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2014 Drilling Activity Forecast PTI Group connects with First nations t H E O F F i C i A L V O i C E O F t H E P E t r O L E U M S E r V i C E S A S S O C i At i O n O F C A n A D A
Enform brings oil and gas industry together on safety
PM#40020055
Ditch Hitch helps out in the field
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Passing the baton Managing succession You’re proud – and rightly so - of what you’ve achieved. You’ve led the way. Now it’s time for others. Whether it’s the handover to the next generation, or a sale to new owners, you want a smooth transition and you want to maximize value. KPMG’s Corporate Finance network is the global leader in mid-market M&A transactions.* Together with KPMG’s powerful network of tax, transaction and accounting advisors, we will help you close the deal and secure the future.
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Rhys Renouf Managing Director, KPMG Corporate Finance 403-691-8426 rrenouf@kpmg.ca
Deb MacPherson Partner, KPMG Enterprise, Tax 403-691-8567 dmacpherson@kpmg.ca
Alex Henderson Partner, Transaction Services 403-691-8140 alexanderhenderson@kpmg.ca
*Source: Thomson Reuters SDC; mid-market transactions (under $1 billion - USD) © 2013 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
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CONTENTS WintER 2013
Departments MESSAGE fROM thE ChAiR in thE fiELd
6 9
News, notes and events from the industry
2014 dRiLLinG ACtiVity fORECASt
11
Expect a spring surge
BuSinESS MAttERS
18
Practical tool for vehicle recovery has become an industry lifesaver
13
Features SAfE And SOund Enform brings the oil and gas industry together on safety ON THE COVER: Left to right: Gary Leach, EPAC; Mark Salkeld, PSAC; Cameron MacGillivray, EnfORM; Brenda Kenny, CEPA; and david Collyer, CAPP
20
22
Advocacy initiatives from PSAC
MEMBER PROfiLE
22
24
PTI Group forges partnerships with First Nations, gaining workers
A LOOK At LEAdERShiP
COVER
13
PSAC in ACtiOn
26
Introducing the 2013-14 PSAC Board of Directors
18
PSAC nEWS AGM highlights; 2013 Insights Forum
20 24
WWW.PSAC.CA
MESSAGE From the chAir New Three-Year Strategic Plan on the Horizon
W
hAt An honour it is to Begin my
term as the Chair of Petroleum Services Association of Canada (PSAC) for the coming year. I have had the pleasure of serving on PSAC’s board for many years, and previously took on the role as committee chair of the STARS and Spurs Gala presented by PSAC, setting a record for the event. John Gorman, PsAc Board chair As incoming chair, I look forward to supporting the board and PSAC staff in the pursuit and execution of the new three-year strategic plan. The strategic plan was developed earlier this year and will guide the efforts of the association as it champions the interests of its nearly 260 member companies across four core pillars: health and safety; human capital; innovation, competitiveness and productivity; and knowledge leadership. These pillars will be underscored by advocacy and growth as the association continues to expand the awareness of the issues our members face and to find solutions that will support our members’ business success. PSAC’s membership has many opportunities and challenges that lie ahead that will require a strong and collective voice. The level of public interest in the operations of Canada’s oil and gas industry is unprecedented, and requires us to seek ways to engage the public in meaningful and productive discussions about the role of our industry in their day-to-day lives. In addition to the economic benefits all Canadians receive from sustainable activity in Canada’s oil patch, our ongoing and shared responsibility will be to further our efforts to help people better understand how we do what we do and the mitigation of risk to health, safety and the environment because of the technological expertise we proudly boast and the world class regulatory regime within which we operate. In the spirit of increasing dialogue and the transparency into our operations, PSAC launched the Working Energy Commitment this year, a program dedicated to opening up the lines of communications with local communities and key stakeholders. PSAC members who perform hydraulic fracturing are leading the program and were pleased to launch the PSAC Hydraulic Fracturing Code of Conduct a few weeks ago. The Code of Conduct was informed by the input received through a series of community engagement sessions organized by PSAC in seven regions across western Canada. Those sessions brought PSAC in touch with more than 100 community members and stakeholders, including landowners, local government, environmental groups and business associations. The Code of Conduct touches on five key areas: water and the environment; fracturing fluid disclosure; technology development; health, safety and training; and community engagement. The Code outlines the commitment of PSAC Members who perform hydraulic fracturing to sound technical performance and to continuous improvement in all areas of their operations. The Code of Conduct will remain a living document, and will grow to include service sector commitments aimed at improving the operational, environmental and social performance of this critical sector of Canada’s oil and gas industry. To read the Code of Conduct and to find out more about the Working Energy Commitment, visit workingenergy.ca. I personally look forward to the year ahead and delivering what our members need to achieve their goals.
John Gorman PSAC Board Chair
winter 2013
Petroleum services news
WINTER 2013 VOL 13 • No.3 The Petroleum Services Association of Canada is the national trade association representing the service, supply and manufacturing sectors within the upstream petroleum industry. PSAC represents a diverse range of nearly 260 member companies, employing close to 80,000 people and contracting almost exclusively to oil and gas exploration and production companies. PETROLEUM SERVICES ASSOCIATION OF CANADA 1150 800 6TH AVENUE SW CALGARY, AB T2P 3G3 TEL: 403.264.4195 FAX: 403.263. 1 4 PRESIDENT AND CEO: MARK SALKELD VICE PRESIDENT, COMMUNICATIONS: KELLY MORRISON COMMUNICATIONS COORDINATOR: LINDA ALDRIDGE
You Gotta See thiS FrackinG thinG!
PETROLEUM SERVICES NEWS IS PUBLISHED FOR PSAC BY VENTURE PUBLISHING INC. 10259-105 STREET, EDMONTON, AB T5J 1E3 TEL: 80.990.0839 FAX: 80.425.4921 TOLL-FREE: 1.866.22 .42 6 CIRCULATION@VENTUREPUBLISHING.CA PUBLISHER: RUTH KELLY DIRECTOR OF CUSTOM CONTENT: MIFI PURVIS MANAGING EDITOR: SHELLEY WILLIAMSON CONTRIBUTING WRITERS: ROBIN BRUNET, MATT HIRJI LISA RICCIOTTI ART DIRECTOR: CHARLES BURKE ASSOCIATE ART DIRECTOR: ANDREA DEBOER ASSISTANT ART DIRECTOR: COLIN SPENCE PRODUCTION MANAGER: BETTY FENIAK SMITH PRODUCTION TECHNICIANS: BRENT FELZIEN, BRANDON HOOVER DISTRIBUTION: KAREN REILLY ACCOUNT EXECUTIVES: PEGGY BOGDAN, KATHY KELLEY, DENNIS McCORMACK, RACHELLE WATTS
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IN THE FIELD
News, events and activities in the industry
Slickline Services Congratulations Are in Order Gets Designated In AddITIon To THE PSAC rEgulAr mEmbEr SCHolArSHIPS In SEPTEmbEr 2013,
the Government of Alberta under its Apprenticeship and Industry Training Act recognized Slickline Services as a designated occupation. This designation gives workers the opportunity to obtain a provincial certification in the occupation. The scope of work of this occupation involves the use of slickline, specialty line or braided line in conjunction with operation-specific tools to perform completion, production and abandonment operations for the life cycle of a well bore. For more information on the occupation, apprenticeship and industry training programs, please visit www.tradesecrets.alberta.ca.
and the PSAC Roger Soucy Legacy Scholarship Funded by KPMG, the PSAC Education Fund provides scholarships for Canadian students pursuing post-secondary education in petroleum-related or trades programs in five Western Canadian colleges. These colleges include Keyano College, Northern Alberta Institute of Technology (NAIT), Northern Lights College (NLC), Southern Alberta Institute of Technology (SAIT), and Saskatchewan Institute of Applied Science and Technology (SIAST).
2013 Technical School Scholarship Recipients NAIT Elmer Half, Petroleum Engineering Program Marshal Reimer, Heavy Equipment Technician Program Jordan Sedgwick, CNC Machinist Program
NORTHERN LIGHTS COLLEGE Joe Courtoreille, Welding Level C Kyle Laursen, Welding Kyle Moran, Welding Level C Austen Thompson, Heavy Duty/Commercial Transport SAIT Andrew McElroy, Petroleum Technology Program Spencer Mallow, Equipment Technician Program Travis Chipping, Power and Process Operations Program
COMING EVENTS STARS & SPURS GALA PRESENTED BY PSAC January 25, 2014 BMO Centre, Stampede Park Calgary, Alberta For more information, visit www.stars.ca PSAC 2014 SPRING CONFERENCE April 8 & 9, 2014 Sheraton Red Deer Hotel Red Deer, Alberta
WWW.PSAC.CA
SIAST Cheryl Arcand, Truck and Transport Mechanic Philippe Belanger, Welding Robin Free, Truck and Transport Mechanic Michael Harvey, Heavy Duty Equipment Mechanic Cody Istace, Welding Tim Mansuy, Heavy Duty Equipment Mechanic James Young, Welding
NEw MEMBERS PSAC MID-YEAR LUNCHEON April 2014 Calgary, Alberta
REGULAR MEMBERS Red Hawk Pressure Testers Ltd. TAM International Oil Services Ltd.
PSAC EDUCATION FUND GOLF CLASSIC July 17, 2014 Calgary, Alberta
ASSOCIATE MEMBERS AssetWorks ICICI Bank Canada Invest NB KR DrillGear Oilfield Solutions
For more information about PSAC events, visit www.psac.ca/events
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DRILLING ACTIVITY FORECAST
Spring Surge PSAC ExPECTS A CoNSTANT PACE of oIl PATCh ACTIVITY IN 2014 2014 CANADIAN DRILLING ACTIVITY FORECAST (NUMBER OF WELLS)
ALBERTA: 6,555
SASKATCHEWAN: 3,196
BRITISH COLUMBIA: 550
MANITOBA: 480
TOTAL IN CANADA: 10,800 Note: Total includes activity in Northern and Eastern Canada.
T
hE 2014 Canadian Drilling Activity Forecast, released
on October 30 by the Petroleum Services Association of Canada (PSAC), forecasts a total of 10,800 wells drilled (rig releases) across Canada for the coming year. This assessment represents a 1.5 per cent decrease compared to the expected final tally of 10,960 wells drilled (rig releases) for 2013. “Although we expect fewer wells to be drilled in the coming year, these numbers do not tell the entire story about 2014 drilling activity levels,” says Mark Salkeld, president and CEO of PSAC. “The first quarter will see a typical ramp up of activity, and of course, slower activities in the spring with breakup. We do, however, expect increased activity over last year during the spring breakup period thanks to improved technologies and better access to multi-well pad locations with the construction of permanent roads to those sites.” In the final two quarters, depending on the weather, PSAC expects steady activity to balance out the year. PSAC is basing its 2014 Forecast on average natural gas price of CDN$3.50/mcf (AECO) and crude oil price of US $95/barrel (WTI). “We are slightly optimistic about natural gas prices for the year ahead
WWW.PSAC.CA
and, therefore, expect little change in next year’s drilling levels for natural gas,” says Salkeld. On a provincial basis for 2014, PSAC estimates 6,555 wells to be drilled in Alberta, representing a decrease of less than one per cent in the province compared to last year. Manitoba is expected to see a 7.7 per cent decrease of activity with 480 wells, while British Columbia is forecasted to drill 550 wells, representing a 2.2 per cent increase over 2013. In Saskatchewan, drilling activity is expected to see 3.5 per cent decrease with an estimated 3,196 wells to be drilled in the year ahead. “In 2014 we are expecting to see the continued focus on drilling for oil using complex completion processes,” noted Salkeld. “Other factors that are likely to impact next year’s activity include increased confidence related to market diversification and access to those markets, access to capital, continued interest from foreign investors, and recruitment of the skilled labour required to complete projects in a safe and timely manner.” The Canadian Drilling Activity Forecast can be used with the PSAC Well Cost Study to effectively determine potential drilling and completion market sizes, as well as pricing and activity direction.
11
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Safe Sound aNd
by ROBIN BRuNet
Industry comes together on safety issues in the oilpatch WWW.PSAC.CA
A
S the oIl And gAS
industry’s strongest safety advocate, Enform is constantly looking for ways to improve safety orientation and training, whether it be promoting a culture of safety or bringing groups together to discuss specific issues. But of late, two topics have shown up on the organization’s radar. One pertains to orientation and training and has been a growing concern for providers: redundancy. “The one thing companies can’t afford to do is waste time and resources when it comes to teaching their workforce basic standards,” explains Cameron MacGillivray, Enform’s president and CEO. “But because so many of them are choosing their own way to meet occupational health and safety
13
enform enlisted industry experts to design the content of a new safety training video.
requirements, redundancy has become a problem – to the point where upper management has become very worried about it.” Enform’s leadership team agreed there should be a single standard that governs orientation procedures. But what is the best way to make it accessible and easy? “We hit on the idea of creating a video, and from there everything else fell into place,” says MacGillivray. Enform’s eGSO (electronic general safety orientation) is a free online general safety orientation video designed to support existing new worker orientation programs. The 30-minute video meets industry general safety orientation requirements and was developed specifically for the new, young workforce entering the upstream oil and gas industry. Since the video was only made available earlier this year, McGillivray says it’s too early to determine to what degree its content will help young workers – and how beneficial eGSO will ultimately be in reducing injuries and downtime in the oil and gas sector. “However, industry leaders have conceded that this is the way to go to make orientation as efficient as possible, and we definitely think we’re on the right track,” he says. Enform enlisted industry experts to design eGSO’s content, which includes the minimum occupational health and safety information that all employers are required to provide to their new, young, inexperienced
workers upon hire or transfer. Since it was conceived as an awareness product, the video doesn’t contain a learning test – but companies can create their own exams if desired. The video is mandatory viewing for all new employees, and in September of this year an announcement was made by all six petroleum industry associations that, beginning in June 2014, an eGSO Record of Completion from Enform will be required as evidence of a worker’s completion of the safety orientation (this will apply to both new and existing workers). The expectation amongst the industry associations and Enform is once a user completes the program, he or she can immediately print out a Record of Completion – and that this record will help reduce the repetition of general safety orientations as workers transfer or move between work sites within the industry. “This method of providing orientation and follow-through is unique to our western Canadian environment,”
“we’ll encourage our members to imPlement fatigue risk management initiatives, Plus we’ll measure, review and continually imProve on our Processes.”
14 winter 2013
Petroleum services news
INSURANCE EXPERTS for the oil & gas sector
Providing insurance solutions says McGillivray. Nobody could be more satisfied with the new video than PSAC president Mark Salkeld. “Prior to its creation, it wasn’t uncommon to have crews undergo 20 or even 30 safety orientations, depending on the number of customers they were involved with,” he says. “It was a nightmare in terms of wasted time – plus, it was expensive. And the most frustrating thing was that all these different orientations had pretty much the same content. Now, finally, the orientation process will be radically sped up without sacrificing any quality of information.” The other topic that has shown up on Enform’s radar is fatigue, a long-standing problem for the transportation industry but entirely new (in terms of examining and quantifying its hazards) to the oil and gas sector. Ian Whyte, chair of the fatigue management committee, and EHS team leader, North American Onshore Exploration and Production, for Suncor Energy, says the main driver for forming the Enform committee was a North American Fatigue Management Program rolled out earlier in 2013. (The NAFMP is a voluntary, fully interactive web-based educational and training program developed to provide both truck and bus commercial vehicle drivers and carriers and others in the supply chain, with an awareness of the factors contributing to fatigue and its impact on performance). “I think it’s a huge issue; so does Enform, hence our effort to shine some light on the topic,” he says. Brent Harrison, a committee member and vice-president of Environmental Health and Safety for Encana, agrees. “We deal with
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1,900 different companies ranging from tiny firms to large corporations and, while many of them have comprehensive ways of dealing with the problem, many others have no idea that fatigue is in fact a risk to safety and productivity,” he says. The main task facing Whyte and colleagues is gathering data to determine just how much of a problem fatigue is in the oil and gas sector. “This, of course, has been undertaken to a forensic degree in the trucking industry, but unfortunately when an accident occurs in our sector we haven’t bothered to ask things like ‘How much sleep did you get last night?’ ” he says. “That entire line of questioning hasn’t been pursued.” One country where workplace fatigue has been studied scrupulously is Australia, to the point where the Government of Queensland earlier this year discussed its implications in an article on its website. The article defines fatigue as “mental or physical exhaustion that stops a person from being able to function normally. However, fatigue is more than just feeling tired or drowsy – it is normal to become tired through physical or mental effort.” The article states that “people who are fatigued are unable to gauge their own level of impairment, and are unaware that they are not functioning as well or as safely as they would be if they were not fatigued. Performance levels drop as work periods become longer and sleep loss increases. Staying awake for 17 hours has the same effect on performance as having a blood alcohol content of 0.05 per cent. Staying awake for 21 hours is equivalent to a blood alcohol content of 0.1 per cent.” To date, Whyte’s committee has developed Fatigue Risk Management Guiding Principles that have been endorsed by all six petroleum industry associations. “We, the associations of the upstream oil and gas industry, recognize that fatigue is an industry issue and acknowledge that it has the potential to impact all aspects of our operations,” the principles read. “Successfully managing the risks associated with fatigue is a shared responsibility among all industry stakeholders.” To meet this responsibility, an integrated, risk-based approach to manage fatigue will be pursued as well as the development of fatigue risk management initiatives founded upon scientific knowledge and combined with operational experience. “We’ll encourage our members to implement
16 winter 2013
fatigue risk management initiatives, plus we’ll measure, review and continually improve on our processes,” says Whyte. Whyte adds that as hard data is gathered about the prevalence of fatigue in the oil and gas sector, the resulting initiatives “will not likely affect the GSO. Instead, an entirely separate set of tools will be developed – and perhaps instructional videos.” Harrison agrees, saying “The foundation for all of our initiatives will be building relationships and maintaining good communications with our colleagues in the field.” For now, Whyte wants his members to start talking about fatigue, ask their employees questions. “The more we understand the problem, the better our guidelines will be,” he says. Salkeld applauds these efforts. “The Guiding Principles are very welcome and long overdue: fatigue has been a safety problem for years, even for people working regular shifts – because the nature of the work is very demanding and physical. The majority of fatigue-related incidents have occurred while someone is either driving from or to a work camp. If we can tackle this problem effectively, it’ll be quite an achievement as well as a distinct benefit to our industry.”
The Group of Six The organizations that signed off on the eGSO and in agreement of the Fatigue Risk Management Guiding Principles, also form Enform’s Board of Directors: • The Canadian Association of Geophysical Contractors (CAGC) • The Canadian Association of Oilwell Drilling Contractors (CAODC) • The Canadian Association of Petroleum Producers (CAPP) • The Canadian Energy Pipeline Association (CEPA) • The Explorers and Producers Association of Canada (EPAC) • The Petroleum Services Association of Canada (PSAC)
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HOWDY Yâ&#x20AC;&#x2122;ALL
Dust off your hat, polish your boots and wear your best western attire! Itâ&#x20AC;&#x2122;s time again to join us for a fun-filled evening at one of Calgaryâ&#x20AC;&#x2122;s premiere events.
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BUsiNEss matters Photo courtesy Ditch hitch
The Wheel Deal a Practical tool for vehicle recovery has become a lifesaver and injury Preventer for oil and gas workers and truckers worldwide by Lisa Ricciotti
I
f there’s one universal truth
that Calgarybased Vern Sparkes has encountered during his 20 years working around the globe as an oilfield safety consultant, it’s this: trucks get stuck. Somewhere in the oil sands of northern Alberta, the American shale oil formations in the Bakken and Eagle Ford, or the reserves of Saudi Arabia and Yemen, Kazakhstan and Russia, some ill-fated oil patch truck is stuck in a snow bank, sliding off an icy road, spun out in the sand or bogged down in a mudhole. And inside, the hapless driver is wondering, “Now what?” For years Sparkes addressed that question at safety orientations for employees and contractors of major energy companies. He’d warn that tow straps, chains and cables can snap under the strain and become deadly metal missiles. Or, if recovery straps are attached to bumpers, ball hitches or tie-down eyes rather than proper recovery points, the stress of towing can literally rip them off, sending them flying through windshields or clean through a vehicle. “I’d tell them you can’t use chains. You can’t use slings with tail chains, tow ropes with hooks, shackles, trailer balls, pintle hitches or the hooks on the front of your truck. I’d name them all off,” says Sparkes, describing his usual safety spiel. Then about 10 years ago at a safety session a participant challenged Sparkes’s do-not-use list and demanded a realistic alternative. “He’d stayed behind just to talk to me and I could see he was angry and agitated. ‘So what’s left?’ he asked me. ‘What can we use?’ ” Sparkes had to admit he didn’t know, but often the standard company policy was to call a tow truck. “Well, he just lost it,” Sparkes remembers. “He didn’t think that was practical. ‘You’re the safety guy. You should have a solution!’ he yelled, then stomped out, slamming the door.” Sparkes realized the man had a valid point. There should be a safe, practical and easy-to-use system. He went back to his office, started thinking and by the end of the afternoon he had rough prototypes sketched out. “That was the day the Ditch Hitch was born,” says Sparkes. He found himself in new territory. He wanted a vehicle recovery system designed and engineered to withstand shock-load force – the sudden and intense stress that results when a tow driver “takes a run at it.” Most existing systems can handle the slow, steady pressure of a static pull on level ground, but as Sparkes notes, it usually takes more to get an oilfield truck unstuck. “Some energy companies have banned shock-loading by their drivers. But the reality is that you have to shock-load to get the vehicle out, and whether they admit it or not, everyone does it.” Sparkes’s big breakthrough in developing the Ditch Hitch came when he decided to switch from steel to aluminum. Everyone told him not to, that aluminum was too weak and wouldn’t work. “But me being Mr. Stubborn, I had to try it,” Sparkes says. Amazingly, the aluminum version proved to
18 winter 2013
be 15 per cent stronger than his steel model and the tested breaking strength increased from 58,000 pounds to 69,000 pounds. That’s equivalent to the weight of 14 half-ton pickup trucks or a fully-loaded cement truck. Aluminum also added other benefits. It’s light, so Sparkes was able to reduce the weight of his Ditch Hitch system from 28 pounds to a very portable 7.5 pounds. And unlike steel, the aluminum Ditch Hitch won’t snap in cold, which Sparkes proved by field-testing it at -55 C. Sparkes added other innovative features that put the Ditch Hitch in a class of its own. The extra-wide U-bar of the receiver is a solid unit, with no welds or seams to crack or break. It’s also designed to pivot a full 180 degrees on a specially engineered high-tensile corrosion-treated steel pin, which eliminates the hazards of side-loading. And it’s easy to attach, “nearly idiot-proof ” says Sparkes, and comes with a pre-job checklist to ensure safe operation. According to Sparkes, thousands of injuries are reported annually that occur during vehicle recovery and towing, on job sites and in recreational areas. He also has newspaper clippings and incident reports on fatalities, horrific and heartbreaking.
“some energy comPanies have banned shock-loading by their drivers. but the reality is that you have to shock-load to get the vehicle out, and whether they admit it or not, everyone does it.” – vern sparkes, oilfield safety consultant
One of them involved a 38-year-old volunteer firefighter who died three days after being struck in the forehead by a shackle on a tow rope. His fire truck became stuck in a soybean stubble field after he put out a grassfire and when a large tractor tried to pull him out, the tow rope broke. The shackle flew through the fire truck’s windshield and out the back window – while the firefighter was sitting in the driver’s seat. Sparkes has similar stories from the Alberta job sites of large energy companies, but fortunately, in these cases only windshields were smashed. “My mission is to save lives,” says Sparkes. “It’s why I created the Ditch Hitch, why I started this company. We now have over 12,000 units in use and there have been no incidents. I feel that’s potentially 12,000 lives saved. The Ditch Hitch is the only vehicle recovery product on the market certified as safe for shock-loading and it was evaluated by a professional engineer.” Many energy companies in Alberta agree and use the Ditch Hitch exclusively on their vehicles. Sparkes isn’t done innovating yet. Next he wants to create a smaller version, suitable for SUVs, quads and other ATVs. He already has it named – the Son of a Hitch. Of course.
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2013 Industry Insights Forum PSAC 2012-2013 longStAnding MeMberS 30 years Fmc technologies company 25 years mud master Drilling Fluid services ltd. nwP industries inc. oPsco energy industries 20 years Pason systems inc. PSAC CelebrAteS MileStoneS And releASeS HydrAuliC FrACturing Code oF ConduCt Without question the 2013 Industry Insights Forum is one for the record books. The full-day event – which took place in Calgary on October 30 – included the Petroleum Services Association of Canada’s (PSAC) Annual General Meeting, and the release of the 2014 Canadian Drilling Activity Forecast to a sold-out crowd. The day was kicked off with the release of PSAC’s Working Energy Commitment: Hydraulic Fracturing Code of Conduct which outlines standard practices for sound technical and environmental performance when fracturing a well, and defines mutual expectations for working with stakeholders. The release of the code followed six months of community engagement sessions with stakeholders across the western provinces to address increased public concern surrounding hydraulic fracturing operations. “Working closely with stakeholders and gathering their input is critical to building trust in oil and gas operations, and it’s with that input that we have created this code of conduct,” says Mark Salkeld, PSAC president and CEO. PSAC 2013 AnnuAl generAl Meeting At its 2013 AGM, PSAC celebrated the commitment and dedication of its volunteers with the presentation of its 2013 Distinguished Service Awards. PSAC also honoured retiring directors Ken Bagan, Mike Edmonds, and Lloyd Stewart and welcomed PSAC’s 2013-2014 board chair, John Gorman, and the new board of directors. Members also reviewed financial statements and celebrated the many achievements in the preceding year including the introduction of a new series of events, Canada’s Energy Technology Blueprint and PSAC’s Working Energy Commitment initiative.
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2014 CAnAdiAn drilling ACtivity ForeCASt And induStry outlook SeSSion Moderator and former PSAC chair, David Yager, hosted the session which included Martin Molyneaux of FirstEnergy, who delivered a comprehensive outlook for exploration and production sector. This was followed by the Oilfield Services Outlook given by Dana Benner, of AltaCorp Capital, which detailed the importance of drilling rig efficiency and the future increase demand for camp accommodations. David Daly delivered the outlook for the Canadian Association of Petroleum Producers (CAPP) and outlined opportunities for the Canadian oil and gas industry in the international marketplace. PSAC president and CEO Mark Salkeld gave the final presentation with his outline of the 2014 Canadian Drilling Activity Forecast which estimates a total of 10,800 rigs to be released across Canada next year. induStry inSigHtS dinner This year’s keynote speaker Bruce Anderson of Anderson Insight delivered a well-received presentation and provided great insight about Canadians perception of Canada’s oil and gas industry. His talk, based largely on research polls, focused on how Canada is a country of “yes.” He noted, “Canadians have a sense that if we can only get along, we can find common ground and solutions, which applies to finding a balance between economic progress and protecting the environment.” Anderson also commented that, “Canadians are pragmatic people who understand that fossil fuels are critical to their way of life, but they want resources developed as responsibly as possible.” To read more about PSAC’s year in review, please visit www.psac.ca.
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2012-2013 DiSTiNGUiSHED SERvicE AwARD REciPiENTS Tricia Mallet Angeline Arsenault Jeanne Miller Karoline Beninger Tamara Nelson Clyde Bonnell Brett Noble Sheri Brake Brian Paisley Debbie Charlton Grant Pilgrim Dawn Doucet Marty Price Richard Dunn Doug Smith Lee Emond Travis Strube Brian Farmer Julie Sullivan Aron Ferchuck Renee Vanderwolf Lisa Fraser Glenn Walker Coleen Hutton Sarah Whaley Garry Lane Ross Whelan Blake Lawrence Graham Maglio THANK YOU TO OUR GENEROUS SPONSORS
psaC in aCtion the Petroleum services AssociAtion of cAnAdA (PsAc) continues to keeP the services sector front And centre through AdvocAcy And outreAch
PSAC recently connected with officials in Saskatchewan including Premier Brad Wall, the Honourable Tim McMillan, Minister Responsible for Energy and Resources, and MLA Warren Steinley. PSAC will continue to work with officials on issues related to employment standards and PST in the province. inCreasing psaC’s profile with key audienCes and deCision makers
ConneCting with Community members: working energy Commitment update A critical part of PSAC’s Working Energy Commitment initiative is meeting with community members to listen to, and openly discuss, public concerns about oil and natural gas development. The Working Energy Commitment initiative is also designed to raise awareness of the efforts PSAC members put into mitigating the impact of their activities on local communities to ensure the safety of their workers and the general public, and showcase the services and technologies they provide. Since the launch of the program earlier this year, PSAC has met face-to-face with more than 70 community members in the three western provinces and will continue to meet with community members in B.C., Alberta, Saskatchewan and Manitoba. To gain further awareness and support of the Working Energy Commitment program, PSAC hosted 12 Members of Parliament from across Canada on a bus tour from Edmonton to Red Deer in September. The tour included a presentation en route which introduced PSAC, the services sector, the Working Energy Commitment and hydraulic fracturing. The tour included stops at two member companies’ facilities, where tour participants got the chance to see first-hand the technologies and equipment used in hydraulic fracturing and learn from subject matter experts about the process. PSAC also met with government officials to provide updates on the community engagement sessions in their jurisdictions including: Donna Kennedy-Glans, MLA, Calgary-Varsity and chair, Alberta Standing Committee on Resource Stewardship; B.C. Minister of Natural Gas Development Rich Coleman and Deputy Minister Steve Carr; and Blake Richards, MP, Wild Rose, Alberta. A meeting was also held with Ron Casey, MLA, Banff-Canmore-Cochrane, to address constituent concerns about hydraulic fracturing in his riding. offering solutions to address the labour shortage Recently, PSAC met with representatives from the Department of Citizenship and Immigration Canada to introduce PSAC, and discuss the impacts and possible solutions to the labour shortage affecting the petroleum services sector. In particular, PSAC brought forward examples of challenges member companies have met with obtaining work permits for potential employees. To further address the labour shortage, PSAC, as a member of ACALS (Alberta Coalition for Action on Labour Shortages), attended a roundtable discussing the future of the Temporary Foreign Worker program with the Honourable Jason Kenney, Minister of Employment and Social Development and Minister for Multiculturalism. Additionally, PSAC met with new representatives from the Temporary Foreign Worker Program, Employment and Social Development Canada to introduce PSAC, and the labour challenges members face including obtaining labour market opinions (LMOs).
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In the past quarter, PSAC attended a Business Council of British Columbia (BCBC) roundtable with Minister for the Federal Economic Development Initiative for Northern Ontario and President of the Treasury Board, Tony Clement. As a result of the meeting and discussion with other participants in attendance, PSAC has joined BCBC’s membership, as the organization is regularly sought out for input on economic and business issues affecting oilfield services companies in the province. PSAC also met with Minister Lynne Yelich, new Minister of State, Department of Foreign Affairs Trade and Development Canada (formerly DFAIT) to provide an overview of PSAC and its member companies. Late in the summer, PSAC attended the Oilmen’s Business Forum in Banff, Alberta, which provided the opportunity to discuss the services sector with Alberta Premier Alison Redford; the Honourable Ken Hughes, Energy Minister of Alberta; the Honourable Tim McMillan, Saskatchewan’s Minister Responsible for Energy and Resources; Gary Doer, Canada’s Ambassador to the U.S.; and Gary Mar, Alberta Trade Representative to Asia. PSAC attended the 2013 Energy and Mines Ministers’ Conference (EMMC) in Yellowknife, Northwest Territories. The EMMC is an annual event that brings together federal, provincial and territorial ministers to discuss priorities and opportunities for cooperation in developing Canada’s vast natural resources. During the event PSAC continued its efforts to build relationships with elected officials and increase the Association’s profile. In September, PSAC attended the Energy Council of Canada Summit focused on the development of a Canadian energy strategy featuring keynote speaker, Kathleen Wynn, the Premier of Ontario. Information gathered from the sessions will shape a report to Canadian premiers at the next Council of the Federation Meeting in 2014. advoCating for improved market aCCess PSAC recently took part in two roundtable discussions, the first with New Brunswick Premier David Alward to discuss the province’s oil and gas industry, and the second with the Honourable Edward Fast, Minister of International Trade, to discuss LNG and exports.
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Building Bridges Pti GrouP forGes PartnershiPs with first nations, GaininG workers alonG the way by Matthew hirji
P
laced Predominately on the
wall of Stephen Crocker’s office is a map detailing the location of every First Nations group in Western Canada. As the Director of Aboriginal Relations at PTI Group – an Edmonton-based company that designs, manufactures, installs and operates remote site accommodations for the resource industry – Crocker’s days are spent building alliances with, and creating employment opportunities for, aboriginal populations. The map in his office is a constant reminder of the importance of his work. “In my job, no two days are alike. It’s really interesting work. It’s like building a bridge,” says Crocker, speaking about the work that PTI has done to bring Aboriginal people into the PTI team. “We are taking people who are predominantly unem ployed, or on social assistance, and moving them from the reserve culture to work in an industrial culture. This is quite the transition, and it’s our job to build a bridge between the two worlds.” Creating sustainable symbiotic relationships with Aboriginal communities is high on PTI’s priority list for several reasons. First, many of the sites that PTI operates in are in close proximity to Aboriginal communities and their traditional territories, creating sensitivities that must be addressed head on. Secondly, as the oil and gas industry continues to rapidly expand in Western Canada it’s becoming increasingly evident that staffing shortages are on the horizon. PTI’s solution? Tap into the potential of Aboriginal communities. “Why look further than our own backyard? Canada’s Aboriginal group is the fastest growing source of people. We have a young unemployed population right here, and they want to work. Companies should take that into stronger consideration,” Crocker says. “Rather than recruiting temporary foreign workers, we need to tap into this local source. It’s in everyone’s best interest. Why would we ignore a local population that is unemployed, and let them continue to be on social assistance, while we bring in people from offshore? We should be getting this population involved and helping to set them up on a sustainable career path. It makes sense.” There are close to 300 Aboriginal people currently employed by PTI in jobs ranging from site maintenance to custodial work, and many are employed as cooks in the kitchen. Going beyond just employment and training – the company also proactively looks for ways to support local businesses operated by First Nation community members. PTI has engaged in partnerships with many Aboriginal communities across Western Canada including the notable business alliance formed
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with the Dene Tha First Nation in 2011. Crocker speaks to the four key drivers of this alliance: contracts, training, employment and revenue sharing. “We actively engaged the Dene Tha in the recruitment of hospitality workers,” he says. “We also met with the Nation’s economic development corporations and business owners. Subsequently local contracts were awarded, on a competitive basis, for road clearing, site preparation, and snow removal. For assisting us in obtaining the project contract, revenue sharing was also provided as an additional source of income for the Nation.” In light of these and other successes, PTI has been recognized as an industry leader. In 2011 PTI was awarded the Premier’s Award of Distinction by the Alberta Chambers of Commerce (ACC) for the work they’ve done engaging with Aboriginal populations. In 2012 PTI added to the trophy case when recognized by the ACC again for their best practice in Aboriginal relations. While these awards affirm that PTI is heading in the right direction, for Crocker, it isn’t about gaining recognition. It’s about confronting the realities of a rapidly growing economy, and building strong communities in the process. “We want to maximize our partnerships with local communities,” he says. “We do this by engaging local Aboriginal businesses and employees whenever possible. The First Nations are committed to lowering their unemployment rate and assisting members in building sustainable businesses. They see the benefit that partnering with companies such as ours affords their communities. Ultimately, it is about fostering truly mutually beneficial relationships.”
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a looK aT leAdershiP the Petroleum services AssociAtion of cAnAdA’s 2013-2014 BoArd of directors PSAC is pleased to announce its 2013-2014 Board of Directors. PSAC’s Board of Directors represents the diversity of Canada’s upstream petroleum services, supply, and manufacturing sectors, and brings unparallelled expertise to the strategic direction of the Association. To learn more about PSAC’s directors, visit psac.ca.
oFFicers chair
FirsT vice-chair
seconD vice-chair
ThirD vice-chair
PasT chair
secreTary
John Gorman
ray mills
Wally DumonT
Trevor haynes
lucas mezzano
mark salkelD
Vice-President, Canada, Halliburton Group Canada
CEO and founder, KUDU Industries Inc.
SVP Industrial Service Technology, Clean Harbors Energy and Industrial Services
President & CEO, Black Diamond Group Ltd.
Regional Sales Director - Coiled Tubes Canada, Tenaris Global Services
President & CEO, Petroleum Services Association of Canada
(Canada) Inc.
DirecTors
Duncan au
Deborah close
braD FeDora
chris Gall
Donna GarbuTT
scoTT hauck
President & CEO, CWC Well Services Corp.
President, Production Services, Tervita Corporation
President and CEO, Canyon Technical Services Ltd.
Vice-President, Global Supply Chain, Calfrac Well Services Ltd.
President, Schlumberger Canada Limited
President, Distribution Services - Canada, NOV Wilson Canada ULC
Quinn holTby
ron mackinnon
DouG mcneill
John Taskinen
scoTT van vlieT
President, Katch Kan
Vice-President, Business Development, Strike Energy Services Inc.
Executive VicePresident Business Development, StreamFlo Industries Ltd.
President, Snubco Pressure Control Ltd.
Co-President, Environmental Refuelling Systems Inc.
Limited
26 winter 2013
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