Pipeline September 2019

PIPELINE NEWS SASKATCHEWAN’S PETROLEUM MONTHLY Canada Post Publication No. 40069240

September 2019

www.pipelinenews.ca

Vol. 3/13

Get your OILFIELD NEWS on the go at: PIPELINENEWS.CA

Soon there will be a change in season, and perhaps more?

Troy Adams worked for Enbridge for 13 years in the control centre, as a measurement tech and operator before deciding to farm full-time. When the protest convoys rolled through Estevan and Regina, he had two of his semis in them. There are numerous wells on his land along the U.S. border. Here he was combining near a Gear Energy battery on Aug. 18. “We’re all in this together,” he said on Aug. 27. Like many in the oilpatch, he’d like to see a change of federal government in October. Photo by Brian Zinchuk

DEEP begins flow test on geothermal well A2

Aldon Oils buys 350 bpd from Enerplus

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Gibsons dispositions settle out in Saskatchewan A10, A11, A12

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PIPELINE NEWS September 2019

DEEP begins flow testing geothermal well

By Brian Zinchuk Torquay – With a recent $5 million private placement of funding in place in addition to previously announced federal and provincial government money, Deep Earth Energy Production Corp.

(DEEP) has begun flow testing of its first well for a geothermal electrical power production facility south of Torquay, within sight of the U.S. border.

The first well, drilled in late 2018, was put on production on Aug. 25.

But it’s not producing oil or gas. It’s producing really, really hot briny water, hot enough that you can feel the heat coming off the tanks the water is being stored in. The intention is that when all is said and done, that water from a hot aquifer will be used in an Organic Rankine Cycle power plant to produce electricity.

But long before they get to that point, DEEP needs to get a few things sorted out, and that’s where August’s test comes into play.

On Aug. 26, DEEP president and CEO Kirsten Marcia showed Tina Beaudry-Mellor the operation. Beaudry-Mellor holds three ministerial postings; Minister of Advanced Education, Minister re-

sponsible for Innovation Saskatchewan, and Minister Responsible for Status of Women Office, all three of which she felt were applicable to this project.

“It’s interesting how much those three things intersect today,” she said.

“Kirsten Marcia, a young female entrepreneur in a kind of non-traditional space. We just did some lab testing with a young female chem tech; again, a non-traditional space. Doing some great work on renewable energy that Innovation Saskatchewan is funding,” she said.

The province, through Innovation Saskatchewan, has been one of the backers of the project. SaskPower has signed a power purchase agreement with DEEP to buy the electricity produced.

Beaudry-Mellor made a point of asking those involved about their educational backgrounds, where they got their training and how the got to Saskatchewan. “I’m interested in all those things,” she said.

“I’m really impressed.

The renewable energy and drilling space is a bit new for me, so I have a lot of questions to ask. I think there’s a tremendous potential here.”

She noted a bit of a “blue-sky discussion” about

A key piece of hardware is the electric submersible pump, the pipe in the centre of the photo, seen here just before it was lowered into the well.

a renewable energy hub, minerals and the possibility of monetizing other products from the geothermal work that’s being done here.

“I think that’s really exciting,” she said.

Test details Dave Brown is the project engineer for drilling and completions. He said the approximately 220 metres of core retrieved from the 3,530 metre-deep vertical hole was analyzed during spring breakup.

Now the hole saw a downhole electric submersible pump (ESP) at the end of 3.5 inch tubing. “It’s now sitting at 2,500 metres,” he said.

There’s a dedicated 1 megawatt (500 horsepower) diesel generator adjacent to the hole, powering the ESP. There’s enough fluid in the well that the ESP is placed roughly 1,000 metres above bottom, which means it takes less energy to bring that fluid to surface. Also, deeper than 2,500 metres is the prairie evaporite formation, so thicker casing is required beyond that point.

This phase of flow testing has several purposes.

“We started production at a lower rate and ramped it up over 12 hours,” Brown said. The hot water, really a brine, first goes through three settling tanks before entering the 27-tank farm which will be used as temporary storage.

While the initial flow from the well was dark, it soon cleared up, as evidenced by samples drawn into a bucket.

“We got some solids initially, but not anymore,” he said.

The storage tanks are filled one at a time. The expectation was they would be filled in three days.

There are high tech reservoir analysis flow and pressure data acquisition recorders placed downhole in addition to surface pressure and flow sensors.

Brown said the well would then be shut in for 12 days after the initial three days of flow. “After 12 days, we’ll move a service rig back in, pull the pump and recorders, and then recomplete it as an injection well for the next step. We’ll put a packer in and a triplex pump and run

It might be a geothermal project, but all the service providers are oilpatch related, and most come from Estevan. In this picture, the service rig is from Independent Well Servicing, the tanks and containment come from Black Diamond, the bed truck and foreground picker are Camion Trucking, the distant picker is from Bert Baxter Transport. A few days earlier, the mud being mixed in the tank came from Prairie Mud, and L&C Trucking handled in the tubing. it through a filter system, reinjecting it into the hole.”

The reinjection is also expected to take three days.

The total duration of the test work is estimated at 50 days.

Overall, he noted this phase confirms the resource is there. Furthermore, this supplementary data collected will be analyzed by subject matter experts to identify other brine constituents that may extracted to be of additional value to the Williston Basin Geothermal Power Facility.

“The plan is to drill the next well,” Brown said.

That’s planned for the latter half of September.

That second well is expected to be drilled adjacent to the first well, but instead of going straight down, they will use directional drilling to go off

at an angle such that the toe of the well will be at roughly the same vertical depth, but end up 1.5 kilometres to the southwest.

The result will be something of a triangle.

The second well will be the producer, pulling hot brine from the ground.

When the power plant is in place, the brine will run through the plant. But for testing purposes, it will be reinjected into the first well, which will function as an injector. That test is expected to take 60 days.

That will create something approximating a closed loop in that they will re-inject into the same formation they are drawing from.

“Ideally we want to do the closed loop test before Christmas,” Brown said.

Reservoir modelling

Claude Ghazer is a reservoir engineer working on the project. He said the core had been one piece of the puzzle, and now all the pieces need to come together.

They’ve done XRD testing, elemental analysis, and determined porosity and permeability.

“We’ve done some reservoir modelling to build a test program to gather subsurface reservoir data to find the boundaries and reservoir potential,” Ghazer said.

This phase of testing will provide the fluid rates. But by pumping fluid out of the formation, the resulting pressure drop will help them map out the boundaries of the reservoir. Ghazer offered an analogy, saying, “You’ve got a pond ► Page A6

The Rig 9 crew from Independent Well Servicing ran the tubing in.

Proud to support our communities

PIPELINE NEWS September 2019

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Aldon Oils buys 350 bpd from Enerplus

By Brian Zinchuk Weyburn – If you want to find someone eternally bullish about the Saskatchewan oil and gas sector, just sit down a few minutes with Del Mondor, owner of Aldon Oils, a private, Weyburn-based producer.

After all, you’d have to be bullish to be buying right now, which he is. In the late spring he picked up 350 barrels per day of production from Enerplus.

That company’s second quarter report stated they brought in $9.6 million from divestment of 350 bpd in southeast Saskatchewan.

The deal closed June 1, Mondor said on Aug. 16.

“These were three properties that were competitively marketed by Sayer Energy Advisors in Calgary. I understand it was a fairly competitive offering, and we were the winners,” he said.

There were about 65 wells in all. “There’s a mixture. There’s a few shut-ins, a few disposals, a couple injectors, lots of verticals and horizontals.

“Honestly, I’ve been driving by these assets since I was 18 years old, kind of dreaming of own-

ing them one day,” he said with a smile.

“I would think that kind of makes me bizarre, 18 years old, thinking of owning oil assets.”

The properties are next to Tatagawa, Colgate, and an Enerplus’ piece of the Whitecap-operated Weyburn unit. This increases Aldon’s ownership in the Weyburn Unit, but it’s quite a small fraction, nonetheless.

The deal started with Aldon “hearing rumblings of them selling” earlier in the year. They evaluated the properties, like they do so many times. “And so many times, disappointed, but in this particular case, they gave us a call back, and we got the deal done,” Mondor said.

“We took on two of the Enerplus operators,” he said.

Competitiveness “We remain bullish on the oil business despite Saskatchewan having issues with competitiveness, and some of the negativity that we are seeing.

We still maintain a fairly bullish outlook on Saskatchewan and producing assets in Saskatchewan,” Mondor said.

“There’s been a real disconnect between the price of oil, and the value of assets. I think that’s holding a lot of deals back.

There was just a report today in the Calgary Herald about the stock prices of oil companies and the price of oil. So much political interference and policies of certain governments are negatively affecting it. First and foremost, the federal government, which is certainly not promoting our business,” he said.

While he’s confident enough to put his money down to buy additional oil wells, that doesn’t mean there isn’t a level of frustration with moves governments have made reducing the competitiveness of the industry.

“The governments of the day, at all levels, are so focussed on the liabilities, and the negativity of what’s going on, that it’s getting in front of the underlying value of the assets.

So when we have a conversation about an asset, the first thing that gets talked about is the liability. That should be the fifth, or sixth, or eighth. It shouldn’t be a conversation about the liability. It should be a con-

Lasso Drilling Rig 1 has been drilling wells in the Lampman area this summer for Aldon Oils. Last year, just a few hundred metres over, it drilled what was, for a month at least, the best producing well in Saskatchewan at the time. Aldon Oils is planning on drilling on newly acquired properties south of Weyburn. Photo by Brian Zinchuk versation about asset management. These things are assets. Why do they keep referring to them as liabilities? As soon as you drill an oil well, you have a liability.

Are you kidding?” he said.

“The policies of the governments of the days are pushing companies into bankruptcy, and making the liability issue even worse. Rather than supporting these resource companies, and work-

ing with them, we hang all these deposits and all this liability first policy in front of all of them. Thus, it becomes a self-fulfilling prophesy.

“You see, Aldon Oils wouldn’t have started, if these policies had been in place. When my dad first started in this business, picking up old wells, making them better, doing the proper work to get these things producing oil

and creating employment.

Guess what? Technology changed, and we started drilling horizontal wells next to these old wells that my dad was so smart about bringing back up. If we had these policies, back in the day, Aldon Oils would have never started. It wouldn’t be 450 wells today.”

“That whole liabilityfirst mentality is killing this thing. I think we need ► Page A6

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PIPELINE NEWS September 2019

PIPELINE NEWS

EDITORIAL

Publisher

Rick Sadick - 1.306.634.2654 Editor

Brian Zinchuk - 1.306.461.5599 Advertising Sales:

1.306.634.2654 Deanna Tarnes - Advertising Manager Teresa Hrywkiw Kimberlee Pushie Production:

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To submit a stories or ideas: Pipelines News is always looking for stories or ideas from our readers. To contribute please contact Brian Zinchuk at 306-461-5599.

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Today we say enough is enough.

We couldn’t agree more A video dropped on YouTube on Aug. 26, and it soon started going viral. On our own Pipeline News webpage, pipelinenews.ca, it was viewed around 1,700 times in the first two hours, which, for us, is pretty impressive.

It’s a message put out by a group calling itself Canadians for Canada’s Future, energy companies and service providers. Their message in this 2 minute 20 second video rang out almost word for word what Pipeline News has been saying on these editorial pages for years. It’s also a script that could have been taken from any number of speeches

by Saskatchewan Premier Scott Moe, former Premier Brad Wall, or Alberta Premier Jason Kenney.

So what did it say?

Here’s the transcript of the narration: “Over the past decade, everyone from foreign-funded protestors to homegrown activists have attempted to landlock our resources.

“While we’ve been busy reducing GHG emissions, and maintaining the highest environmental and human rights standards for energy development in the world.

“We’re working hard to keep this country running, and Canadians in jobs, even as our critics do everything in their power to keep our resources locked away.

“Today we say enough is enough.

“For too long, we’ve been taken for granted, by all too many people who vigorously condemn what we do, while relishing in the fruits of our labour every day of their lives.

“We’re tired of our natural resources being sold to American customers at bargain prices, and it sickens us to see our strong and free nation buying oil from countries that violate every value Canadians hold dear.

“It’s time for us to tell our story. A story we can all be proud of.

“A story that positively impacts millions of lives across our beautiful country.

“The truth: global energy needs are increasing every year. The world needs Canadian energy. It needs thee most responsibly sourced and safely delivered energy in the world.

“It drives our economy as much as it drives your car.

“We create jobs and build schools, playgrounds and hospitals. We support communities, charities and families.

We fuel the arts, technology, renewables, and virtually every other industry.

“We are here to stay.

“We will continue to employee millions, feed families, fund infrastructure, pay doctors and teachers and fill restaurants, movie theatres and hotels.

“Canada needs us. The world needs us. We are Canadian energy, and we are proud.”

That’s it. 274 words that distill what we, as an industry have felt in our hearts, our souls, our very being, for the last decade as we’ve been trampled up, denounced, derided, protested and belittled. We’ve taken it on the chin, and in the gut. But this video, and the message it sends, gets it. It’s like a doubled over boxer, whose taken the beating of his life, standing up straight and saying “Is that all you got?”

In other words, the plot to every Rocky movie ever, and we’re Rocky.

There’s another movie allusion, too. Perhaps one of the most moving dialogues in cinema was this line by Jack Nicholson in A Few Good Men, shortly after his character, Col. Nathan Jessop, says, “You can’t handle the truth!”

In it, he says, “I have neither the time, nor the inclination, to explain myself to a man, who rises and sleep under the blanket of the very freedom that I provide, and then questions the manner, in which I provide it. I’d rather you just say ‘thank you’ and go on your way. Otherwise I suggest you pick up a weapon, and stand a post. Either way, I don’t give a damn, what you think you are entitled to!”

The line in the video, “For too long, we’ve been taken for granted, by all too many people who vigorously condemn what we do, while relishing in the fruits of our labour every day of their lives,” echoes this sentiment exactly.

They can’t handle the truth.

The truth, as the video not so subtly points out, is that their mochaccino-sipping, cellphone tweeting, gas-guzzling, natural-gas heated comfortable lifestyles would not exist without our blood, sweat, toil and tears to provide the fundamental elements, literally, for a 21st century lifestyle.

It’s no wonder Brad Wall and Jason Kenney both shared this video on social media within an hour of each other. It’s the message they’ve been preaching for years, and that the rest of Canada needs to hear. Not only do they need to hear it, but they need to internalize it. Live and breath it. Understand that without our oil and gas, they’d be living in huts wearing wool or animal skins.

We are Canadian energy, and we are proud, indeed.

PIPELINE NEWS September 2019

The drilling rigs have worked most of their industry out of a job I have spent a lot of time looking at numbers over the years - numbers of active drilling rigs, oil production, investment in the patch, etc. A significant segment of my efforts is in sorting the wheat from the chaff, picking out the key figures of what matters.

One really good source is the North Dakota Department of Mineral Resources. Their director, Lynn Helms, has been director of the department quite literally for decades.

And as a “director,” he likes to make the allusion to Hollywood, so his regular report is known as the “Director’s Cut.” He’s actually a very affable guy who starts every speech with a pretty decent joke, so he’s entitled to call it whatever he wants.

He’s overseen the growth of North Dakota from 120,000 barrels per day (bpd) in 2007 to 1,424,555 barrels per day today.

I wrote out that last figure instead of rounding it off because there was some-

thing about it that struck me. I recall a conversation with a senior Saskatchewan government official about seven years ago at the Lloydminster Heavy Oil Show.

He pointed out that, for much of the prior decade, Saskatchewan’s oil production had remained relatively flat at about 425,000 barrels per day. And that, he noted, was actually quite an accomplishment, given the natural declines every oil well has.

North Dakota is now production a million barrels a day more than what we were so proud of back then.

I just came across an interesting resource. On the provincial Saskatchewan. ca website, there is a dashboard which includes oil production statistics (where have you been these last 11 years? Did you exist and I not know it?) You can find it at https://dashboard. saskatchewan.ca/businesseconomy/business-industry-trade/oil-production.

Unfortunately it speaks in cubic metres, whereas the

oil industry often uses barrels. The most recent data shows 2,396,696.8 cubic metres in the month of May. My math says that’s 486,282 barrels per day.

If my calculations are correct, it corresponds very closely with the little infographic on the page which says, “In 2015, the province produced 486,000 barrels of oil per day and shipped about 65 per cent of that production to the United States.”

So, we have now finished five years of downturn, and four years ago we were producing pretty much precisely what we are now. All told, that’s not bad given the aforementioned natural declines.

But we’re also running a lot fewer rigs. I routinely use Rig Locator, a sister publication within our parent company, for my rig analysis. It says on Aug. 23 we had 45 drilling rigs working.

That’s about half of what we had prior to the downturn.

Yet we’re still producing the same amount of oil.

OPINION

FROM THE TOP OF THE PILE

By Brian Zinchuk

One of the interviews I did this month pointed out a similar thing. Josh Biggs, owner of Top Torque Services Ltd., said, “You keep hearing all the buzz how the States is booming, but I disagree with that. I look at Baker’s rig count. We’re five years into this downturn. When the rig count drops off, it’s a great time to look. North Dakota, five years ago, 185 rigs. Now? 47. So they’re at 25 per cent of what they were at.”

Baker’s numbers differed from the Director’s Cut, which said 61 rigs, but close enough. Biggs’ point is there aren’t nearly as many drilling rigs out there.

Canada’s drilling rig fleet has shrunken from 800 five years ago, to 549 today.

And now the whole, muchreduced fleet, nation-wide is currently running at only 29 per cent capacity.

So what does all this tell us? Not good news if you’re in the drilling business. You, and your competitors, have largely worked not many, but most of your

industry, out of a job.

That’s right. Most.

When just 29 per cent of a fleet that is already down by 31.4 per cent is working, most of the drilling industry is out of a job.

Rigs have simply become too efficient for their own good. The last time I spoke to Helms, a year ago at the Williston Basin Petroleum Conference, he noted that the rigs in their state have become 300 per cent more efficient. It used to take an average rig a month to drill a North Dakota Bakken well. That same rig is now drilling three wells in a month. (I should add, a North Dakota Bakken well is not only twice as deep vertically, but twice as long horizontally, compared to a typical Saskatchewan Bakken well.)

I’ve been told that advances in bits, with polycrystalline diamond cutters, solids control, and much larger mud motors have all played a factor.

But the sorry conclusion of all this is that the

Canadian drilling rig fleet is still overbuilt by a very large measure. If we can keep producing the same amount of oil with so few rigs, eventually the conclusion will be that we don’t need that many rigs anymore.

I’ve heard tales of long ago of trees growing through rig substructures.

I’m pretty sure that’s happening today with the idle rigs, many of which haven’t spun a pulley in years.

A lot of that iron is going to be cut up. A lot of capital is going vanish in stranded assets.

I understand one rig recently sold at auction for the price of what just one key component cost. They essentially got the rig for free.

I don’t know when I will see a new drilling rig in Saskatchewan, but I expect it will be a long time from now, while the fleet continues its merciless cull.

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

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PIPELINE NEWS September 2019

Closed loop system allows pressure maintenance of formation ◄ Page A2 and you’re dropping a stone into the middle. It creates ripples and when it hits the boundaries, it can come back.”

Understanding that response is important to developing the geothermal field.

Measuring the pressure transient data and analyzing it with software allows for reservoir modelling.

“You do a lot of this

analysis in wildcatting exploration,” he said.

Since there are few wells drilled into the Deadwood formation, the target for this project, they’re in essentially virgin territory. Ghazer said it was a unique opportunity to gather this data because it is undisturbed.

The injectivity test is another key point.

“It’s a flow, build up, injectivity and fall-off test,” he said.

Earlier statements from DEEP implied that a much shallower formation, the Mannville, could be used for injecting the high volumes of brine produced during operations. But Marcia said that could be problematic for nearby oil producers who also use that formation for water disposal, and they “want to be good neighbours.”

While the shallower Mannville is still a possibil-

While bullish overall, government frustrations hinder oil producers, according to Mondor ◄ Page A3 to change this whole thing from liability to asset management, because that’s what these things are – assets.”

To that end, he said that a couple of bad managers that have abused the good stewardship that 98 per cent of oil companies have conducted themselves.

Asked about talks between Saskatchewan Headquartered Oil Producers (SHOP), an informal group of junior oil producers, and the Ministry of Energy and Resources regarding regulatory com-

petitiveness, Mondor said, “The ministry is taking steps, and they promised us to address Saskatchewan’s competitive issues. And I think they’re taking it seriously, but there’s a level of frustration between SHOP members, the other people that are right on top of it in southeast Saskatchewan, southwest Saskatchewan, and other areas. Overregulation and rural municipality taxation are really forcing us to take our minds and hands off the prize of drilling for and producing more oil.”

All this leads to con-

ity, and drilling injector wells to only that depth is much cheaper and easier than drilling 3,500 metre wells to the Deadwood, there is a compelling reason to drill to those depths – pressure maintenance. By putting the brine back in the same formation it came from, Marcia explained, “It adds time and cost to the project, but the benefit is it allows us to keep the pressure up.”

“If our pressure declines, our production declines, and we have less power to sell.”

The results of this work will provide detailed data required for the final subsurface and facility design required prior to full con-

fusion, and confusion in the industry is not a good thing, he noted, as it results in companies not spending. But he is drilling right now at Lampman. And he sees future development and drilling in the newly acquired former Enerplus properties.

“We’re going to work at it, and put our people on it and try to make things better and manager our asset. We will be doing some drilling. We’ll be doing some conversions.

And we are expanding the waterflood. That’s why we bought it,” he concluded.

struction. The reservoir data will be incorporated into a full-scale simulation model to design the full production wells, optimal well

spacing and full field development. This data will also be implemented to optimize the final surface power facility design.

Minister of Advanced Education Tina Beaudry-Mellor, in red, was toured around the DEEP geothermal site

by DEEP president and CEO Kirsten Marcia, right, and reservoir engineer Claude Ghazer on Aug. 26. Photo by Brian Zinchuk

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PIPELINE NEWS September 2019

Top Torque in Texas

A7

Canadians in Texas

By Brian Zinchuk casing joint, and has five casing. They’ll still make nies down there have their Estevan – Ten years expanding dies that grip up with the power tong, own tools. They’ll have four ago, Texas was producing the casing from the inside. but use the CRT to circu- tools, but have five jobs roughly 1.1 million barrels Before coming to Este- late and rotate the casing to up. We fill that void. We per day, according to the van in 2011, Biggs used to bottom.” fill the shortage. We also U.S. Energy Information work for Volant.

“They’re doing really have times where the cusAdministration. Now it is “We picked up some extended reach horizontals tomer will need a tool with producing just shy of 5.0 tools in the downturn, there – 3.4 mile lateral sec- a higher capacity, or a size million barrels per day. which led to us having tions,” he said, pointing out they don’t have.”

With most oilfield some excess inventory a recent story on a record April 1 was Day 1 in services companies tell- here,” he said. well in the Permian.

Texas. A little over four ing Pipeline News things One came from a “When you get out months later, he said, “It’s are “slow” in southeast competitor, and two came that far, you want to rotate going well. There’s been Saskatchewan, it’s really from auction. This left the casing to help get it slow weeks and busy weeks. tempting to look at the them with excess inventory. down.”

It’s taken us a little while to hottest play on the con“I got a call from an In southeast Saskatch- figure out exactly which tinent. That would be the old colleague who asked if ewan, Top Torque delivers sizes were in high demand.

Permian basin in west we had any tools for lease. I and picks up its tools. They Here in Estevan, we basiTexas and southeast New said, ‘Yeah, we could prob- used to stay with the tool cally run 9-5/8, 7 inch and Mexico, where the word ably spare one or two.’ on site, but local crews are 4-1/2. Down there, there’s slow only applies to traffic.

“So we had a couple now proficient with it to a lot more variety of sizes, That’s what Estevan- down there.” the point that is no longer and a lot heavier casing. based Top Torque Services “Then the oppor- necessary.

We’ve bought a pile of Ltd. has done. Owner Josh tunity came up. We had In Texas, it’s a daily equipment in the last few Biggs explained on Aug. those two tools for six or rental shop. “We’ve got months.”

14 how things are going eight months. Then we one full-time guy and one They added seven where they produce “Texas had the idea to start a daily part-time guy,” Biggs said tools. When they started tea.” He noted there are rental shop. Our business of Texas. In Estevan, it’s the expansion, they had 11 predictions Texas will be model is a little different a two-man band running tools, of which two were in producing seven to eight down there than here. In from Cromer to Shauna- the U.S. on lease. Some are million barrels per day in the Permian Basin there’s von. still on long-term rental, the next few years. about 30 power tong com“There, the guy basi- which is nice, because it In the U.S., the com- panies who also use CRTs cally stays at the shop and means a secure, regular in- Josh Biggs stands in front of Top Torque’s Texas location. pany is incorporated as Top in conjunction with the services and loads tools.” come.

Photo submitted Torque Inc. power tongs. In Saskatch“It’s a good model Tools have moved Top Torque offers the ewan, the super single rigs down there. I like going back and forth as needed. it themselves. It’s a 24- “We were lucky, we found Volant CRT, or casing run- will use the CRT to make out to the rigs out here. I “It’s been a juggling act, for hour drive, not counting a good spot really close to ning tool. It’s used on top up the casing. But in Texas, don’t mind going out for sure.” stops, otherwise. customers.”

ESTEVAN drive drilling rigselectrical to make services they useare the an power tongs to of athe couple drive onbuilt a by They use a transport “We’re set up in OdesThe cost per square Our extension solidhour reputation up casing. Itour doesinstrumentation this by make up the casing.

Down Saskatchewan Es- sa. Odessa is the heart of foot is roughly half of what Estevan Metersunny Services for safety,afterquality,truck to ship between 306-634-2900 partner attaching to the topreliability, drive. there they use expertise the CRT that noon. tevan and Texas, which is the Permian,” he said. As it was in Estevan during www.apolloec.ca and technical clients can rely on.

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PIPELINE NEWS September 2019

It was either expand geographically, or add services lines, so he went to Texas ◄ Page A7 the boom here.

Biggs heads down to Texas regularly. “The goal is once a month, for four days. The first couple months I was down there a lot more. But I’ve got a really good guy running things down there.”

It’ll take some time to recoup the costs of the additional equipment, but so far, things are going well for Top Torque in Texas. “The first month or two were up and down, but we’ve established our-

selves now, and people know we’re there. We’ve been able to find the sweet spot for pricing.

Texas is definitely different “It’s definitely different. My expectation going down there, partially because of all the buzz that you hear, I was expecting North Dakota, 2011. But it’s really not.

It’s an oilfield that’s been established for a lot longer, and has been busy for a lot longer. I don’t want to say the infrastructure

is in place, but the service companies are in place.

There’s guys who’ve been down there in a big way.”

“You keep hearing all the buzz how the States is booming, but I disagree with that. I look at Baker’s rig count. We’re five years into this downturn. When the rig count drops off, it’s a great time to look.

North Dakota, five years ago, 185 rigs. Now? 47.

So they’re at 25 per cent of what they were at,” he said.

(On Aug. 15, North

Dakota’s Department of Mineral Resources listed 61 rigs active, which may differ from the Baker rig count of 47.)

Top Torque stayed relatively busy in Saskatchewan during the downturn. But the potential for expansion was limited. “If we wanted to expand, we had to look outside our geographical area or get into other service lines,” Biggs said.

“This is what I know.”

He pointed out that half of the rigs in the

United States are working within a 2.5 hour drive of their shop.

“I’m pleasantly pleased with the reception. There’s no animosity against being Canadian,” he said.

Indeed, they’ve had phone calls as far as Pennsylvania, desperate for a tool. So their part-time worker drove it there, getting it on site in time.

“When something is needed, we find a way,” he said.

One other benefit

is getting paid in greenbacks. Biggs said, “The U.S. dollar is nice.”

Beyond the U.S., they’ve had calls from Pakistan, Netherlands and Mexico, but they don’t have the iron to go overseas yet. Biggs has overseas experience, however.

Maybe three or four months down the road, Top Torque might be in the position to buy some more equipment. “Right now, the only limitation is capital. There’s work out there,” he said.

Regina – The Government of Saskatchewan introduced the Oil and Gas Processing Investment Incentive (OGPII), a versatile new incentive program designed to enhance Saskatchewan’s competitiveness in oil and gas development by enabling increased value-added processing and infrastructure capacity.

Gibson Energy Inc. (Gibson Energy), which operates a facility in Moose Jaw, is the first successful applicant for

the OGPII. The announcement was made on Aug. 1 at the Gibsons Moose Jaw Refinery.

The incentive will support oil and gas producers and value-added companies to grow and generate more value from their operations in the province. OGPII can also be used to support improved greenhouse gas (GHG) emissions management projects in the sector.

“Establishing functional, practical in-

centives through collaboration with our stakeholders is how we attract investment, create jobs and support longterm sustainable growth in Saskatchewan’s oil and gas industry,” Premier Scott Moe said. “This incentive will help the sector increase throughput capacity and grow valueadded processing, while overcoming operational challenges associated with effectively managing emissions.”

“Today’s announcement highlights the importance of partnerships between the public and private sectors to help drive investment and growth across the province,” Gibson Energy’s chief administrative officer Sean Wilson said. “As a proud member of the Moose Jaw community

for nearly twenty years, we would like to recognize the Government of Saskatchewan for offering programs such as the OGPII to help businesses strengthen their ties to the province and to continue to create jobs throughout Saskatchewan.”

“Being a part of Gibson Energy’s debottlenecking project was very impactful for us at Right Choice,” said Trevor Hagerman of Right Choice Energy Services Inc. “It allowed us to provide new opportunities for over 40 local employees and subcontractors, who came together as a team and completed this project with zero incidents. We are all proud to have been part of such a successful project.”

Gibson Energy’s existing Moose Jaw opera-

tion consists of a heavy crude oil processing facility that produces a variety of refined products including distillate and asphalt.

The expansion, completed on June 29, 2019, will increase throughput capacity by approximately 30 per cent—from 17,000 barrels per day to 22,000 barrels per day—with no increase in GHG emissions, ultimately reducing the facility’s emissions per barrel of oil processed by approximately 20 to 25 per cent. The incentive provides successful applicants with a 15 per cent transferrable royalty credit, applied to eligible costs directly related to an eligible greenfield or brownfield project.

In order to be eligible, a project must be a refinery, an upgrading facility,

a gas commercialization project or other valueadded facilities, including helium processing, petrochemicals and carbon capture, storage, and utilization for enhanced oil recovery, or a value-added project.

It must result in a significant increase in processing capacity, and have a minimum of $10 million in eligible costs.

This incentive has a royalty credit cap of $75 million per project and a total program credit cap of $300 million in royalty credits.

The government noted OGPII aligns with the goals of the Government of Saskatchewan’s Methane Action Plan, which is part of Prairie Resilience: A Made-in-Saskatchewan Climate Change Strategy.

Gibson Moose Jaw refinery expansion

Fighting for Saskatchewan's Oil Industry Lori Carr, MLA

Service rig death on Crescent Point site near Stoughton

Estevan Constituency Office

306.634.7311 loricarrmla@sasktel.net

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A fatality was reported at a Crescent Point Energy Corp. site near Stoughton on Aug. 19. A Weyburnbased service rig company was working on the site, according to a statement from Crescent Point received by email.

The statement said, “Earlier today, an Aaron Well Servicing employee passed away while located at one of our sites near Stoughton, Saskatchewan. Our thoughts are

with the family of the deceased Aaron Well Servicing employee.

“Immediately after notification of the incident, we initiated our corporate emergency response and secured the site to ensure the ongoing safety of staff, the community and environment.

“As both external and internal investigations into the cause of death are ongoing, Crescent Point

is unable to comment on this situation. Right now, our focus is on supporting our colleagues.”

Mark Biglin, 38, of Brooks, Alta., was the victim. He is survived by his partner and three children. A GoFundMe page was set up for their benefit, which can be found at https://www.gofundme. com/f/a-life-taken-toosoon-help-nickie-breck.

At press time it had raised $44,260.

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PIPELINE NEWS September 2019

Gibson Energy sells trucks to Trimac

By Brian Zinchuk Calgary – On Jan. 30, 2018, Gibson Energy announced that it planned to sell of its trucking business, and focus on tanks and infrastructure. It was something of a surprise, coming from a company that had initially been known for trucking.

A year-and-a-half later, the fallout from that announcement appears to have settled, with several of Gibsons former divisions in Saskatchewan now in new hands.

In Arcola, its hydrovac services which used to operate as Littlehawk Enterprises, before being acquired by Gibsons, is now in the hands of CEDA. (See related story page A12).

Its disposal facilities went to Wolverine Energy and Infrastructure, which spun off most of the southeast Saskatchewan assets to Fleet Energy as part of the same deal. (See related story page A11).

But the big question was what would happen to the vast trucking fleet, for which Gibsons was largely

You won’t be seeing the giant Gibsons logo on trucks anymore. In Canada, Trimac bought their large fleet of trailers. File photo. known.

That trucking fleet, trailers, actually, went to Trimac Transportation, based in Calgary.

Gibsons Energy announced on July 2 it had closed the sale of its Ca-

nadian truck transportation businesses to Trimac Transportation for gross proceeds of approximately $70 million prior to customary closing adjustments, with the potential for additional proceeds

depending on the performance of the business over the next several years.

As part of the sale of its Canadian truck transportation businesses, Gibson has also entered into an agreement with an en-

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tity affiliated with Trimac for the sale of a field office and shop facilities situated on 31 acres of land in Edmonton, Alberta for $30 million. Gibson expects this portion of the sale will close by the end of the first quarter of 2020, subject to the satisfaction of certain conditions, with Trimac utilizing the properties under a lease arrangement in the interim.

With the closing of the sale of its Canadian truck transportation business, Gibson said it had “successfully completed all non-core divestitures announced at its January 2018 Investor Day for total proceeds of approximately $325 million.”

All proceeds from the non-core divestitures will be reinvested into the company’s core tankage and pipeline infrastructure projects.

Trimac Transportation said in a release, “The purchase compliments the existing portfolio of Trimac, and further expands its coverage and capabilities in the provision of bulk transportation services, hauling a variety of products including crude, condensate, LPG, sulphur, asphalt and petroleum coke. The company will operate under the name Trimac Energy Services Ltd., and retain all existing commercial agreements and rolling assets. Trimac Energy Services Ltd. will continue to provide transportation services to Gibson through a long-term exclusive agreement.

“Approximately 600 new team members will join the Trimac family, increasing the total to 3500 across North America. Trimac will add over 1,300 trailers for a total of

over 5,000 in the Trimac fleet, along with the existing compliment of 2,500 tractors.

Matt Faure, president and CEO of Trimac Transportation said, “We are very excited to start this new chapter in our 75-year history, and leverage the knowledge and expertise of two great companies. Trimac Energy Services will be a much-needed solution for the North American energy industry, and we look forward to introducing our combined offerings to new and existing customers.”

Garry Snow, who handles communications with Trimac, explained that the purchase was for trailers, but not tractors.

“We have lease operators,” he said by phone on Aug. 26.

He noted that approximately 500 owneroperators were associated with the deal as Trimac took over the Gibson contracts. There’s been little to no disruption in the changeover, except for the usual turnover.

Snow noted that they are “looking at the broader landscape to see opportunities to grow.”

“The idea is to grow the company as best we can.”

At this point they’re investigating what they have, and from their will create a plan to service customers.

“We bought it to grow the business,” he said. “We’re not going to sit idle.”

Trimac was founded in Moose Jaw in 1945

by J.W. McCaig, Trimac has been a family-owned business for almost 75 years.

PIPELINE NEWS September 2019

A11

Fleet Energy expands its operations, buying former Gibsons/Palko disposal sites

By Brian Zinchuk Midale – Fleet Energy (Fleet Environmental Solutions) has more than doubled in size, adding three salt water disposal and waste disposal sites in southeast Saskatchewan, adding to its two operating sites.

With the Bakken boom, the increased oil production lead to a corresponding increase in produced water. There was a significant need for disposal sites in the play, and several facilities were built to accommodate the need for water disposal services and oilfield waste management.

Among the first were those built by Palko. They started in 2007 with a site north of Midale, not far from Viewfield, after which the Bakken play was named. It was initially a disposal well, but then in 2009 a pad was added to deal with other oilfield waste streams.

Their second and third sites were both built around the same time in 2011.

The second location, south of Oungre, was initially licensed to accept water-based oilfield waste streams. Some examples include service rig completion fluids, spill fluids, production fluids and frac fluids. (More on that later).

The site is on Highway 35.

The third site was built just south of Stoughton, within a few kilometres of Crescent Point Energy

Corp.’s main Viewfield battery. It was essentially a mirror of the Oungre site, and is just off Highway 47. It is referred to as the Viewfield location.

Highway access was an important consideration in site selection.

In late 2011, Palko sold to Gibson Energy for $62.7 million, a deal which included several sites in Alberta as well.

Around the same time, Fleet Energy, headquartered at Indian Head, fired up in 2010. Its principal location was located just east of Forget, along Highway 13. The plan was to commence construction in 2011 but put off the project due to flooding throughout the region. The facility was built throughout 2012 and went into operation in late 2012. The following year, they added a state of the art heated pad to handle solids at Forget. (This location is referred to as “Stoughton” by Fleet. Their facility south of Stoughton, but nearer to the community, is called “Viewfield.”)

In 2017, Fleet picked up the former Tervita site on the edge of Arcola, which was initially built for T-45 Oil. That site was shut-in in late 2014 due to the slowdown in oilfield activity and has not currently been put back into operation, but is being used for storage from time to time when Fleet’s Stoughton site needs extra capacity.

All this leads up

to a pivotal announcement made by Gibsons in September 2018. The company, whose reputation was initially built on trucking, announced that it was selling off its trucking division along with its other divisions to focus on tank farms and pipe infrastructure. That announcement led to the sale of the disposal sites in southeast Saskatchewan.

Stephen Hoff is the sales manager with Fleet, while Nathan Hollick is president and CEO. Hoff met with Pipeline News at the Midale location on Aug. 16.

Hoff explained that the purchase wasn’t a direct one from Gibsons. Rather, Gibsons sold all their waste disposal facilities in Western Canada to Wolverine Energy and Infrastructure Inc. and Fleet bought the oilfield waste facilities in southeast Saskatchewan from Wolverine.

“Gibsons didn’t want to sell just Saskatchewan, but the whole waste business,” he said.

Daily Oil Bulletin (DOB) noted on Feb. 15 that Wolverine would be acquiring “12 environmental services facilities across Alberta and Saskatchewan, including multiple waste management, waste disposal, and crude oil handling facilities, as well as associated tanks, pumps, pipelines, treaters and various other equipment.”

On March 1, DOB

Fleet Energy’s recently acquired Midale location, north of Midale, is now its hub. Photo

by Brian Zinchuk reported Wolverine “has closed a disposition of three non-core environmental services facilities in Saskatchewan being acquired as part of the acquisition for total cash proceeds of $15.4 million.”

There was one asset in the region that wasn’t included in the deal – the industrial landfill at Heward.

Wolverine kept that, as Fleet chose not to buy it, according to Hoff.

Fleet took over the three Gibsons assets effective on March 1 this year, where the purchase/sale was closed on March 22, 2019.

Of the total six facilities now, Midale and Stoughton (Forget) are full-waste capable,

while Oungre, Viewfield, Stoughton and Arcola are fluids only. All six facilities have as a miminum of one injection well for fluids.

Solids processed at the Midale and Stoughton (Forget) are then transferred to appropriate industrial landfills.

Between all these facilities, the company employs 15 people, with head office just outside of Indian Head. “It’s a Saskatchewan company with Saskatchewan-ownership and Saskatchewan operated. We try to source everything locally,” Hoff said.

Hollick added by email, “Our employees are our greatest asset! They are our frontline and face of our company.”

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Hoff said, “Midale is our hub. We can pull from Oungre, Stoughton, Viewfield. We’re trying to make Midale our central location.”

“Our whole game is separation at the end of the truck. Everything goes through a centrifuge. We have three at Midale, one decanter and two tricanters,” he said.

The Oungre facility is what Hoff referred to as “deep well injection.” waste fluids are injected into the middle and lower Devonian formation, a deep sedimentary formation in southeast Saskatchewan above the Ordivician and the PreCambrian basement. ► Page A12

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PIPELINE NEWS September 2019

Fleet could use a few more people, but the stack of resumés is no more ◄ Page A11 The well was originally drilled to in excess of 3,000 metres. In addition to water, this well can take industrial waste. “We did an amendment to expand the type of wastes on our Oungre license. It has been recently approved by the regulator’s.”

It’s not a cavern. But by being a deep well, it can take things like industrial leachate, some refinery waste, drilling mud and the like.

Hoff said, “We have a pretty good maintenance program,” explaining that they would be dead in the water if their disposal wells

went down. Everything All fluids are processed and then goes through tiny screens, resulting in zero solids and zero oil going into the disposal wells.

Fleet has an oil credit program. Hoff explained, “If you haul in oil, we take ownership and give you a credit.”

Regarding how business is going, Hoff said. “It’s sluggish. Peaks and valleys.

So much of our business is tied to the drilling.”

As a result, he noted, “We started to diversify.

We’re looking elsewhere for industrial waste.”

That includes the other industries and mu-

nicipalities where possible, with plans to continue to expand its acceptable waste streams, according to Hollick.

While highways in the Oungre region have been historically quite bad, that’s no longer the situation.

Recent roadwork means they’re “brand new” from both Weyburn and Estevan, leading to Oungre.

Hoff said they are looking to hire three people, for Stoughton (Forget), Oungre and Midale. “We’re always looking for good operators, someone who wants to be part of a team.

“We’re hoping to expand our facilities, our

The Midale facility can take solid waste, which is processed and eventually sent to industrial landfills. waste streams. We’re strong believers in charging a fair rate and providing a great service.”

The pool of people out there looking for work

has shrunken dramatically, however, as Fleet, like most other companies Pipeline News has spoken to in recent years, have found many people have abandoned the

CEDA picks up Littlehawk division from Gibsons

By Brian Zinchuk Weyburn, Arcola – Among the numerous dispositions Gibson Energy has made this year, one of them was the Arcola based Littlehawk division.

Gibsons had purchased Littlehawk effective Jan. 1, 2017. At the time, Gibsons amalgamated its Frobisher operations with the Littlehawk operation in Arcola, clos-

ing the Gibsons Frobisher branch in the process.

(That branch, in turn, used to be Johnstone Tank Trucking. Gibsons bought it in February, 2010.)

Now CEDA acquired the Littlehawk division from Gibsons on May 1, 2019.

Randy Loustel, vicepresident of “rest of Canada” region with CEDA, explained the deal while

at the Saskatchewan Oil and Gas Show on June 6. His responsibilities include Estevan, Regina, Arcola and Sarnia, Ont. “We’re really excited to acquire Littlehawk into our organization. There’ a great fit for us, as they’re only 45 minutes away from Estevan. They do a fair bit of the services that we do – supply hydrovac, water truck services, pressure truck and acid services – really integrate well.

“We’re really excited to have them on board.

“As CEDA, we want to be the dominant ser-

The Littlehawk division of Gibsons is now part of CEDA. This water truck could be seen east of Hirsch on Aug. 17. Photo by Brian Zinchuk vice providers among what we supply, in the areas we service. They fit

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We bring to the customer base great service. Their talented workforce fits with our talented and experienced workforce.”

It brought 28 people into CEDA from Littlehawk. “We brought on 12 hydrovacs, three combo units, four pressure trucks, four water trucks and two

acid trucks. It’s quite a bit of iron.”

A few units have been spread out. A few others were repaired and brought into service.

Through Estevan and Regina, chemical cleaning, hot oiling and highpressure water blasting services will be combined with Littlehawk to offer services they didn’t have.

“We’re super excited to have these guys on board. The potential for us combining makes us a bigger service provider in southeast Saskatchewan.

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PIPELINE NEWS September 2019

Unreserved Public Real Estate & Equipment Auction

Glen Peterson Construction Ltd

Unreserved Public Auction – Complete Dispersal

Caradawn Transport

Retirement for Dave Wellings, plus equipment from other sellers

2 of 3– 2020 & 1 of 3– 2019 Kenworth T800

2013 Caterpillar 980H

1 of 2– 2019 Kenworth T800 & 2012 Cozad 80 Ton 16+16+16

2007 Mack MR688S w/Concord CCP-38XZ-170

2010 Caterpillar 140M VHP Plus

Property may be viewed without an appointment

2001 Kenworth T800B

3 Parcels of Real Estate – 1.63± Title Acres w/Concrete Plant 2.69± Title Acres w/Shop & Office 140.9± Title Acres w/Rail Access SK/City of Estevan

2014 Gerrys KLH405 75 Ton 3+3+3

Parcel 1 – Lot 11 Blk/Par 84, Plan 92R50022, Lot 12 Blk/Par 84 Plan 92R50022, Lots 5-9 Blk/Par 84 Plan 92R50022 – 1.63± Title Acres

▸

6000± sq ft concrete plant & office, 4 silos, 100 ft conveyor, 3500± kg powder weigh batch, Win batch MPAQ C48-TB V8.6.6 automation, MPAQ computer program, air card in computer, Rice Lake digital weight indicators IQ plus 355, control panels, (2) hopper weigh batch discharge, (4) hopper holding bin, pneumatic air system, boiler system, graveled yard, full municipal services. Zoned “M1” Light Industrial, taxes $19,780.95.

2012 XL Specialized 80MFG 40 Ton

Parcel 2 – Lots 1-12 Blk/Par 101 Plan C3929, Blk/Par 101A Plan 3929 Ext 4, Blk/Par 101B Plan 101270898 Ext 6, Lots 2-5 Blk/Par 109 Plan C3929 – 2.69± Title Acres

▸

7200± sq ft shop & office, full municipal services, natural gas heat throughout (2017). Zoned “M1” Light Industrial, taxes $25,346.38.

SK/RM of Estevan No.005

2005 XL Specialized

Parcel 3 – SW-18-02-07-W2 – 140.9 Title Acres

▸

Rail line access, 2± acres of storage space with (2) 24 ft x 36 ft storage buildings & (1) 20 ft x 30 ft steel framed storage building, balance native grass, taxes TBC. 2012 Transcraft TL2000 53 Ft

Estevan, SK

Regina, SK

October 31 (Thursday) 9 am For more information: Tyler Peterson – Contact 306.421.3474

Chad Caza – Ritchie Bros. Territory Manager – 306.514.8655 ccaza@ritchiebros.com Ritchie Bros. Real Estate – Broker – Ed Truelove –306.441.0525 etruelove@ritchiebros.com

Location

Parcel 1: 446 6 St, Estevan, SK Parcel 2: 314 6 St Estevan, SK Parcel 3: At the junction of Hwy 18 & Sawyer Road go South 3.5 km (2.17 miles). Property on East side.

Brokerage: Ritchie Bros. Real Estate Services Ltd.

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2008 Wrem 55 Ton

October 18 (Friday) 9 am

1512 Fleet Street N, Regina, SK GPS: 50.503644; -104.547634

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Equipment Viewing: October 15 to 17

For more information: Mason Schick: 306.897.9900

Auction will be held at the Cara Dawn Transport yard:

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A13

A14

PIPELINE NEWS September 2019

VP Energy jumped in right when things looked the worst, and has grown since

By Brian Zinchuk Kindersley – Most people wouldn’t think of jumping into an industry right when things are at their lowest, but that’s exactly what Bear Trapp and his partners did in 2016.

They founded VP Energy Services, a storage pipe yard just outside of Kindersley.

“We have 50 acres of storage for OCTG (oil country tubular goods); casing and tubing and we have a mud warehouse and a delivery arm as well,” said Bear Trapp, founder and president, by phone on Aug. 13.

They also store oilfield equipment for a number of other companies.

“We’ve got winch tractors, picker trucks and heavy highway trucks.

And we’ve got a fleet of one-tons for hotshot services.

“Southwest Pipe built the pipe yard we are now headquartered in, in 2014, and we took it over in 2017,” he said.

The principle yard, 40 acres in size, is 16 kilo-

metres east of Kindersley, along Highway 7, close to Netherhill. They have an additional 10 acres inside Kindersley, including a five-acre rail yard in town that they purchased from CN. “It was about a twoyear process, but we finally got ownership of the land in the summer of 2018. That’s where we unload the rail cars. We can store the pipe that comes in by rail there.”

The previous users of the rail facility would unload it there, then load it onto a truck and move it, thus handling it twice.

“We can unload it right from a rail car, build racks in that five-acre yard and set it up right there. I find it a lot more effective and cost efficient,” he said.

The company saw the impacts of the recent tariff war on steel between Canada and the United States, one that was recently resolved. “Since the tariff war went on with steel, we probably went six months without getting a rail car,” Trapp said.

“All the pipe was coming

by truck from the two EVRAZ mills in Alberta.

There was a 25 per cent tariff on steel. We (Canada) put it on America because the Americans put it on everything outside America.”

The majority the pipe is still coming out of Alberta, but with eight rail cars last month, things are coming back to normal again, according to Trapp.

“We don’t source the suppliers. The pipe companies do. We’re a storage location for them.”

Operations like VP Energy are sometimes referred to as “pipe custodians.” Trapp agreed with that description, saying, “That’s what we are. We’re more of a transfer station, where we hold the pipe for the pipe ownership companies out of Calgary, and they sell it directly to the oil companies, out of our yard.”

The money is made on the pipe handling and trucking.

“We have seven highway trucks, two pickers, and three hotshot trucks,” he said.

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This is a “mud can.” It means roughnecks don’t have to climb stairs to retrieve heavy bags. Photo submitted There’s another pipe yard in Provost, Alta, that services the Viking play, but Trapp likes to say, “We are the pipe yard that’s located in the heart of the Viking.”

“We have about 32 employees. We’re pretty busy,” he said.

Operations are 24/7.

The company fired up in 2016. It has a number of investors from southeast Saskatchewan. Board members include Jim Fox, George Sereggela, Wayne Paproski, Dennis Day and Doug Trapp, in addition to Bear Trapp. The board makes up around 70 to 80 per cent of the ownership.

One might recall that 2016 was the depths of the oil downturn. Asked if the timing was either a genius move or a crazy one to fire up that year, he replied, “a bit of both.”

He said he and a couple of friends he grew up with in southern Saskatchewan were looking for oil and gas assets in the crash.

“When we crunched the numbers, we saw the

Viking area had seen almost 50 per cent of holes drilled. (in Saskatchewan). As a service business, that was attractive to us,” he said.

“We did a lot of research before we went out and took this risk, but we were all around 30 years old at the time, and we thought we would take this risk now at 30 rather than 40, because oil tends to take a dive every eight to 10 years,” he said.

(Trapp played junior hockey with the Estevan Bruins in 2004-2005, and received a NCAA scholarship while playing with them.)

While a lot of people are still sour about the oil downturn, now entering its sixth year, Trapp has a unique perspective on it.

“The day that we started the company, oil was US$31 per barrel, so in most industries, if the underlying commodity doubles in value, you would think business would pick up dramatically.”

According to sister publication Rig Locator

(riglocator.ca), there were 12 drilling rigs working around Kindersley the day of the interview. VP Energy was servicing the majority of them.

A common occurrence operating in west central Saskatchewan is the quick imposition of road bans when it rains.

“The RMs are very touchy.

An inch of rain and they put a road ban on for 24 hours,” he noted. And that has implications.

“The last week of June, we were expecting having a good month. We basically did nothing the last week of June, when all that rain came,” he said.

“That cost us a significant amount for the end of Q2, but you imagine those wells are going to be drilled anyways.”

“We offer storage.

Northern Mat and Bridge is moving into our yard this week,” he said. VP Energy will be moving their mats. It’s a good match, as he noted, “We have trucks, loaders, drivers and trailers going to ► Page A15

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PIPELINE NEWS September 2019

A15

Just $1.5 million in August Crown land sales Regina – Saskatchewan continues its lackluster Crown land sales this year, with just $1.5 million brought in in the Aug. 15 sale.

With three of six land sales under our belt for this fiscal year, the total has been only $9.5 million.

In comparison, British Columbia, which holds its land sales monthly as opposed to every two

months like Saskatchewan, announced it brought in $192,000 for its Aug. 14 sale. Sister publication Pipeline News North reported, “The province (BC) has taken in roughly $2.8 million in bonus bids to date this year — far short of the nearly $60 million it saw through this time last year.”

The highest bonus bid received by Saskatchewan in this offering was

$261,410for a 258-hectare parcel west of Luseland, purchased by Millennium Land (333) Ltd., and is prospective for oil in the Mannville Group.

This lease and is partially located within the Plover Lake Mclaren Sand Oil Pool, 18 kilometres west of Luseland.

The highest dollars per hectare in this offering was $1,828 for a 129-hectare parcel, totalling

$235,932. This parcel, located east of St. Walburg, was purchased by Silver Hawk Resources Ltd. and is also prospective for oil in the Mannville Group.

Two leases in the Kindersley area consisting of 130 hectares received a total offer of $219,850. These parcels are situated southwest of Major, and were purchased by Millennium Land (444) Ltd. and Millennium Land

Mud cans mean roughnecks don’t have to climb stairs with heavy sacks ◄ Page A14 every location already.”

The mud storage warehouse is the exclusive warehouse for Newpark Drilling Fluids. “We store and deliver their mud. We have our own vans,” he said.

VP handles the delivery for Newpark clients all across Saskatchewan.

This includes some of Newpark’s biggest clients, which are the potash mines of Saskatchewan.

VP also has developed their own product, what they call “mud cans.”

“We started building mud cans with foursided doors on a skid,” he said. That’s a 40-foot sea can welded on a typical oilfield skid. As it sits on the ground, there are no stairs to climb up, and then climb down, carrying heavy bags.

“They’re much safer for all the people on the rig,” he said. They’re much easier on the roughnecks, and the rig movers like them.

VP Energy made four mud cans this year, and may build more in the future.

Pickers are an integral part of VP Energy Services’ offerings. Photo submitted

(555) Ltd. In its press release, the Ministry of Energy and Resources pointed out Saskatchewan currently averages $637 per hectare for the fiscal year, higher than similar public offerings held to date in Alberta and British Columbia, which average $155.63 per hectare and $87.46 per hectare respectively.

However, that average was not reflected in this sale, which saw an average of $281.62 per hectare.

There were no exploratory permits posted in this land sale.

In southeast Saskatchewan, all 17 leases posted were sold, for a total of 1,915 hectares.

That brought in $418,982, or $219 per hectare. The highest bonus bid and the top dollars per hectare received in this area was for a parcel partially situated in the Hastings Frobisher Beds Oil Pool, 11 km northeast of Oxbow. This 194 hectare lease was purchased by Millennium Land (555) Ltd. for $774 per hectare or a total of $150,173.

In the Swift Current area, only one parcel was posted, but it did not sell.

The Kindersley area had 37 parcels posted, totalling 4,178 hectares.

However, only 24 sold, comprising 2,751 hectares. That brought in the lion’s share of the revenue, at $789,961, averaging $287 per hectare.

The highest dollars per hectare received in this area was $1,766 per hectare for a 65 hectare parcel located 12 kilometres southwest of Major, adjacent to the Hoosier North Viking Gas Pool.

This lease was purchased

by Millennium Land (444) Ltd. The Lloydminster region had 12 parcels posted but eight sold. This brought in $337,570, averaging $409 per hectare, substantially more on a per hectare basis than the other regions.

Requests for petroleum and natural gas rights in each public offering are submitted electronically from oil and gas companies to the Ministry of Energy and Resources through the Integrated Resource Information System (IRIS).

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PIPELINE NEWS September 2019

Today we say enough is enough: the story behind the video

By Brian Zinchuk Calgary – Birchcliff Energy president and CEO A. Jeffery Tonken and Tourmaline Oil president and CEO Mike Rose were on hand at the packed Calgary Petroleum Club at 7:30 a.m. on Aug. 26 to present a new video, put forth by a group calling itself Canadians for Canada’s Future.

On that morning it launched a new national campaign to reinforce the significant impact that the energy sector has on Canada. The organization has committed funds to a national campaign that highlights the fact that when the energy sector is at risk, and they noted every Canadian is affected.

By midnight, the video had 10,000 views on YouTube. While the video is entitled “Supporting the wellbeing of every Canadian,” its central message is explained by a narrated line one-quarter in. It says, “Today we say enough is enough.”

Jesse Doenz, the group’s spokesperson and co-founder, spoke to Pipeline News that evening by phone. His day job is being the controller and inves-

tor relations manager for Birchcliff, an 80 per cent gas-weighted producer whose daily production equals 78,500 barrels of oil equivalent per day.

He didn’t say who his other co-founders were, other than they were in marketing and media.

The objective of the campaign, according to the group is to encourage the necessary discussion about the energy sector in Canada and to promote the benefits that this industry directly and indirectly brings to all Canadians.

“The video is the starting point for the conversation,” Doenz said.

It can be found at https://youtu.be/BlAil_ zuyBw .

It’s being launched now, and will be accompanied by TV ads, prior to the federal election writ period, which restricts political advertising.

Doenz said because of the significance and scale of Canada’s energy sector, “Our quality of life and high standard of living that we enjoy every day in this great country - is a direct result of the access we are fortunate to have, to many forms of energy.

Canada has an abundance of natural resources that can fuel our nation yet we are importing resources daily from countries that take advantage of us, and that do not share the social values or legal standards that we demand from ourselves.”

Asked who makes up their organization, he replied, “There’s a large group of service companies and energy companies.

“We had a big show at the Petroleum Club today, and all facets were out.”

Doenz said, “I like to always say, when someone understands the whole story, I have never met a Canadian that supports billions and billions of dollars going to other countries, along with tens of thousands of jobs, yet that is what happens every year, year after year.”

“Our energy industry is the most technologically advanced and environmentally friendly energy industry on this planet. Every single one of us cares about the environment and how we develop our resources and we want to bring all of Canada together to understand that this is the truth.

The message about the in-

Today we say enough is enough. Screen capture from YouTube/Canadians for Canada’s Future dustry’s commitment to the environment and to safety and its investment into alternative energy sources is all too often overshadowed in current discussions.”

“World energy demand is increasing every year and we support the growth of all responsibly developed energy to fill this demand, including significant growth in renewables. There is no question Canada should be a world leader in supplying the most responsibly sourced energy to not only ourselves but to other parts

of the world.

“We’re also blessed with the ability to supply ourselves and fuel our whole nation with our own natural resources, yet we chose not to do that. We take energy from countries that don’t have anywhere near the social values, or rule of law, or treatment of their own individuals, as we have, and aren’t nearly as environmentally friendly. And yet, we take their products as opposed to using our own, and we buy those products at world prices, and we sell ours at

massive discounts. How does that make sense in any world?”

He added, “We as a nation need to come together and fix the issue of our country selling our resources for less than world prices. This will stop the growing debt burden we are all facing, which leads to crushing interest payments and cuts to social programs we all want to see thriving.

It will also bring back investment and stimulate our economy in a way that will benefit all Canadians and all sectors of industry.”

◄ Page A15 online training material, which was developed in conjunction with stakeholders, will be

introduced. This will help industry use IRIS as effectively as possible and align with the Government of Saskatchewan’s objective

of achieving regulatory excellence.

The scheduled date for the next public offering will be October 1, 2019.

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The Crown land sales this month don’t inspire a lot of confidence for additional drilling, bringing in just $1.5 million. Photo by Brian Zinchuk W W W. M A C K A U C T I O N C O M PA N Y. C O M

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PIPELINE NEWS September 2019

A17

Core Lab brings back oil analysis to Estevan

By Brian Zinchuk Estevan – Due to the oil industry downturn, Core Laboratories shut down its oil analysis laboratory in Estevan in 2015.

Now, driven by clients’ needs, they have restored that capability with new, more capable equipment.

Dustan Leman is the senior core analyst in Estevan, and he’s been at that location since 2009.

He has been with Core Lab since 2001.

He explained on Aug.

20 that they have three main areas of focus in Estevan – oil, gas and water sampling, routine core analysis, and oil analysis.

“Core Lab is about helping clients to produce more oil through the lifespan of the well,” he said.

The bread and butter work historically has been the core analysis, but due to the decline in exploration in the region, that work has declined significantly.

“Before we shut down the oil lab in 2015, we were doing start-to-finish oil analysis,” Leman said.

After the lab shut down, he said, “We didn’t do any fluids analysis here. We shipped it all to Calgary.”

Their local analytical equipment was shipped away too. Thus, with the reopening of the oil laboratory, he said, “What we have now is new equipment.”

There are three key devices he pointed out

The box behind Quinn Brown is the Minivap, which allows Core Lab in Estevan to do vapour pressure testing.

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Environmental Division Tel: 306-634-3411 Fax: 306-634-1951

Chuck Haines, Technical Sales Cell: 403-860-4660

Darwin Frehlick, Manager Cell: 306-421-0491

Mud Technicians Gerald Smith Cell: 306-421-2408

Owned & Operated Warehouses Estevan - Jay Burback Cell: 306-421-0101

Ian Scott Cell: 306-421-6662

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in the lab. The most significant is the Minivap, a device which measures vapour pressure from samples in cylinders.

The second is the Stabinger. “We set up a Stabinger that allows us to perform oil densities and viscosities.”

It can measure viscosities at different temperatures as well.

This device is an improvement on their old capabilities. “We can load to auto sample up to 100

samples at a time. Before, we were doing one sample at a time,” he said.

The third device measures total sulphur content in crude oil.

Bringing the oil lab back online means bringing the staff number to four from two. “We rehired one of the techs we laid off in 2015, and hired a new tech,” Leman said.

Asked what the impetus was, he said “We did pick up a new contract for which the vol-

ume dictated we needed the ability to run it here.

Turn around and freight costs didn’t merit sending it to Calgary.

“We officially started in the middle of June.”

As a result, he said they’re reaching out to their clients to let them know about the restored local service. They’ve had a good reception so far.

Asked if he was excited about this development, Leman responded, “Absolutely.”

Luba Feoktistova loads a sample into the Stabinger, which can measure density and viscosity.

A18

PIPELINE NEWS September 2019

Nylon in oilfield capacities

By Brian Zinchuk Regina – There was a prominent logo on the media wall at the 2019 Saskatchewan Oil and Gas Show that many people in southeast Saskatchewan might not be familiar with. It’s a Chinese company known as Yiyuan Nylon Technology. Pipeline News posed some questions by email, and received a response from Joe Zhau, sales and administration department, on Aug. 19.

Pipeline News: Yiyuan Nylon Technology was the platinum sponsor for the Saskatchewan Oil and Gas Show in June, but few people in the area had heard of you before.

What exactly do you do?

Joe Zhau: We are a professional customized engineering plastic monomer cast (MC) nylon manufacturer and supplier. That includes sales, product development and machinery performance improvement solutions.

Our main product is

MC nylon gears, pulleys and slide pads for different industries like elevator and crane. We have 20 years successful experience and main supplier for wellknown elevator brands (Hitachi, Mitsubishi, Toshiba, OTIS, KONE and Schindler). Also, our MC Nylon pulleys and gears are designed for oil field beam pump is testing and using in major oilfields in northeast China.

P.N.: How is that applicable to the oilpatch?

Can you provide some examples?

Zhau: Our nylon product can replace the steel parts. It is light weight, self-lubricating, wear- resistant and corrosion-resistant. It has the same properties and performance from -40 to 100 Celsius and no dirt formation.

Our MC Nylon pulleys are designed for oil field beam pump and is tested and used in a ma-

jor oilfield in northeast China. We are designing nylon pipeline. It improves the performance, needs less to maintain and has significant saving in cost for a long run.

P.N.: What sort of presence do you have in Saskatchewan? Do you have any expansion plans?

Zhau: This is our first year in North America.

We have an office located in Regina and a product show room for samples.

We have great confident and vision in North America market and we plan to set up a factory for machining so we can serve north America customer better, and eventually move the whole manufactory process from rough cast to product to Canada.

P.N.: How did Saskatchewan come to your attention?

Zhau: Saskatchewan is the centre of Canada and part of western Cana-

Two representatives of Yiyuan Nylon Technology were present at the Saskatchewan Oil and Gas show, for which they were the platinum sponsor. From left are Dan Cugnet, Xue Song Fang (Yiyuan), Alberta Premier Jason Kenney, Saskatchewan Premier Scott Moe, Joe Zhau (Yiyuan), Del Mondor, Energy and Resources Minister Bronwyn Eyre.

Photo by Brian Zinchuk da. It has the advantage of transportation and being close to our main target

market, oilfield and mining. (We plan on) expanding to all North America

market as the convenience Global Transportation Hub provides to us.

North Shore Environmental sets down roots in Regina

By Brian Zinchuk Regina – It took a while to finally put down some roots in Saskatche-

wan, but after several years of servicing the Land of Living Skies, North Shore Environmental Consul-

tants Inc. has firmed up their Regina operations.

Todd Clouse, regional director of Saskatchewan

operations, has been with the firm since 2011 and opened North Shore’s Regina office in 2014. Todd managed the Regina office and workload remotely until last July when he and his family moved to Regina.

“Since we opened the Regina office we have seen a steady increase in workload and last year we hit a milestone that justified a permanent move” said Clouse.

The original plan was to set up a full office in

2014-2015, but that was curtailed due to the oil downturn and economic uncertainty.

Currently, North Shore has three full time employees working out of Regina. Clouse said they are looking to hire another person within the next month. When they need additional help, they draw from their Alberta staff.

Clouse went to the University of Alberta, where he earned a Bachelor

of Science degree in environmental science. As for the other staff, he said, “We have a mix of agrologists, engineers and biologists.”

They also have air quality and fugitive emissions specialists which differentiates North Shore from other mid-sized consulting firms, in addition to in-house weed spraying and vegetation management services. They have one person based in Regina ► Page A19

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North Shore offers spraying service ◄ Page A18 who is licensed to spray for noxious weeds. “We are actually doing the work, as opposed to supervising,” Clouse explained. “It really picked up in the last couple of years.” Company-wide North Shore has around 90 to 100 full-time employees, hiring summer students regularly for vegetation management and other seasonal work.

Their work area in Saskatchewan ranges from Kindersley to Shaunavon, as well as southeast and southwest Saskatchewan.

They also do some mainline pipeline work which runs through Alberta, across Saskatchewan, and into Manitoba.

One of North Shore’s specialties, indeed their bread and butter, is reme-

diation and reclamation of abandoned oil and gas well sites. That’s the subject that’s been getting increasing attention across the industry of late.

Clouse said, “One of our biggest clients is the Ministry of Energy and Resources. We do subsurface audits of old, abandoned sites as well as reclamation programs under the Orphan Well Program.”

When it comes to whether or not to abandon a well, he noted that a lot depends on political decisions and on other considerations. If oil were to go back up to US$100 per barrel, then wells that are uneconomic now could be useful again and feasible to redevelop.

“I see it as more and more wells are being aban-

doned,” he said.

Clouse said their general philosophy is this: “We take pride in going above and beyond for our clients, doing the right thing while keeping prices low.”

Future plans for North Shore include servicing new industries. Clouse said, “I think we have an opportunity to break into the mining sector in Saskatchewan by utilizing some of our company experience with oil sands exploration developments. We’re a new player here and relatively small, so it’ll take some time.”

He said there are many overlapping and transferable services from the oil sector to mining. This includes things like regulatory permitting, groundwater monitoring, and greenhouse gas reporting.

Weyburn – Electric submersible pump maker Novomet Canada Limited has entered the southeast Saskatchewan market, according to Brendon Billings, business development manager for Saskatchewan.

“We have substantially different technology and applicability,” he said on Aug. 12. “The artificial lift industry, as a whole, has struggled to keep up with some of the newer drilling technologies, with the extended-reach horizontals and multilaterals, and particularly with production liners installed as opposed to open hole,” he said.

Additionally, electric submersible pumps, also known as ESPs, generally won’t go through a tight build section, and as a result, are placed higher up in the well. “Conventional ESP

applications can sometimes get to the liner top, and that’s it,” he said. That can be at times several hundred metres above the horizontal portion, the paid for production that you aren’t completely capturing.”

It’s something like having a short straw in a deep drink.

Typical or conventional ESP offerings are limited in how small they can be in diameter, he explained. Alternatively, rod-driven pumps while they can be run deeper end up with high wear deflection in the rods. That results in lost efficiency and volume, and often intervention to fix repair rods or tubing, even thought the pump may still be fine.

To that end, Billings said Novomet, offers a “super slimline” ESP. Three sizes are 2.17 inch, 2.72

inch and 3.19 inch in outside diameter. These slimline pumps range from 10 -550 cubic metres per day, are very flexible and can be run inside liners and or even tubing for dramatic production improvement, he noted.

Novomet’s Power Save product is another technology leap forward, he said, adding it combines permanent magnet motors with these pump designs and offers a very quantifiable energy savings in the range of 30 per cent. He said this is case study supported.

Novomet is a long-term well-established manufacturer based in Perm, Russia, he said, with about 6,000 employees. They produce about 700 units a month, on average, and are in 23 countries around the world. They have the full compliment including surface equipment.

Jessie Berzins and Joey Woehleke are conducting a continuous emissions monitoring system (CEMS) audit and an air monitoring directive (AMD) audit. Photo sumbitted He added, “Maybe some municipal work would be nice.”

To that end, they are putting in a request for

proposal for some regional landfill assessments. Other areas could be commercial Phase I and II Environmental Site Assessments,

underground storage tank decommissioning, vegetation management, as well as agricultural drainage and water conservation advising.

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“We’ve been in Canada three years. We’ve had three years to prove ourselves and our claims, and the industry is really embracing the technology” he said.

“We’re in the Bakken, Cardium, Viking and Montney.”

Right now they’re running two units along the border in the Torquay area, another three near Stoughton, and at Minton. “We’ve got a bunch running in Alberta,” Billings said.

“We have conventional ESPs to fit any conventional ESP application as well,” he said.

He noted their products are neither the “same

A Novomet VFD on site. Photo submitted as” other competitors, nor are they “us too.” Novomet technology really is a paradigm shift in the world of oil production, according to Billings.

“We will have a local

operation set up in the next month or so,” he said. “It was not in our plan until 2020, but we advanced this due to much quicker growth in business than originally expected.”

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PIPELINE NEWS September 2019

Quality Wireline runs three slickline units

By Brian Zinchuk Estevan – Perhaps a change in government will result in things picking up?

That’s the hope of Chris Ball, operations manager of Estevanbased Quality Wireline Services Ltd. “We are specifically slickline. The difference is we have a thin stainless steel line which we run

tools on,” said Ball, on Aug. 22.

At the end of that long wire they run a series of mechanical tools like tubing plugs, mechanical tubing perforators, gauge ring runs and the like.

“We also run pressure and temperature recorders,” he said.

This are electronic gauges that store its data in memory, as opposed to

sending data down the line.

“We run tools in, sit on bottom for one to two hours, then we make stops on the way out,” he said.

There’s one simple maxim that applies here.

You can’t push on a rope.

“We rely on gravity. We can’t push it down,” he said.

The wire they use is

Quality Wireline runs three slickline units out of Estevan. Chris Ball is operations manager. Photo by Brian Zinchuk

2.74 mm thick. While a thicker braided wirelines can push a bit, their slickline cannot.

“We have about 6,500 metres on the truck. We cut off about 10 metres every job,” he said, explaining that is to ensure fatigue does not become an issue, and you end up fishing for the tool.

But fishing is one of their capabilities, to a

point. While a slickline isn’t going to be able to pull a rod string, it can be used to retrieve smaller fish downhole. Quality has some tools to that end.

(The Schlumberger oilfield glossary refers to “fish” as “anything left in a wellbore.”)

Their line is cable of about 1,600 pounds of pull. It runs through a

30-foot lubricator which is positioned above the wellhead.

“We have hydraulic jars at the end. There’s a lot of banging involved,” he said of one application.

Asked how business is going, Ball replied, “Right now, it’s hit and miss. We’ll be busy one month and not the next.”

It’s been like that for ► Page A21

Chris Ball holds up a mechanical perforator which can punch a hole in the side of tubing by pulling up on it. Photo by Brian Zinchuk

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Tervita meets $45 million Newalta synergies target a year ahead of schedule

Tervita’s merger with Newalta has meant a lot of synergies. This Newalta location at Halbrite is bearing a new sign these days. Photo by Brian Zinchuk

By Deborah Jaremko Daily Oil Bulletin Calgary-based waste processing and environmental services company Tervita says it is well ahead of schedule real-

izing the benefits of its merger last year with competitor Newalta.

The deal, which closed in July 2018, launched the previously privately-traded Tervita

on the Toronto Stock Exchange.

The company has locations at Alida, Halbrite and Lomond in southeast Saskatchewan, as well as 13 other locations

"Quality Mike's" impact still felt ◄ Page A20 a few years now.

Their work is mostly on the service side, but they do some work related to drilling.

“We have three slickline trucks and one fiveton picker,” Ball said. He’s been with the company 15 years. It was established Sept. 11, 2000.

While a lot of people in the patch start as a rough neck, Ball said, “I was a bartender at the Taphouse.”

He got to know the owner, Mike Muir, and was hired. Muir passed away Dec. 10, 2014. Ball said he was well known around the community as “Quality Mike.”

“I’m still learning all the time, and I had one of the best teachers with Mike,” Ball said.

Quality employs six people including the current owners, Cynthia Muir and D.J. Hamelin, Mike Muir’s sister and daughter, respectively.

“We were up to about 13 staff during the boom,” Ball said.

That 50 per cent re-

duction in staffing is consistent with the broad trend Pipeline News has observed in most oilfield services companies in the region compared to 2014 levels.

Their operating radius is generally within a three-hour drive of Estevan, on the Canadian side of the border. They do go as far as Shaunavon to the west, and Virden, Manitoba, to the east, but most of the work is in southeast Saskatchewan.

A typical job will see them about four hours from shop-to-shop, with two to three hours on location. But there are jobs that will take all day, where they punch a hole, sit and wait.

Asked about the rest of 2019, Ball expects it will be about the same, hit and miss. “We as well as others are looking forward to what happens in this federal election,” he said.

He’s pretty blunt about wanting a change in government in the upcoming October election.

Ball drove one of their

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units in the convoy that rolled through Estevan in late December last year.

“There’s people quite upset about that’s going on in this country and how unfairly we’ve been treated,” he said.

throughout Saskatchewan.

The company said at the time it expected to find up to $45 million in annual synergies within two years, with associated one-time costs of $15 million to $20 million.

Tervita announced on August 1 that it has already met that $45 million goal.

“The company expects $44 million to be realized in 2019 and believes it can now achieve at least $46 million on

an annualized basis. This is particularly impressive in consideration of the significant deterioration in the WCSB oilfield services activity environment since the Newalta deal closed in July 2018,” GMP FirstEnergy analyst Ian Gillies wrote in a research note this week.

The cost to execute these synergies is now expected to be $24 million, he added.

Tervita continues to see a project pipeline of $200 million to $300 mil-

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lion of near to medium term organic growth opportunities, largely composed of water disposal in the Montney/Duvernay regions and storage/ blending opportunities at existing facilities, Gillies said.

In June the company announced a contract with an unnamed senior producer to develop a water disposal network in the Montney play, which Gillies estimated will carry a capital cost of $25 million to $30 million.

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sands while the project was reviewed, yet again.

Here is Anderson’s statement, verbatim: This is a pivotal moment for Trans Mountain, proud and gratifying at the same time.

After seven years of consultation, design, study and planning, we have restarted construction on our Expansion Project. There’s no doubt it has been a long road, fraught with ups and downs and a fair share of debate. But it’s also been a time of great progress, compromise, reflection and ingenuity. By almost every measure, our project is stronger, safer and more inclusive than it was when we started.

Many thousands of Canadians have taken the time to study our plans and offer comments and suggestions. We listened to you, we learned from you and we will keep connecting with you now and into the future. Whether we have seen eye-to-eye or not, these conversations have helped us build a better Project and it’s why we are confident that it will meet every standard, every regulation and reflect the values and priorities of Canadians.

As a country, we debated “if ” the project should proceed, but now is the time for talking about “how” we’re going to do it. It’s time to get pipe in the ground. It’s time to begin delivering the jobs, economic benefits, and environmental and safety enhancements to com-

munities along the pipeline route. It’s time to get Canadians working and for the thousands of hardworking men and women, dozens of communities and Indigenous groups, and countless small businesses to begin reaping the benefits and sharing in the prosperity.

Over the past many months, our project has continued to evolve, and the extensive Crown-led Indigenous consultations and marine environment review recommendations have made our plans better.

We have developed meticulous measures to protect the health of communities and ecosystems, and ensure Indigenous groups are able to harness the economic value in a way that creates a lasting legacy for their people.

But for all the progress we have achieved, we know it’s not enough. There is more work to do and we will continue to carry out that work with the same level of dedication, attention and thoughtfulness that has been at the heart of every discussion we’ve had since we first proposed this expansion.

We have begun a new chapter for Trans Mountain. One where we will fulfill commitments such as our Mutual Benefits Agreements and opportunities for Indigenous groups, as well as contributions for communities along the pipeline through Community Benefits Agreements for local projects. We will complete our

$150 million investment into Western Canada Marine Response Corporation to implement British Columbia’s largest-ever expansion of spill response personnel and equipment, including eight new response bases, vessels and more than 130 new employees. And, we will implement innovative technology and safety features that will set a new standard in pipeline protection, such as fiber optic sensors to support preventative pipeline leak detection.

And once in service, the project will help deliver direct and lasting benefits to many more Canadians through additional revenues for all levels of government, as well as through annual payments to the Province of BC for the Clean Communities program for local, environmental projects. But inservice is still a few steps away.

Today, we are celebrating the milestone of getting ‘boots on the ground’ in BC and thanking those who have taken part in the process to get us here.

That includes our Shippers, who remain committed and have stood beside us through the entire journey.

It’s now time to focus on the incredible engineering feats and scientific achievements our team will carry out over the next couple of years and realize the tangible benefits that will come as a result. We’re eager to move forward and we’re excited to get this project built.

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PIPELINE NEWS September 2019

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Never seen a government with this intended ill will against one half of the country

By Brian Zinchuk Regina – Blair Stewart, founder and former CEO of Stewart Southern Railway, was one of the organizers of the Regina Rally Against the Carbon Tax. One of the points of that rally, and the associated convoy, was to fight Bill C-48. A month after the rally, Steward testified before the Senate Transport and Communications Committee in Regina on May 1, as part of their travelling hearings into Bill C-48, the Oil Tanker Moratorium Act. On May 15, the committee voted against the act, but by June 21 the full Senate had passed the bill and it became law.

Here is Stewart’s opening statement, verbatim: Good afternoon, ladies and gentlemen, thanks for your time. When I first heard of Bill C-48 from the media and the federal government the description I heard was a tanker ban for oil and dangerous goods.

The question for the panel is whether this is true or false.

I think the correct answer is false, as only certain products listed in Bill C-48 are banned.

The ones that are banned are marine diesel, synthetic crude, lubricating oil, dilbit and bitumen.

Why do you not see LNG? Maybe the answer is that the coastal gas link pipeline approved in October 2018 runs from Dawson Creek and Kitimat, B.C. — I think we know what was going to go in it at Kitimat. The bill will allow LNG to travel on tankers over the same waters that are restricted for certain types of oil on the Northern Gateway Project.

This kind of politics, which I might add goes with no scientific facts, restricts three Prairie provinces in developing their own natural resources, which are effectively landlocked, and leaves them with heav-

ily discounted oil reserves.

This very divisive bill goes against the best interests of many First Nation communities, as well as many other communities along the road.

This bill also sows great division between Western provinces and Eastern provinces. How do you think the people of Manitoba, Saskatchewan, Alberta and B.C. think about this bill when they watch the flow of oil in tankers come up the St. Lawrence River, unload at the Irving refinery on the Atlantic Ocean?

This is oil coming in from Saudi Arabia, $10 million a day, Iraq, North Africa, and Norway, which are not regulated by any such divisive bill as Bill C-48 and Bill C-69. Are these tankers all double-hulled like they were mandated to be on the West Coast? Where is the outcry for the coastal protection and the waterways on the East Coast, like there is on the West Coast?

I believe a reason is that the environmentalists and the government hide behind the protection of the coastal water on the West Coast, but seem to ignore the East Coast.

Really, the federal government in my eyes picks winners and losers. It chooses where tankers can travel, what oceans they can travel, what seaways they can travel. 1,500 U.S. ships travel from Alaska, drop off oil at Washington, Oregon, California weekly, with tankers full of oil that is restricted in Bill C-48, plus cruise ships and cargo ships, which I would argue have probably caused more coastal damage than tankers, especially the cargo ships.

I ask you, is this bill fair to all Canadians? Does the federal government really believe Western Canadians are unschooled

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on the world? Do they really believe we don’t understand what Bill C-48 and Bill C-69 have done to Western Canada? If they do, I’m here to tell them they’re incorrect.

Western Canadian people are highly educated, hard workers, very, very generous and highly entrepreneurial, and please never underestimate our resolve.

As a Saskatchewan boy and

a Canadian that has been in business for over 45 years, I’ve never seen in my life a government with this intended ill will against one half of the country.

Do we live in a nation that has one standard for the East and one for the West? Senators, I hope you will think about this.

In closing, when you return, I want you to ask the federal government three

questions for me. One, why have we heard over the last four months about the loss of a possible 7,000 jobs in Quebec and Ontario? Nobody wants to lose their job, I agree, but I have never heard anybody come to the podium and talk about the 100,000 jobs that were lost in the West. Not once have I heard the prime minister address that.

Two, why has the Prime

Minister not addressed the $100 billion — yes, 100 billion — investment lost in the energy sector in the West in the last two years?

One hundred billion is a lot of money.

Third, why would the PM and the government try to pass Bill C-48 and Bill C-69 and then go out and buy a pipeline?

Thank you for your time.

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PIPELINE NEWS September 2019