highway Tractors Winch Truck • 45 & 50 Ton Pickers • Pilot Trucks

Bus: 306-487-2608 • Fax: 306-487-2296 Email: huttholdings@sasktel.net

HUTT’S TRUCKING LTD.

MR. Lock &Key G’s 306.471.0741

24 Hour Emergency Service

www.huttstrucking.ca

 Auto. Home. Office  Video Surveillance  Dead Bolt Locks Installed  Locks Mastered Keyed & Keyed Alike  Emergency Locksmith Services

Thank You

A special thank you to Wil-Tech Industries for your support and continued commitment to our Estevan Swing for Scholarship Fundraising Golf Tournament. Your support helped us raise a record

breaking $40,000 in student scholarships.


A24

PIPELINE NEWS August 2017


Turn static files into dynamic content formats.

Create a flipbook
Issuu converts static files into: digital portfolios, online yearbooks, online catalogs, digital photo albums and more. Sign up and create your flipbook.