SUMMER 2011
PSAC introduces a new name and look for your magazine
ROGER GIBBINS
of the Canada West Foundation explains what a Canadian energy strategy means for the oil and gas services sector
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CONTENTS
SUMMER 2011
Departments MESSAGE FROM THE CHAIR 2011 CANADIAN DRILLING ACTIVITY FORECAST UPDATE
4 7
PSAC expects increased activity in the Western Canadian Sedimentary Basin
IN THE FIELD
8
News and notes from the industry
BUSINESS MATTERS
18
Trade show tips from industry experts
PSAC IN ACTION
11
HEALTH & SAFETY
Features 16
COME TOGETHER PSAC is collaborating on streamlining business in the patch
23
Managing worker fatigue in the field
MEMBER PROFILE
25
Palko Environmental Ltd. quenches an industrial thirst
COVER
11
20
Outreach and advocacy initiatives in focus
COMMUNITY MATTERS
26
Nabors Production Services/Swabtech keeps the giving spirit going all year long
SPRING CONFERENCE
25
This year’s event puts the focus on people and planning effective labour strategies
16
18 PETROLEUM SERVICES NEWS
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MESSAGE FROM THE CHAIR
Taking Old Issues in a New Direction
I
T’S déjà vU all OvER again.” Could Yogi Berra have worked in the oil patch
before going on to his 19-year career with the Yankees? I think yes, as his famous quote could easily be applied to our industry. The sector is quickly gaining strength on the backs of technological advances and hundred dollar oil. After going through the “mother of all recessions” service companies are back scrambling for personnel and equipment to meet the growing demand. PSAC is being asked once again to provide assistance in the areas of employee procurement, training and lobbying for regulatory concessions to enable companies to work more efficiently and effectively. With assistance from our partner organizations, like the Petroleum Human Resources Council of Canada, PSAC is actively engaging governments and post-secondary institutions to ensure funding and focus on developing skilled labour is at the top of their agendas. PSAC continues with its efforts to work with producers and other industry associations in raising the awareness of the importance of the petroleum industry as part of Canada’s future and ensuring the petroleum services sector has a seat at the table when governments Brian Coston, PSac Board chair are changing or developing policies. Some of the projects PSAC is currently involved with, as we work toward participating in policy development, include contributing to the Alberta government’s Regulatory Enhancement Project; participating in the New West Partnership (with a goal to harmonize workplace regulations between the provinces of B.C., Alberta and Saskatchewan); and involvement in a Canadian Energy Strategy (a direct result of the study PSAC commissioned CERI to conduct on the significance and impact of the service sector on Canada’s economy). Our feature story in this issue of Petroleum Services News provides more detail on PSAC’s involvement in these important initiatives. The Community Partners program – the industry-wide in-the-field courtesy program – is well underway with involvement from major oil companies and their associations. The Alberta and B.C. governments are also already on board and Saskatchewan launched their support of Community Partners during the Oil Show in Weyburn, Saskatchewan on June 1. If you have not already done so, please visit our website at www.communitypartners.ca and sign your company up as a Community Partner; join us in receiving the recognition all of us as PSAC members are earning and continue to strive for. Going forward, your PSAC board of directors still has a number of key issues to address such as the environment, and health and safety regulations, including ISNetworld’s reporting requirements. We will continue to be advocates for our industry by defending inaccurate and defamatory statements whenever possible, and by working with other industry sectors to promote the positive aspects of oilsands development and other industry initiatives.
Sincerely,
Brian Coston PSAC Board Chair
4 SUMMER 2011
PETROlEUM SERvicES nEwS
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SUMMER 2011 VOL 11 • No. 1 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 over 250 member companies, employing more than 58,000 people and contracting almost exclusively to oil and gas exploration and production companies. PSAC member companies represent over 80 per cent of the business volume generated in the petroleum services industry. PETROLEUM SERVICES ASSOCIATION OF CANADA 1150 800 6TH AVENUE SW CALGARY, AB T2P 3G3 TEL: 403.264.4195 FAX: 403.263.7174
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PETROLEUM SERVICES NEWS IS PUBLISHED FOR PSAC BY
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DRILLING ACTIVITY FORECAST UPDATE
Activity Increases PSAC’S MID-YEAR FORECAST UPDATE ADDS ANOTHER 200 WELLS
T
HE 2011 CANADIAN DRILLING ACTIVITYFORECAST mid-
year update, released in April by the Petroleum Services Association of Canada (PSAC), forecasts another increase in Canadian drilling activity levels. The revised forecast for 2011 is for a total of 12,950 wells drilled (rig released) across Canada, representing a 5.7 per cent increase in total wells drilled from 2010. The number is up from PSAC’s initial 2011 Canadian Drilling Activity Forecast released in November 2010, of 12,250 wells drilled. The PSAC Drilling Forecast’s GRAPH Hed: 2011 Drilling Activity Forecast of wells) slight increase can be attributed to a few key trends, including the(number fact that British Columbia: 554 fewer wells are being drilled because of horizontal drilling techniques and new Alberta: 8,732 Saskatchewan: 3,043 technologies being deployed for deeper drilling and more complex completions. Manitoba: 587 Additionally, the time and cost commitments are increasing, and the continuing Total in Canada: 12,950 downward trend in the price of natural gas also means a continuing decline in the number of productive natural gas wells. PSAC is basing its updated 2011 Forecast on average natural gas prices of CDN$3.85/mcf (AECO) and crude oil prices of US$100/barrel (WTI). Alberta: 8,390 British going Columbia:on 700in terms of “The level of drilling activity is a good sign of what’s Saskatchewan: 3,075 Manitoba:there 550 recovery from the economic downturn. But even though are strong signs of Canadian Total: 12,750 recovery, further rebounds in drilling activity are being impacted by the ongoing labour shortage and resultant inability to keep up,” says Mark Salkeld, PSAC
Nova Hotels Venture Publishing.indd 000PSN3.NovaHotels_1-2H.indd 1 WWW.PSAC.CA
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President. “That said, productivity is most certainly on a rebound and looking down the road we will continue to see increasing production without drilling levels returning to those of previous years because of the use of new technologies.” On a provincial basis for 2011, PSAC still forecasts the greatest increase in well count to take place in Manitoba with a forecasted increase of 13 per cent over 2010 numbers. Saskatchewan is only slightly trailing with an 11 per cent forecasted increase to 3,043 wells. Alberta boasts a healthy forecasted increase of 7.5 per cent to 8,732 wells drilled (rig released), while B.C. is projected to experience a 15 per cent decline to 554 wells from the previous year’s 649 wells. Overall, any gains being seen in Alberta are offset by losses in B.C.
5/16/11 11-04-20 1:49:57 4:13PM PM
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in the field
News, events and activities in the industry
Aiming for excellence PSAC iS Proud to SuPPort
the Petroleum Competency Program (PCP) and is pleased to recognize those individuals who received their PCP certificate in 2010. PSAC also acknowledges its member companies who have shown leadership in supporting these individuals. The PCP is managed by the Petroleum Human Resources Council of Canada. For more information, visit www.petrohrsc.ca.
Snubbing ServiCeS PSAC member ComPAny Snubco Pressure Control
CertifiCAte Holder Alan MacDonald
trAnSPortAtion PSAC member ComPAny KOS Oilfield Transportation
CertifiCAte Holder Lawrence Borowicz
well teSting PSAC member ComPAny OPSCO Energy Industries/Ensign
CertifiCAte Holder Skyler Ackerman Fidel Acousta Anthony Aldrich Clayton Anderson Perry Askin Barton Barham Joshua Beck Buster Braun Kevan Christensen John Clark Timothy Elston John Gillispie Justin Grimes Kyle Grimes Daron Hollins
PSAC Personnel Play PSAC welComeS Kelly morriSon
to the team! Kelly comes to PSAC with an extensive background in marketing communications and strategic partnerships. Kelly has worked in a number of industries including public sector, media, notfor-profit, telecommunications and professional services. In her new role as the Director, Communications and Stakeholder Relations for PSAC, Kelly will be responsible for promoting and supporting the interests of members by overseeing all communications, publications and events. She is responsible for developing and executing strategic and innovative communications plans as well as providing counsel on stakeholder relations and public affairs initiatives. These efforts will aim to grow and strengthen the profile of PSAC and its members with government, industry, media and the public.
Coming eventS Larry Johnson Brandon Jones Anthony Kraft Cody Legerski Cody Malan Joshua Mattson Christopher Mortimer Luke Pontius Duane Rennick Will Schiffner Robert Schneider Michael Shackelford Aaron Smith Kenneth Taylor Patrick Thompson
Community Partners launch – Saskatchewan
PSAC Agm, drilling Activity forecast and industry dinner
June 1, 2011 Saskatchewan Oil Show Weyburn, Saskatchewan www.psac.ca/events
November 3, 2011 BMO Centre, Stampede Park Calgary, Alberta www.psac.ca/events
PSAC barnstorming breakfast – Saskatchewan
new memberS
June 2, 2011 Saskatchewan Oil Show Weyburn, Saskatchewan www.psac.ca/events
regular members
Petroleum Services investment Symposium June 16-17, 2011 Hyatt Regency Calgary, Alberta www.psac.ca/events
PSAC education fund golf Classic
The RSC Group Audit Tree Inc. SGS Canada Inc. Isolation Equipment Services Inc. Greywolf Production Systems
Associate members BSM Wireless MacPherson Leslie & Tyerman LLP TD Bank
July 21, 2011 Calgary Elks Lodge and Golf Club Calgary, Alberta www.psac.ca/events
8 Summer 2011
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Come Together PSAC IS AT THE FOREFRONT OF EFFORTS TO MAKE DOING BUSINESS IN THE PATCH A WHOLE LOT SIMPLER
I
t’s not often oil and gas producers and environmental groups agree on something, but both camps are convinced Canada needs an energy strategy. It turns out they’re not alone. The Canada West Foundation (CWF) recently combed through two years of reports and releases from the energy industry, environmental organizations, academic policy experts and think tanks, and they all concluded that change is needed in Canada’s energy policy framework. Namely, we need to have one. WWW.PSAC.CA
“We need to have guidance for a regulatory framework,” says Roger Gibbins, CWF President and CEO. “Because we don’t have an explicit policy, climate policy becomes the default,” he adds. “Energy does have impacts beyond just climate change issues like energy security and export demand.” The research conducted by CWF, released in April, identifies a number of concepts that are common throughout much of the commentary on the need for a Canadian energy strategy, including environmental
11
The task force was established following the competitiveness review of the province’s oil and gas industry that also saw the restructuring of Alberta’s royalty framework. During that review it was also established that regulatory changes needed to be examined to create a more competitive oil and gas sector, while committing to environmental standards. The Regulatory Enhancement Task Force was formed in March 2010, with Diana McQueen, MLA Drayton Valley-Calmar and Parliamentary Assistant to the Energy Minister, appointed as the chair. The task force went to work analyzing policies surrounding upstream oil and gas development by consulting with numerous stakeholders, including First Nations, – ROGER GIBBINS, President and CEO of the Canada West Foundation the oil and gas industry, land owners, municipal governments and environmental groups. stewardship, a drive for innovation and technology, and the ability to Despite the diverse group of opinions, McQueen says strengthen Canada’s position in the world. one thing was clear: “A starting point and common “We need to provide an operating environment so provinces aren’t message was that the status quo was too complex.” working alone,” Gibbins says. “We have a more fragmented economic PSAC had an opportunity to meet with McQueen, as union than we should have in terms of our global positioning. A Canadian well as Alberta Energy Minister Ron Liepert, during energy strategy will make discussions of big energy projects more the process to voice the opinion of the services sector. thoughtful and more informed.” “A lot of the focus was on oil and gas producers, but The Petroleum Services Association of Canada (PSAC) is among the when the producers benefit the PSAC membership voices calling for unity inside Canada’s borders on how to position the also benefits,” Salkeld says. “The bigger piece is that country in the global energy market. The organization says recent efforts they realized that PSAC members are where the made in Alberta to streamline operations could be a starting point. “If we don’t get our ducks in a row, we’ll always be at other suppliers’ beck rubber hits the road. We represent more than 258 companies that produce 80 per cent of the business and call, says Mark Salkeld, PSAC President. “If we can gain efficiencies volume in the services sector. They realized that and in western Canada and then Canada as a whole, we’ll be recognized had an appreciation for it.” as a leader. It all rolls up in a vision of Canada being a leader in energy Following six months of briefi ngs, meetings, initiatives,” he adds. “They all feed positively into the next initiative.” workshops and forums, the Regulatory Enhancement On a provincial basis, PSAC views that starting point as the Task Force tabled its report in December 2010. One recommendations stemming from Alberta’s Regulatory Enhancement of the major recommendations from the report Task Force.
“WE NEED TO PROVIDE AN OPERATING ENVIRONMENT SO PROVINCES AREN’T WORKING ALONE. A CANADIAN ENERGY STRATEGY WILL MAKE DISCUSSIONS OF BIG ENERGY PROJECTS MORE THOUGHTFUL AND MORE INFORMED.”
12 SUMMER 2011
PETROLEUM SERVICES NEWS
is the consolidation of policy regulation into a single office. Under the current system, oil and gas policies are monitored separately by the province’s Departments of Energy, Environment, Sustainable Resource Development, and the Energy Resources Conservation Board (ERCB). By consolidating the policies of each regulator into one office, McQueen says the Department of Energy would lead the way, but each department would play a role in establishing policies. “The integrated policy management office will monitor policy or gaps in policy,” McQueen says. “Environmental groups, land owners and producers will all have the same processes, but in one place.” PSAC agrees that streamlining the regulatory process will benefit oil and gas producers, which in turn will benefit the service sector, but stresses it shouldn’t reduce environmental stewardship. “We’re comfortable with the process. If they can get wells approved quicker, then they can employ our services quicker,” Salkeld says. “We cannot lose diligence with respect to the environment and this is not about rubber-stamping projects. If Alberta can set an example on an effective and efficient process that landowners, environmental groups and producers can agree on, they can go to work sooner.” Elizabeth Aquin, PSAC Senior Vice President, reiterates the point that when well approvals get delayed by requiring oversight from a handful of separate departments, service companies are left waiting for work. By creating a one-stop window
with a single policy management office all of those approvals can happen simultaneously. “If you go to a doctor and can do all your tests at the same time, rather than doing 10 tests in 10 visits, it improves the process and you can fi nd out results quicker,” Aquin says. “This is streamlining, not dodging regulations because everyone will conduct their due diligence at the same time.” With the report written, McQueen expects to have something more formal for the Alberta legislature before MLAs break for the summer, giving them a few months to consider all aspects of a new policy framework. Then, McQueen hopes to be able to table legislation when the legislature resumes in the autumn. “It’s so important to Alberta and it’s important we get it right for the industry and all of Alberta,” she says. “It will be permanent, but there would be a process for review, so we know that the outcomes we attempt to achieve are met.” Oil and gas producers are also expecting positive changes to roll out of the New West Partnership (NWP). In July 2010, Alberta, Saskatchewan and British Columbia signed this new trade agreement that would call for each jurisdiction to adopt the same rules regarding goods, REGULATORY ENHANCEMENT services and people. The idea behind the agreement is that by adopting the The recommendations from the Regulatory Enhancement Task Force include: same rules, businesses would be able to • establishing a new Policy Management Office and ensuring move across provincial borders without integration of natural resource policies being bogged down by additional • creating a single oil and gas regulatory body paperwork. PSAC sees plenty of value • providing clear public engagement processes in this initiative for its members. • adopting performance measures to enable continuous By harmonizing labour standards system improvement between the provinces, Aquin says • creating a mechanism to help resolve disputes between service companies will not have to eat landowners and companies, and enforce agreements the additional administration costs, the where required expense of explaining new labour rules
“IF ALBERTA CAN SET AN EXAMPLE ON AN EFFECTIVE AND EFFICIENT PROCESS THAT LANDOWNERS, ENVIRONMENTAL GROUPS AND PRODUCERS CAN AGREE ON, THEY CAN GO TO WORK SOONER.”
WWW.PSAC.CA
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and adopting new, complex and expensive payroll systems. “This is a mobile industry and we have to go where the resources are,” she says. “The standards are not problematic, but by harmonizing some of the provisions for oil well servicing it will save money. Labour is already a huge cost and we’re trying to compete globally, while keeping prices down.” Although the NWP will not be in full swing until July 2013, one positive initiative has already come from the agreement. The energy ministers from each of the three western provinces in the NWP signed an Energy Memorandum of Understanding (MOU) in December 2010. The MOU starts by clearing regulatory hurdles (similar to the REP), but fi nishes with a larger vision of marketing the region’s energy sector around the globe. “It’s very substantive,” says Alberta Energy Minister Ron Liepert. “Can we be more effective as three provinces marketing internationally, be it Asia or other Far East countries? We have more clout as three provinces.”
While Liepert is positive about the outcomes the MOU can provide to the energy sector, he admits that ultimately an energy strategy needs to stretch beyond just western Canada. Liepert says common ground needs to be established in regards to goals, principles and objectives. He and the rest of the energy ministers across Canada plan to get this conversation started at their annual conference this summer. The ministers will meet in Kananaskis in July 2011, and Liepert says a Canadian energy strategy will be the main focus of that meeting. “Ultimately, a Canadian energy strategy should be in the best interest of all Canadians,” he says. “When we’re talking about an energy strategy we’re not just talking about oil and gas. We’re talking about offshore in the Atlantic, hydro in Quebec and even nuclear in Ontario.” Starting to fi nd common ground on a Canadian energy strategy will be important because as the Canada West Foundation says, it would be detrimental for Canada not to have one in place when it comes to setting global standards. FINDING COMMON GROUND “As an energy exporting nation, we have a lot of skin in the game in policy setting,” says These eight common themes regarding a Canadian energy William Kimber, Vice President of Research strategy were identified through research conducted by with CWF. “We need to be out in front, the Canada West Foundation: rather than reacting.” • embrace Canada’s energy diversity as a strength PSAC plans to be out in front. As Aquin • ensure robust environmental stewardship says, she and Salkeld will be at the Energy • set a price for carbon Ministers Conference ensuring the interests • transform the demand side of the energy system of the service sector are represented as policy • strengthen Canada’s position in the world discussions move forward. “It’s a good • promote energy security in the North American context • drive innovation and technological development opportunity for us to succeed as a country on • understand that strategy is a dialogue the energy front, so that Canada can lead into the next generation,” Salkeld says.
Bid and Win Big! The PSAC Education Fund Golf Classic Online Auction Offers Two One-of-a-Kind Entertainment Packages
1981 - 2011
Win a package to attend a Calgary Flames home game from a private luxury box suite, or treat your friends to a two-day golf and stay dream getaway for four at Kokanee Springs Golf Resort on BC’s Kootenay Lake! All proceeds will go to the PSAC Education Fund, supporting Canadian students and helping to build the future labour force for the oil and gas industry.
Online Bidding Now Open!
The online auction is NOW OPEN at www.psac.ca/onlineauction. Package #1: Bid and win tickets to a Calgary Flames home game in the comfort of a luxury private box suite for 12 including premium snacks and beverages. The suite is located on the lower level at the blue line with superior sightlines. Sponsored by: Package #2: Bid and win a package for you and 3 guests to unwind over two days at this golf and stay dream getaway. Kokanee Springs on BC’s Kootenay Lake is one of Canada’s finest championship 18-hole courses. Sponsored by: Bids close at 1:30 pm, Thursday, July 21st, 2011. Winning bids will be announced at the PSAC Education Fund Golf Tournament and posted on www.psac.ca. Thank you to our sponsors: Industry sponsor: • ARC Financial Corporation • ATB Corporate Financial Services • Calfrac Well Services Ltd. • Canamara United Supply Ltd. • CEDA International Corp. • CMA Alberta • Cole Group • ComplyWorks Ltd. • Derrick Exhibit • Doran Steward Oilfield Services • DYNAenergetics Canada Inc. • Ensign OPSCO Energy • Guardian, A ShawCor Company • Halliburton Group Canada
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• KPMG • National Oilwell Varco • Pajak Engineering Ltd. • Probity Capital Advisors Inc. • RBC Royal Bank • Smith Bits • Sterling Western Star Trucks • Stream-Flo Industries Ltd. • Strike Energy Services Inc. • Topco Oilsite Products Ltd. • Trojan Safety Services • Weatherford Canada
www.psac.ca
5/10/11 8:21:06 AM PETROLEUM SERVICES NEWS
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SPRING CONFERENCE
Power
People TO THE
HIGHLIGHTS FROM THE 2011 PSAC SPRING CONFERENCE ILLUSTRATE THE NEED FOR LABOUR STRATEGIES
T
WELCOME:PSAC President Mark Salkeld (seated) welcomes delegates and PSAC VP Health & Safety Patrick Delaney introduces key transportation issues to be addressed over the next two days.
HE OIL AND GAS INDUSTRY CONTINUES TO SHOW
Most Albertans are aware of Bill 16 – the Traffic Safety (Distracted Driving) Amendment Act, 2010 – but more than a few Conference attendees discovered signs of increased activity and with this activity comes a focus that it will become one of the most comprehensive traffic safety legislations in within the petroleum services sector on people. Canada. Jeanette Espie, Executive Director of Alberta Transportation’s Office Current and future labour shortages, retention of employees of Traffic Safety, and Tara Peters, Senior Research Officer with the Office of through engagement, recruitment strategies, and staying on top of issues that Traffic Safety, explained that while using handheld cell phones are a major and can be barriers to completing work in the most efficient and cost-effective widespread distraction for drivers, the legislation intends to tackle the broader manner were the top-of-mind discussions among delegates and speakers issue of distracted driving, which also includes activities like texting and at the 2011 PSAC Spring Conference. Held in Red Deer, Alberta, on April emailing, using laptop computers, video games, cameras, writing, personal 12 and 13, more than 215 delegates focused on these issues as they relate to grooming and other activities that take the eyes off the road. transportation management and human capital management. “There are many “Producers are spending again. The record sources of driver $2.66 billion spent on conventional oil and gas distraction,” says Espie. rights, as of March 31, 2011, is the number one “International research indicator that the industry is coming back,” says indicates that distracted Mark Salkeld, PSAC President. “And while this is drivers are involved very good news, it also means the labour issue – in an estimated 20 per current and future shortages – is also causing some – Mark Salkeld, PSAC PRESIDENT cent to 30 per cent of stress amongst many of our member companies total collisions. Alberta Transportation was challenged to create a law that is and conference delegates.” comprehensive, practical, effective and enforceable.” This year’s two-day conference was organized by PSAC’s Transportation “Drivers will still be able to chat with passengers, have a coffee or snack, Issues Committee and Human Resources Committee, and offered three smoke a cigarette, or glance at a map,” says Peters. “This legislation is also focus streams: Transportation Management, Personal Development and intended to be reasonable.” Human Capital Management. The Federal Hours of Service exemption for “Specialized Service Operations,” fatigue management, drug and alcohol testing technologies and techniques, industry training best practices and an HUMAN TOUCH: Gail Purdy of National Oilwell Varco and Chair of PSAC’s Human overview of the upcoming distracted driving legislation were among some Resources Committee moderates the Human Capital Management stream. of the standing-room-only sessions within the Transportation Management stream. These are some issues that, depending on how they are dealt with, can either make or break the success of upstream petroleum services work. “Fatigue on the job results in many preventable and costly accidents,” explains Dr. Adam Blackman, President of MedSleep. “Shift work will usually involve both sleep restriction and circadian misalignment as key factors in fatigue. Unrecognized or undetected sleep apnea is also a critical contributor to fatigue.” A fatigue management program that addresses these problems can result in significant improvements for employees and companies overall, adds Dr. Blackman. Implementation of fatigue management programs has shown improvements in safety measures, lower levels of absenteeism and costly decision making errors, increased productivity, lowered risk around liability and insurance claims, and a bolstered reputation for a company’s strong corporate health and safety record.
“PRODUCERS ARE SPENDING AGAIN. THE RECORD $2.66 BILLION SPENT ON CONVENTIONAL OIL AND GAS RIGHTS, AS OF MARCH 31, 2011, IS THE NUMBER ONE INDICATOR THAT THE INDUSTRY IS COMING BACK.”
16 SUMMER 2011
PETROLEUM SERVICES NEWS
WINNER: PSAC President Mark Salkeld congratulates Justin Clark of Hart Oilfield Rentals Ltd., winner of the $250 cash draw.
Bill 16 is expected to take effect by mid-year. More information can be found at www.transportation.alberta.ca/distracteddriving.htm. On the human capital management side, there is no shortage of content for debate, especially given the Labour Market Information stats recently announced by the Petroleum Human Resources Council of Canada, one of PSAC’s partner associations. “The Council’s latest announcement that the oil and gas industry is going to require between 39,000 and 130,000 workers over the next decade due to retirement and increased activity illustrates how critical the current and future labour shortage is becoming,” says Gail Purdy of National Oilwell Varco and the Chair of PSAC’s Human Resources Committee. “PSAC’s HR Committee is steadfast in seeking solutions to these challenges and we’re optimistic the sessions we’ve put together will help our member companies begin to address some of the challenges.” From actual accounts describing the benefits of recruiting through social media, to sessions on employee engagement and retention strategies, and guidance on training, development and succession planning, Conference attendees participated in some lively debate about tactics and possible solutions in the face of the labour shortages that lie ahead. PSAC’s annual Spring Conference remains one of the only events designed specifically for managers, and operations and field staff of petroleum service companies to learn and exchange ideas on the latest happenings in the industry.
PEP TALK: Randy Parkin of Key Consulting Group presents the benefits of leadership through coaching.
WELL ATTENDED: Although service companies are happily experiencing a busy time, they made efforts to ensure they could attend the 2011 Conference. Attendance was higher than 2010 levels by roughly 60 per cent.
SHOW & TELL: Sponsoring exhibitors enjoy frequent interaction over the two days with delegates.
PSAC WISHES TO THANK ALL THOSE SPONSORS WHO HELPED MAKE THE 2011 PSAC SPRING CONFERENCE A SUCCESS! Major Sponsors: Cenovus Energy GEOTrac International Inc. JuneWarren-Nickle’s Energy Group Kal Tire Rogers Communications Inc.
Program Sponsors: BOWEN workforce solutions DriverCheck Inc. Nexus Exhibits OBP Promotions and Awards Rogers Insurance Sterling Western Star Trucks Alberta Ltd.
Athabasca University Canalta Hotels Enform Makeda Publishing Ltd. Mentor Engineering Partners in Compliance Province & State Permitting Red Deer College Roadata Services Inc. VRV Global Recruiting Waterous Power Systems
Registration and Nutrition Break Sponsors: Calfrac Well Services Ltd. Flint Energy Services Ltd.
Delegate Lounge Sponsors: Abacus Datagraphics Ltd. AGM Wear Ltd.
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BUSINESS MATTERS
Show and Tell BY ROBIN SCHROFFEL
BUSINESS OPPORTUNITIES COME IN MANY SHAPES AND FORMS DURING A TRADE SHOW. HERE’S A FEW WAYS TO GET THE MOST OUT OF THE EXPERIENCE
O
18 SUMMER 2011
PPORTUNITIES FOR ONE-
on-one business marketing don’t get much better than at trade shows like the Gas & Oil Expo and Conference in Calgary in June. Used correctly, these events can be one of the most valuable marketing strategies in a company’s toolbox, offering a chance to attract new customers and strengthen relationships with existing ones, make sales and raise the overall profile of a business. But beware, if not executed properly, trade shows can be a colossal waste of capital and can even cause damage to a company’s reputation. For the past 30 years, Derrick Exhibit has made trade shows its business, providing customers with everything from custom booth creation, setup and teardown to long-term project management, helping companies make the most of their trade show appearances. There are a few secrets for success that work right across the board, according to Derrick Exhibit President Shane Henderson and Calgary Branch Manager David Stokes. The objectives for companies usually differ depending on the show. At consumer shows, exhibitors tend to focus on sales, while at industry shows businesses focus more on building longterm relationships. Here are some of the trade secrets they can share.
THE PROPER PEOPLE It’s not just what is in the trade show booth that’s important – it’s who is in it. “You want to have that thing that attracts someone to your booth, and you want to have the communication skills that keep them there,” says Stokes. Henderson stresses that having well-groomed, knowledgeable, enthusiastic and friendly people attending the booth can make all the difference, especially in building relationships with potential clients.
KEEP IT CONCISE Simplicity can be a virtue at trade shows, where it’s important to get your message across at a glance. “People should be able to walk by your booth and within five to eight seconds, know what your business is about,” says Henderson. He notes that paper is now passé, and most of the time, pamphlets and info sheets end up in the trash on the way out the door.
FUN, FUN, FUN Giveaways are a good option. Companies can purchase LCD televisions for almost as much as they rent for, so why not do a business card draw and give one away as a prize at the end of the show? “Make it a little fun,” Stokes says. “You’re on the floor sometimes 12 hours a day – it gets long and boring.” A little creativity can help set your booth apart in a big way, says Stokes. He suggests spicing things up with a casino theme or using interactive games to engage people in a memorable manner.
SHOW YOUR PRODUCT Stokes says that products can often speak for themselves. “Actually have pieces that people can pick up and touch and feel,” he advises. But even if your company produces a host of wonderful products, it’s best to focus on just a few to keep things simple, says Henderson.
PETROLEUM SERVICES NEWS
THREE COMMON TRADE SHOW MISTAKES Maximize your company’s trade show presence by avoiding these common pitfalls Too Much Information There’s obviously more to your business than meets the eye, but overloading people with facts and figures, especially on your booth display, is a common mistake that can cause people to lose interest quickly. Henderson says to pick just a few of your biggest strengths and run with them. Pulling Out Sometimes the absence is more conspicuous than the presence, Stokes says. That’s why it is important to maintain a trade show presence year after year, even if you don’t necessarily need the new customers immediately. “If you’re a big company and people have seen you year after year at that trade show, and suddenly you’re no longer there, they tend to think that you’re no longer around – possibly, no longer in business,” he says. That, and it can also be tough to get back into some of the trade shows after you’ve dropped out. Lack of Communication Communication is the single most important factor for trade show success, according to Henderson, and that doesn’t mean just during the show. Calling up current clients beforehand can work wonders. “Invite them down, invite them to your booth, offer to buy them a sandwich at lunch,” he suggests. “Where else are you going to get the chance to meet face-to-face with eight or nine of your best clients in one weekend?” Similarly, following up afterwards is a key factor in developing new business relationships.
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PSAC in action PSac continueS to SPread the good word through advocacy and outreach TACKLING THE ISSUE OF SKILLED LABOUR SHORTAGE PSAC met with representatives of Alberta Employment and Immigration to discuss the growing skilled labour shortage and the challenges of programs such as the Temporary Foreign Worker Program for PSAC members. Further meetings are planned with government representatives in April. PSAC also began discussions with the Pacific Northwest Economic Region (PNWER) regarding issues related to moving employees across borders.
well head boom truck operations and the B.C. regulatory requirements for crane operators to “have full control of the equipment controls whenever hoisting equipment is in use and engaged in no other duties while operating the equipment.” A group of subject matter experts drawn from PSAC member companies will be working with WorkSafeBC on this issue and the membership will be kept advised of progress at future meetings of the PSAC Transportation Issues Committee.
TAX EXEMPT FUEL USE (TEFU) AND PRESCRIBED REBATE OFF-ROAD PERCENTAGES (PROP) PSAC met with Diana McQueen, MLA and Parliamentary Assistant to the Alberta Minister of Energy, regarding the abolition of the off-road fuel rebate program announced in the recent provincial budget. PSAC expressed its members’ concerns over the lack of consultation with industry prior to the budget announcement and with the lack of a phase-out period for these programs. PSAC has also written to Alberta Finance Minister Lloyd Snelgrove asking that the program be reinstated.
LEASE LIGHTING An update on the PSAC-sponsored Industry Recommended Practice #23: Lease Lighting, was also provided to PSAC Spring Conference delegates. The IRP will set out recommended outdoor lighting requirements for nighttime lease operations and for drill rig mobilization and demobilization, ancillary drilling activities (excluding the rig floor), and any lease site servicing operations. The intent is to provide a standard for minimum lighting requirements for a variety of lease tasks and to clarify roles and responsibilities with respect to meeting the standard. It is hoped to have the IRP sanctioned for industry use by June 2011.
LOWER ATHABASCA REGIONAL PLAN PSAC attended an industry session to represent member interests with the Alberta government in April on the recently unveiled Lower Athabasca Regional Plan. Further consultations were held throughout April and May. PSAC AND CAPP PRESENT ALBERTA IS ENERGY IN COLD LAKE As part of the ongoing Alberta Is Energy campaign, PSAC and the Canadian Association of Petroleum Producers (CAPP) co-delivered the Alberta Is Energy presentation to the Cold Lake Chamber of Commerce in Cold Lake, Alberta. The program’s goal is to educate western Canadians about the outlook for the oil and gas industry in Alberta and western Canada; demonstrate how the energy industry touches the lives of most Albertans and many Canadians; the challenges and opportunities Canadians face in balancing energy supply needs, environment and economy; the importance of Albertans working together to ensure our economy and environmental performance is continually improving as we develop our resources; and some of the work being done on the oilsands side of the industry, particularly around performance and communications. Presentations will continue to be made throughout Alberta in the coming months. NEW WEST PARTNERSHIP MEETING TAKES PLACE PSAC staff met with New West Partnership (NWP) government representatives as part of a consultation process to provide information on the business, investment and employment barriers and opportunities that can be addressed by the NWP’s Energy MOU signed by the Energy Ministers of B.C., Alberta and Saskatchewan last December. The goal of the Energy MOU is to build upon and enhance existing energy sector activities by attracting new investment, stimulating job creation, and strengthening the region’s economy through collaborative energy initiatives. PSAC discussed harmonization of employment standards and certain health and safety regulations. WELLHEAD BOOM TRUCK OPERATIONS At the recent 2011 PSAC Spring Conference held in Red Deer, Alberta, PSAC reported on discussions it has had with WorkSafeBC on issues related to
20 Summer 2011
SELECT FIRE OPERATIONS Representatives from the PSAC Oilwell Perforators’ Committee have been holding discussions with WorkSafeBC on issues related to the interpretation of B.C. regulations as they relate to “select fire” operations. Further details can be accessed through the Committee minutes in the Members’ Area at www.psac.ca. SAIT INDUSTRY NIGHT PSAC presented to the faculty and students of the Southern Alberta Institute of Technology (SAIT) Petroleum Engineering Technology Program. Approximately 80 students who will graduate from the program this year attended to hear about the petroleum services sector, oil and gas technology, the job market and opportunities for new graduates. EDUCATION FUND ANNOUNCES NEW SCHOLARSHIPS As the goals of the PSAC Education Fund are to create awareness of and promote careers in the petroleum services sector and to help develop a potential long-term labour pool for the upstream services sector of the oil and gas industry, PSAC’s Education Fund continues to evolve to meet the needs of students and industry. Changes are currently in the works for the 2011 program that will see more of a focus placed on establishing scholarships to support students who are, or plan to be, enrolled in petroleum-related training programs at trade schools and colleges. While the Fund has contributed some very positive educational support over the years through public scholarships and grants to schools, the Education Fund Committee has decided to suspend the public scholarship and grants portions of the program and instead direct the funding to support students in petroleum-related training programs. The Committee feels this new focus will have a greater impact on both students and industry, while targeting potential employees at a time when they are making crucial career decisions. These changes to the PSAC Education Fund are in the final stages of planning. Full details can be found at www.psac.ca/community/education-fund.
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PETROLEUM SERVICES NEWS
health & SAfety
Don’t Sleep On It WitH fileS Contributed by andrea W. lorenz
An exemPtion to federAl HoS ruleS Will require A CArefully monitored fAtigue mAnAgement ProgrAm
A
fter SeverAl yeArS of negotiAtionS with federal and
provincial transportation regulators, oil and gas service sector companies are getting time back on their side. The Petroleum Services Association of Canada (PSAC) has gained approval from the federal Transport Minister for some exemptions from the federal Commercial Vehicle Hours of Service (HOS) Regulations. Service sector companies that wish to operate under the exemptions must have a fatigue management program (FMP) in place as part of their health and safety management program, in addition to meeting several other conditions. The FMP will have to be approved by the provincial HOS director of the carrier’s base jurisdiction. Under new federal Commercial Vehicle Drivers’ Hours of Service Regulations rolled out on January 1, 2007, drivers are restricted to 13 hours driving time in a day and only 14 hours of total on-duty time. Drivers are also required to take at least 10 hours off-duty before they can drive again and at least eight of those hours must be consecutive. The regulations apply to all commercially registered vehicles over 4,500 kg owned and operated by carriers whose business takes them across provincial borders. These HOS rules presented some challenges for the oil and gas sector. Under the rules, if a driver is held up on a job site and waiting to start operations, this “stand-by time” counts towards the driver’s daily “on-duty time.” “The oil and gas drilling industry is a 24/7 business and many of the smaller rigs move 24/7,” says Harold Drok, Operational Compliance Manager for Flint Energy Services. “Under the 2007 Hours of Service regulations it’s been virtually impossible for the rig mover to be compliant with the regulations when moving rigs working on projects. In order for the rig mover to be compliant while working on a Fort McMurray oilsands project, for example, the rig moving company would be required to have two crews working 12 hours per day – something that’s impossible with the current driver shortage.” Members of the PSAC Transportation Issues Committee have worked diligently over the last several years to ensure that service sector concerns with the HOS rules were brought to the attention of Transport Canada and provincial regulators in Alberta, B.C., Manitoba and Saskatchewan. PSAC’s meetings with these regulators culminated in the submission of the formal exemption application to Transport Canada on June 16, 2009. The exemptions will apply to commercial vehicles and their drivers engaged in “rig moving operations” and “specialized service operations.” The rig moving exemption will apply to rig move operations as part of a drilling project under the provisions of a valid Oil Well Service Vehicle Permit. The exemption will be valid during the winter season – November 1 to March 31. The exemption for specialized service operations will also apply under the provisions of a valid Oil Well Service Vehicle Permit. These specialized services are defined in the exemption as including but not limited to: well testing; mud-filling; cementing; hydraulic fracturing; voltage, logging and resistivity measurements; and cleaning of industrial equipment; as the
particular requirement might arise in the normal course of well drilling, completion and maintenance operations. While operating under the exemption, drivers will be exempt from the off-duty requirements of Sections 13 and 14 of the regulations. Another purpose of the exemption is to allow drivers to meet the mandatory off-duty requirements by accumulating off-duty time in sleeper berths or in alternative sleep accommodations. Use of the exemption is optional. “Because the rigs move during both the day and the night, the new alternative sleeper berth HOS exemption allows the driver to take his required daily off-duty time in two periods totaling 10 hours in the client camp facilities versus having to take eight consecutive hours off-duty each day,” says Drok. Both exemption documents can be viewed and downloaded from the PSAC website at: www.psac.ca/hos.pdf PSAC is working with Alberta Transportation on an information package for industry outlining how the exemption process will be administered. For more information, visit www.psac.ca.
Call for Expressions of Interest The CCEMC has up to $60 million to invest in projects that reduce greenhouse gas emissions through the use of cleaner methods of energy production, and innovative carbon capture methods in Alberta. Submissions must be received by July 28, 2011 at 4:30 p.m. MST. For more information and to learn more about the CCEMC, visit ccemc.ca
Climate Change and Emissions Management (CCEMC) Corporation
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MEMBER PROFILE
Waste Not, Want Not TRANSITIONING FROM FLUID DISPOSAL TO FLUID RECOVERY IS GOOD FOR THE ENVIRONMENT – AND THE BOTTOM LINE BY STEVE MACLEOD
A
LARGE VOLUME OF WATER – both
fresh and briny salt water – is used to produce oil and gas, something Palko Environmental Ltd. realized was a potentially lucrative business niche. With a network of six treatment facilities spread across Alberta and Saskatchewan, Palko was already in the business of safely disposing of the waste fluid created during oil and gas production, whether that be water, oil, frac fluids, drilling fluids, drilling muds or waste from spills. Their busiest facility, in Midale, Saskatchewan, processes up to 1,400 cubic metres of fluid a day. As water scarcity becomes a bigger issue, producers are starting to look for ways to reuse
WETWORK: Palko’s mobile units allow producers to treat emulsified oil without transporting it off site
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water from their operations, rather than just disposing of it and purchasing new water. “We had customers who dealt with water issues and there was a need for environmental solutions around water recovery,” says Palko President Steven Peterson. “With our base of facilities we had a great framework to expand.” The transition from just running waste disposal facilities to also offering the treatment and recovery of waste fluids for reuse started a few years ago, but the business has begun “seriously trending down that road the last 10 months,” says the company’s Vice President of Operations Don Johnson. As well as removing solids and other contaminants from water for reuse, Palko’s facilities are also designed to provide the same treatment for oil products. To complement their oil treatment and recovery business at its facilities, Palko recently launched a division of mobile on site oil treatment units. The company currently has four of these DSU Processing Systems in operation. The units are fairly similar to a field office trailer, can be delivered on the back of a typical flatdeck trailer and set up at a production site. Fully staffed and sealed to allow for the processing of gassy fluids, the units treat oil that has been emulsified with water and process it so it is pipeline-ready. “We’ve been working on this for about a year now,” Johnson says. “Lots of our customers don’t have the facilities to treat off-spec oil.” Without the ability to treat the oil on site, producers have to transport their off-spec oil to a treatment facility where it can be processed before being moved to a terminal. Johnson says the firm is still in the infant stages of operating the mobile units, but he’s encouraged by results so far. Just like many other environmental initiatives, companies have an easier time getting on board when there’s economic incentive. “It has to make economic sense, and we feel it can,” Johnson says. “You can recycle water and be no more expensive than purchasing fresh water.” While the technology to make water reusable aims to help companies keep costs affordable and keep more water in the ground, Johnson says there’s also a safety incentive for producers using the on site oil treatment units. “It reduces risk for the customer. If you don’t have to put oil on the highway you can take that risk out of the equation,” he adds.
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COMMUNITY MATTERS Pictured from L to R: Nathalie Steenbergen, Stacey Sugden, Kim Campbell, Mandi Hoffman
Always ’TIS
THE SEASON
NABORS PRODUCTION SERVICES/SWABTECH KEEPS THE GIVING SPIRIT GOING ALL YEAR
T
HERE’S A SPECIAL CHRISTMAS TRADITION in central Alberta, where people decorate trees and then auction them off at Westerner Park in Red Deer, Alberta, to raise money for special projects at the Red Deer Regional Hospital. Staff members at Nabors Production Services and Swabtech, a division of Nabors Production Services, have added their own little twist to that tradition. Every year the company buys back its tree in the auction and then raffles it off back at their office in Sylvan Lake, Alberta. The moneyraised through the raffle is also donated to the Red Deer Regional Hospital. During the holiday season, the staff at Nabors/Swabtech also lends a hand at the Breakfast with Santa for local kids. The food hospitality is just a warm up for the charity efforts served up during the rest of the year. “We meet as a group at the beginning of the year and we get
26 SUMMER 2011
BY STEVE MACLEOD
everyone’s input on what charity to raise money for that year,” says Swabtech manager Jerry Lefebvre. Running from April to October, Nabors/Swabtech puts on a monthly barbecue with proceeds donated to charity. In 2010, the company raised money for the Ronald McDonald House and this year, they decided to donate fundraising efforts to the Adolescent Mental Health Services ward of the Red Deer Regional Hospital. Not all of Nabors/Swabtech’s charity efforts revolve around food. The company is also involved with the Heart and Stroke Foundation’s annual golf classic, STARS air ambulance and the Sylvan Lake community spring clean-up. Sports teams also benefit from the corporate kindness. “There are lots of efforts and resources put back into the community,” Lefebvre says. “You get back what you put in and the appreciation for helping one another is important.”
PETROLEUM SERVICES NEWS
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