pipeline news december 2012

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PIPELINE NEWS Saskatchewan’s Petroleum Monthly Canada Post Publication No. 40069240 December 2012 FREE Volume 5 Issue 7 Cobra Industries Ltd. of Delisle builds 400 - bbl. tanks. Alex Karpenko can be seen welding a Ňange. See story Page A24. Photo by Josh Schaefer MADE IN MADE IN

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Pipeline News December 2012

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Page 1: Pipeline News December 2012

PIPELINE NEWSSaskatchewan’s Petroleum Monthly Canada Post Publication No. 40069240

December 2012 FREE Volume 5 Issue 7

Cobra Industries Ltd. of Delisle builds 400 - bbl. tanks. Alex Karpenko can be seen welding a ange. See story Page A24. Photo by Josh Schaefer

MADE INMADE IN

Page 2: Pipeline News December 2012

SECTION A3 Re nery expansion complete

4 CAODC forecasts 2013 blip

5 Close look at fracking

6 Editorial

7 Opinion

11 W. Bre Wilson rede nes success

INSIDE

SECTION C1 CAODC drills MPs

3 Grit "cold starts" in NB

8 Blue Spark pulse tool

10 Oil eld career day

14 Paradise Hill model for Husky

SECTION B1 Transi oning from one-o to manufacturing

3 Bee ng up an ag product for the oil patch

6 Fleet Energy opens

9 Magna Fab now in Redvers

Stacey [email protected]

PIPELINE NEWSNEWSSaskatchewan’s Petroleum Monthly

Jan 2013 FocusContact your Sales Rep

to be a part of the focus edition

SE Sask and SW Manitoba - for all of your advertising needs contact:Ph: 306.634.2654 Fax: 306.634.3934

Cindy BeaulieuSales Manager

[email protected]

Candace [email protected]

Deanna [email protected]

Kristen O’[email protected]

Teresa [email protected]

NW Sask - for all of your advertising needs contact:

Cell: 780.808.3007 Fax: 780.875.6682

Randi [email protected]

SW Sask - for all of your advertising

needs contact:Ph: 306.773.8260 Fax: 306.773.0504

WORKING IN THE COLD

A2 PIPELINE NEWS December 2012

Page 3: Pipeline News December 2012

PIPELINE NEWS December 2012 A3

TOP NEWS

Day Day Construction Ltd.Construction Ltd.

Lease ConstructionLease ConstructionLease Restoration • MulchingLease Restoration • Mulching

Carnduff, SK.Carnduff, SK.Phone: (306) 482-3244Phone: (306) 482-3244

By Brian ZinchukPipeline News

Regina – Seven years from conception, four-and-a-half years of construc-

tion and a cool $2.66 billion later, it’s done. Th e Consumers’ Co-operative

Refi neries Ltd. expansion has been completed.

Scott Banda, CEO for Federated Co-operatives Ltd., spoke to Pipeline News by phone on Oct. 26 after the announcement. He said, “Today we had

the offi cial announcement of the start-up of section V. As of Wednesday, Oct.

17, Section V started up and we are ramping up. It’s up and running!”

“We maxed out at 5,000 people on this site at the peak of construction.

Th ere were two pieces of our construction: Section V and the revamps. Th e re-

vamps, we’re still a couple months from fi nishing. But we will add 45 per cent

capacity to our facility. Th at takes us up to 145,000 barrels a day.”

Th ere were 8,000 person-years of construction, with an economic spinoff of

over $5 billion dollars.

He said, “To get us through that, about 150 companies worked on the con-

struction. Today we’re pretty excited to celebrate it’s up and producing.

“One advantage of our refi nery is we’re very fl exible on crude weights.

We run them all through our facility and yes, part of it does come out of the

oilsands.

Southeast Saskatchewan crude. Is the “wrong way on the pipeline,” and

goes the other direction, however. But Lloydminster crude fi nds its way to

Regina.

“Depending on what the economics are, we can move between light, heavy,

sour or sweet. Th at’s what gives us one of the advantages on the economic side.

We can move as we have to, to ensure our production, but also to accommodate

the economics,” Banda said.

Saskatchewan’s daily production of crude oil has risen from roughly

425,000 bpd over the past 10 years to 440,000 bpd. Th e refi nery will be dealing

with some of that increased production, particularly on the Lloydminster side.

“Anything that’s up the pipeline, by and large, will come into our facility.”

“Part of our story here is our ownership. As a co-operative, we’re Western

Canadian-based, this is a massive investment in this region in Western Canada.

In Saskatchewan, in particular, in the city of Regina, this will add another 100

permanent jobs. Th ere are 800 permanent employees there, plus another 1,000

we use on annual turnarounds. Th is is, from our perspective, a commitment to

Western Canada’s long term viability. We believe in it. Th is is our home, here,

in Western Canada, of own ownership and retail co-operatives.

“Th at’s a big piece of this story. We have made a massive commitment to

the energy business to be here for the long term.”

Section V will see largely gasoline and diesel production.

On Oct 6, 2011, a fi re in an older part of the refi nery injured several work-

ers and damaged one of the areas being revamped. Th at area requiring extensive

rebuilding.

“Th at was in the area where the revamps are. We’re probably about two

months away from where we want it. Th e end of December, early January, we

should have that all rebuilt. Where the incident did occur, we tore it right out

and rebuilt a whole lot of that facility in that area.

“It has put us back a little bit”

Th e fi nal dollar amount, $2.66 billion, was higher than what was initially

projected. “Th e additional cost was productivity. We didn’t get the productiv-

ity we thought, on site. (Th ere were) challenges in labour, in Western Canada,

in this economy. And frankly, not fully appreciating working in live, existing,

operating units aff ected our productivity. Costs escalated on us. Th at’s not

something we’re really excited about, but that’s the reality.

Asked about any more future expansions, Banda said, “Th is maximizes pro-

duction from this facility. In other words, is a Section VI likely? Not likely. In

order to build a new section, you would have to basically build a new refi nery

on the same site.

“Th is maximizes the ability of the process units we have on site. Further

expansion on this site – never say never – is not very likely.”

“Th is growth was a refl ection of the growth on the retail side. We built this

to accommodate where we are right now with our retail,” he concluded.

As seen in August 2010, this is the main area of the Sec on 5 expansion of the Consumers’ Co-op-era ve Re neries Limited (CCRL) re nery complex in Regina. The major com-ponents visible are, from le : green pipe racks that carry the arteries of the facility; between the white and red cranes are three small towers that are part of the gas concentra on unit; below them, on the pipe racks are grey n-fan cooling units; to the right of the yellow crane and inside the green structure is the catalyst regenera-tor; lying below it and to the right are the reactor and main frac ona ng col-umn, awai ng installa on; the next two grey towers are the prefrac ona on tower and the stack of the prefrac ona on heater.

File photo

Co-op Re nery expansion complete

Page 4: Pipeline News December 2012

A4 PIPELINE NEWS December 2012

BRIEFS

Briefs courtesy Nickle’s Daily Oil Bulletin

By Geoff LeePipeline News

Calgary – Th e 2013 drill-

ing forecast of 10,409 wells by

the Canadian Association of

Oilwell Drilling Contractors

will be hard to digest for some

members who were served the

news during an association

breakfast on Nov. 13.

Th e CAODC forecast is

six per cent below the expect-

ed 2012 year-end well count

of 11,067.

Th e association, that rep-

resents the Canadian drilling

and service rig industry, ar-

rived at the lower well count

for 2013 based on continued

uncertainty around commod-

ity prices.

Th e well count also re-

fl ects the challenge of more

complex drilling programs

that require more time to drill

– an expected average of 11.4

days to drill a well in 2013.

CAODC expects the

10,409 wells drilled in 2013

will generate an average of

118,401 operating days.

Th at’s fewer than the 2012

year-end forecast of 126,167

operating days and an average

rig utilization rate of 44 per

cent.

CAODC projects fl eet

utilization in the fi rst quarter

of 2013 to be 60 per cent (or

498 rigs) with 44,367 operat-

ing days in this period.

Second quarter activity

that includes spring breakup

is projected to have an average

utilization of 20 per cent (166

rigs active) and 14,789 operat-

ing days. Th is projection mir-

rors second quarter activity

seen in 2012.

For the third quarter of

2013, the forecast calls for a

35 per cent utilization (or 291

rigs) and 25,925 operating

days.

Th e fourth quarter of 2013

will be higher with the ramp-

up for winter drilling.

Th e CAODC forecast

pegs fourth quarter utiliza-

tion at 45 per cent (374 active

rigs), similar to current activ-

ity levels with 33,320 operat-

ing days.

CAODC predicts the

registered rig fl eet will begin

2013 with 830 rigs includ-

ing 30 rigs added to the fl eet

through 2012, but no further

expansion is anticipated in

2013.

“It’s more likely contrac-

tors will retire older equip-

ment,” said CAODC presi-

dent Mark Scholz.

Th e retirement of older

equipment has been an ongo-

ing trend over the last three

years as the newer, more ad-

vanced equipment is better

suited to explore unconven-

tional plays.

Th e activity level in 2013

is projected to be slightly be-

low 2012 activity levels, but

industry will remain focused

on attracting back the skilled

workers lost during the 2009

downturn and on investing in

new employees.

CAODC members con-

tinue to cite skilled labour

shortages as a signifi cant chal-

lenge.

Th e drilling and service

rig sectors’ manpower chal-

lenges are compounded by the

fact that the rigs are a recruit-

ing ground for other oil and

gas sectors.

CAODC also released

revisions to its fourth quarter

projections for 2012. Th e re-

vised numbers refl ect operator

budgets tightening due to un-

certain commodity prices.

Average rig utilization for

the fi nal quarter of 2012 is ex-

pected to be 45 per cent (or

374 rigs). Operating days will

be approximately 33,320.

Th e level of activity in

2012 is stronger than 2010

(when industry attained

41 per cent utilization and

119,303 operating days) but

not as strong as 2011 (52 per

cent utilization and 145,118

operating days).

CAODC forecasts drillingblip in 2013

A Canadian patent has

been granted to CO2 Solu-

tions Inc., which covers the

use of a biocatalyst for the

effi cient capture of carbon

dioxide.

CO2 Solutions, an inno-

vator in the fi eld of enzyme-

enabled carbon capture

technologies, believes the

patent may have signifi cant

potential for application in

the Alberta oilsands, an area

of current opportunity for

CO2 Solutions and where

pure CO2 can be produced

at high process temperatures

for enhanced oil recovery or

geologic sequestration.

Th e main application

of the patent includes high-

temperature CO2 capture

and production processes

and mineral-carbonation

opportunities where the bio-

catalyst, which includes the

enzyme carbonic anhydrase,

may be retained in the CO2

absorption phase to reduce

denaturation and losses in

the mineral material, respec-

tively.

In a prepared state-

ment, company president

and CEO Glenn Kelly said

the newly-granted patent

provides a process option in

a number of large industry

applications, including in oil

and gas production.

“It further strengthens

our already signifi cant intel-

lectual property in Canada

and adds important value

to our technology scale-up

and commercialization pro-

gram.”

CO2 Solutions receives carbon capture patent

Purchase 6 months now and receive the 1 year

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To see what people are saying about us go to: www.bellmedicalaesthetics.com

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Tattoo removal coming soon!!

Saxon Rig 170 was working for Williston Hunter just north of the U.S. border. Williston Hunter has been very ac ve in the area. Photo by Brian Zinchuk

Page 5: Pipeline News December 2012

PIPELINE NEWS December 2012 A5

BRIEFS

Briefs courtesy Nickle’s Daily Oil Bulletin

Saskatchewan’s active

drilling rig count hovered

around the 84 mark for much

of the early part of Novem-

ber. Th at is roughly 20 fewer

than the same time the year

previous, but about 12 more

than what was seen in 2010.

Th e percentage is much low-

er than last year, as there are

now substantially more rigs

in Saskatchewan. For much

of 2011, Saskatchewan had

approximately 125 drill-

ing rigs. Th at number has

climbed to 142. Th e result-

ing active percentage is now

59 per cent.

With the soft gas mar-

ket, British Columbia’s rig

count for the entire year

has been running well be-

low both its 2011 and 2010

numbers. On Nov. 9 it was

about 15 off the pace of both

previous years, sitting at 39.

Alberta had 271 rigs

working, accounting for 47

per cent of its fl eet of 580.

Th at’s down by about 80

from the year before, and 40

from 2010.

Manitoba saw a sharp

decline over October and

November, dropping to just

10 active rigs, off from 22

at the same time in 2011.

Other than spring breakup

or the traditional Christmas

shutdown, that’s the lowest

point it has been over the

last three years. With 21 rigs

in the province, it made for a

48 per cent active rate.

Fleet-wide, 404 of 797

drilling rigs were active in

Western Canada as of Nov.

9, making the utilization

rate just over half at 51 per

cent.

Not too hot, or cold

Bethany Kurz of the Energy and Environmental Research Centre in Grand Forks, North Dakota, gave the presenta on on hydraulic frac-turing, or “fracking,” to approximately 25 people in Weyburn on Nov. 7. Photo by Brian Zinchuk

A close look at hydraulic fracturing By Brian Zinchuk

Weyburn – Th e gallery area of Weyburn City Hall was full

on Nov. 7 in response to a presentation on fracking put on by

the Petroleum Technology Research Centre (PTRC).

Bethany Kurz of the Energy and Environmental Research

Centre in Grand Forks, North Dakota, gave the presentation on

hydraulic fracturing, or “fracking,” to approximately 25 people.

Th e information, presented to a full house, covered the history,

nature, science and technology of “fracking” as it known in pop-

ular culture, and also addressed many of the public questions

around this important hydrocarbon recovery method.

Kurz began by explaining the formation of oil in reservoirs

in a marine environment. Th e hydrocarbons (oil/gas) originally

began as organic matter (plankton, plants, animal remains, etc.)

that was buried and compressed by other layers of sediment.

“Over time, they get buried, and it heats up,” she said.

Th e oil and gas often migrate away from the organic-rich

source rock and accumulate in underground “traps.”

“At one time, when the Bakken formed, this was a huge

ocean, a tropical ocean, which is hard to believe.”

Th e Bakken has garnered the most attention recently, she

noted, but there are many other oil and gas producing forma-

tions.

Porosity is the amount of void space between the rocks,

while permeability is how well fl uids move in those spaces.

Sandstones tend to be high in permeability and porosity, and

make up conventional oil and gas reservoirs. Th ey were consid-

ered the “low hanging fruit” by the industry.

However, advances in drilling and fracturing makes uncon-

ventional plays more viable.

Th e Middle Bakken is more of a tight sandstone, not a shale

like the Upper and Lower units of the Bakken. It’s considered

tight, meaning it has low permeability. Creating fractures creates

passages in the rock, allowing the oil to fl ow, she explained.

“Hydraulic fracturing is nothing new,” Kurz said. It was

experimented with in Kansas in 1947. Th ey originally used na-

palm (gelled gasoline) and sand from the Arkansas River. Th ey

were very successful.

As far back as the 1900s, fracturing was accomplished with

nitroglycerine, a highly unstable high explosive. “Th ey would

pour it down the well and ignite it. Th e safety record wasn’t so

well.

In the 1950s, surplus Second World War Allison aircraft

engines were used to provide pumping horsepower.

Page A8

“The risk of fracturing into

a drinking water zone is equivalent to

the risk of dying from falling out

of bed.” – Bethany Kurz of the Energy and Environmental Research

Centre, Grand Forks, N.D.

Page 6: Pipeline News December 2012

A6 PIPELINE NEWS December 2012

Publisher: Brant Kersey - Estevan

Ph: 1.306.634.2654

Fax: 1.306.634.3934

Editorial Contributions: SOUTHEAST

Brian Zinchuk - Estevan 1.306.461.5599

SOUTHWEST

Swift Current 1.306.461.5599

NORTHWEST

Geoff Lee - Lloydminster 1.780.875.5865

Associate Advertising Consultants:SOUTHEAST

• Estevan 1.306.634.2654

Cindy Beaulieu

Candace Wheeler

Kristen O’Handley

Deanna Tarnes

Teresa Hrywkiw

CENTRAL

Al Guthro 1.306.715.5078

[email protected]

SOUTHWEST

• Swift Current 1.306.773.8260

Stacey Powell

NORTHWEST

• Lloydminster Randi Mast 1.780.808.3007

MANITOBA

• Virden - Dianne Hanson 1.204.748.3931

• Estevan - Cindy Beaulieu 1.306.634.2654

CONTRIBUTORS

• Estevan - Nadine Elson

To submit a stories or ideas:

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stories from our readers. To contribute please contact your

local contributing reporter.

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please contact the sales representative for your area to as-

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for their contributions and assistance with Pipeline News.

Published monthly by the Prairie Newspaper Group, a divi-

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Offi ce, Estevan, Saskatchewan.

Advertising rates are available upon request and are subject

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NEWSPIPELINE

Mission Statement:Pipeline News’ mission is to illuminate importance of Saskatchewan oil as an integral part of the province’s sense of community and to show the general public the strength and character of the industry’s people.

EDITORIAL

Th ere’s been more talk about exporting Canadian

oil and gas in recent years than you can shake a stick

at.

One recent proposal is to build a liquefi ed natural

gas (LNG) export terminal on the EAST Coast.

Th at’s a big change from what we’ve heard recently,

where everyone has been talking about the West

Coast.

Th is project would see the export facility built

at Goldboro, Nova Scotia. Th at also happens to be

where Sable Island natural gas makes landfall.

As far as we’re able to determine, the TransCana-

da mainline system doesn’t go that far east. It termi-

nates in Quebec. Shippers are troubled by the tolls

on that system right now, because it’s vastly under-

utilized, yet bills have to be paid. Indeed, there’s now

some very serious consideration to turn one of those

pipelines into an oil pipeline, as has already been done

with the initial Keystone pipeline.

You don’t want to build an export facility on the

St. Lawrence, however, because it is not ice-free. To

hit open water, you have to go east, which would

mean more new pipe. Don’t forget, that new pipe

would have to be built in what is essentially a hostile

environment to oil and gas, Quebec, where fracking

has been frozen out for “study.”

As such, an East Coast export facility may quite

literally be a pipe dream.

Back on the West Coast, we’ve got a newspaper

baron suggesting one of the largest refi neries in the

We must get to tidewater for our exports

world should be built at Kitimat, so that we export

refi ned products, not crude (and the jobs that refi ne said

crude).

B.C. Premier Christy Clark is doing her best im-

pression of Danny Williams, making demands and ex-

pecting the rest of the world to grovel at her feet. She’s

dead set against a pipeline carrying dilbit to Kitimat, but

a natural gas pipeline to the same port is perfectly fi ne.

Perhaps there’s a sense of desperation in the air

from gas producers, as their industry isn’t just on the

ropes, it’s lying on the canvas. Daily Oil Bulletin report-

ed that just nine gas wells were drilled in Saskatchewan

in the fi rst nine months of the year. Nine. Single digit

drilling.

So we, the Canadian oil and gas industry, and the

gas side in particular, absolutely must fi nd export mar-

kets where we can get more that $3 per gigajoule.

It’s doubtful LNG export facilities are going to

outnumber fi sh canneries on the coasts, but we’re going

to need some there to get this industry going again.

Most analysts are saying Canada must get into the

game right away, and secure long-term markets while

they are still available. With Japan all but shutting down

its nuclear power capacity after the Fukushima disas-

ter, the market there is ripe for the picking. If we sit on

our hands, we will lose this opportunity. Australia, for

example, would be more than happy to sell them LNG.

Fortune favours the bold, they say. But will Canada

be bold, or will we let this opportunity pass us by, like an

LNG tanker in the night?

Page 7: Pipeline News December 2012

PIPELINE NEWS December 2012 A7

PIPELINE NEWS INVITES OPPOSING VIEW POINTS. EDITORIALS AND LETTERS TO THE EDITOR ARE WELCOME.Email to: [email protected]

OPINION

Lee Side of LloydBy Geoff Lee

From the Top of The PileBy Brian Zinchuk

Are contami-

nants in the Atha-

basca Delta north

of the oilsands in

Alberta naturally occurring or the result of indus-

try?

Th at’s a question open to more debate and re-

search, but two small studies released in October

suggest the impact of the oil and gas industry in the

Athabasca oilsands region is not as great as some

critics and some environmental groups have con-

tended.

Th e pair of studies by University of Waterloo sci-

entists didn’t discover any increase over time of toxic

hydrocarbons or heavy metals in sediment samples

collected from lakes and rivers on the Athabasca

Delta north of the oilsands mines.

Some of the blame goes to Mother Nature.

Th e report notes that Athabasca River is essen-

tially self-polluting through erosion of the same hy-

drocarbon (bitumen) deposits that are being mined.

Th e studies however, were confi ned to just one

basin and both authors recommend that sediment

sampling be expanded to 40 basins to collect more

data.

One of the studies posted in the online journal

PlosOne stated: “We observe no measurable evi-

dence of related far-fi eld airborne metal contamina-

tion in the Peace-Athabasca Delta located (about)

200 km to the north.”

Th e second research paper published in Science of the Total Environment also concluded there was

no evidence of hydrocarbon deposits in lakes down-

stream of the mines.

“Despite rapid growth of oilsands development

during the past 25 years, the data reveal no measur-

able increase in concentration or proportion of river-

transported bitumen-associated indicator (hydrocar-

bons),” said the report.

Th e good news studies fl y in the face of high

profi le anti-development campaigns that paint all

production from the Fort McMurray area as being

“dirty oil.”

Th e tarring of the oilsands by environmentalists

led the Obama administration to block approval of

the 830,000 barrel per day Keystone XL from Al-

berta to the Texas last fall.

Environmental criticism of the oilsands as an

area where so-called dirty oil is produced has also

heated up opposition to the proposed Northern

Gateway pipeline from Edmonton to Kitimat, Brit-

ish Columbia.

Th e two latest Waterloo studies were funded by

oilsands producer Suncor, but the scientists say that

was due to other funding sources not being able.

Th e authors also publicly stated Suncor did not

have any say in the design or conclusions of the re-

ports.

Th e study was focused on what sediment core

samples from riverbeds and lakes dating back more

than 200 years revealed.

Scientists discovered that fl uctuating levels of

toxic heavy metals such as lead, arsenic and mercury

over the years, didn’t appear to be the linked with oil-

sands development.

“Enrichment of these metals peaked between

1950 and 1970 (at about 30 to 45 per cent above pre-

industrial values) and has been declining since,” said

one of the reports.

“Mercury enrichment began about two decades

later (post-1940s), peaked between 1965 and 1990,

and has since declined.”

Th e scientists used a similar method in the sec-

ond study to examine hydrocarbon deposits in several

lakes downstream from the oilsands in the Athabasca

delta.

Th at study also couldn't fi nd any increase of toxic

heavy metals in those deposits since oilsands mining

began.

While the study area was too small for its conclu-

sions to be extrapolated to the entire delta system, the

fi ndings are in stark contrast to other studies that link

contaminants to industry activity.

No doubt the fi ndings of the two small studies

will demand funding for wide large scale sediment

sampling to be conducted to distinguish between nat-

ural and artifi cial sources of bitumen in the water.

Only then can any reasonable conclusion can be

made about the impact of mining versus the power

of Mother Nature in the Athabasca Delta.

Is nature or industry polluting the oilsands?

It seems a month can’t go by without someone

suggesting a new export route or market for Western

Canadian Sedimentary Basin oil or gas. Th e most re-

cent one, however, strikes close to home.

When my stepfather, Brad Stroud, graduated

high school back in the 1970s, his grad gift was a

suitcase and a train ticket. He, like his father, would

end up working as a deckhand on a Hudson Bay

tugboat at the Port of Churchill. His father, Harvey,

served on the tugboat Graham Bell in the 1950s. Har-

vey’s mother Nellie lived there from 1968 to 1992,

and worked as a cleaner for the substantial U.S. Army

base and later for the RCMP. Harvey was also an

equipment operator for the U.S. Army.

As a child, Brad spent about three years in

Churchill, and was a classmate of the current mayor,

Michael Spence.

Brad’s perspective is rather unique. Not many

people have plied those waters, or the ones leading to

our northernmost port. He served two seasons on the

tugboat MV Toulon. It was the main harbour tug, and

there were two smaller ones at the time.

Th ey would handle roughly a dozen ships a sea-

son. Grain was the main shipment, especially barley

and wheat.

Th ey also shipped nickel from Th ompson. Die-

sel came into the port from the east. Liquid sulphur

rail cars would come from Alberta, for shipment out.

“Ships from Europe would come in and export it all

over the world,” Brad said of the sulphur.

“It used to catch on fi re. We would put it out

with our water cannons,” he said.

“Th e shipping season was so short. Ships would

have to get in, get loaded, and maybe they would get

two trips in a year.”

Th e fi rst season he worked, they were the last

boat out of the bay. Th ey went across Hudson Bay,

Ungava Bay, down the Labrador coast to the ship-

yards at Marystown, Newfoundland. It took “not

quite a week,” he said.

Th e tugboat was left there over winter for main-

tenance and the following spring they sailed it back

to Churchill. Along the way, they encountered sea

ice.

“Th e ice comes in packs. You have to follow along

until you fi nd a lead or hole. We had a pretty heavy-

duty tugboat. It wasn’t like an icebreaker, but it was

a steel hull.”

As for icebergs, he said, “We steered clear of

them.”

“Th e big problem was the insurance. Th e ships

could still get in and out. But after a certain date,

there was no insurance on any ships out there.”

“Not only insurance, but there was no air/sea res-

cue. Th ere was no one to come and get you.”

“In Norway and Russia, they have an icebreaker

and big ships go behind it. I don’t know what it will

be like with global warming. Quite a bit of the ice is

gone.”

As for the Labrador coast, Canada’s iceberg alley,

he said, “Th ey have to

watch, like the Ti-tanic. Ice is a critical

thing.”

One of the concerns regarding supertankers on

the West Coast is response to a potential oil spill. In

B.C., we can expect there’s at least some capacity to

deal with this already. Th ere’s a well-established Coast

Guard presence and thousands of boats and ships.

Taking a good look at the satellite photos of

Churchill, the only major port on the entire Hudson

Bay, (which is close in size to the Gulf of Mexico),

one soon realizes there are next to no boats of any

type, specialized or not, that can mount a response.

I count six things that can fl oat, and two are barges.

You simply can’t put a skimmer or containment boom

on a boat that doesn’t exist. It takes a long time to get

from Newfoundland to Churchill. On the U.S. Gulf

coast, there were plenty of resources to draw from

to deal with the BP spill, and we all know how that

went.

Brad noted, “Th ey brought in fuel during the

wartime. Th is is oil going the other way. Would it be

any diff erent?

“Th ey could make it into a world class port. Th ey

would have to make a highway. If this was the Soviet

Union, there would have been no question. It would

have been a world-class terminal.”

Brian Zinchuk is editor of Pipeline News. He can be reached at [email protected].

Should we ship oil north, to Hudson Bay?

Page 8: Pipeline News December 2012

A8 PIPELINE NEWS December 2012

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WITH THANKSFrom Our Entire StaffAT CHRISTMAS

As we wrap up yet another year, we’d like to acknowledge all the individuals - customers, neighbours, associates, and friends, who have made doing business here such a pleasure for us. 93 Panteluk Street, Kensington Avenue N, Estevan, Saskatchewan93 Panteluk Street, Kensington Avenue N, Estevan, Saskatchewan

PHONE:PHONE: 306-634-8828 • 306-634-8828 • FAX:FAX: 306-634-7747 [email protected] • www.nov.com

Addressing misconceptions about fracking Page A5

Nature of a frac jobA frac job will have

several key ingredients.

First, there’s going to be

a series of tanks to hold

water, a lot of it, gener-

ally speaking. Th ose

water tanks will then

be manifolded together

to a mixing tank. It

is pumped down into

a portion horizontal

wellbore that has been

isolated. Th is is a zone,

of which there will be

many. Th e water will

enter the formation

through holes in the

casing – the example

Kurz used was explosive

perforation – and the

pressure of the water

will cause the rock for-

mation to fracture.

A blender will ac-

cept proppant, small

granules to prop open

the fractures created

by the water pressure.

Th ese will range from

sands to ceramics.

“Th ere are diff er-

ent mechanisms for

hydraulic fracs,” Kurz

said.

“Over 2.5 million

frac operations have

been done globally, over

one million in the U.S.”

Th irty to 40 frac

stages are most com-

mon in the Bakken, she

said. More stages than

that haven’t seen as

much of an increase in

production to warrant

them.

IssuesTh ere have been

lots of issues in the me-

dia regarding hydraulic

fracturing, and a lot of

misconceptions. Kurz

started with facking

water.

“You hear these

numbers – three to

fi ve million gallons to

fracture a well. Th at

certainly sounds like a

lot of water,” she said.

Disposal of frac

fl owback is another

issue.

“You have movies

such as Gasland which

are complete misrep-

resentations of what

is actually happening,”

she said. Pulling up the

movie’s website, she

pointed out a graphic

that showed fractures

extending well up

towards the surface into

potable water aquifers.

“I would challenge

somebody to create

a fracture, given the

depths we’re really at, to

frac into a drinking wa-

ter zone. At a 9,000 or

7,000 foot depth, you’re

not going to be able to

create fractures all the

way into your drinking

water zone, which will

be in some cases up to

2,000 feet, your deepest

drinking water zone.

“Th is is oil spilling

out of a well. Industry

doesn’t want that. It’s

worth a lot of money,”

she said, pointing to an

animation of a gusher.

“You don’t want

to be fracturing into

a zone that contains

water, because that

means you are going

to produce more water,

which is expensive to

dispose of.”

“If your targeted

formation is 7,700

feet deep, that’s more

than six Empire State

Buildings stack. Typi-

cally your fractures will

extend hundreds of feet,

or 90 metres. Th ey don’t

typically extend very

far.”

A microseismic

study done in the

Marcellus shale forma-

tion showed that the

fractures came nowhere

near potable water

aquifers.

Regarding a sup-

posed lack of regula-

tion, states and prov-

inces already have

regulations in place,

from drilling wells to

disposal of wastes, she

said.

A typical frac job

will require three to fi ve

million gallons of water,

she noted, and have ad-

ditives mixed in. “In the

Bakken, typically in a

three week period, you

may only recover 17

per cent of that water.

You’re not getting a

whole lot of it out of

the ground.”

Th e rock almost

acts like a sponge and

absorbs water, Kurz

noted.

Typically only 20

per cent of the chemi-

cals will return. You

will get some of the

water fl owback, as well

as formation water that

may be as much as 20

per cent salt, far saltier

than sea water.

Four million gal-

lons of water is about

the amount used to

irrigate one section

of land for one day in

western North Dakota,

or one per cent of the

water used for cool-

ing for a 400 megawatt

power plant. It’s about

one-fi fth of the average

daily water use of the

City of Regina.

Typically water is

transported by water

hauling trucks. “Any-

thing they can use to

minimize truck traffi c is

benefi cial,” she said.

While water quality

needed to be very high,

now they are able to use

higher salinity water,

reducing costs to buy

water as well as water

transportation costs.

What else?A typical shale

fracturing mixture

makeup will be 90 per

cent water, 9.5 per cent

sand, and 0.5 per cent

chemical additives.

Page A9

Page 9: Pipeline News December 2012

PIPELINE NEWS December 2012 A9

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The gallery area of Weyburn City Hall was full during a presenta on on fracking, put on by the Petroleum Technology Research Centre.

Page A8Th e most common proppant is sand, highly

weathered sand from a beach. Missouri, Illinois and

Wisconsin are sand sources. Typically three to fi ve

million pounds of sand are used per operation.

Ceramics are the “Cadillac” of proppants, and

come from China, Brazil and Russia.

Biocides are added to reduce the growth of

hydrogen sulphide producing bacteria. Friction re-

ducing agents, which create “slick water” are surfac-

tants that promote fl uid fl ow. Polymers are used in

some cases to create a more viscous solution to hold

the proppants in suspension. Guar gum, used in the

food industry, is used for this purpose.

Scale inhibitors and acid treatments are also

used. Hydrochloric acid is used to clean swimming

pools, she noted.

Initially frac fl uids were not known by the

public, but now websites like fracfocus.com and

fracfocus.ca disclose what goes in.

Regarding frac fl owback, places like Penn-

sylvania have very few disposal wells. “Like two,”

Kurz said. For awhile some was taken to municipal

water treatment facilities, but that didn’t go over

well. “Th ey were not used to dealing with the same

chemicals as waste water.”

“More and more they’re looking at re-use and

recycling.”

Multiwell pads have substantially reduced

surface disturbance and reduced transportation of

drilling rigs. Some sites in the Horn River play of

British Columbia might have 16 wells on a site.

“Th e risk of fracturing into a drinking water

zone is equivalent to the risk of dying from falling

out of bed,” Kurz said.

As for the relationship between facturing and

earthquakes, yes, you will get microseismic events.

“If we had a geophone here, it would be the equiva-

lent of me jumping. It’s very low,” she said. “Th e

largest recorded was 2000 times less energy than a

magnitude 3 earthquake. In most cases it’s 10,000

to one million times less.”

Th at being said, in instances of deep well injec-

tion of disposal fl uids along faults, the fault can be

lubricated, causing movements.

Page 10: Pipeline News December 2012

A10 PIPELINE NEWS December 2012

Page 11: Pipeline News December 2012

PIPELINE NEWS December 2012 A11

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MAKE ITMERRY!

By W. Brett WilsonSpecial to Glacier Media

I grew up in Sas-

katchewan, and like

many people, I have a

huge soft spot for my

homeland. I have a

tremendous amount of

pride in my roots, and

great respect for the

people who pioneered

this part of the world.

In a relatively short

time, those determined

settlers – including my

great-grandparents –

helped turn the wild and

rugged prairie into one

of the greatest places to

live on Earth.

Part of what makes

Western Canada so

unique is the special

breed of people who

live here. Th ere’s just

something about this

place – this land – that

has helped to shape a

people that are solid to

the core. My aff ection

for the land is surpassed

only by my aff ection

for the people who live

here, and what sets

us apart is really what

holds us together – a

deep and enduring com-

mitment to each other.

Growing up in

North Battleford, a

small city just north-

west of Saskatoon, I

witnessed incredible

displays of community

spirit from a host of

people, but most notably

from my own parents.

My father, Bill Wil-

son, is a classic Prairie

gentleman. If a stranger

were stranded with a fl at

tire, he was the guy who

would pull over fi rst to

lend a hand. I once was

with my dad when he

backed up 1/4 mile on

a very muddy road just

to follow a neighbour

lady driving in another

direction because he

was worried she might

get stuck and need help.

My mother was equally

inspirational. As a social

worker, she was always

doing what she could

to help out the commu-

nity – from volunteering

for causes related to her

children to taking in

foster kids to teaching

parenting classes. For

my mom, giving back

was part of her DNA.

Th is commitment to

community is a wonder-

ful part of my legacy,

and probably yours. You

may be reading this in

Kamloops, Kipling, or

Calgary, but my guess is

that we share a simi-

lar belief: that the real

measure of success is

not just about hard work

and big rewards. It’s also

about giving back and

taking care of the people

around us. It’s about our

sense of community.

As a city, Calgary

has been shaped by

corporate and com-

munity leaders whose

collective dreams

have taken it from a

North West Mounted

Police outpost to an

international centre of

excellence for energy.

We owe many of our

greatest assets – such as

world-class sports teams

and facilities, dynamic

arts and culture, and

state-of-the-art health

care and education – to

the individual visions

and collective eff orts of

our community-minded

citizens.

One of my favourite

examples of great com-

bined eff ort comes from

my hometown. When I

started to become more

focused on personal phi-

lanthropy a decade or so

ago, I realized I hadn’t

yet done anything sub-

stantive to give back to

my birthplace – North

Battleford – so I orga-

nized large (to me) do-

nations to the both the

local United Way and

the Battlefords Union

Hospital. It didn’t take

long to learn that my

personal donation of

$100,000 matched the

United Way’s entire

fundraising goal for

that year. Until then, I

also learned, the big-

gest single donation the

United Way had ever

received was $5,000. I

was dumbfounded. I

knew that people in the

Battlefords had wealth,

but obviously they had

never been given a vi-

sion for building their

city through creative

philanthropy. I believed

there was a fair amount

of money sitting under

some mattresses in that

town. And it was time

to shake of some of it

loose.

I asked the hospital

CEO what else was on

his wish list and the

request for four new

anesthesiology ma-

chines caught my eye.

Th e hospital had four

operating rooms with

four old units on site,

but at least one unit was

down for repairs at any

given time. I told the

hospital that I would

give $300,000 toward

the new machines, but

they had to match my

donation by raising

$300,000 themselves. I

didn’t realize then that

the most the hospital

had previously raised

during one campaign

was $100,000.

Th e hospital accept-

ed my plan, but wanted

12 months to raise the

money. I thought for a

few minutes and gave

them three months. I

can only imagine the

nervous conversations

that took place at BUH

that day, but they called

back the next morn-

ing and agreed to the

three-month challenge.

Th e “Dollar-for-Dollar”

campaign was on.

Page A12

Rede ning Success

REDEFINING

S T I L L M A K I N G M I S TA K E S

W. BRETT WILSON

DISTRIBUTION INC.315A Kensington Ave., Estevan, SK

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May your holiday be brimming with good times and

glad tidings

It’s been a pleasure serving you this past year...thanks!

Page 12: Pipeline News December 2012

A12 PIPELINE NEWS December 2012

301 Kensington Ave.Estevan, SK.

Phone: (306) 634-3616

3902 - 75th Ave.Leduc, AB.

Phone: (888) 835-0541

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Serving the oil patch of Western CanadaLONG HAUL - Canada & US

The “Dollar-for-Dollar” campaign was on Page A11

It actually took less than three

months for the city to meet – and

exceed – their fundraising goal. Th ey

announced their victory on the lo-

cal radio station at the end of a very

touching multi-day radiothon, and

called me with the results: “Brett,

we have met your challenge – in

fact we blew through it – and have

raised $500,000!” I was so moved by

the way the community had come

together to support the hospital that

there was little I could do but match

them – dollar for dollar – and up my

donation to $500,000. Th e $1 million

total tally was an incredible boost for

the city, but the bigger impact came in

terms of community engagement. To

say the city and its citizens surprised

themselves would be an understate-

ment. But North Battleford is not

unique. Th ere are hundreds of similar

communities with innovative orga-

nizations addressing an assortment

of similar issues and causes – and

providing great opportunities for citi-

zens to work with them to make our

communities better places to live and

do business.

Page A13

Bre Wilson, originally from North Ba leford, has done well in oilpatch nance. In re-cent years he has turned his focus to philanthropic e orts. Photo submi ed

Page 13: Pipeline News December 2012

PIPELINE NEWS December 2012 A13

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www.samstrucking.ca

Page A12To me, the business value of philanthropy is obvious. Strong communities

attract new businesses, and quality employees, which in turn create an even

stronger business climate. Employees want to live in communities with a strong

economic and social fabric – places where they feel connected to one another

and enjoy a great quality of life. Without question, communities with a strong

economic base and a strong social fabric are the best places to live and work. As

business guru Don Tapscott has said, “Business cannot succeed in a world that

is failing.”

As one of the proud co-founders of Calgary’s FirstEnergy Capital Corp.,

I’ve seen the enormous impact one company can have on its community. It

would be nearly impossible to measure the number of lives that have been dra-

matically improved by FirstEnergy’s philanthropic work. In addition to donat-

ing more than $10 million to more than 500 community agencies over the past

almost 20 years, FirstEnergy has raised millions for the victims of the 1997

Manitoba fl ood, the Quebec ice storm in 1998, the Alberta drought in 2002,

and the Slave Lake disaster in 2011.

But the best corporate philanthropy doesn’t just make a social impact – it

also adds to a company’s bottom line. FirstEnergy didn’t set out to be a leader

in corporate philanthropy. We did set out to be a leader in investment banking.

And we used charitable giving as a marketing tool. Every time we gave a con-

tribution to a charity, we were very open about the fact that we expected some-

thing in return. What we gained in the form of public recognition, co-branding

with larger companies, or recognition within the charity’s network helped us to

dramatically increase our profi le, develop new partnerships, and grow our client

base. Th at is the kind of return on investment corporate philanthropy should

expect to achieve.

In my world, giving and getting defi nitely go together, but philanthropic

giving can be more rewarding than you might expect. I’m quite candid about

the fact that when I fi rst started my career 30 years ago, my goal was simple:

I wanted to make money – and lots of it. I wanted success, the big house, and

a few nice toys in the garage. What I soon learned was that fi nancial success

can become surprisingly hollow. Ironically, philanthropic pursuits produce a

much more satisfying return. So after spending many years focused on making

money, I now spend as much – if not more – of my energy giving it away.

Th at’s why I am constantly challenging people to think carefully about how

we measure success. Earlier this year, the fi rst World Happiness Report was

released. It attempted to measure social and economic well-being around the

world. Canada placed fi fth. It came as a surprise to some people, but not to me,

that a nation's happiness is not necessarily tied to its economy, but has more to

do with things like personal freedom and strong social networks.

Just like the people who settled our communities decades ago, we are wired

to connect with and care for one another. If we stop measuring success based

on material wealth, and start measuring it in terms of things we really value

– like our relationships with family and friends, and the quality of our com-

munities, then we all might start to feel richer than we thought possible. To

me, the real bottom line is not about how much we get, but how much we are

privileged to invest in others. Th at’s how I have redefi ned success.

Business, entrepreneur and philanthropist Brett Wilson is publishing a new book in November. Entitled Redefi ning Success: Still Making Mistakes it will in bookstores this month. Brett Wilson authored this column in partnership with Glacier Media Group, which has extensive holdings in community media and business-to-business media across Canada. Pipeline News is a part of Glacier Media Group.

Page 14: Pipeline News December 2012

A14 PIPELINE NEWS December 2012

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Gilliss Power Tongs handles casing sizes from 2 3/8” up to 20”

By Brian Zinchuk

Estevan – When smaller tubulars

need to go down a well, the old way

of doing it involved putting your back

into it to get the pipe to the drill fl oor.

Th e roughneck would typically bend

over and lift it off the catwalk, ground

or truck. In some cases, air-driven cat-

walks would at least lift it from waist

level and up towards the elevators on

the drilling fl oor, but it still required

lifting. In other situations, a sling was

used.

“I felt the oilfi eld needed a safer

tool to assist in picking up the smaller

tubulars from the ground/catwalk,

into the rig elevators and laying them

back down,” said Dean Gilliss. He

recently retired from Gilliss Power

Tongs, completing his management

contract after selling the company to

Wyoming Casing Service in 2008.

His wife, Bonnie, was also active in

the management of Gilliss Power

Tongs, and is now working with him

on the new venture.

“Th e current methods were to ei-

ther hand bomb or lift with a conven-

tional sling. I explained the concept

to my partner at the time and my idea

soon became a working prototype.

“At the time the tool had to be

government-tested. We took the

prototypes to PAMI in Humboldt, to

have the testing done, and a compli-

ance certifi cate was obtained. Ap-

plications for both U.S. and Canadian

patents were made. Th e U.S. patent

was granted, and we are awaiting the

Canadian patent.”

Th e company was originally called

R&D Technologies, and was founded

in 2006. Th e partnership eventually

fell apart, however, and it eventually

became Gilliss Oil Tools in 2008.

“Even though the tool was well

received, there were a number of

factors between 2006 and 2011 that

hindered marketing and sales of the

tool,” he said.

Th e project hung dormant during

that time largely because he focused

on operating Gilliss Power Tongs

until the handover was complete last

year. Dean and Bonnie’s son, Dylan,

now is general manager, and their

other son, Logan, handles sales for

Gilliss Power Tongs.

“I’m happy we sold,” Bonnie said.

“I am too,” added Dean.

Th eir focus is now on sales of the

new product, and those sales have

picked up substantially. “We sold

more this year than in the last fi ve

years,” Bonnie said.

Th e tool itself is deceptively

simple, but there’s a lot of thought

involved.

Th ere are three main parts – the

body, which has half of the clamp, the

lifting eye which includes the second

half of the clamp, and the release.

When you pull the release (which

originally had a hockey puck for a

handle), the jaws open. When the

jaws are placed over a pipe, the lower

part of the lifting eye piece engages

the pipe. It does this by having a cam

feature which causes the mouth of the

jaws to close and then lock into place.

Since the lifting eye is off centre,

any time the lifting eye has tension on

it, the jaws will remain closed. Even

if you open the release, the jaws will

not open unless there is slack on the

lifting eye. Th at’s an important safety

feature.

To let go of the pipe, the release

must be pulled and tension slacked off

the line.

Th e clamps come in four sizes –

2-3/8, 2-7/8, 3-1/2 and 4-1/2 inch.

Th e wrong sized clamp will not work.

Either it will be too loose and slide, or

it will not fi t.

Th e two popular sizes are 2-7/8

inch in Alberta and 3-1/2 inch in

Saskatchewan. Gilliss Power Tongs

runs a lot of 4-1/2 inch tubing and

has a unit on each truck.

“It’s a mechanical clamp. A guy in

Edmonton started calling it a ‘bull-

dog clamp.’” Dean said. “Th at’s what

people call it now.”

Th e design has evolved over time.

Initially the lifting eye had a rounded

end. Two ears were added to ensure

that the tugger’s hook stays straight

and cannot set off the release mecha-

nism. Th is is a safety feature. (Th e

tugger is lighter-duty hoist on a rig.)

A handle was added on the op-

posite side. Some users attach a tag

line to the handle to make it easier to

retrieve.

Finally, the manufacturing process

has been revised. While the thick,

hard steel is cut by water jet, the in-

side of the clamp is now machined on

a lathe, allowing for tighter tolerances.

Page A15

Why lift it by hand when you can grab it with the tugger?

Page 15: Pipeline News December 2012

PIPELINE NEWS December 2012 A15

Cell: (306) 487-8120 Bus: (306) 487-2608 • Fax: (306) 487-2296Lampman, SK. Email: [email protected]

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A roughneck uses a “bulldog clamp” in the eld on Sun Country Rig 8 in October. The clamp allows rig hands to use the tugger to li up pipe, as opposed to “hand bomb-ing” it.

Page A14

Th ey were initially

made in North Bat-

tleford, but Dean felt

that was too far away to

keep an eye on produc-

tion. Th e second manu-

facturer was in Regina,

but they went bust.

Now manufacturing is

done in Estevan, at the

recently renamed Axis

Services.

Th e usage is pri-

marily on service rigs

since the advent of the

“skate” on drilling rigs.

Th e skate is the me-

chanical device on a

hydraulic catwalk that

pushes a pipe up to the

drilling fl oor.

“We’re more geared

to the service rig side,”

he said.

With most of

its steel components

roughly an inch thick,

it’s not likely this clamp

will wear out any time

soon. Rig Locator lists

only 1,010 service rigs

in all of Canada, for

instance.

“It’s kind of a niche

market,” Dean said,

picking up a pen.

“Th is BIC pen, you

build four billion of

them, then four billion

again,” Dean cited as an

example of goods that

are constantly replaced.

Durable goods, how-

ever, will last.

As a result, con-

tinued sales will mean

seeking markets further

afi eld. Th e fi rst market

is straight south.

“We have a com-

pany, a distributor,

handling the northern

states,” he said. Th ey

are now looking for

a distributor for the

Midwest and southern

states.

Dean is looking for

more exclusive arrange-

ments, so that those

who do carry the clamp,

it have more interest to

promote it than having

it as a commodity all

over the place.

In the early days of

this venture, they talked

to a large, international

outfi t, but were brushed

off . “Th ey were selling

things that cost mil-

lions,” he said.

Another large fi rm

backed off back then,

too. But that’s not stop-

ping them.

Th is winter the

Gillisses will be taking

the tool on a road show

down south during

their snowbird months.

Houston is targeted

for demonstrations,

although actual sales are

expected to be handled

by someone else.

“I’m going to be

showing how the tool

works, in the fi eld and

training facilities,” he

said.

Making personal

connections is a key

business strategy, as

Dean noted he would

go to Calgary about

four times a year while

running Gilliss Power

Tongs. Going for sup-

per, talking face-to-face;

these sorts of contacts

are invaluable, he feels.

“It always paid off .

We’ll see what happens

in the States.”

“Baby steps,” Bon-

nie said.

“Anywhere there’s

an oilfi eld, there’s a

potential market,” Dean

said.

Part of the chal-

lenge will be overcom-

ing old school thinking,

which Dean readily

acknowledges is out

there. “Th at’s how we

did it for 40 years,” he

said is an attitude they

have to overcome. “We

hand bombed it all our

lives, they can too.”

Th ey saw similar re-

luctance with the intro-

duction of air slips with

Gilliss Power Tongs.

“It’s called progress,”

Dean said.

“It’s a back thing,”

Bonnie added.

While it weighs

around 25 pounds, in

use much of that weight

is taken up by the tug-

ger cable. “You’re guid-

ing it, but the weight is

on the tugger,” he said.

“It’s not about the

money. It’s about the

logo – Gilliss Oil Tools

– on the bottom. I’ve

been in the oilfi eld for

34 years this spring. It’s

about giving back. Th e

people who use it really

appreciate it,” Dean

said.

Page 16: Pipeline News December 2012

PIPELINE NEWS December 2012 A17A16 PIPELINE NEWS December 2012

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Have A Safe And Happy Holiday Season. We Look Forward To Working With You In 2013.Have A Safe And Happy Holiday Season. We Look Forward To Working With You In 2013.

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Page 17: Pipeline News December 2012

A18 PIPELINE NEWS December 2012

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Shaun Kozak, Mineral Manager 306-790-4352Chad Morris, Surface Manager 306-790-4363Celeste Farrow, Surface Coordinator 306-790-4378Laurie Bielka, Assistant Branch Manager 306-790-4360Crown Sale Inquiries 403-261-6580Main Line: 306-359-9000

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Office (306) 457-2785Email: [email protected]

Cell (306) 457-7692www.goudytransport.sasktelwebhosting.com

Wishing you a veryMerry Christmas

& Prosperity in 2013!

By Brian Zinchuk

Estevan – On Oct.

26, Minister of the

Economy Bill Boyd

spoke to the Estevan

Chamber of Commerce

about the direction

the province is going

in. After his speech,

Pipeline News was able

speak to the minister

about the sorry state of

gas development, ship-

ping crude-by-rail, and

land sales among other

things.

Earlier this fall, the

province announced its

intentions to establish a

sovereign wealth fund,

similar to Alberta’s

Heritage Fund.

Boyd said, “It’s

in the works now for

establishment. It will be

up and running relative-

ly soon. First we want

to pay down the debt

in Saskatchewan before

putting money into that

fund. Mr. (Peter) McK-

innon will be looking

at diff erent priorities in

terms of establishing

the fund. We’ll look-

ing at diff erent ways of

creating money to go

into that fund, mainly

from the resource sector,

I expect. And he’ll be

looking at the types of

investments we will put

the resources into in the

future.”

Th e goal, he said, is

for the province to be

debt-free before putting

money into the fund.

While the speech

from the throne spoke

of dedicating $400 mil-

lion a year to pay down

debt, Boyd elaborated,

“Th at’s the minimum.

If we see the kind of

growth in the economy

we’re expecting, and

if we see, particularly

in the area of potash,

the growth that we’re

expecting, I think you’ll

see signifi cantly more

paydown going for-

ward.”

Th e Daily Oil Bul-letin reported in late

October that in the

fi rst three quarters of

the year Saskatchewan,

had only drilled nine

gas wells. “It’s certainly

a concern to us,” Boyd

said. “We put forward a

gas well royalty reduc-

tion program a couple

of years ago. We haven’t

seen the kinds of

stimulation of industry

we would like. We’re

at very, very low prices

for natural gas, and as

a result of that, the in-

dustry has moved their

priorities from gas to

oil, which is no surprise.

At some point in the

future, I think we’ll see

gas prices bump up,

and it will restart the

industry in Saskatch-

ewan. Th e gas sector is a

bit of a disappointment

in terms of the activity

we’re seeing, no ques-

tion.

“Gas was not a

huge part of our royalty

regime in the past. Oil

was much more signifi -

cant in terms of gener-

ating royalties for the

province. We’ve seen a

little bit of a reduction,

but there’s really not

much that can be done.

Th is is a profi t-driven

business. If companies

aren’t making profi t,

they’re going to move

their capital into other

areas, and they are.

Asked if there’s

anything else the prov-

ince can do to stimulate

gas production, he said,

“I don’t think there are

anymore steps being

contemplated at this

time. You can only re-

duce rates so much, that

you might as well be

giving it away. We’re not

prepared to do that.”

Nordic Oil and Gas

reported fi rst produc-

tion of oil from a well

near Preeceville in

October. It’s the fi rst oil

producing well in east

central Saskatchewan.

Asked what this means,

he said, “We’re excited

about the possibilities of

expanding oil produc-

tion in Saskatchewan.

Clearly there’s explora-

tion going on in a num-

ber of areas around the

province, and it’s quite

exciting. Th ere may be

additional pools of oil

across the province that

haven’t been explored

at any great length in

the past. We’re doing

everything we can to

encourage that type of

activity now, and in the

future. Obviously it’s a

good news story when

we see another area that

may have signifi cant oil

production now, and in

the future.

“Th e only way

you’re going to fi nd it

is with drilling activity.

Th e use of new tech-

nologies has certainly

helped. We would want

to wish the companies

involved in that area the

very best in luck and

fortune in the future.”

He noted time to

time there are permits

given for outlying areas

that don’t result in a

lot of production, but

there’s always the pos-

sibility that they could.

Page A19

Boyd address sovereign wealth fund, gas drilling, and future developments

Bill Boyd

Page 18: Pipeline News December 2012

PIPELINE NEWS December 2012 A19

Page A18Land sales are down substantially this year compared to previous years.

Asked about the resulting impact on provincial revenues, Boyd said, “It’s had

an impact. Land sales are a fairly signifi cant generator of activity for our prov-

ince. It’s clearly a benchmark of activity going forward. We’re a little bit backed

up, still, because of fl ooding problems in the southeast part of Saskatchewan.

We’ve also seen oil prices have come off a fair bit in the last little while. Th at

creates a pullback in the industry, naturally. We expect that will pick up in the

future.

“I think a lot of oil companies have a signifi cant backlog of wells they want

to drill, in properties they already have, and they’re simply not investing in

those land sales at the moment.

“We’ll continue to see strong drilling activity, but we’ve got to see land

sales pick up in the future if we’re going to continue to see that level of devel-

opment. A lot of companies, though, have huge infi ll drilling opportunities to

explore and to develop, and we’re seeing a lot of that activity right now. We’re

still seeing production improving. We’re still seeing growth in the industry.

We’re not alarmed at this trend, but it’s something we have to keep an eye on.”

On the topic of the growing shift to shipping crude-by-rail, Boyd said,

“We’re seeing a tremendous increase in opportunities to move crude-by-rail

all across Saskatchewan, not just in the southeast, but in many locations. It’s

created another opportunity for moving Saskatchewan oil to export posi-

tions, into the United States primarily. Th ere may be the possibility of moving

signifi cant volumes to the West Coast and other destinations in the future. We

have a resource here that is very signifi cant, and we believe there is growing

opportunities for the sale of that resource into markets around the world into

the future. Th ere’s opportunities for those markets to be explored, to move that

product into international markets. It would greatly enhance the viability of oil

operations in Saskatchewan and increase revenue streams to the province in the

future.

“Clearly we’re onside in terms of seeing those kinds of pipelining oppor-

tunities or other transportation methods for moving product into positions of

sale.”

Ac vity is picking up for crude-by-rail operators. These cars were seen at Bro-mhead, just east of Long Creek Railroads Southall facility on Nov. 7.

Photo by Brian Zinchuk

Page 19: Pipeline News December 2012

A20 PIPELINE NEWS December 2012

LINELOCATING

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GPSMapping

www.absolutelocating.com

Serving Southeast Saskatchewan and Southwest Manitoba

Box 235Oxbow, SKSK S0C 2B0Canada

Dispatch: 306-483-7897 Office: 306-483-2194

Fax: 306-483-2292Email: [email protected]

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Prairie Mud ServicePrairie Mud Service

HAPPYHOLLY

DAYS!As another year comes to a close, we want to let you

know how very much we enjoyed serving you, and wish you all a very joyous and wonderful holiday season.

Head Of ce: Estevan, SKHead Of ce: Estevan, SKTel: 306-634-3411Tel: 306-634-3411

By Brian ZinchukRegina – A made-

in-Saskatchewan stan-

dard regarding storing

carbon dioxide under-

ground has been ac-

cepted by the Canadian

Standards Association

and the government of

the United States.

CSA Group, a

leading developer of

standards, codes and

training programs, and

the International Per-

formance Assessment

Centre for Geologic

Storage of Carbon Di-

oxide (IPAC-CO2), an

environmental non-gov-

ernment organization

(ENGO), announced

Nov. 15 the world’s

fi rst bi-national carbon

capture and storage

(CCS) standard for the

geologic storage of car-

bon dioxide (CO2) for

Canada and the United

States.

After three years of

working on the world’s

fi rst standard for the

geologic storage of

carbon dioxide, IPAC-

CO2’s work on the stan-

dard is now realized.

Developed by

IPAC-CO2 in collabo-

ration with CSA Group

(formerly CSA Stan-

dards), a leading devel-

oper of standards, codes

and personnel certifi ca-

tion programs, the new

standard will provide

essential guidelines for

government regulators,

project developers, and

researchers involved

with CCS around the

globe. Th e standard will

focus on areas such as:

requirements for site

selection and charac-

terization, monitor-

ing, measurement and

verifi cation, injection

operation, modeling and

risk assessment, cessa-

tion of injection and site

closure.

Th e CSA Z741 Geological storage of

carbon dioxide standard

is a bi-national Can-

ada-U.S.A. consensus

standard, developed

with a technical com-

mittee of more than 30

professionals represent-

ing industry, regulators,

researchers and NGOs

from both sides of the

border. Th e genesis of

the standard was a seed

document developed

by IPAC-CO2 based

on their research. It

is intended that the

new standard will also

be used as a basis for

the international CCS

standards through the

International Organiza-

tion for Standardization

(ISO).

“It’s been a long

time birthing this baby,”

Dr. Carmen Dybwad,

CEO of IPAC- CO2,

told Pipeline News. “It’s fi nally out the door. Th e

next step is ISO.”

Th at will be a much

more complete standard,

encompassing capture,

transport and storage.

Th e recently accepted

CSA standard just cov-

ers storage.

“We started with

the easiest and most

important,” she said.

Transportation is al-

ready largely covered by

National Energy Board

standards. “Th ere’s lots

of pipeline regulations,”

she said.

On the capture end,

she noted, “Th ere’s so

many diff erent types

of capture technology.

Th ey’re still experiment-

ing.”

Storage, she said, “is

the jewel.”

“Th e real nuts and

bolts rests with capture.

China is probably going

to be the leader in this,”

Dybwad said, noting

a recent billion dollar

Chinese purchase into a

plant in Texas.

“Th ey (the Chinese)

want the intellectual

property.”

Th e ISO process is

expected to take three

to four years, at mini-

mum. Th ere are 13 or 14

countries that are active

participants, which

means a lot of negotiat-

ing.

Th e CO2 storage

standard, at a practical

level, is used in charac-

terizing reservoirs, doing

risk management and

site certifi cation.

To that end, IPAC-

CO2 has signed a mem-

orandum of understand-

ing and non-disclosure

agreement with the

Petroleum Technology

Research Centre, which

has recently completed

its injection and ob-

servation wells for

the Aquistore project.

Aquistore will take CO2

from the Boundary

Dam carbon capture

project and inject it into

a deep saline aquifer.

“We will do an

independent assess-

ment of the initial risk

assessment,” Dybwad

said, adding third party

assessments provide

confi dence for regula-

tors and the public alike.

“It ensures you con-

sidered all the aspects,

i.e. reviewing potential

for microseismic.”

IPAC- CO2 has CO2 standard accepted

Page 20: Pipeline News December 2012

PIPELINE NEWS December 2012 A21

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Page 21: Pipeline News December 2012

A22 PIPELINE NEWS December 2012

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Goodwater – Th ere was a time when the long-established Goodwater Ma-

chine Shop focused on repairs. Now, much of their work is in manufacturing.

Goodwater Machine Shop is owned by Lionel and Donna Wanner, who

purchased the operation in 1986. “I couldn’t even spell machinist until I bought

it,” Lionel said. “My uncle, Phil Wanner, bought it in 1967. He sold it in 1979.

We bought it from Frank Bird in 1986.”

Th e Wanners’ son, Kevin, is now a pressure welder with the fi rm.

When the Wanners purchased it, the company handled machining, general

repairs and fabrication. Over the years they have expanded that.

“We do lease mowing and maintenance, i.e. jack repairs, snow removal –

blowing and dozing,” Lionel said.

“I also do consulting for lease construction.”

Gibson’s (formerly Palko Energy) disposal sites at Oungre, Stoughton and

Midale saw Goodwater Machine Shop do piping and catwalk work.

“We had two crews with welders. We did the pressure welding,” he said.

As for welding work, Lionel said, “We used to sub it. Once Kevin got his

welding tickets, we started doing it on our own. We have another welder now,

Tyler Gammack.”

Th e company also manufacturers several products. “We build livestock han-

dling equipment and build corral systems. We do prefab and on-site.”

Th e Wolseley Natural Valley slaughterhouse was one of their projects, as

was the Neilson Bros. operation in Moose Jaw.

As for oilpatch products, Tex fence is one line, while Texas gates are an-

other. Used tubing from oilwells is one of their primary working materials.

“We use used tubing – 2-7/8 and 2-3/8 of an inch.”

Casing pipe is used for Texas gates.

Th ey try to source much of their new materials locally, if possible.

New products are now the majority of their work, with just 20 to 30 per

cent of the business in repairs.

“We’re basically a job shop. If you want something made, we’ll do it.”

Page A23

Lionel Wanner and his wife Donna have owned and operated Goodwater Machine Shop since 1986. Beside him is some stackable, free-standing Tex fence.

A shift from repairs to manufacturing

Page 22: Pipeline News December 2012

PIPELINE NEWS December 2012 A23

Page A22Ten people work for

Goodwater Machine

Shop. However, its loca-

tion, in a small hamlet

a half hour’s drive from

Weyburn, has its chal-

lenges. Lionel said wist-

fully that he there was

once a cafe next door

with accommodations

above it, but he had it

knocked down many

years ago. Th ose accom-

modations would have

been useful now.

“In the bright lights

of Goodwater, it’s really

tough to keep machin-

ists,” he said, adding,

“we use a lot of subcon-

tractors.”

“We have guys

driving from Ogema,

Weyburn, Radville and

Torquay.”

Th ey try to be nine

to fi ve, he said, but

acknowledged, “We’re

not. We off er service on

weekends.”

Snow removal in

particular happens when

it snows. Last year there

was only a few hours

work. “Th ere was just no

snow. Th e year before, it

was insane,” he said.

Th eir other son,

Terrance, is a machinist,

but he has since moved

on to become a land

agent. Both of the sons

worked service rigs, and

Kevin also spent some

time on drilling rigs.

Th eir daughter,

Michelle, worked at the

company in her younger

days during summer

holidays.

As for the future,

Lionel said, “We plan

on building cement

tanks, that and contain-

ment walls.”

Th ey are also con-

sidering a new shop.

Ed Lennox welds free-standing, stackable Tex fence at the Goodwater Machine Shop. Photo by Brian Zinchuk

Used casing pipe makes for good Texas gates.

Page 23: Pipeline News December 2012

A24 PIPELINE NEWS December 2012

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Here’s hoping the holiday delivers an abundance of glad tidings to you and yours. For your kind patronage,you have our heartfelt thanks.

By Josh SchaeferFor Pipeline News

Delisle – Cobra Industries Ltd. started in 2007

by building components for other tank manufac-

turers, and after a work slowdown, owner Pat Esau

decided if they built all of the parts for the tank,

why not build the rest of it as well?

“We built a complete tank and took it to the

oil show in Weyburn,” Esau explained, “and it took

off from there. It’s pretty much been steady ever

since.”

Cobra Industries operates in an industrial

building in Delisle, a 20 minute drive from Saska-

toon. Pat’s father Dean, who runs operations for

the company, said that the land they are on was

formerly a golf course. When the course moved to

the other side of town, it left a stretch of vacant

property along one side of Highway 7.

Page A25

Quality is priority for Delisle company

Alex Karpenko (centre) measures a piece component for the tank that is being manufacturing, while two other mem-bers of the sta assist. Photo by Josh Schaefer

Page 24: Pipeline News December 2012

PIPELINE NEWS December 2012 A25

www.carsonenergyservices.com(306) 487-2281(306) 487-2281

• Oil eld Maintenance• Welding• Oil eld Construction• Pipeline Construction• Facility Construction• Mainline Pipeline Construction• Safety Sales & Service• Environmental Services• Horizontal Directional Drilling• Picker Trucks• Pile Driving• Hydro vac• Gravel and Sand Hauling• Skid Packages• Lease Preparation• Insulating• Major Facility Construction• Gas Plant Turnarounds

Carson Energy Services works with clients from 13 loca ons across Alberta and Saskatchewan, serving a footprint covering both those provinces and southwest Manitoba.

• Lampman• Alida• Calgary• Carlyle

• Saskatoon• Swift Current• Virden• Wainwright• White City

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Page A24“Th ese lots were sitting empty for years, so we approached the town about

building here,” said Dean. “It costs a lot less for commercial property (com-

pared to a city), and we think it’s an ideal location.

“It’s maybe a bit tough for people that need tanks to fi nd us, we’re not right

in their area and they won’t run across us right away, but we can service a larger

area.”

With access to major shipping corridors, Cobra Industries can service the

entire province of Saskatchewan from their central location.

Before moving into town limits earlier this year, Cobra Industries was

building 400-bbl. tanks on Dean’s farm about 15 kilometres southeast of the

town.

Th ey have a larger building and a staff of about fi ve people, and are build-

ing up to three tanks per week. “Now that we’ve moved in here, we have the

room to build bigger tanks but in the other shop we didn’t,” Pat explained.

Th e company builds all of their tanks horizontally. By using a rotating jig,

they are able to weld the fi ve-foot wide rings together in one constant, consis-

tent weld. Th e rotating jig also makes it easier to manoeuvre the tank around to

weld the various components on to it. Th is arrangement allows them to install

those the components, such as fl anges, at ground level.

Page A26

Sergiy Gryshchenko welds the base for one of the tanks that Cobra Industries is cur-rently manufacturing. Photo by Josh Schaefer

Page 25: Pipeline News December 2012

A26 PIPELINE NEWS December 2012

315A Kensington Ave., Estevan, SK

(306) 634-2835Fax (306) 634-2797

1730 Ebel Road, Weyburn, S4H 1V3Ph: (306) 842-5081 Fax: (306) 842-5309

www.apexdistribution.com

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Page A25“Each company has their preferred method of assembly,” Pat said. Th e

horizontal method is easier to work with and does not require as much heavy

lifting as a vertical assembly method would take.

Cobra Industries puts a high priority on building a quality product. “Th ere

are a lot of good tanks out there, and there are also a lot of poorly-built ones,”

Pat said, “and we don’t put out a huge quantity, but we try to put out the best

quality.”

Pat noted of the tanks they have sold, they haven’t received a complaint

about the units at all.

Safety is also a large contributing factor to how they build their tanks. Co-

bra has recently joined the Safety Association of Saskatchewan Manufacturers.

“We just wanted to provide a safe environment for all of our staff ,” Dean said.

“In the other shop, we were only concentrated on building 400’s and that’s

what we’ve still been doing,” Pat said, but in the near future, Cobra will be set-

ting up to build bigger tanks, citing a lot of inquiries as the reason for expan-

sion.

Alex Karpenko welds a component onto one of the tanks. Photo by Josh Schaefer

High on quality

Page 26: Pipeline News December 2012

PIPELINE NEWS December 2012 A27

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SUCCESSHEALTHHEALTH

PEACEHOPELOVE

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Calgary – TransCanada Corp. has teamed up

with Chinese-owned Phoenix Energy Holdings

Ltd. to construct a $3 billion pipeline in northern

Alberta that would carry 900,000 barrels per day of

crude oil and 330,000 barrels per day of diluent.

Both companies will own a 50 per cent share in

the 500 kilometre Grand Rapids project to connect

a developing oilsands area northwest of Fort Mc-

Murray to the industrial heartland near Edmonton.

Phoenix Energy, a business entity of stated-

owned China National Petroleum Corp. is devel-

oping its Dover and MacKay River oilsands assets

and has entered a long-term commitment to ship

crude oil and diluent on the Grand Rapids pipe-

line.

Th e new pipeline system will be operated by

TransCanada and is expected to be in service by

early 2017, subject to regulatory approvals, with

capital spent between 2014 and 2017.

“As Alberta crude oil production continues to

grow, it’s critical to have the infrastructure in place

to move oil to market from emerging developments

west of the Athabasca River,” said Russ Girling,

TransCanada’s president and chief executive offi cer

in an Oct. 29 news release.

“Th is is the fi rst major pipeline project to meet

the needs of this fast-growing area.

“We are pleased Phoenix is joining us on the

Grand Rapids pipeline project to transport this

growing, long-term supply of Canadian crude oil

in a manner that respects the communities and

environment where the pipeline will operate.”

Th e project will be constructed, owned and

operated by the Grand Rapids Pipeline Limited

Partnership, which is jointly owned by Phoenix and

a wholly-owned subsidiary of TransCanada Corpo-

ration.

“Phoenix is committed to developing its Dover

and MacKay River oilsands assets through multiple

phases,” said Zhiming Li, Phoenix’s president and

chief executive offi cer.

“Given that transportation in the Athabasca

region has become a bottleneck, working with

TransCanada to build a pipeline system in a timely

fashion is crucial to implement our development

strategy.

“Th is transportation solution will be important

to Phoenix and other potential producers in this

area to monetize their huge resources,” Li said.

Page A28

TransCanada, Chinese to build oilsands pipeline

Page 27: Pipeline News December 2012

A28 PIPELINE NEWS December 2012

3D3D MAINTENANCEMAINTENANCECell numbers: Cell numbers: 483-8024, 483-7024, 483-8148483-8024, 483-7024, 483-8148

Home number: 486-2143 • Fax: 486-4855Home number: 486-2143 • Fax: 486-4855Box 12 Frobisher, SK. S0C 0Y0Box 12 Frobisher, SK. S0C 0Y0

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Page A27

TransCanada

expects to apply for

regulatory approval for

the project in 2013.

Th e fi nal pipeline

route and design will

be determined with

Aboriginal and stake-

holder input, as well as

consideration for envi-

ronmental, archeological

and cultural values, land

use compatibility, safety,

constructability and

economics.

Th e Grand Rap-

ids system will further

expand TransCanada’s

liquids transportation

capabilities and comple-

ment TransCanada’s

extensive operating

experience in Alberta.

TransCanada

recently announced the

Northern Courier Pipe-

line project, a 90-kilo-

metre pipeline system

to transport bitumen

and diluent between the

Fort Hills mine site and

the Voyageur Upgrader

located north of Fort

McMurray, Alberta.

Critical to have the infrastructure in place

Rig Locator records

show that 82,295 oper-

ating days were booked

in the fi rst three quar-

ters of 2012 by members

of the Canadian Asso-

ciation of Oilwell Drill-

ing Contractors, down

from 95,084 operating

days in the comparable

period last year.

Total metres drilled

by CAODC members

during the January-

to-September interval

declined to 15.86 mil-

lion from 16.19 million

metres in the year-prior

period.

Wells have aver-

aged 1,938 metres over

the fi rst nine months of

2012 compared to 1,753

metres a year ago.

It took CAODC

members an average

10.10 days to drill a well

during the nine-month

period versus 10.30 days

to the end of September

2011.

Including oilsands

evaluation holes and

experimental wells, the

top contractor over

the fi rst nine months

of 2012 was Precision

Drilling. Th e contractor

drilled 2,611 wells and

fi nished 4.01 million

metres of hole.

Precision's main

customer during the

nine-month period

was Canadian Natural

Resources Limited,

which accounted for

788 of its wells (30.2

per cent). Husky Energy

Inc. (231 wells) and En-

cana Corporation (229

wells) - each accounting

for 8.8 per cent of the

total – were the next top

customers for Precision.

Th e company’s rig

235 drilled 76 wells to

the end of September,

the highest count for a

rig.

Second-place

fi nisher Ensign Drilling

Inc. rig released 1,838

wells and drilled 2.69

million metres.

Canadian Natural

was also the main cus-

tomer of Ensign (326

wells, or 17.7 per cent

of the total), followed

by Cenovus Energy

Inc. (195 wells, or 10.6

per cent) and Suncor

Energy Inc. (139 wells,

or 7.6 per cent).

Savanna Energy

Services Corp. was the

only other contractor to

drill more than a thou-

sand wells. Th e com-

pany rig released 1,111

wells over the fi rst three

quarters and fi nished

1.84 million metres

of hole. Th e company

main customers were

Cenovus (329 wells,

or 29.6 per cent of the

total), Northern Bliz-

zard Resources Inc. (77

wells, or 6.9 per cent of

the total) and Canadian

Natural (72 wells, or 6.5

per cent of the total).

In fourth

place, Trinidad Drilling

Ltd. rig released 687

wells in the January-to-

September period (1.43

million metres of hole),

followed by Nabors

Drilling with 492 wells

drilled (1.31 million

metres).

Precision was the

top contractor for hori-

zontal wells during the

fi rst nine months of the

year with 1,202 wells

rig released and 2.96

million metres of hole

(excluding test/experi-

mental or DSW wells).

Ensign was second with

837 horizontal wells

(1.99 million metres),

followed by Trinidad

with 537 wells (1.31

million metres), Sa-

vanna with 448 wells

(1.2 million metres)

and AKITA Drilling

Ltd. with 239 wells

(617,048 metres).

Excluding test wells,

Precision’s share of the

market rose to 28.57 per

cent over the fi rst three

quarters of 2012 from

27.43 per cent last year.

Ensign’s market share

rose to 17.58 per cent

from 16.45 per cent.

Rig utilization in

the third quarter for

CAODC members

was 38.66 per cent, off

from 51.09 per cent a

year ago. Nine-month

rig utilization stands at

37.94 per cent this year

compared to 43.11 per

cent a year ago.

Excluding ex-

perimental or Eastern

Canada wells, AKITA's

38 rigs had a 63.87 per

cent utilization rate

during the fi rst nine

months of the year. Pan-

ther Drilling Corp.'s

three rigs booked a

61.56 per cent utiliza-

tion rate, while Fox

Drilling Inc.'s two rigs

had a 60.40 per cent

utilization rate.

Ironhand Drill-

ing Inc. ranked fi rst

in average metres

drilled per rig (44,749

metres), followed by

Panther (32,313 metres)

and Bonanza Drilling

Inc. (31,573 metres).

Operating Days, metres drilled declined

Page 28: Pipeline News December 2012

PIPELINE NEWS December 2012 A29

By Richard Macedo

(Daily Oil Bulletin) Calgary –

Crescent Point Energy Corp. reported

lower net income in the third quarter,

and reached a new production record

during the period of 99,631 barrels of

oil equivalent per day, weighted 90 per

cent to light and medium crude oil and

liquids.

Th is was three per cent above the

second quarter of 2012 and 38 per cent

higher than the third quarter of 2011.

Th e company's net income in the third

quarter dropped to $2.35 million from

$204.62 million during the same pe-

riod last year. Th is happened mainly as

a result of an unrealized derivative loss

and increased depreciation, depletion

and amortization expense, partially

off set by the deferred tax recovery, the

increase in funds fl ow and an unreal-

ized foreign exchange gain.

During third quarter, the company

spent $259.4 million on drilling and

development activities, drilling 149

(84.7 net) wells with a 100 per cent

success rate. Crescent Point also spent

$54.5 million on land, seismic and

facilities, for total development capital

expenditures of $313.91 million.

“As we approach the end of the

year, we feel we're in a great position to

meet or exceed our targets for 2012,”

said Scott Saxberg, president and chief

executive offi cer, during a third quarter

conference call on Nov. 8.

Crescent Point maintained con-

sistent monthly dividends of 23 cents

per share, totalling 69 cents per share

for the third quarter of 2012. Th is is

unchanged from 69 cents per share

paid in the third quarter of 2011. On

an annualized basis, the third quarter

dividend equates to a yield of 6.5 per

cent, based on a volume weighted aver-

age quarterly share price of $42.54.

Subsequent to the quarter, on

Nov. 1, the company announced the

US$861-million acquisition of Ute

Energy Upstream Holdings LLC, a

privately held oil and gas producer

with assets in the Uinta Basin light oil

resource play in northeast Utah.

Th e company said its balance sheet

remains strong, with projected average

net debt to 12-month cash fl ow of ap-

proximately one times and signifi cant

unutilized credit capacity.

Crescent Point continued to

increase oil deliveries through its

Stoughton rail terminal, providing

access to diversifi ed refi ning markets

and more stable price diff erentials to

West Texas Intermediate (WTI). Th ird

quarter average throughput was more

than 15,500 bpd, with an additional

1,000 bpd also being delivered to

third-party sites.

Page A30

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Page 29: Pipeline News December 2012

A30 PIPELINE NEWS December 2012

Curly’s Picker Service Ltd.Curly’s Picker Service Ltd.Mark T. (Curly) Hirsch

1595 Dieppe Cres.Estevan, Sask.S4A 1W8

Secor Certi edCell: (306) 461-5898Fax: (306) 634-6690

Crescent Point Energy will expand its Stough-ton facility, see here last winter, to con nue its crude-by-rail marke ng strategy. File photo

Crescent Point boosts oil deliveries on rail Page A29

Expansion of the Stoughton rail facility, which

is expected to be completed in the fourth quarter,

will increase shipping capacity to 40,000 bpd.

In the April 2012 Pipeline News story about

this facility, it was noted the company’s oil produc-

tion in the region at that time was rougly 46,000 to

47,000 barrels per day. Th e added shipping capac-

ity will mean Crescent Point will have the ability

to ship most of its southeast Saskatchewan crude

production by rail.

Late in the third quarter, the company com-

pleted preparation of its rail loading facility in

the Dollard area of southwest Saskatchewan and

delivered its fi rst loads in October. Current capacity

is approximately 4,000 bpd.

“For competitive reasons, we are not disclos-

ing exact markets for our railed volumes,” Trent

Stangl, the company's vice-president of marketing

and investor relations, told the Bulletin. “Generally

speaking, we have targeted multiple markets outside

of the well-supplied U.S. PADD II market. Th ese

are markets that have historically been supplied by

waterborne crudes. Th e ability to receive volumes by

rail opens up a new opportunity for the refi neries in

these markets.”

Crescent Point continued to implement its

hedging strategy to provide increased certainty over

cash fl ow and dividends. At Oct. 31, the company

had hedged 56 per cent, 54 per cent, 35 per cent, 17

per cent and three per cent of its oil production, net

of royalty interest, for the balance of 2012, 2013,

2014, 2015 and the fi rst quarter of 2016, respective-

ly. Average quarterly hedge prices range from C$88

per bbl. to $94.

In the third quarter, Crescent Point participated

in the drilling of 66 (43.8 net) wells in southeast

Saskatchewan and Manitoba, achieving a 100 per

cent success rate. Of the wells drilled, 44 (35.6

net) were horizontal wells in the Bakken light oil

resource play. Th e company also participated in

the drilling of 22 (8.2 net) horizontal oil wells in

conventional zones.

During the quarter, the company converted

six additional Viewfi eld Bakken producing wells

to water injection wells. By the end of the third

quarter, Crescent Point had converted a total of

41 producing wells to water injection wells in the

play. Production performance from water injec-

tion patterns in the Viewfi eld Bakken resource play

continues to exceed Crescent Point's expectations

and has demonstrated the fi eld wide applicability of

waterfl ood to the play.

Discussions with potential unit partners and

the Saskatchewan government to implement a

unit-wide waterfl ood are advancing.

Across Crescent Point's asset base, the company

continues to pursue multiple applications of new

technologies to maximize recoveries and improve

effi ciencies. In the Saskatchewan Bakken, this has

included re-entering existing wells that were origi-

nally completed with eight-stage and 16-stage ce-

mented liners and increasing them to 25-stage and

30-stage cemented liner completions. Th e company

has identifi ed 90 wells in the play as candidates for

this process. Page A31

Page 30: Pipeline News December 2012

PIPELINE NEWS December 2012 A31

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Page A30

Crescent Point has

also drilled three, two-

mile horizontal wells to

date in the Flat Lake

Bakken play, achieving

a 100 per cent success

rate. Based on this suc-

cess, the company plans

to drill a fourth, two-

mile horizontal well in

the fourth quarter.

During the third

quarter, the company

participated in the drill-

ing of 20 (14.5 net) oil

wells in southwest Sas-

katchewan, achieving

a 100 per cent success

rate. Of these wells, 11

(9.8 net) were drilled in

the Shaunavon area.

Th e company is

currently injecting

water into seven hori-

zontal injection wells

in fi ve pressure mainte-

nance programs in the

Lower Shaunavon zone.

Crescent Point contin-

ues to be encouraged

by results to date in

all programs. Th rough

acquisitions completed

in 2012, Crescent

Point has acquired 17

injection wells that are

injecting water into an

additional fi ve patterns

in the Upper Shau-

navon formation. Based

on success to date, the

company plans to begin

injecting water into an

additional fi ve wells in

the Upper Shaunavon

by year-end.

In total, Crescent

Point expects to have

up to 30 water injection

wells into the play by

year-end 2012.

To date, 30 wells

have been drilled at

eight wells per sec-

tion spacing in both

the Lower and Upper

Shaunavon zones with

no signs of interference.

By the end of the third

quarter, the company

had drilled two wells in

the Lower Shaunavon

at 16 wells per section,

with plans to drill an-

other two by year-end.

Late in the third

quarter, the company

completed prepara-

tion of its rail loading

facility in the Dollard

area and delivered its

fi rst loads in October.

Current capacity is ap-

proximately 4,000 bpd,

with plans for further

expansion in 2013.

Crescent Point also

completed construction

and commissioned the

second of three new

batteries planned for

2012. Construction on

the remaining battery is

underway, with com-

missioning anticipated

by the end of the fourth

quarter.

In the south-central

Alberta and west-cen-

tral Saskatchewan areas

during the third quarter,

32 (20.6 net) oil wells

were drilled, with a 100

per cent success rate.

Th e company's plans

for its fi rst waterfl ood

pilot in the Beaverhill

Lake light oil resource

play are well underway.

Crescent Point expects

the pilot to be opera-

tional in early 2013.

To date, the com-

pany has drilled 17

(17 net) wells with a

100 per cent success

rate in the Viking area

on lands acquired in

the Cutpick Energy

Inc. acquisition, which

closed on June 20.

Th e successful drilling

results from this initial

program have expanded

the pool boundary by

eight sections, beyond

the 83 net sections

expected at the time of

the acquisition.

Late in third

quarter, Crescent Point

converted a producing

well to a water injection

well on the Cutpick

lands, bringing the

total number of water

injection wells to three.

Th e waterfl ood program

began in the area in

1998 and, in August

2011, a second pilot

was established. With

encouraging production

performance to date,

the company plans to

convert an additional

three producing wells to

water injection wells on

these lands in 2013.

Crescent Point has

access to a signifi cant

land base in southern

Alberta and has been

pursuing several explo-

ration projects in the

area. In the fourth quar-

ter, the company plans

to drill up to an ad-

ditional seven wells to

follow up on previously

drilled unconventional

exploration wells in the

Alberta Bakken play.

In the U.S., during

third quarter, the com-

pany participated in the

drilling of 30 (5.4 net)

oil wells, of which 14

(2.2 net) targeted the

Th ree Forks formation,

achieving a 100 per cent

success rate. Crescent

Point also drilled one

(0.4 net) service well.

In total in 2012,

the company expects to

drill up to 16 net wells

targeting the Bakken

and Th ree Forks zones.

Crescent Point is cur-

rently working with

its service providers

to reduce capital costs

that have seen upward

pressure due to high

industry activity levels

in North Dakota.

Crescent Point ex-

pects to release its 2013

capital expenditure

plans in early Decem-

ber.

Page 31: Pipeline News December 2012

A32 PIPELINE NEWS December 2012

Page 32: Pipeline News December 2012

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By Brian ZinchukEstevan – Wil-Tech

Industries of Estevan is

undergoing a transfor-

mation, as the hydrau-

lics specialist has seen

one of its products take

off . Th at, in turn, has led

to some introspection

and evolution within the

company.

About four years

ago Wil-Tech began

work on the fi rst pro-

totype of its bucking

unit. Th e old way of

assembling and disas-

sembling downhole oil

tools was to manually

use pipe wrenches and

snipes. That didn’t

provide any way of

ensuring how much

torque had been ap-

plied, and generally

speaking, wasn’t par-

ticularly safe. So Wil-

Tech started using

power tongs, the type

used on service rigs, to

do the job of thread-

ing pipe together or

disassembling it.

The tongs are

mounted horizontally

instead of vertically,

and are tied into an

electronic monitoring

system that provides

detailed records on

how much torque is

applied. It takes away

the manual factor, and

instead provides safe,

repeatable, measurable

torque application to

oil tools. The measur-

able part is key from a

quality control per-

spective.

The product is

known as the Wil-

Torq 11000.

“We have built

different sizes. This

is the most common

we have been asked

for,” said Jim Wilson,

president. His son

Dustin is Estevan

branch manager and

is also involved with

product development

and production.

The product has

seen several years of

evolution. Indeed, each

order has had clients

asking for some form

of customization, be

it different lengths,

different torques, dif-

ferent logging require-

ments, etc.

The big appli-

cation has become

packers. “In the past,

that would have been

with a pipe wrench or

chain tong, and that

was very unsafe. The

problem isn’t threading

it together as much as

taking it apart,” Jim said.

Page B2

Making the transition from one-offs to manufacturing

Travis Souther, le , and Cohen Wells prep a new Wil-Tech Industries Wil-Torq 11000 bucking unit prior to delivery. Both are heavy duty mechanic appren ces, with Wells as a hydraulic service technician and Souther being a cylinder mechanic.

A completed Wil-Torq 11000 is ready to go out the door. The machine uses power tongs to ght-en or loosen oil tools, and provided a computerized record of that ac on.

Page 33: Pipeline News December 2012

B2 PIPELINE NEWS December 2012

Well Service• Acid

• Coil Tubing• CO

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• Industrial

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• Polybore

Page B1Now things are

starting to take off . Th ey

are in talks with three of

the four largest oil ser-

vices companies in the

world, a.k.a. the big four,

and one has recently

placed an order for 10

units. Th at was after

they initially purchased

one, and then three.

Th eir total, after this

order will be 14 units.

“We’ve sold dozens

of units,” Jim said.

Predominately

they have gone to the

Canadian market, but

some clients have U.S.

operations where they

are now being deployed.

“We’ve shipped to

Williston, and next is to

Fort Worth,” Jim said.

Dustin noted they

have bucking units in

Grande Prairie, Edmon-

ton, Red Deer, White-

court, and of course,

Estevan, where most of

the local oil tool compa-

nies employ a unit.

“We’re certainly

surprised how well it’s

doing in the market,”

said Jim, who pointed

out a company from

Estevan is now supply-

ing the North American

market.

“Th e hard part is

the specifi ed needs of

each customer,” Dustin

said. “It’s evolved with

knowledge of our em-

ployees and feedback

from customers.”

“Our intent is to

have our generation two

version ready for the

2013 oil show,” he said,

referring to the Sas-

katchewan Oil and Gas

Show in Weyburn next

June 5-6.

Th e following week

is the Global Petroleum

Show in Calgary, where

they hope to make a

splash.

“Evolving as a

manufacturer, you want

to standardize the units,

but the customers keep

wanting to add new

functions,” Jim said.

“We’ve been asked

for mobile trailer-

mounted units,” he not-

ed. Higher torque values

are another request.

One potash mine

that is using oil tools

wanted one for assembly

and disassembly.

“One of the larg-

est sellers for the unit is

safety,” Jim said.

“Safety and effi -

ciency,” Dustin added.

“Th e torque monitoring

is important as well. A

report can be printed

off at the time. Th ere’s

an approval process

saying, ‘Yes, it has been

torqued.’”

Diff erent customers

have diff erent software

requirements to inte-

grate into their own

system. As a result, a

company that special-

izes in hydraulics and

machining now has a

software engineer on

staff in Regina.

“We had to have

that in-house,” Jim said,

noting the important of

retaining that knowl-

edge from job to job, as

opposed to hiring short

term contractors.

Th at software

engineer also works

on other aspects of the

business, such as pres-

sure testing, logging

and hose certifi cation.

Th e company is also

working on getting its

ISO 9002 certifi cation,

an important consid-

eration when working

with large, international

fi rms.

Operators miss it when they move“Basically the prod-

uct sold itself,” Dustin

said.

An important

element has been the

operators of these

units. As they have

gone on to work with

other companies in the

oil tool business, they

quickly miss working

with these bucking

units, and request one

at their new place of

work.

Dustin said, “It’s

not so much managers

as operators requesting

it. Th ey’ve switched jobs,

then push for it. Th at’s a

huge aspect.”

Service manager Mike Holowchuk, le , and manufacturing department manager Jason Hale go over some blueprints.

You see one, you want one

Page 34: Pipeline News December 2012

PIPELINE NEWS December 2012 B3

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By Brian Zinchuk

Weyburn – When it

comes to new products,

this one really sucks,

and that’s a good thing,

because that’s exactly

what it’s supposed to

do.

Over the past year,

Weyburn-based Stewart

Steel Inc. has gone from

the prototype stage to

producing and deliver-

ing over a dozen units

of its Vac-U-Spread, a

vac wagon used primar-

ily for handling drilling

by-product disposal.

“Th e product origi-

nated as an agricultural

product, but applied

in the oilfi eld for land

spreading,” said Jarrett

Johnson, project man-

ager.

Th e agricultural

application for similar

units is in the use of

collecting and spreading

manure, usually from

pig barns.

Johnson has been

with Stewart Steel for

12 years. “I grew up on

a hog farm. I ran these

things as a kid,” he said.

“Guys were using

these in the oilpatch,

buying ag units. But

the service life wasn’t

designed for industrial

use,” he said.

An agricultural

product, for instance,

might see 2,000 to

4,000 hours of use

before showing signs

of wear. Stewart Steel

sought to double that.

Th e B10 component

life ratings they were

aiming for (the point

at which 10 per cent

of units would start

seeing failure) is much

higher. “We shot for

8,000 hours in the B10

life,” he said.

“Everything was

beefed up from an ag

product. We made it

more user-friendly

and less maintenance

intensive. We used

higher-quality com-

ponents,” according to

Johnson. “Th e pump

and hydraulics are over-

rated past what they

need to do.”

Page B4

Bee ng up an ag product for the oilpatch

This is a near-complete Vac-U-Spread vac wagon.

Project manager Jarre Johnson demonstrates the side-opening door.

Page 35: Pipeline News December 2012

B4 PIPELINE NEWS December 2012

#6 - 461 King St. • Estevan, SK

637-3460 www.petrobakken.com

Strength In Our Resources

...and to all a Good Holiday!

Page B3Doug Demby of

Demby Trailer Ltd.

pointed out the op-

portunity to Stewart

Steel. Th e two com-

panies work closely

on products, and the

Vac-U-Spread is sold by

Demby Trailer.

Th e offi cial decision

to go ahead with the

project was Oct. 1, 2011.

Th eir turnaround time

was quick.

Johnson said, “We

were doing fi rst unit

testing by Jan. 5.”

Th at initial pro-

totype was tweaked

and eventually sold. So

far, 13 units have been

delivered.

“Th ey’re all over the

place – Saskatchewan,

Alberta and Manitoba

now,” he said.

“It’s built and mar-

keted as an ag prod-

uct. It’s not a licensed

vehicle like a vac truck,”

Johnson explained.

“We’re an ag manufac-

turer.”

Many of the people

who purchase these

units are farmers who

will hire on with their

tractor and vac wagon to

work with a drilling rig.

Th ey’ll put a blade on

the tractor and take care

of snow, for instance.

It’s pulled by the

tractor and needs either

the PTO or hydraulics

of the tractor.

Th e Vac-U-Spread

is a crossover product,

he noted.

Th e key thing is

high fl otation. Th ese

units carry a lot of

weight. With a larger

capacity than typical

farm units, their 100 per

cent capacity is 23 cubic

metres, with a usable

capacity of 20 to 21

cubic metres. Including

the unit, the gross total

weight is up to 85,000

pounds.

“Big trucks leave

ruts,” Johnson said,

adding that tractors can

land spread in softer

conditions without

negative environmental

impact.

“We recommend a

large four wheel drive

tractor,” Johnson said.

Other options are the

rubber track-style trac-

tors, like the Case IH

Quadtrac. As for tires or

tracks, they don’t note a

preference.

Th e primary usage

may be land spreading,

but over the past year

some units saw usage

sucking production

fl uids out of tanks and

bringing them to the

road to be transferred to

trucks.

Page B5

A dedicated produc on cell is used to build Vac-U-Spread units.

Vac-U-Spread built for industrial usage

Page 36: Pipeline News December 2012

PIPELINE NEWS December 2012 B5

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GLADTIDINGS

Page B4Design

“We identifi ed areas

of improvement and

modelled everything in

3D SolidWorks,” he said,

referring to a three-

dimensional drafting/

modeling program.

Th e design was also

put through an extensive

amount of fi nite ele-

ment analysis, looking

for stress points in the

design. Computation-

heavy fi nite element

analysis used to be the

purview of companies

like Boeing or Lockheed

Martin. Now a small

manufacturer in Wey-

burn is capable of having

the computer power to

do it.

“We’ve structured

our company to use

technology to our advan-

tage,” Johnson said. “We

do extensive 3D design.

We can look at things

several diff erent ways

before we start, without

cutting a piece of steel.

“I can do physical

collision analysis, and

multiple hole alignment

analysis.”

Multiple hole

analysis looks at a series

of holes that are needed

to line up, and works

within their tolerances to

see if it will fi t.

“I’m in the process

of doing an owner’s

manual right now,”

Johnson said. It will

incorporate the feedback

they have received from

users.

“So far we estimate

there has been approxi-

mately 10,000 hours of

usage in the fi eld, so they

have a good idea of what

works and what doesn’t.”

“Our machine has

an internal paddle agita-

tor,” Johnson said. “In

testing we had people

who own machines tell-

ing us we had exceeded

what was expected.”

Once the company

reached its 10th unit,

they did some reassess-

ment, and with the Mark

II design, they switched

to a heavier motor and

reduced the size of the

agitator. Agricultural

designs use an auger

for agitation, but they

wanted something with

more of a stirring action.

Th e upsized motor and

reduced agitator size

made for approximately

10 times more agitation

power.

“We tested it by

sucking up cubic yards

of gravel. At one time

we had about four cubic

yards of gravel in the

thing.”

A typical agricultur-

al unit will generate 15

inches of vacuum pres-

sure. Th e Vac-U-Spread

far exceeds that.

“Th is will generate

in excess of 22 inches

of vacuum pressure,” he

said. “Th is thing really

sucks.”

Vac-U-Spread vac

wagons use the exact

same pump system as

that used on vac trucks.

“We used Hibon 820

blower packages,” John-

son said.

Th e package in-

cludes muffl er, silencer,

valves and the drive

train.

“We’ve had owners

with a tridem truck and

Vac-U-Spread say the

Vac-U-Spread has better

performance,” he said.

“Given the choice, they

will pick the Vac-U-

Spread over the truck.”

“It will pull on 23

cubes of pure liquid

(such as water) with a

seven foot lift in just

over seven minutes.”

It doesn’t take long

to blow off a tank, either.

About 45 seconds will

do it. Th ere’s a complete-

ly adjustable rear spread

plate that adjusts for

thickness or pattern.

Th ere are options

that can be included,

like tool boxes and a rear

beavertail step. Choices

can be made for straight

fl uid or high solids

agitation. And similar to

Henry Ford’s philosophy,

you can have it in any

colour you want, as long

as it’s blue.

While PTO power

is typical, it is possible to

get a hydraulically-driv-

en system in situations

where the tractor may

not have a PTO.

Unlike vac units

seen on trucks, the rear

door swings to the side,

instead of being raised

by a hydraulic ramp.

It means one man can

close it and seal it by

hand, and there is no

danger of having a door

suspended above you.

It typically takes

about four weeks to

produce a new unit. One

of Stewart Steel’s defi n-

ing characteristics is its

adoption of Lean manu-

facturing principles,

seeking to eliminate as

much waste as possible

from production. “We

don’t build fi ve frames

and fi ve tanks. Th ey’re

built as one. We’ve built

an adaptable production

cell, set up to build this

machine. It’s a modu-

larized project. Based

on orders, we can add

more men, or remove

men, without aff ecting

production effi ciency,”

Johnson said.

Jarre Johnson uses the hand crank to seal the door.

Page 37: Pipeline News December 2012

B6 PIPELINE NEWS December 2012

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By Brian ZinchukForget – Location is the most important part of real estate, and the latest

addition to the waste disposal business in southeast Saskatchewan seems to

have locked up a good one.

Fleet Energy opened its doors this fall, and held a grand opening on Oct.

30. It’s located right on the south side of Highway 13, just 3.2 km east of

Forget, putting it on the Bakken fairway and perhaps just as importantly, on

primary highway.

Nathan Hollick, Fleet Energy’s president and CEO, has long, deep roots

in the southeast Saskatchewan oilpatch. One can run out of ink writing them

down.

“I’ve operated in southeast Saskatchewan since I started my fi rst company

in 1981 – Vista Petroleums. Th at was bought out around ’95-96. My last com-

pany sold out in 2010,” he said.

Herc Oil was its name, and it had the slogan of “I will work with Herc.”

“We took over the Williston Wildcatters Assets,” he said.

“I co-founded Big Sky Drilling in 1985. Ensign bought it out around

2000. I sold out my shares to the operating group before that.

Hollick led a number of oil companies, specializing in reservoir exploita-

tion, from 2002 to 2006, including Empire Capital and Empire Resources.

And now Fleet is Hollick’s going concern. He’s backed by a small group of

investors out of Calgary, some of which “had a Saskatchewan persuasion.”

Hollick has always been a Saskatchewan resident and was raised in Blaine

Lake, Saskatchewan.

“Fleet came together as a group of oil people who saw a need to have these

waste facilities. With the advent of the technology of the Bakken, you have

fl owback fl uids from fracking. Prior to the Bakken, wells in southeast Sas-

katchewan weren’t fracked,” Hollick explained.

“We’re a waste processing facility. We’re all here providing a service.”

Chad Bunch, vice-president of business development and a professional

mechanical engineer, noted the highway location was a big reason they chose

the site. Page B7

Fleet Energy offers new waste disposal services

Some of the people responsible for the new Fleet Energy facility near Forget are, from le , Shane Pollock, opera ons manager; Kevin “C.J.” Thomas-Simpson, plant operator; Chad Bunch, vice-president of business development; and Nathan Hollick, president and CEO.

Page 38: Pipeline News December 2012

PIPELINE NEWS December 2012 B7

#6 - 461 King St. • Estevan, SK

637-3460

www.petrobakken.com

Page B6“Location is critical. Accessibility is key,” Hollick said. “It just made sense.

Highway 13 never gets banned. It’s an open corridor. It’s strategic for us to be

here.”

Th e site used an existing well that was re-entered in 2008 and converted to

a disposal well with coated tubing. Th e well’s casing was checked with an eddy

current and fl ux leakage tool beforeany fl uid was injected.

Th e well uses the Mannville formation for disposal.

Th e site will accept oily waste, produced water, fl owback fl uids, completion

water and solids. Th ey just opened up their solids receiving area at the time of

the grand opening.

“You’ll see a guy come in with two cubic meters of oily solids. What do you

do with two cubes?” Hollick asked. “We’re a facilitator. We then deal with the

solids, blend them down, and/or clean them up.

“It depends on the content of the solids which determines how we have to

deal with them. Th ey can go to a land farm, a landfi ll, or caverns.

Th e facility has two 1,000-bbl. tanks, and four 750-bbl. tanks, plus a fl oc

tank and the aforementioned dumping bin for solids. It was built with the abil-

ity to expand. Indeed, by the time this edition hits newsstands, that expansion

was expected to have taken place.

“We are looking to expand it as early as next week, adding another 1,000-

bbl. tank,” Bunch said.

Four layersIn designing their facility, Fleet sought to set a new standard.

Bunch said, “We have four layers of protection between our fl uid and the

environment.”

Th e fi rst layer is the pipes, valves and fi ttings.

Secondary containment is standard, but they’ve also added a box and liner

for any pipe outside the usual secondary containment structures. Th at means

between the unloading points and the tank farm, for instance, the piping is all

surrounded by a lined box, something that Bunch said is “not at all common.”

Th e entire production area is lined and sloped to a containment pond, such

that if something did spill on the surface or breach secondary containment, it

would fl ow into that lined pond. Below the lined pond is a sandy layer sloped

to a monitoring sump, and beneath that is a bowl-like structure made up of a

minimum three-foot layer of clay. Indeed, there is a liner and clay under all of

the production area.

Th e fourth layer is a keyed dyke surrounding the lease site, dug down to the

natural clay layer. Since the area saw fl ooding in 2011, the entire site in use was

raised above that level. “If this place were to fl ood now, the highway would be

fl ooded before it breached our dykes,” he said.

Since the highway did not fl ood during this historic summer of 2011, that

should not be an issue. Th ey are seven feet above last year’s high water.

Surrounding the site are piezometer wells for monitoring outside the keyed

dyke. Th ere are four barriers and four ways of monitoring those barriers, Hol-

lick said.

“It was our commitment when we were consulting people in the area,”

Bunch said. “We wanted to engineer our lease to mitigate any eff ects on the

environment.

Page B8

Through the pea soup fog you can make out all the important element of Fleet Energy’s new disposal site. In the foreground is the solids bin. From le is the reten on point, unloading sta on, pumphouse and tank farm.

Page 39: Pipeline News December 2012

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Page B7“I like to think of this as the Fort Knox of leases when it comes to environ-

mental protection ,” Hollick said. “When I handed in this application to the

regulators, I thought this would set the bar.

As for piping protection, Bunch noted there are four things you need: cor-

rosion, chemical, crack and abrasion resistance.

“We use a combination of coatings, stainless steel and specialty HDPE

(high density poly ethylene) wherever applicable. We engineered out the sus-

ceptibility. Th ere’s lots of stainless steel fi ttings.

Hollick said,“Th is is a business where the environment is important. We’re

all here for a short time, geologically speaking. Th e idea was to build a safe

place for the environment. We should all leave as little a footprint as possible.”

OperationsTh e company had a “soft start” of operations at the beginning of Septem-

Four layers of protection

ber, and opened to general usage in the beginning of October.

Th ere are three unloading stations staggered at a 45 degree angle. Trucks

drive in a loop, fi rst going to the left to the unloading stations, then looping to

the right around the containment pond and out to the exit. As a drive-through

system, there is no backing required for fl uid unloading, but solids disposal

does require one to back up to the receiving bin.

Th e lease is designed and tested to handle B-trains.

Th ey rely on the truck pumps to unload, typically at a rate of one to two

cubic metres per minute, making for 15 to 30 minute unload times. With the

additional tank they can handle about 40 trucks a day.

Th e site is open 14 hours a day and on call for the remaining hours.

Th e facility has three operators.

Th ey are already looking at additional sites. “We have two locations we’re

looking at,” Hollick said, casting a broad net which includes Saskatchewan,

Manitoba, Alberta, northern British Columbia, North Dakota and Montana.

Three unloading sta ons are set up to allow drive-through opera ons.

A truck is unloaded. The yellow tub is a secondary containment device.

Page 40: Pipeline News December 2012

PIPELINE NEWS December 2012 B9

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INNOVATIONINNOVATIONFOCUSFOCUS

By Brian Zinchuk

Redvers – A company that got its start build-

ing underbalanced drilling equipment for Russia

has expanded to include fabrication, equipment

rentals and manufacturing. In 2011, the company,

Magna Fab Inc., part of Magnafl o Corp., came

home in a way, establishing a Redvers operation.

Home for owner Marc Dumaine was

Storthoaks before he ended up in Calgary. Now

his brother, Trent, runs the Redvers operation.

Th eir display was one of more prominent at

the Redvers Oil Showcase this past spring.

Magnafl o Corp. is the holding company

established 11 years ago, Marc described as he

drew a fl owchart of the various businesses under

its umbrella.

Eleven-year-old Magnafl o Systems Inc.

builds underbalance drilling equipment. Mag-

nafl o Services is the support team that goes

into Russia to support that equipment and train

operators. It was formed ten years ago.

In 2008, Magna Fab Inc. came to be, with

welding shops in Calgary and now in Redvers.

Magna Flo Rentals has locations in Redvers

and Calgary. It was founded in 2006 and has four

partners – Marc Dumaine, Trent Dumaine, Larry

Matthewson and Mike Shea.

Scary week to launch a businessMagnafl o Systems got it start precisely when

the world got turned upside down. In the second

week of September 2001, Marc was slated to fl y

to Russia. Th at was scant days after the World

Trade Center and Pentagon had planes fl own

into them.

“On Sept. 17, I got on a plan and went to

Russia. I’ve got to go. Russia’s not in trouble with

the U.S. I stayed in the World Trade Center Ho-

tel in Moscow. I went into Siberia with the guys I

met there. I started talking underbalance equipment

with these guys. It took fi ve more trips into Siberia,

and we fi nally convinced the oil company to use coil

tubing drilling equipment.”

Page B10

Russian work leads to Canadian manufacturing

Marc Dumaine, le , and Trent Dumaine pose beside Magna Fab’s sta onary hardbanding unit in Redvers. Below them is an example of bre grate, which the company will use to make “safety mats.”

Page 41: Pipeline News December 2012

B10 PIPELINE NEWS December 2012

SASKATCHEWANOIL & GAS SHOW

June 5 & 6, 2013

Please download form off our website: www.oilshow.caEmail or send to address below

Page B9 Marc’s experience with underbalance drilling came

from working with Tesco for four years prior to 2001. Before that, like many

men from Storthoaks, he worked with Big Sky Drilling, which was purchased

by Ensign. He also worked with Long Rider.

“I went to the school of hard knocks. I started on rigs in 1984 with J-horn

Drilling at Drumheller. I worked two weeks and gave up. It was too cold. Th e

next summer I worked for Terry Carpenter of Carievale. We got a job working

with Bird Drilling at Waskada, Manitoba.

“I eventually took off for Alberta in 1988. I started production well testing

there for Norward Energy Service. While working for Tesco, I moved into sales

for underbalanced drilling, downtown, and was placed in with the design team

for building new UBD units.

In Russia, he noted, “We sold them coil tubing rigs good for 4,000 metres.

National Oilwell built the coil tubing rigs and Magnafl o Systems built the

underbalance drilling systems.

“We rotated 16 guys in and out of Russia, training the Russians on opera-

tions and drilling over 2002-2003.

Th eir underbalance systems were complete with rotating head, choke

manifold with fl owlines coming off the BOPS. (Th e well production defl ects

into the fl owlines and is controlled with choke). Th e fl ow then continued into

a three phase separator which separates it into solids, fl uids and gas. Nitrogen

used in the process goes to the fl are stack along with the gas.

“Siberia is very similar to Saskatchewan for drilling. Th ey have the same

types of formations,” Marc said. “On average a well is 3,000 metres true vertical

depth.”

Th e equipment to reach such depths is usually triple drilling rigs and big,

coil rigs.

A Russian drilling rig will put casing into the hole, and do 15 to 20 wells

on a pad. “Th at rig would then move and we would move in with smaller pipe

and tools and drill into the formation,” he said. “Baker Hughes calls it ‘coil

track.’”

“We use nitrogen and oil, because nitrogen is used as an artifi cial lift mak-

ing the hole cleaner, also (you) drill faster.”

“It was a new way of drilling back then. Th is had already taken off in

Canada. Page B11

Magna Fab establishes itself in RedversMagna ow Systems’ underbalance units have found a home in Siberia, as seen here. Photo submi ed

Page 42: Pipeline News December 2012

PIPELINE NEWS December 2012 B11

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Page B10“Western Siberia is all muskeg. Th ey build roads from the sand at the bot-

tom of lakes. Th e sand will sink into the ground. Th en they bring rock in by rail

from the mountains. Th en they pave the road. It takes two complete years to

build the lease,” Marc said.

Th e horizontals legs are drilled just 150 metres. Th ey then pull back and

drill two more horizontal legs in diff erent directions.

“With 114 mm casing in the well, it will allow for 90 tonnes per day of oil.

We increased their production to 200 tonnes per day,” Marc said. A tonne of oil

is roughly one cubic metre.

Magnafl o Systems has sold 13 underbalance systems and 15 nitrogen

membrane units into Russia over the last decade. Th ey continue to sell parts

and provide manpower for support, as well as consulting on new wells in new

fi elds.

Everything has been built in Calgary. Th e last fi ve of the 13 units were

built by Magna Fab.

From overseas to domestic“We started breaking into Canada as Magna Fab Inc.,” Marc said. “We saw

opportunity in the Bakken, being from Saskatchewan, knowing who we know.

It was two years that we were looking for a shop in Saskatchewan.”

Carnduff was considered, but they found Redvers to be a better fi t. “Red-

vers wasn’t really an oilfi eld town,” he said, and thus, less economic pressures in

the community.

Th e local John Deere dealer had moved to a new facility and its old build-

ing was up for sale, but had been lined up by someone else, which led Magna

Fab to buy two other lots on the north side of Highway 13. Th e initial deal for

the John Deere shop fell through, however, so in July 2011 Magna Fab Inc. did

the deal on the dealership and moved in.

“We gutted the whole offi ce area. Th is used to be a parts area,” he said in

the boardroom. Th e upstairs now has several offi ces. Enbridge has taken up

some of them for their Bakken pipeline expansion project.

“Th e Bakken opened my eyes. We should get into Saskatchewan. Th e busi-

est oilpatch is in Saskatchewan, I thought. Go home, start up a business. Trent

agreed to move back to Redvers and manage a shop for me here,” Marc said.

Trent liked the idea of raising his kids in a smaller town.

Th eir roots run so deep, in fact, that Marc was mayor of Storthoaks for

three years before moving to Alberta.

“We moved our rentals here as well. It doesn’t do much in Alberta now. It’s

a Saskatchewan company,” Marc said.

Th e hot shot service has two trucks, a two-ton with a 40-foot fl atdeck

trailer, and a semi with a 53-foot fl atdeck.

Th e rentals operation includes a payloader, a

58-foot Genie lift, one generator and shale bins.

Th ey also have an eight-ton picker truck.

Th rough the rentals division they will do lease

cleanups with a truck and payloader, cleaning up

after a service rig.

Seeking to build drilling rig componentsTh e main shop is a fabrication outfi t, doing

work for oilpatch and agricultural clients.

“We build pump houses, catwalks for slant rigs,

mud tanks, skids – pretty much everything,” Trent said.

Th e company is also working on building drilling rigs. Not the derrick and

substructure, but everything else around it.

“In Calgary we’re building a mud tank for CanElson,” Marc stated. “We’re

working with one company about building a rig right now. We’ll build the big-

ger parts in Calgary and smaller parts in Redvers. We’ll also assemble it in the

(Redvers) yard.

“We’ll build the rig, you buy the components. We take on the manufactur-

ing of the buildings and we’ll do the electrical. We’ve got the potential to build

rigs between our Calgary and Redvers shops, and the yard space to set them up.

“Substructures and derricks, we don’t do. I’ll build everything around it –

pumphouse, doghouse, pipe racks. Th e drilling company can source the sub and

derrick from a third party.”

“We’re certifi ed to do ASME B31.3 high pressure piping,” Trent noted.

Painting would be done in Calgary, Marc said, adding, “Th is corner needs a

paint shop.”

“In Calgary we’re doing a project for Mexico – an underbalance drilling

system separation package.” Page B12

Page 43: Pipeline News December 2012

B12 PIPELINE NEWS December 2012

Page B11A new product they are working on is “safety

mats.” Th ey are mats meant to be placed in front

of shacks. But instead of solid wood, they use fi bre

grate, a composite, lightweight grating that allows

boots to be scraped. Th ey are built to suspend the

grating six inches above the ground, allowing mud

and snow to pass through.

“Th ey’re light and easy to move around,” he

said. “Safety is No. 1.”

Texas gates are yet another product.

HardbandingHardbanding is the application of a wear sur-

face to the outer diameter of the drill pipe, heavy

weights and monel collars.

“It’s new in this area. We’re the only ones in

this area that can do the non-mag,” Trent said.

“You don’t have to ship it to Alberta to be done.

Th at’s a big savings to the directional company.”

Magna Fab has two hardbanding units. One is

shop-based, the other is a-trailer based mobile unit.

Th e shop-based version has a hydraulically

controlled pipe handler that moves and positions

the pipe. A large device similar to a lathe rotates

the pipe while the welding head applies the hard-

banding. A computer keeps detailed records of the

application of the hardbanding.

Trent noticed that when drilling in the Estevan

and Torquay areas, directional equipment usually

needs its hardbanding redone about every three

holes. “Th is Bakken is really hard and abrasive,” he

noted.

Agriculture very important“We do a lot for farmers. Panels for windbreaks

are made out of 2-7/8 inch pipe, used tubing,”

Marc said. A perfect example of their agricultural

work is some cattle handling equipment under

construction in the same shop as the hardbanding

equipment.

Th ose windbreaks are in high demand, he said,

pointing to a list of customers on the boardroom

whiteboard.

“We’re very proud of the farming community

here. When we fi rst started, if it wasn’t for the

farmers, we would have had a tougher start-up

year. It’s been unbelievable, the response from the

farmers. I want to thank the farmers and ranchers,”

Marc said.

With so much invested in newer, expensive

equipment, farmers want repairs to look profes-

sional so that the equipment looks good when it

comes time to trade it in, according to Trent.

“We no sooner had a welding machine here

than we had farmers at the door,” Marc said.

“Farmers have so much land now, they don’t have

time to do repairs themselves.

“If you break it, bring it in right away, and get a

good job right off the bat.”

As they became more established, oilpatch

companies and drilling companies are getting to

know them.

“My theory is it takes three years to become

successful, to get known and trusted,” Marc said.

Staffi ngTh e company has 14 employees in Redvers, and

another 25 in Calgary.

Marc’s wife Suzanne did a lot of the contract

and paper work in the early days of the company,

and then stepped back so they could “have a family

life.” She’s worked for Th ermon Heat Tracing for

12 years, and does accounts receivables.

Th ey haven’t had issues in fi nding staff , Trent

said, with lots of friends in the area.

Housing, however, has been an issue. “We

bought a combination shack to house our out of

province welders and the hot shot driver,” he added.

Future expansionMagna Fab is already eyeing an expansion in

the near future.

“We’d like to add, hopefully this summer, a 120

foot by 60 foot expansion with three drive-through

bays,” Marc said.

Th e doors would be 16x16 feet.

Th ey would include two 20-ton cranes.

Farmers were chomping at the bit for welding

Page 44: Pipeline News December 2012

PIPELINE NEWS December 2012 B13

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By Josh SchaeferPipeline News

Saskatoon – 3twenty

Solutions are an in-

novators in the design

and manufacturing of

modular structures for

the oilpatch.

Started in Janu-

ary of 2011, 3twenty

has been taking steel

shipping containers

and converting them

into offi ces, sleeping

units, wash cars and

other buildings that are

needed on a job site.

“Th e steel con-

tainer gives us our

structure,” explained

Bryan McCrea, CEO

of 3twenty. “From

there, we are basically

building houses inside

of them.”

3twenty uses stan-

dard manufacturing

processes when placing

the framing, plumbing

and electrical into the

units. “It’s like taking a

residential home, and

putting it inside of a

320 square foot con-

tainer module.

“We’ve done quite

a bit of work in the Fort

McMurray and Estevan

areas,” McCrea said.

Th e three main products

that they have sent to

these areas have been

sleeper, offi ce and wash

car units.

Th e sleeper units fo-

cus on stylish but practi-

cal private living quar-

ters and are built for

the purpose of attract-

ing and maintaining

a workforce. Th e units

feature private bath-

rooms, independently

controlled air condition-

ing and a private dinette

including a fridge and

microwave.

Offi ce units can

be manufactured and

custom designed to

fi t specifi c needs, and

self-contained wash car

systems provide func-

tional wash facilities for

crews in the fi eld.

“What has been

more popular is our new

rental division,” McCrea

explained. “In the last

three months, 3twenty

has done a lot more

work in the oilpatch and

oilsands area with offi ce

and wash car rentals.

“It seems like that

market really loves to

rent instead of buy, so

we’ve been renting a ton

of units.”

Page B14

New rental division more convenientCory Chambers works on the framing inside one of the steel containers being manufactured at 3twenty Solu ons. The spray foam used for insula on can also be seen in the purple colour in the framing. Photo by Josh Schaefer

Page 45: Pipeline News December 2012

B14 PIPELINE NEWS December 2012

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Page B13McCrea explained

that the modular units

that he sells, and now

rents, are right on par

with market price. What

sets his company apart

from other stick frame

modular manufacturers

is the quality and dura-

bility of his product.

“We are delivering

far more value from

a product that is built

from steel, not wood,”

McCrea said, “and dura-

bility is a huge require-

ment on these rigs and

isolated projects.”

3twenty also ensures

that the parts and com-

ponents that are used

to build the units are

quality materials. “Th e

end user does not want

cheap, fl imsy doors,

they want good quality,

industrial commercial

steel doors.”

All of the compo-

nents for the modular

units are manufactured

in a plant just outside of

Saskatoon.

Another advantage

over stick frame manu-

facturers is that each

unit is being insulated

with closed cell two

pound spray foam.

“What that provides

us with is a continuous

moisture barrier along

the steel, so you won’t

have the same suscep-

tible mould that is going

to grow in the stick

frame and fi breglass

insulation buildings.”

Th e spray foam also

provides 3twenty with

a more effi cient struc-

ture so that heat in the

winter and cold air in

the summer does not

escape.

Another huge sell-

ing point that McCrea

points out is the ability

to stack the product

without any additional

infrastructure. “It’s a

huge selling point for us,

especially in areas where

they do not have a lot of

space on their job site.”

In essence, the units

are shipping containers

and as such are meant

to move. “You can move

them, you can drag

them with a skid steer,”

McCrea explained. “You

can put it on a semi

truck, you can crane it,

you can pick it, you can

train it, you can barge it,

these things are meant

to move which makes it

easy to handle on site.”

So far in 2012,

McCrea estimates that

the oilpatch and oil

sands market makes up

roughly 30 per-cent of

his business.

“It was tough for us

to compete, especially

in the oilsands market,

since this is an industry

that picks up the phone

and needs a wash car by

yesterday, not in a week

or a couple of weeks.

“If you don’t stock

it, you can’t compete, so

starting the rental divi-

sion was huge for us.”

McCrea continues

to see the oil and gas

portion of his business

rising and expects it to

become a larger part of

his business over time.

“We’ve grown

out company truly in

Saskatchewan and in a

very bootstrapping type

of story, we’re moving

out West and East,”

McCrea said, “I can’t

exactly say where it’s go-

ing to go, but it’s going

to grow.”

A general view of the framing and spray foam insula on inside of one of the steel containers being ed as a wash car. Photo by Josh Schaefer

Durability a key factor

Page 46: Pipeline News December 2012

PIPELINE NEWS December 2012 B15

Lyle Leclair - Cell: 306-421-7060

With thanks from our entire staff

for your most generous support.

Happy Holiday!

Spread Cheer All Around!

LECLAIR TRANSPORTGeneral Oilfi eld

Hauling

Aldergrove, B.C. – A British Columbia-based

modular building company is seeking to expand its

off erings into Saskatchewan.

Shelter Industries Inc. has factories in Alder-

grove and Dawson Creek, British Columbia.

“We’ve been manufacturing lot of products for

Alberta,” said Mark Penaluna, sales and marketing

manager.

He described Shelter Industries as a modular

manufacturer catering to the oil and gas business.

Th ey can build camps as large as 500 to 800 beds.

Th ey can build off their standard plans or custom-

ize the product.

“We’re focusing on getting into the Saskatch-

ewan market,” he said.

Th e company was formed three years ago

from a merger of Greensmart Manufacturing

and Shelter Industries. In addition to pre-built

modular units for permanent or temporary needs,

one of their key products is the use of structurally

insulated panels with have two pieces of oriented

strand board sandwiched between insulation.

A typical modular unit is up to 14 feet wide

and can be up to 64 feet long. According to their

website, “Pre-built modular units can be used, like

building blocks, to create expansive permanent

buildings, such as a multi-level residential build-

ing, a school with a full-sized gymnasium, or even

a remote community complex. Th ey can also be

used for more temporary applications, such as site

offi ces, school portables, and workforce housing.

Built indoors to stringent standards, pre-built

modular units are typically higher in quality than

most site-built structures. Th e primary advantage

of pre-built modular units is speed and fl exibility.”

Standard off erings include 12 x 60 foot skid-

ded units.

Twenty-man “super executive dorms” have

queen-sized beds and individual bathrooms, in-

cluding their own showers. Th ey also have lots of

storage and desk space, Penaluna said.

Th at’s a change from the Jack-and-Jill style

of shared washrooms that are prevalent in the

industry.

In Saskatchewan they are targeting oil and

gas, but Penaluna noted they are looking at any

industry needed housing. Southeast Saskatchewan,

in particular, is in their crosshairs.In British Columbia the company has done

extensive work with kindergarten classrooms.

Modular builder targets Sask.

Page 47: Pipeline News December 2012

PIPELINE NEWS December 2012 B17B16 PIPELINE NEWS December 2012

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By Josh SchaeferFor Pipeline News

Saskatoon – Saskatoon Boiler has been

sending boilers to the oil and gas industry for

the last 60 years and it has been a steady indus-

try for them during that time.

Ray Graves, president of Saskatoon Boiler

Manufacturing Co. Ltd., said his company

manufactures several diff erent boilers for the

oil industry and that each one is designed for

the particular job the customer requires it to

do.

“We build boilers for oil drilling rigs, oil

service rigs, steaming rigs, and for general

steaming cleanup units,” Graves said. Th ey also

manufacture boilers for slop oil plants, and for

frac water heating.

“We build a special boiler for each one of

those applications and that’s what sets Saska-

toon boiler apart,” said Graves.

“Most companies have one style of boiler

and it’s supposed to fi t all applications, in our

case, our boilers fi t the particular application

very well because that is what they are designed

to do.”

Saskatoon Boiler’s units are widely con-

sidered to be some of the most reliable on the

market and as Grave’s explained, “Down time

on oil drilling rigs

is disastrous, so our

customers are prepared

to spend more to get a

boiler that will oper-

ate from fall to spring

without any mainte-

nance requirements and

not shut them down.

“We work very

diligently to continually

improve the product,”

noting that 90 per cent

of the boilers they are

currently selling go to

repeat customers.

Graves also spoke about his relationship

with customers. “We are very close to our cus-

tomers, they are not shy at telling us what they

want.”

Th e diff erence between Saskatoon Boiler

and another larger manufacturer, he said, is that

“Because we are a small independent company,

we can respond to these diff erent warrants.”

All of the boilers that Saskatoon Boiler pro-

duces are designed and manufactured in house.

“It’s an extremely complicated and convo-

luted business,” Graves explained. Th e boilers

are governed by a series of codes and regulations

that must be followed.

All of the boilers have to be designed in ac-

cordance with American Society of Mechanical

Engineers, the Canadian Standards Association

and the individual boilers act for each province

in Canada.

Going above and beyond these codes,

Graves showed Pipeline News shelving units full

of their own internal codes and practices that

they follow to go above and beyond the basic

requirements.

“While these codes are very cumbersome

and expensive to comply with and institute,”

Graves explained, “the justifi cation for it is that

we are building a safer product.”

Th e boilers have to be designed and engi-

neered for the province or state they are being

manufactured for to meet all of the regulations.

Th e design must then be registered with the

province or government authority before manu-

facturing begins.

In the case of all oil fi eld boilers manu-

factured by Saskatoon Boiler, they are also

registered with Underwriter’s Laboratories of

Canada, which gives them an approval label for

the units that covers the whole boiler.

Th e ULC label covers the oil burner, the

boiler, all of the controls and how the compo-

nents are married together. “When a customer

buys one of our boilers and see’s the ULC label

on it, there’s a lot of assurance.

“Th is is one of the reasons we can send our

boilers into the United States and to off -shore

companies. Th ese approvals are recognized and

not all boilers have these approvals, but ours do,”

Graves explained.

“We are building the best boiler we know

how to build.”

Saskatoon Boiler has sent oil fi eld boilers

across Canada, the United States and Siberia.

“We know how to outfi t these boilers for cold

weather operation,” Graves said.

During a plant tour, Graves explained that

the boilers they build assist in the production of

oil from the time it is taken out of the ground

until it is refi ned in a gas processing plant and

put into the pipeline.

Graves also explained that steam around

drilling rigs is a safe source of heat. “You don’t

have problems with something burning like an

open fl ame or hot water heater. It is very safe,

and very eff ective.”

Th e units are also becoming more energy

effi cient. “We have to pay attention to effi ciency,

especially as fuel prices increase. Th at’s prompt-

ed the move to fi ring the boilers on natural gas

and diesel.

“It saves a lot of money. Even if we can save

a gallon of fuel an hour,

over the course of a

week, that cost savings

can add up.”

Boilers are con-

sistently coming in to

their shop in Saskatoon

to have a conversion

performed from fi ring

on just oil, to fi ring on

oil and natural gas.

Service is an aspect

of the business that

Graves likes to focus on

as well. “We don’t send

boilers into an area that we can’t service them.”

Saskatoon Boiler has two service trucks with

a third one currently being built. Th e current

fi eld service crew consists of a dedicated staff ,

the most junior of whom has been with the

company for 14 years.

“We have service people going out to service

the boilers that they built in this factory, and the

customer likes the idea of the factory servicing

the boiler that built it 40 years ago,” said Graves.

“We are fortunate that boilers are used for a

variety of applications.”

Saskatoon Boiler celebrates its 100th an-

niversary in 2014.

Great customer service brings customers backGreat customer service brings customers backRay Graves, president of Saskatoon Boiler poses for a photo next to one of the boilers that his company manufactured.

Tracy Thibodeau works on a larger boiler that is expected to go to an oil processing plant in Weyburn.

Domingo Meningas wires an electrical motor on one of the boilers.

This 125HP boiler, which produces 4.1M BTU/hr of high pressure steam had just nished produc on and was being prepared for ship-ment.

Page 48: Pipeline News December 2012

B18 PIPELINE NEWS December 2012

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Calgary – Can Telematics, a Calgary-based

global GPS asset management company, is on a

growth roll with strong sales of its industry leading

web-based software called Trakopolis.

Customers such as oil and gas, mining and

transportation businesses can log onto Trakopolis

to track their assets anytime and anywhere in the

world in real time using a web browser.

Sales of Trakopolis put the company ninth on

Alberta Venture magazine’s list of 50 fast growth

companies with revenue growth of 379 per cent in

2011 with a similar forecast for 2012.

“It’s going very well. We are expecting to triple

in size again this year. Th ere is a lot of competition

out there out, but for us, it’s having an easy to use

system,” said Ted Duffi eld, sales director.

Th e company ended 2011 with revenues of over

$1.1 million compared to $230,382 in 2010 and

just $38,207 in 2009, the year Trakopolis became a

sellable product.

“A lot of that growth is our relationship with

Google and some attention to detail on the soft-

ware development side,” said Duffi eld.

“We can put all of your equipment, not just

your vehicles, on one platform that is easy to use

and gives our clients the information they need to

succeed.”

Trakopolis interfaces mobile communications,

software applications and GPS systems including

Google maps into a secure online system.

Brent Moore, Can Telematics’ CEO, describes

how it works in an online product video.

“We can attach an intelligent hardware device

to any asset, and the device continually conveys its

location to our secure servers, using cellular or satel-

lite communications,” said Moore.

“A business can log onto Trakopolis from any

Internet connection, and they can see their assets

anywhere, worldwide.”

Can Telematics integrates the latest Google

maps into Trakopolis to off er customers the best

possible view of their assets from a browser.

“We are a Google Enterprise partner. We have

an agreement to be a reseller for their map engine

which means oil and gas companies can use their

GIS mapping,” said Duffi eld.

“Th ey can pull points of interest into Trakopolis

and see their assets in real time.”

Safety, effi ciency, better control and visibility of

assets are the overall benefi ts for the end user using

cellular, satellite or a combination of both to locate

and track asset data.

Trakopolis includes mobile fl eet manage-

ment, active maps, real-time tracking, geo-fencing,

customizable reports, alerts, exceptions and e-mail

messaging, to suit client needs.

“We work on the notion that we can track any-

thing, anytime and anywhere,” said Duffi eld.

“Companies use the product for a number of

reasons – fuel tax savings, effi ciency, safety for lone

workers and asset utilization purposes.

“Any asset they want to have information about

that can work from a location base, we can provide

for them through Trakopolis,” added Duffi eld.

“You can get anything from a simple location

– from knowing where your equipment is to things

like engine and equipment diagnostics and when it

needs to be serviced.”

Th e analytics feature can even tell the user if

a driver is wearing a seat belt, how fast they are

travelling, and whether they have entered or exited

a yard – all in real time.

Can Telematics has also developed specialize

tracking software called CanHaul for the ship-

ping and transportation sector and a marketing

tool called MobileMatch that enables a truck to let

shippers know when it is available for work.

Duffi eld said Trakopolis makes up 95 per cent

of Can Telematics’ business with sales in 14 coun-

tries to oil and gas, mining, transportation busi-

nesses and municipalities using the technology.

“We have some law enforcement customers

and it can be used for incident recreation,” added

Duffi eld.

“Th e applications are endless. Trakopolis is built

with an open API, meaning that it makes it easy for

us to tie into other software systems that a company

might be using.

“We can really look at a company’s entire sup-

ply chain management and asset inventory control.

We can tie into a number of diff erent challenges

that they may face as a company.

Page B19

Stellar sales of Trakopolis asset tracker

Page 49: Pipeline News December 2012

PIPELINE NEWS December 2012 B19

www.crescentpointenergy.com

We’re proud to be a part of your community.

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joyous noel!

Page B18“Our focus has

been moving into

other areas outside

of oil and gas as well

as staying true to our

roots. For us, we’re

focused on sustainable

growth,” Duff said.

Can Telemat-

ics also sells a variety

of vendor hardware

devices for cellular or

satellite service.

The company,

incorporated in 2007,

is Canadian owned

by a group of private

investors and currently

employs more than 40

employees.

Can Telemat-

ics’ partnership with

Google along with

a commitment to

continuous product

development has

positioned Trakopolis

as the system of choice

for many oil and gas

companies and other

customers.

“We work very

closely with Google

on our development

– things like overlays

and their map engines

and tying into GIS

mapping systems used

by oil and gas compa-

nies,” said Duffield.

Duffield also at-

tributes the the rapid

growth and success

of Can Telematics to

a flexible company

service model with no

locked in contracts for

Trakopolis customers.

“Because they

are not locked into a

long-term contract,

what we do on a day-

to-day basis for them

is ensure they are us-

ing the system to get a

return on investment,”

he said.

“What’s made us

successful is our focus

on understanding spe-

cific customer require-

ments and delivering

fantastic service.

“As soon as the

customer signs on

with us – working

through the imple-

mentation, the train-

ing and through the

rollout of that year –

we work with specific

people within their

organization that need

to be trained on the

functionality to make

sure they are getting

that proper return on

investment.”

Trakopolis so ware devel-oped by Can Telema cs enables businesses to track xed or mobile assets any-

where and any me in the world with a web browser. The company is a Google Enterprise partner.

Photo submi ed

Page 50: Pipeline News December 2012

B20 PIPELINE NEWS December 2012

805 Government Road SWeyburn, SK

306•842•0307

Centrifuges

Shale Shakers

Shaker Screens

Drilling Fluids

(Daily Oil Bulletin)

Operators across Can-

ada rig released 8,163

wells during the fi rst

three quarters of 2012,

off 11 per cent from

9,178 wells drilled in

the January to Septem-

ber period last year, with

drilling levels setting

records in Manitoba.

Th at province is the

only one in the West

to see a year-over-year

increase in its rig release

tally to the end of

September. Operators

have drilled 463 wells in

Manitoba at the three-

quarter mark, up 34.59

per cent from 344 rig

releases in the com-

parable period a year

ago. Th ere was a bigger

percentage increase in

total meterage, however,

which climbed about

38 per cent to 861,164

metres from 622,769

metres a year ago.

To the end of Sep-

tember, the biggest per-

centage decline in year-

over-year drilling has

been recorded by British

Columbia, where 347

wells were rig released

compared to 474 a year

ago (off 26.79 per cent).

Operators have also

drilled fewer metres in

the gas-prone province:

1.33 million metres this

year compared to 1.68

million metres at the

three-quarter mark of

2011.

Across Canada,

of those wells with a

reporting status, only

12 per cent of the rig

released wells have gas

as an objective. Close

to 79 per cent of wells

with a status are listed

as oil or bitumen wells

— up from 68.62 per

cent last year — and the

highest percentage ever

recorded.

In Alberta, 3,682 of

the wells drilled to the

three-quarter mark of

the year had oil or bitu-

men as an objective —

down from 3,744 to the

end of September 2011.

Wells targeting natural

gas or CBM declined to

813 from 1,507 at the

three-quarter mark last

year.

Th e same pattern

held true in Saskatch-

ewan, where 2,218 wells

were rig released in the

January to September

period with oil as an

objective (compared

to 2,350 last year), and

only nine gas wells were

drilled, down from 32 a

year ago.

Th e total number

of wells rig released in

Alberta declined 13.56

per cent to 5,022 wells

versus 5,810 after last

year’s fi rst nine months.

Total metres drilled de-

clined slightly to 10.36

million metres from

10.37 million metres a

year ago.

Operators in Sas-

katchewan drilled 2,314

wells in the January to

September period of

2012, off eight per cent

from 2,514 wells rig re-

leased a year ago, while

meterage has decreased

to 3.7 million metres

from 3.85 million me-

tres in 2011.

In comparing

Alberta and Saskatch-

ewan rig releases, the

former’s overall count

for the nine-month

period included 163

outpost wells and a total

of 453 exploratory wells.

In Saskatchewan, 329

exploratory wells were

rig released, including

242 outpost wells.

In the third quarter,

only two PSAC zones

recorded year-over-year

increases in rig releases.

Northeastern Alberta

saw 405 wells drilled

compared to 301 a year

ago, while Manitoba

recorded 220 rig releases

versus 146 a year ago.

East Central Alberta

was the busiest PSAC

zone, with 540 wells

drilled in the July to

September period.

In September, oper-

ators rig released 1,150

wells across Canada

compared to 1,374 in

the year-prior period

(off 16 per cent), as all

four western provinces

recorded decreases in

drilling.

Only nine gas wells drilled

Drilling and Service ActivityOnline or on Your GPS

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Page 51: Pipeline News December 2012

PIPELINE NEWS December 2012 B21

Happy Holidays

WINTER

Jayson King 306.736.9169Stoughton, SK

www.jkcontainments.com

(Daily Oil Bulletin) Calgary – Oil and liquids-

rich natural gas will be the focus of ARC Resources

Ltd.’s record $830 million capital budget for 2013,

including development and infrastructure spend-

ing that will set the stage for signifi cant production

growth in 2014, said the company.

ARC’s board of directors also has announced

that Myron Stadnyk, currently president and chief

operating offi cer, will replace John Dielwart, chief

executive offi cer, who is to retire Jan. 1, 2013. Stad-

nyk, who has been COO since 2005, will become

president, CEO and a director at Jan. 1, 2013.

Dielwart, who will remain on the board of direc-

tors, will stay on as an adviser through to the annual

general meeting in May to assist his successor with

the transition.

Spending, which will be up 38 per cent from

this year’s $600 million capital program, will

be directed at opportunities at Tower in British

Columbia, Ante Creek and Pembina in Alberta,

Goodlands in Manitoba and various oil properties

in southeast Saskatchewan.

A total of $751 million, 91 per cent of the

budget, will be spent on oil and liquids drilling and

infrastructure.

Plans call for the drilling of 178 (160 net)

operated wells with 153 wells targeting oil, 16 wells

focused on liquids-rich natural gas and nine wells

targeting dry gas.

On its non-operated properties, ARC antici-

pates that 103 (10 net) non-operated wells will be

drilled by partners with its share of expenditures

approximately $56 million, dominated by oil drill-

ing activity in the Pembina and House Mountain

areas of Alberta and at the Weyburn property in

Saskatchewan.

Of the total budget, $563 million has been

allocated for development, $162 million for facili-

ties, $35 million for maintenance, $27 million for

enhanced oil recovery and $13 for optimization.

Spending for exploration and seismic will account

for $11 million, down from an estimated $52 mil-

lion this year.

Consistent with guidance following the $160

million reduction in its 2012 capital program an-

nounced earlier this year, ARC expects modest

annual average production growth of three per cent

year-over-year to approximately 95,000 boepd in

2013 (60 per cent natural gas) with a fi ve per cent

growth in oil and liquids production.

Th e growth will accelerate throughout the year

with 2013 exit volumes targeted at 100,000 boepd.

ARC expects 2014 annual average production to

be in excess of 110,000 boepd, representing greater

than 15 per cent production growth relative to

2013.

ARC plans to spend $73 million in southeast

Saskatchewan and Manitoba to drill 51 gross oper-

ated oil wells. Th e areas will include Goodlands,

Oungre, Lougheed, Skinner Lake, Browning, North

Weyburn, Queensdale and Parkman. Full-year aver-

age oil production is expected to grow by approxi-

mately eight per cent to 12,500 boe per day in 2013.

A considerable portion of the activity in this

area will occur at Goodlands, where ARC plans to

drill 22 horizontal oil wells with production increas-

ing 20 per cent over this year to an average of 2,700

boepd.

ARC sets $830 million capital budget for 2013

Page 52: Pipeline News December 2012

B22 PIPELINE NEWS December 2012

Regina – Except for snow on the ground in

some parts of Saskatchewan, the province couldn’t

have asked for a better start to November with the

release of three positive economic reports.

Th e good tidings began with news from Sta-

tistics Canada that Saskatchewan is coming off

another record month in October for labour force

numbers, employment and full-time employment.

Employment for October 2012 was 541,600,

the highest on record for the month with 12,500

more jobs than last October for the 11th month of

year-over-year increases.

“Saskatchewan has been fortunate to have

undergone signifi cant growth on both an economic

and employment front,” said Economy Minister

Bill Boyd.

“It has improved the job opportunities available

for people in our province, and makes us an attrac-

tive destination for those who are looking for new

employment options from beyond our borders.”

Th e seasonally adjusted unemployment rate

in Saskatchewan was 4.7 per cent in October, the

second lowest in Canada, and below the national

unemployment rate of 7.4 per cent.

Full-time employment hit a record of 452,800

for October, an increase of 16,100 from a year ago.

Th e next batch of good news also delivered at

the start of the month by Statistics Canada, trum-

peted a 79.1 per cent increase in September resi-

dential building permits compared to a year earlier.

Overall, building permits in the province

improved by 39 per cent, the third highest increase

among the provinces.

“Saskatchewan’s construction industry is ex-

tremely active right now,” said Boyd.

“On the residential front that demand is a com-

bination of our increasing population and a strong

economy that’s contributing to an increase of new

homes.” Page B23

Three thumbs-up for provincial economy

Page 53: Pipeline News December 2012

PIPELINE NEWS December 2012 B23

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Page B22 Regina’s building permits

jumped a whopping 225 per cent on a year-over-year

basis, the highest increase among major Canadian

cities. Saskatoon was also up by 19.1 per cent.

“Th e level of construction has a huge impact on

our overall economic progress,” Boyd said.

Boyd noted that report is defi nitely a good indi-

cator that the economy is moving forward, creating

jobs and business opportunities in every corner of the

province.

Th e third batch of positive news delivered in

November is all about the 1,014,363 visits to the

province’s Sask.ca website by jobseekers in Octo-

ber. Th at number is up by 29.53 per cent from last

October.

“Saskjobs.ca is helping Saskatchewan employ-

ers fi ll much-needed positions in 309 communities

across the province,” said Boyd.

“Employers are looking for workers in a wide

range of occupations to fi ll mostly full-time posi-

tions.”

Th ere were 16,331 jobs posted in October 2012,

a 12.28 per cent increase from October 2011. Mobile

device visits went from 54,273 in October 2011 to

213,122 in October 2012.

On a monthly basis, postings increased by 6.58

per cent between September 2012 and October

2012. Visits to the website from Quebec job-seekers

increased by 53.28 per cent over this same period.

Th e increase in Quebec can be attributed to an

employer-led recruitment mission to promote the

province at the Montreal Job Fair.

“Our economy is one of the best in Canada right

now,” Boyd said.

“It allows us to attract workers from other prov-

inces and beyond who are looking for new opportu-

nities and are choosing Saskatchewan as a destina-

tion of choice.”

Saskatchewan residen al building permits in Septem-ber were up 79.1 per cent compared to September 2011 as the economy con nues to grow and a ract new workers. The latest numbers were released by Sta s cs Canada at the beginning of November.

File photo

Page 54: Pipeline News December 2012

B24 PIPELINE NEWS December 2012

Calgary – Petrobank

Energy and Resources

Ltd. and its 57 per

cent owned subsidiary

PetroBakken Energy

Ltd. are being reorga-

nized into two indepen-

dent companies to take

eff ect Dec. 31, 2012.

“Th e reorganiza-

tion is consistent with

our long-held corporate

goal of enhancing share-

holder value by creating

strong, focused indepen-

dent companies,” said a

company spokesperson

on Oct. 29

A new Alberta

corporation, New

Petrobank, will be

formed to acquire exist-

ing assets and liabilities

of Petrobank including

heavy oil assets as well

as toe to heal air injec-

tion or THAI technol-

ogy.

New Petrobank will

not acquire Petrobank’s

ownership interest in

PetroBakken shares.

Existing sharehold-

ers of Petrobank will

receive one share of

New Petrobank for each

Petrobank share held.

Th e 2013 business

plan for New Petrobank

will focus on pursuing

the commercializing of

its THAI project near

Kerrobert.

“We expect New

Petrobank to enter 2013

with extensive fi nancial

resources, a focused

portfolio of heavy oil

assets and a multi-year

business plan to capture

the signifi cant value

potential of the THAI

technologies and drive

long-term shareholder

value,” said the company

in a release.

New Petrobank also

plans to commence cold

production at Dawson

(Peace River area) in

2013 to condition the

reservoir for a THAI

demonstration project.

Planning will also

continue in 2013 for

as many as three new

THAI projects on

existing lands along the

Kerrobert trend while

exploiting cold produc-

tion opportunities on

existing lands.

New Petrobank

plans to add more

prospective resources to

their land inventory and

enhance their intellec-

tual property portfolio.

During 2012, the

company purchased

additional lands on the

Kerrobert channel trend

and currently owns ap-

proximately 25 sections

of land in Saskatch-

ewan.

Th ey will also strive

to pursue future tech-

nology licensing oppor-

tunities through Archon

(which owns THAI

technology).

Production from

the Kerrobert project

averaged 305 barrels per

day of upgraded THAI

oil per day in the third

quarter of 2012, an in-

crease from 236 barrels

per day in the previous

quarter.

Page B25

Petrobank, PetroBakken shuf e deck

The Kerrobert THAI heavy oil project site includes this three stage treater with oil and water storage tanks in the background. File photo

Page 55: Pipeline News December 2012

PIPELINE NEWS December 2012 B25

738 5th Street (back door) Phone: 634-3522

24 Hour Service - 7 Days A Week!

• Two Way Radios• Alarm Monitoring

• Safety Checks

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

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Page B24“We have focused on increasing air injection

and continue to target much higher injection and

production rates in the near future,” said the com-

pany in its third quarter report.

“At Dawson (Peace River area), we have com-

menced cold oil production at the fi rst of the two

horizontal THAI production wells.

“We expect to initiate cold production at the

second well before the end of 2012.

“Th ese wells are expected to produce for a

period of time to pre-condition the reservoir for

start-up of the THAI demonstration project.”

Petrobank has reactivated eight wells in the

Kerrobert trend lands for cold production. All of

these wells are in the early stages of clean-up and

production.

“We expect to drill four stratigraphic wells in

Q4 2012 to better defi ne our resources in the Luse-

land area,” said the report.

“We expect to complete these four wells for

cold production in 2013 as part of our plan to

opportunistically exploit the primary production

potential of our assets.”

In other news, PetroBakken’s third quarter

results released on Nov. 12, noted that production

averaged 38,503 barrels of oil equivalent per day.

Production in the quarter was relatively fl at

compared to the third quarter of 2011, due primar-

ily to the disposition of producing assets in the fi rst

half of 2012 and a delayed start to the second half

2012 capital program.

PetroBakken’s nine month production averaged

41,303 boepd, a seven per cent increase over the

same period in 2011.

Capital expenditures before dispositions totaled

$292.7 million in the third quarter with PetroBak-

ken drilling 82 net wells.

COMPRESSION CONSULTING LTD.

www.annugas.comToll Free 1.866.ANNUGAS

with Warm Wishes

And many thanks to our friendsand neighbors

at Christmas.

Greetings of the Season

Bison Transport has signed an agreement

with Shell Canada Products to run 15 LNG tractors

in Alberta.

Bison's fi ve-year fuels supply agreement marks

the fi rst step in launching Shell's LNG refuelling

infrastructure in the province.

Th is agreement is the fi rst of its kind in Canada,

the companies said, as Bison will obtain LNG from

Shell Flying J publicly accessible LNG fuelling

facilities in Calgary, Edmonton and Red Deer, which

are expected to open in early 2013. It also highlights

LNG's potential as a transport fuel option. Under

specifi c conditions, the use of LNG in heavy duty

applications has the potential to deliver a 20 per cent

reduction in greenhouse gas emissions.

“We are very pleased to be working with Shell

on this leading-edge initiative that stands to trans-

form the commercial freight and fuel industries in

North America,” said Trevor Fridfi nnson, Bison's

vice-president of western operations. “Proving that

this alternative fuel source can be economically and

practically viable is our objective, aligning perfectly

with our company values.”

Shell believes its LNG refuelling infrastructure

will support an increasing number of commer-

cial fl eets with LNG fuel options. Th e company is

constructing a natural gas liquefaction plant at its

Jumping Pound facility, west of Calgary, to supply

this growing market.

“LNG can be a cost-eff ective fuel from an

abundant resource of natural gas and we believe it

can help our customers build competitive advantage,”

said Lorraine Mitchelmore, Shell Canada Limited

Country Chair. “Th e opportunity to work with one

of Canada's leading fl eets marks an exciting mile-

stone for Shell.”

Bison will start receiving new Peterbilt tractors

featuring the innovative Westport HD natural gas

engines in November and the entire LNG heavy

duty fl eet will be operational by January 2013.

Bison Transport's truck eet

Page 56: Pipeline News December 2012

B26 PIPELINE NEWS December 2012

#1 Hwy 18, Oxbow, Sask.306-483-5132

www.ensignenergy.com

MERRYCHRISTMAS

We’re really grateful to have friends and neighbors like you!

46 – 13th Street NE • Weyburn, SK • S4H 1K8Phone: 306-842-5490 • Fax: 306-848-0275

Toll-free: 888-346-8260

www.hseintegrated.com

If You’re Serious About Safety

Occupational Health & SafetyAudiometric & Respiratory Equipment Fit Testing

••

Standby & Emergency Medical ServicesIndustrial Hygiene

Wireless Air Quality MonitoringPlume Dispersion Modeling

••

Gas Detection EquipmentGas Leak Detection and Analysis

••

Safety Project Management & ConsultingBreathing Air Equipment & ServicesOf ce/Air TrailersShower ServicesH2S Safety

•••

Emergency Fire ghtingCon ned Space & High Angle RescueWell Control and Blowout RecoveryHot Tap & FreezeSafety Training

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Dan O’ConnorOperations Manager

204-748-5088

Office - Kola, MB.Office - Kola, MB.204-556-2464204-556-2464

Daylighting, Oilfield Hauling, Steaming & Mobile Pressure Washing, Winch, Water & Vac-uum & Computerized Certified Pressure Truck Services

Saskatoon – Th e

fourth quarter of 2012

could be another pro-

ductive period for Allstar

Energy Ltd. with drilling

in progress or pending at

its Viking, Red Pheasant

and Riverside properties.

Allstar Energy, a

wholly-owned subsidiary

of 49 North Resources

Inc. based in Saskatoon,

provided a forward look-

ing operational update at

its three exploration and

development properties

on Oct. 17.

Th e snapshot was

taken with Allstar’s

fi eld-estimated total

gross production at ap-

proximately 550 barrels

of oil equivalent per day

(net approximately 400

boepd) weighted 70 per

cent oil 30 per cent gas.

At its Kindersley Vi-

king oil property Allstar

successfully completed a

three well (net one) hori-

zontal drilling program

with two of the wells

fl ow lined and tied into

the 100 per cent owned

battery.

Th e company

reported the two wells

were on production for

approximately eight

weeks and were in line

with typical Viking

expectations.

Allstar also drilled

a step out well (delayed

development well) on

a section that had no

previous drill holes.

Th e operational

update noted the well

had not yet been tied in

but was free fl owing to a

tank. Th e initial produc-

tion data on this well

exceeded management’s

expectations for the sec-

tion.

Th e wells were

drilled into the Viking

formation using the

same monobore tech-

nology that has been

deployed on all of the

previous 17 horizontals

(net 14.7) Allstar has

drilled at Kindersley.

At Red Pheasant,

Allstar drilled two verti-

cal wells to test seismic

data acquired earlier in

the year.

Th e company noted

they would complete

a review from that

program by the end of

October.

At Riverside, Allstar

completed fi eld acquisi-

tion of a 3D seismic

program announced

in September and they

expected to wrap up fi nal

interpreted results by the

end of October.

Th e company plans

to initiate a new drill

program on the River-

side lands based on the

interpreted seismic.

In addition to the

recently shot seismic

program, Allstar has ac-

quired an additional 2.6

square kilometres of 3D

seismic that surrounds

one of the recompleted

wells.

Th e company has

identifi ed up to fi ve

development well loca-

tions from this data and

expects to begin drilling

in the current fourth

quarter.

Allstar identi es new drill locations

Page 57: Pipeline News December 2012

PIPELINE NEWS December 2012 B27

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Happy HolidaysWith our thanks for your valued patronage at this special time of year. It’s been both a privilege

and a pleasure serving you.

Winnipeg – Westeel, a Winnipeg-based manu-

facturer of steel storage products, got off to a quick

start with the marketing of its new frac tank instal-

lation system which allows most tanks to be built in

one day.

Th e fi rst order for Westeel’s proprietary Speed

Plate frac tank system went to Total Oilfi eld Rent-

als LP, a subsidiary of Calgary-based Total Energy

Services Inc. on Oct. 2, less than two weeks after

the product launch on Sept. 24.

Th e Westeel Speed Plate tanks were introduced

to the market on Oct. 15 at Total Oilfi eld Rentals’

new location in Minot, N.D., that opened in July.

“Our fi eld trials confi rm that the speed at

which the new system can be deployed will be a real

benefi t to our customer base and the rental rates

at which we can off er this system will be attractive

relative to other systems in the market,” said Russ

Strilchuk, vice-president sales and marketing for

Total.

“We see this product as a valuable complement

to our broad product off ering in the marketplace

both in the northwest United States and Western

Canada.”

Th e frac tank will be available through

Westeel’s distributor with Total having the exclu-

sive right to rent the Speed Plate frac tank system

to the oil and gas industry in Western Canada,

North Dakota and certain other states.

“Th is product provides tremendous oppor-

tunities for our business in these locations,” said

Westeel president and general manager André

Granger.

“We are excited to be able to off er this conve-

nient new system on a rental basis throughout the

oil and gas industry in the northwestern United

States and Western Canada through our distribu-

tor’s exclusive arrangement with Total Oilfi eld

Rentals.

Th e frac tank system ordered by Total incorpo-

rates “Speed Plate” technology, that enables frac site

operators to get their sites up and running in record

time, without the use of cranes for a safer installa-

tion.

“Increasing the speed of frac tank installation

has been our focus,” said Granger.

“Th is new system provides a fast, safe, cost-

eff ective solution to water management at drilling

sites.”

Th e reusable and movable frac tanks are engi-

neered with corrugated steel panels, and most sizes

can be delivered to site on a single truckload, which

includes the tank and liner. Th e new patent-pend-

ing Speed Plate uses fewer bolts per panel seam,

which enables the installation crew to build the

system quicker, while still maintaining its structural

integrity.

Total Oilfi eld Rentals off ers a full slate of

oilfi eld rental products as well as transportation ser-

vices through its network of 20 branches in western

Canada and its new U.S. branch in Minot.

Total Energy Services Inc. is a growth oriented

energy services corporation involved in contract

drilling services, rentals and transportation services

and the fabrication, sale, rental and servicing of

natural gas compression and process equipment.

Total rst to rent Speed Plate frac tanks

Page 58: Pipeline News December 2012

B28 PIPELINE NEWS December 2012

Calgary – Th e Alberta government expects to

have one energy regulator in place to cover landown-

ers, industry and the environment by June 2013.

Th e government has introduced Bill 2, the Re-

sponsible Energy Act, that creates a single provincial

regulator for upstream energy resource activities in-

volving oil, gas, oilsands and coal.

Under the proposed legislation, the new regu-

lator will be a unifi ed one-window approach that

makes it easier to navigate the system.

It will also be responsible for energy resource de-

velopments from initial application to reclamation.

“With this legislation, we are laying the foun-

dation for the next 50 years of responsible energy

development in the province,” said Energy Minister

Ken Hughes in a news release on Oct. 24.

Alberta to create new energy regulator

“Th is new system will be more eff ective and ef-

fi cient for industry and landowners and it will build

on Alberta’s long-standing commitment to the en-

vironment.

“Th e result will be a benefi t to not only Alberta’s

economy but to Canada’s economy. It will help us

maintain the social licence to operate.”

Th e proposed legislation includes higher fi nes

for individuals and companies who break the law.

It will also allow landowners to volunteer to reg-

ister for private-surface agreements, which can then

be enforced.

Th e need for a single regulator was identifi ed by

the Regulatory Enhancement Task Force two years

ago. A comprehensive oil and gas regulatory review

was carried out as well.

Th at work included numerous consultations

with industry, landowners, environmental groups

and First Nations, and an online survey inviting Al-

bertans’ feedback.

Th e government adopted all six recommenda-

tions of the task force with its Bill 2 legislation.

Under the proposed legislation, the single reg-

ulator will assume the regulatory functions of the

Energy Resources Conservation Board and Alberta

Environment and Sustainable Resource Develop-

ment, with respect to oil, gas, oilsands and coal de-

velopment.

Th e arm’s-length agency will be governed by a

board of directors, with a chief executive offi cer at

the helm. It is expected to be operational by June

2013.

“As we grow, we must continue to fi nd the right

balance between environmental management and

resource development to ensure Alberta and Canada

remain global leaders on both fronts,” said Environ-

ment and Sustainable Resource Development Min-

ister Diana McQueen.

“Th rough this regulator, we are taking a new ap-

proach to how we develop our energy resource while

maintaining our strong environmental outcomes.”

Th e legislation also gives the regulator the au-

thority to administer the Public Lands Act, the En-ergy Protection Enhancement Act and the Water Act, with regards to energy development.

In addition to the single regulator, the govern-

ment of Alberta is making improvements to how it

sets energy-related policy.

Policy direction for the province will continue

to be set by the government of Alberta, through a

newly-created Policy Management Offi ce which

will be responsible for providing clear policy guid-

ance to the new regulator.

Th e province is also completing and implement-

ing regional plans. In August, the province released

its fi rst land-use plan for the Lower Athabasca Re-

gion.

Th e province announced another component of

its integrated resource system – an environmental

monitoring system on Oct. 17.

Greetings at Christmas

Plans to cover land owners, environment, and the industry

Page 59: Pipeline News December 2012

PIPELINE NEWS December 2012 B29

G I V E T H E G I F T O F W A R MT H

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Phone (306) 842-4845 or email [email protected]

Lloydminster – Sunny days are ahead for sales of a solar operated chemical

injection pumps at Bruin Instruments Corp. in Edmonton.

Th e Canadian owned and operated manufacturer of chemical injection

pumps and pumping equipment generated a lot of sales leads with its solar

powered BR1100 chemical injector pump exhibit at the Lloydminster Heavy

Oil Show in September.

“We do very well with solar and electric pumps in this area,” said sales

representative Jason Treichel at the Bruin booth.

“We are bringing the solar along for everyone to see what it’s all about and

hopefully, get some clientele for that as well.

Page B30

Solar injector pump a bright idea

Jason Treichel, a sales rep with Bruin Instruments, a Canadian owned manufac-turer of chemical injec on pumps based in Edmonton, leans on a 130-wa solar operated BR1100 chemical injector pump at the Lloy-dminster Heavy Oil Show in September. The solar op on is ideal for remote northern well sites where electricity isn’t available.

Page 60: Pipeline News December 2012

B30 PIPELINE NEWS December 2012

FIND OUT MOREEnbridge.com/InYourCommunity

We support the people who keep our communities safe.

Our Safe Community program provides firefighters, police departments and other first responders with funding for everything

from equipment to training. The program gives the men and women who protect us the support they need to ensure the safety

and wellbeing of our communities, now and into the future.

Enbridge delivers more than the energy you count on. We deliver on our promise to help make communities better places to live.

It’s part of the reason we were named one of the Global 100 Most Sustainable Corporations in the World.

WHERE ENERGY MEETS SAFETY

T. K. Trailer SalesManor, Sask. Ph: 1-306-448-2260; Cell: 1-306-575-7116

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Halbrite Service Centre306-458-2419

Happy holidays and many thanks for your kind patronage this past year.

It’s Been OurPleasure Serving You!

Page B29

“It’s a solar operated chemical injection pump.

You just put it on a well site, and you can inject

methanol, chemicals and corrosion inhibitors. Any-

thing you want inside a well, this thing can handle.”

Th e BGR1100 is a rotary cam driven positive

displacement plunger type pump that utilizes a

rotary electric source.

Th e BR1100 fi tted with a DC motor can be

powered with a set of batteries charged by solar

panels such as the 130-watt panel displayed in

Lloydminster.

Th e alternative to solar is electric, but electricity

is not always available at remote well sites and in

northern regions of Western Canada.

“It’s the new age, I guess, we’re going for now.

Everyone wants to save money with the gas and

stuff like that. Th e next step-up is solar,” said Tre-

ichel.

“In the north country, one 130-watt panel and

two batteries can usually stand up for quite a long

time.

“In the fall and the summer these things are

perfect. It’s the harsh Canadian winters that are

hard on the batteries. You may have to switch the

batteries a little bit more or use a heater on the bat-

teries.

“If it’s -40 Celsius that’s when the batteries

kind of freeze up. If you are willing to spend the

money, solar is the way to go.”

Th e pump can be operated with an electronic

control that turns the pump on for a specifi ed

period of time.

“Th at way it’s a little bit easier on the batteries

and the solar panel, so it’s more long lasting,” said

Treichel.

Th e pump can handle a wide variety of output

volumes from less than one litre to 378 litres (100

gallons) per day and discharge pressures up to 3,000

pounds per square inch.

Bruin Instruments also manufactures a variety

of pneumatic, electric, natural gas and beam driven

pumps for the global oil and gas market including

an environmental gas recovery pump.

“Here in the Lloydminster area, electric is very

popular because the gas is usually low pressure

around here,” said Treichel.

“Th ere’s a lot of gas around, so they usually

want to save the gas and go with the electric.”

Bruin Instruments also provides sales, parts,

service and repairs and exchange services for its

Bruin Pumps and a wide range of other pumps they

carry from brand name manufactures.

Next step-up in solar

Page 61: Pipeline News December 2012

PIPELINE NEWS December 2012 B31

Leading The Wayg y

Setting new standards Setting new standards for performancefor performance

Fast Growing Fast Growing CompanyCompany

www.CanElsonDrillingCanElsonDrilling.com

Box 312Carlyle, SK S0C 0R0Office: 306.453.2506Fax: 306.453.2508

Suite 700, 808 - 4th Avenue SWCalgary, AB, Canada T2P 3E8Phone: 403.266.3922Fax: 306.266.3968

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Opportunities On Our RigsOpportunities On Our RigsCanElson Drilling Inc. is currently looking for hard working individuals that are looking CanElson Drilling Inc. is currently looking for hard working individuals that are looking

for challenging and rewarding work on top-of-the-line equipment in Saskatchewan. for challenging and rewarding work on top-of-the-line equipment in Saskatchewan. We provide competitive wages and stock options for Drillers and Rig We provide competitive wages and stock options for Drillers and Rig

Managers. Interested individuals can drop off resumes in person at our Managers. Interested individuals can drop off resumes in person at our Carlyle Office or fax to 306-453-2508. Carlyle Office or fax to 306-453-2508.

Offices in Calgary, Nisku, and Carlyle, as well Offices in Calgary, Nisku, and Carlyle, as well as Midland, Texas and Mohall, North Dakotaas Midland, Texas and Mohall, North Dakota

Since it was established in late 2008, CanElson Drilling Inc. has grown quickly to become one of Canada’s premier drilling contractors. In addition to building its own drilling rigs, the company is expanding its eet of drilling and service rigs through acquisition. CanElson now operates a eet of 40 rigs.

With operations in Western Canada, West Texas, North Dakota and Mexico, CanElson Drilling Inc. is setting new standards for rig utilization.

With right-sized, purpose-built rigs built for horizontal and resource play drilling and experienced, well trained crews, the company is achieving new records for cost-effective, ef cient drilling operations.

Page 62: Pipeline News December 2012

B32 PIPELINE NEWS December 2012

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Page 63: Pipeline News December 2012

NEWSPIPELINE SECTION C

December 2012

By Geoff Lee

Calgary – Th e Canadian Association of Oilwell Drilling Contractors

wants the federal government to know the rig industry benefi ts all of

Canada economically, not just the western provinces.

Members of CAODC, led by its president Mark Scholz, took

their message before the federal Standing Committee on Fi-

nance meeting in Ottawa on Oct. 24.

“Our purpose was education and reaching out to our

federal policy makers. CAODC understands the infl uence

that the federal government can have on our industry,” said

Scholz.

“We were educating our members of Parliament from

across the country on some of the unique challenges in the

drilling and service rig business and ways they can help im-

prove our industry going forward.

“Th ere is a growing myth in our country that the oil and

gas industry only benefi ts western Canadians, and that’s just

not the case.”

Service rig and drilling rigs workers are recruited from

all parts of the country including Newfoundland, Quebec

and Ontario for rig activity from Manitoba to British Co-

lumbia.

“We have rigs that are built and are composed of a num-

ber of individuals right across the country who don’t make

Western Canada their home,” said Scholz.

“Th eir home could be in Eastern Canada, in Atlantic Canada,

and possibly the west coast of British Columbia.

“We attract our manpower from right across the country, so all

Canadians are really benefi ting from this industry. Th at’s what we are

trying to communicate.”

In a news release on Oct. 24, COADC said one active drill-

ing rig draws support from 135 jobs with 75 of those jobs

in oil and gas occupations and 40 in hospitality

services such as hotels, restaurants and gas

stations.

Scholz said the economic im-

pact of the rig industry is over-

looked especially in regions

like Ontario and Atlantic Canada that continue to suff er from

high unemployment as well as gas prices at

the pumps.

“Th ere’s a tremendous amount of

manufacturing activity and indirect

economic spinoff that occurs in

parts all across the country,” said

Scholz.

“Th ere’s a lot of manu-

facturing that’s done in

Ontario for the oilsands.

Th ere are some compa-

nies that have said ‘look

we wouldn’t be around if

it wasn’t for the oil-

sands."

While in Ottawa,

CAODC members also

took time to highlight

the skill set of rig work-

ers and seek help to re-

cruit more workers from

Eastern Canada to meet

the labour shortage.

“We still have a num-

ber of people from those areas

coming to Western Canada

and working on the rigs. You

just have to look at the

economic conditions in

Ontario right now,”

said Scholz.

Page C2

Mark Scholz, president of CAODC, took part in a public rela ons mission in O awa in October to promote the na- onal economic bene ts of

the rig industry and to seek help in hiring new workers from hard hit parts of East-ern Canada.Photo submi ed

CAODC drills MPs,sees stable Q4

Page 64: Pipeline News December 2012

C2 PIPELINE NEWS December 2012

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Page C1“Southern Ontario is in really bad

shape, particularly on the manufactur-

ing front with auto workers.

“We would love to continue to

see successful recruitment for those

folks who need jobs because we have

the jobs here.”

Rig technicians are a Red Seal

trade with apprenticeship training

off ered in British Columbia, Alberta,

Saskatchewan and the Northwest

Territories for the past nine years.

More that 9,500 overall positions

in the oil and gas industry, including

rig crews, need to be fi lled by 2015,

according to a market outlook pub-

lished in May 2012 by the Petroleum

Human Resources Council.

Collaboration among indus-

try, government and labour supply

stakeholders is cited by that report as

a good way to meet the demand for

labour due to age-related attrition as

baby boomers retire.

“Th ese labour challenges aren’t

going to be going away in the short

term, or frankly, also the long term. I

think this a lull in labour supply that

we are going to be with for a long

time,” said Scholz.

“Th at’s partly the reason I was

in Ottawa speaking in front of the

federal fi nance committee and talking

about ways that we can incentivize

Canadian workers in Ontario and

parts of Quebec to look for work in

Western Canada.

“We are in a very unique place in

Western Canada. If we don’t address

this, we can have an unsustainable

escalation in wages and infl ation in

Western Canada that is not going to

fare well with our economic health.”

CAODC released their 2013

drilling forecast on Nov. 13 and is

sticking with its fourth quarter fore-

cast for 2012 for a utilization rate of

55 per cent and a year-end average

rate of 49 per cent.

For the week of Oct. 23, the

utilization rate stood at 42 per cent in

Western Canada.

“What I am hearing for quarter

four is I think there will be stable

activity. I don’t think we are going to

see any major thrusts in activity,” said

Scholz.

“Th is summer, we were very

concerned about some of the an-

nouncements of clawbacks of capital

expenditures. It didn’t materialize to

the extent that we were looking at in

terms of a worst case scenario.

“I think we are going to have a

stable quarter four.”

In 2011, the petroleum industry’s

workforce expanded signifi cantly due

to capital spending that far exceeded

industry forecasts.

Th ere were over 186,000 oil and

gas industry jobs in 2011, an increase

of one per cent over 2010 and a fi ve

per cent increase over 2009.

CAODC sees little hope for

increased gas drilling in Saskatchewan

unless natural gas prices rebound.

“At $3 to $3.50 – at those num-

bers they are just not economic. We

have seen some analysts have been

on the record indicating plus $4. Th at

certainly will help.”

Th e bigger worry for the rig in-

dustry is the prospective threat of low

crude oil and gas prices at the same

time with crude oil prices hovering

around $84 a barrel in late October.

“We are in a unique position right

now. Before we always had more of

a balance between drilling for crude

oil and drilling for natural gas,” said

Scholz.

“One of the risks we have is if oil

continues to see this much volatil-

ity – if it gets any lower than where it

is now and we see operators clawing

back on crude oil drilling, we don’t

really have gas to fall back on.

“Th at is a tremendous concern,

so we are really – at this point from a

drilling community – we are putting

all of our eggs in one basket.

“We hope to see that change. We

would love to see gas back up to $5 or

$6. I don’t think it’s going to happen

in 2013 and I don’t think it’s going to

happen in 2014 either.”

Demand for natural gas could be

helped with a prolonged bout of cold

weather across populated areas of the

United States.

“If we can get a few cold snaps

down there and get people turning

on their heaters, we’d love that,” said

Scholz on a cold day in Calgary.

Scholz said the construction

of pipelines such as the proposed

Keystone XL and Northern Gateway

projects originating from Alberta may

not spike the demand for drilling, but

would be good for the industry and

Canada economically.

“I don’t know if you’d see an in-

centive in the short term, but I won’t

argue if we don’t see those major

infrastructure projects go ahead, it

will certainly be a deterrent for future

investment in the long term,” said

Scholz.

“You have to keep in mind 98 per

cent of our oil and even on the gas

side is being sold to the United States

and is being sold at a discount.

“For a country that wants to be

an energy super power in the next fi ve

to 10 years, we’ve got to diversify our

markets.

“If we don’t do that, it’s going to

hurt investment. It’s going to hurt

drilling activity and it’s not going to

do very well for the overall Canadian

economy.”

Little hope for increased gas drilling

Page 65: Pipeline News December 2012

PIPELINE NEWS December 2012 C3

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By Geoff LeeLloydminster – Grit

Industries Inc. is off to

a fl ying start at its new

manufacturing base in

North Battleford with

a backlog of orders to

fi ll for their fl agship

cold weather technology

products. Demand for

the products means they

already have orders to

take them well into the

third quarter of 2013.

Th e Lloydminster-

based company expects

to complete the reloca-

tion of its core manu-

facturing divisions to

its new 92,000 sq.-ft.

complex on 12 acres of

land in North Battleford

by December.

“Th e buildings in

Lloydminster have all

been sold. We have sim-

ply outgrown our facili-

ties here and we needed

to move forward in

order to be competitive,”

said president Wayne

King on Nov. 2.

“In order to keep up

with the demand for our

products, we needed to

relocate.”

Grit Industries’

decision to shift manu-

facturing to North

Battleford includes the

relocation of sales and

general administrative

staff to a new two-stor-

ey head offi ce located

near the Lloydminster

airport.

“We will be basing

our operations in Lloyd-

minster for the A-Fire

Burner Systems group

as well as the secondary

containment product

line,” said King, who

expects the staff transfer

to be complete by mid-

December.

Th e Lloydminster

offi ce will also house the

company’s research and

development depart-

ment.

Th e new site in-

cludes a welding shop

that will make parts for

Grit Industries’ new

heat exchangers.

King said the

company in the future

will focus on growing its

cold weather technology

division and sales of its

natural gas line heat-

ers and indirect fl uid

heaters from the North

Battleford facility.

Grit Industries has

sold more than 1,400

of its gas line heat-

ers in Canada and the

U.S. and has an energy

effi cient and low NOx

prototype unit cur-

rently being evaluated in

England.

Th e company has

also sold and installed

more than 60 of its

indirect fl uid heaters for

heating light oil tanks

for clients in Estevan,

Elrose and Kindersley.

Grit Industries

recently obtained ap-

proval to market its

fl uid heaters to industry

in North Dakota for

the purpose of heating

light oil in tanks and it

expects to soon receive

code approval to branch

into the Alberta and

Manitoba markets.

Th e company hired

a consultant to assist

with the logistics of

the relocation and the

layout of the new build-

ing in North Battleford

that contains 5 overhead

cranes up to 20 ton cap-

acity and 8 jib cranes to

serve welding stations.

Th e building is

equipped with the latest

cutting, bending and

metal forming machines

for plasma cutting,

water jet cutting and

robotic welding.

Th e company has

hired more than 60

employees to ramp up

manufacturing of their

A-Fire burner systems,

cold weather technol-

ogy products, G-55

containment systems

and related fabrica-

tion products in North

Battleford.

When it came to

hiring, it helped that

Grit Industries also had

a manufacturing shop in

the McMillan Industrial

Park for the past fi ve

years.

“When we put a

request in for welders

in Lloydminster, we get

very poor response,” said

King.

“When we put an

ad in the papers for

welders in North Battle-

ford, we might get eight

or 10 responses and we

will hire a number of

them.”

King said the

availability of labour

in North Battleford

compared with Lloyd-

minster weighed heavily

in the decision to move

their core manufactur-

ing activities to Sas-

katchewan.

Page C4

Grit quickly “cold starts” in North Battleford

Grit Industries’ manufacturing centre features a new robo c MIG welder for welding parts such as a retube throat.

Page 66: Pipeline News December 2012

C4 PIPELINE NEWS December 2012

Page C3“Th e industry doesn’t concern itself with where the product is manufac-

tured. What they want is a good high quality product at a low cost.”

Th e cold weather line of natural gas heaters has caught on with industry

with their improved thermal and combustion effi ciencies and fuel savings.

Th e product is based on heat-driven loop technology that King began to

develop in 1999 to heat heavy oil tanks using their own vented meth-

ane instead of a fi retube.

“When we discovered the heating of natural gas was very successful using

that same technology, it was one of those ‘Eureka moments’ in product de-

velopment,” said King.

“In 2003, we partnered with SaskEnergy and we developed the natural gas

heating systems that are around North America today.

“It’s simple, it’s very functional, it’s safe and it’s code compliant. Th at’s

where we are today.”

Th e indirect fl uid heater is designed to heat multi-tank or vessel applica-

tions with signifi cant cost savings in energy consumption and effi ciencies.

“A fi retube maybe runs at 45 to 50 per cent effi ciency. Th is new device that

we have runs at 80 per cent thermal effi ciency,” said King.

“A fi retube has a high fl ux rate, meaning the skin temperature is about

1,200 F. Th e skin temperature on this device is 200 F.

“So therefore, what takes place with a fi retube is that because of the high

temperature, you are actually fl ashing the water portion of the crude oil to

steam which leaves a salt deposit on the fi retube.

“Our technology, because it has a lower skin temperature, it does not

create that salt deposit and the heat exchanger remains clean and unob-

structed for that heat transfer.”

Th e indirect fl uid heaters can easily be retrofi tted to existing fi retube

throats and have no moving parts, and do not require electricity to oper-

ate.

When used to heat light oil tanks, the technology upgrades oil to

pipeline specifi cations safely with indirect steam heating technology.

“Th e temperature of the heat exchanger is much lower than the

fl ash point of crude oil. It heats fl ammable liquids safely, using indirect

steam,” said King.

Grit got the go ahead on Nov. 2 to begin fi eld testing of one of

its most advanced indirect heaters for natural gas distribution in

England for National Grid, an international electrical and gas

supplier to Great Britain and Northeast United States.

“It’s being evaluated. Potentially, it will be the world-

leading technology for the heating of natural gas,”

said King.

Page C5

High quality and low cost desired

Dean Iverson puts the nishing touches to a ame arrestor.

Page 67: Pipeline News December 2012

PIPELINE NEWS December 2012 C5

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Page C4“Th e technology we are developing for England, will at some point in time,

be introduced in North America. We are developing the futuristic model into

Europe to be proven.”

Th e units received CE marking for European safety standards and they

exceed stringent emission standards with only seven parts per million of NOx

emissions.

King said National Grid has about 3,500 natural gas distribution points in

the U.K. that need to be upgraded to the new technology.

“We are certainly hopeful that our technology is chosen,” he said.

Th e European natural gas line heater being tested produces 1.5 million

BTUs of heat per hour.

Th e North Battleford plant manufactures units from 70,000 to 770,000

BTUs but larger ones are in the works.

“Currently, we are developing a three million and a fi ve million BTU unit

and combinations of those units will put us in the multiples of 5, 10 and 20

million BTUs,” said King.

SaskEnergy has also saw a need for the technology for the pre-heating of

natural gas at two of its gas turbine stations in Saskatchewan.

“Th e industry has shown that natural gas has better combustion at a certain

temperature. Th ey pre-heat the gas before the gas goes into the gas fi red tur-

bine. Our technology works well there,” said King.

Other potential markets for cold weather technology are U.S. hospitals and

utilities that are retrofi tting oil burning furnaces to natural gas furnaces using

high pressure gas captured from shale gas fracking and trucked to location.

“When you have high pressure gas and you are going from 2,000 psi to

two ounces of pressure to burn in the furnace, you have to have a heating sys-

tem,” said King.

Due to the Joule-Th ompson eff ect, gas begins to freeze when it loses pres-

sure.

Closer to home, SaskEnergy will become an even bigger customer for Grit

Industries’ cold weather technology as the Crown corporation replaces its con-

ventional bath heaters with natural gas line heating technology.

“If we can reduce the fuel consumption by 50 per cent, there may be mil-

lions of dollars in savings annually ... let alone the greenhouse emissions,” said

King.

“SaskEnergy must be commended for their forward thinking and plan-

ning.”

Roll foremen Ma Chasse, le , and Leo Romanovych prepare to move a roll of metal used for a variety of metal forming in the roll forming sec on of Grit Industries’ new manufacturing facility in North Ba leford.

Grit Industries’ 92,000 sq.- . manufacturing facility in North Ba leford is equipped with 5 overhead cranes and eight jib cranes for heavy li ing.

Page 68: Pipeline News December 2012

C6 PIPELINE NEWS December 2012

Change your REALITY

&Change others’ PERCEPTION

Syl Tateson: 403-793-4616

Grant Stegan 403-548-1231

For Demonstration Contact:

Geoff LeeInnisfree – Cowboy up and keep on keeping on. Th at’s the code that 38

year-old Curtis Anderson lives by – one day at a time at his cattle farm in

Minburn, Alberta.

Anderson is a cowboy poet, singer, song writer and motivational speaker

with a powerful message about the need to protect yourself from injury at

work and at play.

Th e message is prefaced by his personal story of courage and faith on the

path to recovery from a serious brain injury when stopped time for him on

June 26, 2002.

His compelling story is available on his website at www.caccanada.com

or in a printed handout.

“On that day, I was competing in the bull riding at the Ponoka Stam-

pede,” he said.

“While riding, I lost my balance and was struck in the head twice by the

bull’s head. I was rushed to the University of Alberta Hospital, where I would

spend three weeks in a drug-induced coma.

“From there I was sent to Glenrose Hospital where I started all over

again.”

Th ose are the opening lines to his a 20-minute safety presentation pack-

age that he’s delivered recently to oil companies such as Command Energy,

Leading Manufacturing Group and Red Planet Trucking.

“Not as many know about head trauma as anything else, but it’s out there

and it aff ects a lot of people,” said Anderson.

“It’s something that you will know about the rest of your life when you

experience it.

“Wear your hard hat wherever there is a chance of you having a fall, and

don’t take your life for granted. Appreciate what you have today, because

tomorrow it might be gone.”

Anderson’s safety talk covers hard hat safety, custom earplugs, steel toe

boots and safety boots and his career on the drilling rigs that ended with his

injury. Page C7

Meet Cur s Anderson, cowboy poet, singer, song writer, ca le farmer and custom oil- eld lease fence builder. Anderson is also a mo va onal speaker with a safety message

and life story about the importance of protec ng your head from brain injury. Anderson su ered a brain injury in a rodeo accident and recently got his driver’s licence back. His steering wheel is equipped with a spinner that he grips with his right hand.

Anderson speaks ofinjuries n the workplace

Page 69: Pipeline News December 2012

PIPELINE NEWS December 2012 C7

Main Offi ce:

Lloydminster Offi ce:

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solutions in the oil field services industry.

Page C6“I worked eight winters on the drilling rigs for Akita Drilling, and in the

summertime, I had my custom fence business fencing oil leases,” said Anderson.

“I worked in Fort McMurray, Slave Lake around Bonnyville, and around

Duchess and Medicine Hat. I worked lease hand, roughneck and motorman.

“It’s 12 hours of hard working and you can see how much you got done at

the end of the day.”

His other brother, Derek, works in the oilfi eld for Sweet Wildrose Consult-

ing and his younger brother, Kelly, works for Nexen Energy.

Anderson was unable to walk on his own, speak properly, or move his left

arm immediately after the injury, but weeks of therapy in diff erent hospitals and

his “cowboy up” attitude were rewarded with noticeable improvements.

“When your back is against the wall, you raise the bar of excellence while

believing in yourself, friends, angels and God,” he says in his handout.

“It’s been 10 years. My body is still getting better and I am able to do more

and more things with my left hand. You don’t get better by sitting on a couch.”

For the last two years, Anderson has been able to hold a barbed wire fence

staple with his left hand which has enabled him to resume his custom fence busi-

ness for oilfi eld leases.

Anderson is motivated to fully recover by inspiring slogans including the

words of his hero John Wayne, who said, “Courage is being scared to death and

saddling up anyways.”

He is proud of the fact that he can lift a 40-pound pail of grain now with his

left arm.

Two years ago, he got his driver’s licence back on the condition he install a

cross-over turn signal switch and a spinner on his steering wheel.

“It’s one more step to being independent,” he said.

Asked if he misses working on rigs, Anderson said this: “I am still involved

in the oilfi eld – just in a diff erent manner. Speaking at safety meetings is just as

good as being on the fl oor when it’s -30 C.”

Anderson had delivered his safety story at six diff erent bull riding events

and one rodeo this past summer, and he has spoken at the annual Big Jamboree

Bulls for Breakfast event in Camrose for the past three years where he received a

standing ovation.

Anderson began bull riding at rodeos in 1992 and he won a few events.

“Th e challenge was being better than the bull that day,” he said noting that

it was a bull named Real Handy that got the best of him in 2002 with those

damaging head butts.

“About 40 per cent of the riders are wearing helmets now, and you will see

more and more of the riders wearing helmets. I wish everyone would wear a

helmet,” he said.

“People are more

aware of how serious a concussion can be, so hopefully it does bring more aware-

ness and more people start to wear helmets.”

His hard hat safety talk includes a demo of what happens to your brain with

and without the protection of a hard hat.

He takes a Styrofoam cup lined with cotton balls, puts an egg in the middle

of it and tapes the lid tight. Th en he drops the cup on a tin plate that represents

your brain protected by a hard hat. Th e protected egg is perfectly intact.

Th en he drops the egg by itself to show what happens to your brain without

a hard hat.

A few years back, Anderson began to write poems for rodeo friends and

family in order to communicate his experiences in the oilfi eld, rodeo and farm

life.

“It’s my way to show respect,” he said. “I have quite a bit of material to write

poetry on.”

Anderson hopes to have copies of his new book titled, Road to Recovery avail-

able by the spring of 2013.

“It will have my speech in there and pictures about life before brain injury,

poems and pictures of me speaking,” he said.

Th e book will also make reference to Courage Canada, a trail ride that his

family from nearby Innisfree holds annually to raise money and awareness for

brain injuries.

“Th is year we had 101 riders on horseback, 12 teams, and 74 riders in the

wagons and 250 people for supper,” said Anderson.

Th e 2013 trail riding event will be held on May 25.

“Th is year it started from my place and we raised $19,200,” said Anderson.

“Th at money helps brain injury survivors and their families from day one.

Ten per cent of that money went to the Lloydminster and Area Brain Injury

Society (LABIS).”

Anderson is well connected to the Minburn area as his great, great uncles Ed

and Otto Anderson were the fi rst settlers to set up camp at town in 1904.

Each year on the last Sat-urday in May, Cur s Ander-son’s family holds a Cour-age Canada trail ride in the Innisfree and Minburn area of Alberta to raise money in support of brain injury survivors and their families. Photo submi ed

Page 70: Pipeline News December 2012

C8 PIPELINE NEWS December 2012

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By Geoff LeeLloydminster – Riddle me this:

What generates 65,000 horsepower,

10,000 pounds per square inch of ini-

tial pressure, travels 1,500 metres per

second through a wellbore and can

increase heavy oil heavy production by

a whopping 30,000 per cent?

Th e answer is a new wireline ap-

plied stimulation pulse tool and ser-

vice provided by Blue Spark Energy

based in Calgary, and in Lloydminster

via Ryan Rivett, technical fi eld sales

representative.

Rivett teamed up with business

development manager Trent Hunter

who led a presentation and outdoor

demo of pulse technology for work-

overs and new completions in cold

produced wells during the October

luncheon of the Lloydminster Society

of Petroleum Engineers.

In a nutshell, Blue Spark delivers

pulse stimulation to enhance pro-

duction in oil wells with an electric

hydraulic wireline tool.

Th e company has deployed their

wireline pulse technology in more

than 80 wells around the world in-

cluding 25 vertical CHOPS wells in

the Lloydminster area with a 250 per

cent average increase in productivity.

Productivity gains have ranged

from around nine per cent to nearly

30,000 per cent worldwide.

“My message is that the technol-

ogy is proven and that it works,” said

Hunter moments before taking to the

podium at the Best Western Inn on

Oct. 18.

“Also, I want to basically educate

some of the people on the technique

because pressure pulse technologies

have been widely applied in the heavy

oil market using diff erent techniques,

whether it’s a fl uid pulse or any type

of hydraulic pulse.

“What’s really unique about us

is how we deploy with the wireline

tool and how we can get such extreme

pressures.”

Generating repeated low energy/

high power hydraulic shock waves

mechanically remediates near well-

bore damage from perforations, slot-

ted liners and sand screens.

Page C9

Blue Spark pulse tool boosts recovery

Members of the Lloydminster SPE check out the results of a demonstra on of Blue Spark’s pulse technology in this 150 gallon test tank. The demos took place in the park-ing lot of the Best Western Inn following a lunch presenta on by business development manager Trent Hunter.

Ryan Rive , le , technical eld sales representa ve

for Blue Spark in Lloydmin-ster, helps Trent Hunter, business development manager in Calgary, hold up the business end of this wireline applied s mu-la on pulse tool follow-ing a presenta on of the technology at the October mee ng of the Lloydmin-ster Society of Petroleum Engineers.

Page 71: Pipeline News December 2012

PIPELINE NEWS December 2012 C9

Page C8

Th e energy source can be an inverter or a gen-

erator from a wireline unit or any type of truck.

Th e wireline pulse service from Blue Spark can

also achieve formation breakdown to initiate sand

fl ow in new well completions where traditional

CHOPS initiation methods have not been success-

ful.

“It’s a high speed high pressure shock wave that

we emit from our wireline tool, and it travels out-

ward and intersects the entrance holes of perfora-

tions, slotted liners or sand screens,” said Hunter.

“It causes geo-materials or scales to crack under

tensile failure mechanisms.

“We create a pulse that travels as a fl uid wave

through the wellbore fl uids and out into the forma-

tion. We initiate that using a spark inside of our

tool, very much like lightning.”

Th e science or physics behind wireless pulse

technology is based on the formula that energy

equals power multiplied by time.

“We want really high power pulses. We take

energy and we send it down a wireline cable,” said

Hunter.

“We store it up in the tool downhole in a bank

of capacitors. What is unique about what we do is

we release that in a nanosecond.

“In a couple of microseconds, we get a peak

pressure of 10,000 psi. Because we really ‘com-

press time’ it’s a conversion from a kinetic form of

energy – electricity we send down the cable – and

we convert that into stored potential energy in the

capacitors.

“Once it’s stored, we release it extremely quickly

on a repetitive basis up to 2,000 times. It’s that

repetitive nature that gives us the cumulative eff ect

of reducing wellbore damage.”

Blue Spark adapted the pulse technology from

their sister manufacturing group that was applying

it for welding purposes.

In July 2011, the company began commercial

operations of its wireless pulse service for the oil

industry.

“Th e two key markets that we have been focus-

ing on to date have been the near wellbore remedia-

tion for producing wells, whether that’s new well

completions or workovers, or in injector or disposal

wells,” said Hunter.

Blue Spark’s stimulations and lab tests verify

that the shock wave acts to increase the permeabil-

ity of the near wellbore for enhanced oil production.

“Some stimulation techniques are used to un-

plug what is the existing pathway or pore throats of

the formation right near the wellbore,” said Hunter.

“What our technique does is allow the en-

hancement of the existing permeability and the

pore throats, and to create new fractures as well.”

Th e Blue Spark wireline pulse service can also

be used as pressure or pulse source for seismic ap-

plications since the pressure pulse travels up to a

kilometre through the formation.

Th e current tool is four inches in diameter and

8.5 metres in length with a 5.5 inch diameter and

a 2-3/4 inch slim tool in the advanced stages of

development.

Th e four-inch pulse tool is deployed with a

wireline truck equipped with a 5/16 inch drum

cable.

“We simply rig it with the electrical cable

that comes with the truck and we put our tool on

the end cable and we run it into to the wellbore,”

explained Hunter.

“We log it on depth with the casing collar loca-

tor or a gamma ray, and we make sure that we pulse

over the top of the open perforations. Th at whole

operation takes a few hours of rig time, then we rig

down and we leave.”

Hunter presented examples of fi ve wells treated

with their pulse service in Lloydminster that ranged

from a minimum 10 to 20 per cent increase in pro-

ductivity to the best well that that went from never

being able to produce to nearly 10 cubes a day.

“Given the benefi t plus the cost that we charge,

it is cost-eff ective,” said Hunter. Trent Hunter demonstrated how to use Blue Spark’s wireline applied s mula on pulse technology to clean up damage from perfora ons, slo ed liners and sand screens in heavy oil wellbores.

Page 72: Pipeline News December 2012

C10 PIPELINE NEWS December 2012

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By Geoff LeeLloydminster – Th ere was a lot of mixing and

mingling at the Lloydminster Oil and Gas Career

Discovery Day at Lakeland College where students

met with oil and gas employers and employees to

learn about industry careers.

More than 750 regional students were invited

to the campus on Oct. 23 to hear keynote speakers,

take part in career breakout sessions with industry

workers, and speak with exhibitors and recruiters

regarding career paths.

“Th e main goal is to provide students with

opportunities to hear and know about all of the

diff erent jobs within the oil and gas industry,” said

Cosette Green, business and industry liaison with

Alberta Works, an Alberta government services

agency that funded the event with industry spon-

sors.

“We are defi nitely experiencing a labour short-

age. We know that in the next 10 years we are going

to increase the shortage.

“Our students don’t really understand at this

point the vastness of the job opportunities – and

they can be here in our own back yard.”

More than 30 oil and gas businesses and train-

ing and safety organizations took part in the event

that included scheduled presentations by employ-

ees who spoke about their jobs and how they got

started.

“Th e students will be able to pick and choose

the sessions that they want to go to – jobs they

might want to hear about or jobs that maybe they

never even dreamed of were out there,” said Green

at the start of the day.

“People who are doing the jobs can tell them

what they like about their jobs, and what they do

on a daily basis – what the environment looks like,

what kind of pay they can expect – almost anything

they may want to learn about a job.”

Presenters covered the nuts and bolts of a vari-

ety of careers and positions including engineering,

trades, human resources and administration, survey-

ing, heavy equipment operations, drilling and safety.

Th e event was organized by Alberta Works in

partnership with Newcap TV and Lakeland Col-

lege and co-ordinated by Wilson Consulting.

Page C11

Oil eld career day a hit at Lakeland

Carrie Rawlake, stakeholder rela ons adviser with Cana-dian Natural Resources, preps Rick Monteith, a lead op-erator for CNRL in Tangle ags/Onion Lake on what to say to students about his job at the Lloydminster Oil and Gas Career Discovery Day at Lakeland College.

“Our students don’t “Our students don’t really understand really understand at this point the at this point the

vastness of the job vastness of the job opportunities – and opportunities – and they can be here they can be here in our own back in our own back

yard.” yard.” - Cosette Green, - Cosette Green,

business and industry business and industry liaison with Alberta Worksliaison with Alberta Works

Page 73: Pipeline News December 2012

PIPELINE NEWS December 2012 C11

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Page C10“Th e event was ini-

tiated by the employers,”

said Green. “As I went

around and listened

to what their needs

were, I constantly heard

‘how do we get people

to understand what is

available and keep them

in the region?’”

Th e agenda kicked

off with an assembly

at the Vic Juba Th eatre

and a presentation by

Calgary-based Rick

Davidson, manager of

recruitment for Ceno-

vus.

“We have a great

interest in ensuring

young people from Al-

berta and Saskatchewan

clearly understand the

options around careers,”

said Davidson after his

speech.

“We have huge

needs in terms of labour

over the next decade

and we need as many

of these good young

people working in our

business as possible.

“Th e more that

they can learn today, the

more benefi cial we will

all be in the long run.”

Cenovus, itself, has

a need to recruit new

workers to keep pace

with the expansion of

its thermal oilsands

projects at Foster Creek

and Christina Lake in

Alberta and to meet

future growth.

Th e company re-

cently purchased the Al-

berta and Saskatchewan

assets of Oilsands Quest

that Davidson said,”

adds to our existing

portfolio of assets and

allows us to continue to

grow.”

Davidson said he

jumped at the chance to

speak to students about

a myriad of careers

available to them in

the oil and gas industry

given the current and

looming labour crunch.

“I think people in

Alberta and Saskatch-

ewan know that the oil

and gas business has

opportunities, but we

are trying to help young

people understand all

the opportunities that

exist and all the needs

that we require,” said

Davidson.

“Th ey are signifi cant

and they are many, and

these opportunities are

long-term challenging

assignments, and are

really career paths and

not just jobs to do for a

short period of time.”

Opportunity was

also top of mind for

keynote speaker Tim

McMillan, minister

responsible for Energy

and Resources, who

told Pipeline News that

Saskatchewan is the

land of plenty for young

people seeking oil and

gas careers.

“Th ere are great op-

portunities for them and

we’d like to see them

pursue those opportuni-

ties. We need their help

to make our industry

successful in the long

term,” said McMillan.

“Th is is an indus-

try that has been very

welcoming of people

from across Canada

for a long time. We see

our professionals doing

work around the world

in this industry.

“You start on a drill-

ing rig in Weyburn one

day and you’re in Lloy-

dminster a week later.

You may be in Russia

three years after that.

“It’s one of those

industries where, if you

are willing to work hard,

you will be successful.”

Bob Ross, manager

of Enform Saskatch-

ewan, also took to the

podium with a message

for students that safety

is paramount in the

industry and that it’s top

driven.

Page C13

Bob Ross, manager of Enform Saskatchewan, directs students to some informa- on during the Lloydminster Oil and Gas Career Discovery Day at Lakeland Col-

lege. More than 750 students were invited to the event to learn about oil and gas careers and career paths.

Page 74: Pipeline News December 2012

C12 PIPELINE NEWS December 2012

Phone: 780.614.2113Phone: 780.614.2113Fax: 780.614.2115Fax: 780.614.2115

Luc Cell: 780.210.0635Luc Cell: 780.210.0635email: [email protected]: [email protected]

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Page 75: Pipeline News December 2012

PIPELINE NEWS December 2012 C13

“We have huge needs “We have huge needs in terms of labour in terms of labour

over the next decade over the next decade and we need as many and we need as many of these good young of these good young

people working in our people working in our business as possible.”business as possible.”

- Rick Davidson, manager - Rick Davidson, manager of recruitment for Cenovusof recruitment for Cenovus

Credentials and certi cation needed to work

Page C11“You have to have the credentials and the cer-

tifi cation in order to work for certain employers,”

he explained in an interview.

“As well, you have to have eff ective health

and safety management systems which need to be

audited too, before you can even bid on work.”

Enform is the safety association for the up-

stream petroleum industry in Canada and works

with industry on the development of safety train-

ing and courses.

“We’re not recruiting, but our industry is

always recruiting,” said Ross.

“We being their agent and their representative,

this is all part of our process as well, dealing with

young workers and inexperienced workers as well.

“We are presenting today with some of our

franchise instructors as well as some of our region-

al colleges that off er Enform training courses.”

Ross also staff ed the Enform booth with

Sarah Morris, a safety adviser.

At the ADM booth, Chris Dlaquiere, an ap-

prentice millwright in Lloydminster, had a simple

message for young people thinking of following in

his footsteps into the trades.

“Make sure you fi nd the right job – something

that you are into and something that you enjoy,”

he said.

Dlaquiere explained that becoming a mill-

wright is a four year course available at NAIT,

where he studied, or at SIAST in Saskatoon.

Lakeland College off ers a variety of energy

and trades programs too, but none for millwrights.

Mary Cardinal, a fi rst year student from On-

ion Lake First Nation studying the heavy oil oper-

ations technician or HOOT program at Lakeland,

said she came to the event “to learn more about

the other businesses and how they work.”

Cardinal is one of several Onion Lake fourth

class power engineering students who completed a

pre-HOOT course at Onion Lake this year before

attending Lakeland this fall.

“It was a fi ve month program at Onion Lake.

It’s going good. It’s getting easier now, kind of,”

she said, adding she plans to come back next fall

to get her third class power engineering diploma.

Not every student at the discovery day was

interested in working in the oil and gas industry

including Kyle Whitlock, a Grade 10 student

from J.R. Robson High School in Vermilion who

made his intentions clear when the question was

popped.

“Not especially,” he said although he noted

that his dad was an oilfi eld operator.

“I am not interested it,” was his short explana-

tion. “I want to do some kind of science.”

Le : Bryan Meesto, le , an Onion Lake industry contact for employment, training and careers, speaks to Dion Arnouse, a First Na on liaison from High Velocity Equip-ment Training in Camrose during an oil and gas career day at Lakeland College in Lloydminster.

Right: Hundreds of students, educators and job seekers a ended the Lloydminster Oil and Gas Ca-reer Discovery Day Oct. 23 to learn about jobs and career paths in the industry. More than 30 oil and gas companies and safety associa ons par cipated in the event.

Page 76: Pipeline News December 2012

C14 PIPELINE NEWS December 2012

By Geoff LeeCalgary – Th ere were several story lines to

Husky Energy’s third quarter results, most nota-

bly increased production from the Lloydminster

area, thanks to continued emphasis on thermal

heavy oil production.

Full production from the 8,000 barrel per day

Pikes Peak South and 3,000 bpd Paradise Hill ther-

mal projects in the quarter reduced the impact from

maintenance at Husky’s SeaRose and Terra Nova

facilities in the Atlantic region.

Total production before royalties averaged

285,000 barrels of oil equivalent in the quarter

compared with 309,000 boepd a year earlier.

Quarterly profi t rose slightly to $526 million

compared to $521 million a year earlier with aver-

age crude oil pricing of $70.14 per barrel compared

to $78.70 a year earlier.

“Our results show that we continue to build

operational momentum for the fi rst nine months of

this year,” said CEO Asim Ghosh to investors dur-

ing a quarterly conference call on Nov. 1.

“Since we laid out a strategic plan two years

ago, we have delivered on our targets consistently.”

Th at strategy calls for greater emphasis on

heavy oil thermal production and more drilling on

resource plays in Western Canada.

“We are transitioning this part of our founda-

The 8,000 barrel per day Pikes Peak South and 3,000 bpd Paradise Hill thermal projects in the Lloydminster area reached their design produc on rates within two months of rst oil in the third quarter. More thermal projects are under construc on or being evaluated. Photo submi ed

tion to more thermal production and horizontal

drilling to extract greater value,” added Ghosh.

“Th e Pikes Peaks South and Paradise Hill ther-

mal projects have both reached the design produc-

tion rates within the fi rst two months of fi rst oil.

“Based on their cost effi ciency and perfor-

mance, they will be models for our future using this

modular approach for thermal effi ciency.”

Th e third quarter ending Sept. 30 also saw

construction progress on the new 3,500 bpd Sandall

thermal project in the Lloydminster area with fi rst

production scheduled in 2014.

Design work is also continuing on the 8,000

bpd Rush Lake thermal development due to begin

production in 2015. Additional thermal projects in

the area are currently being evaluated.

“Th e capital intensity of these thermal projects is

very attractive. Th eir modular design and small scale

means we’ve been able to reduce the cost per barrel

to develop,” said COO Rob Peabody. Page C15

Paradise Hill thermal project to be a model for Husky

Page 77: Pipeline News December 2012

PIPELINE NEWS December 2012 C15

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One Call Will Supply It All

Page C14Husky also continued its strategy to focus more on oil drilling with in the

quarter with 95 per cent of the wells drilled targeting oil in Western Canada.

“In heavy oil, we also drilled 49 horizontal wells. In total, 99 horizon-

tal wells have been drilled to date out of a 140 to 150 well program we have

planned for this year,” said Peabody.

While Husky continues to focus more attention on thermal projects and

horizontal drilling, approximately 265 cold heavy oil production with sand or

CHOPS wells will be drilled in 2012.

Th e company is also advancing a number of solvent enhanced oil recovery

projects.

In the third quarter Husky was active in six key resource plays in Western

Canada including the Bakken, Viking, Cardium, Lower Shaunavon, Rainbow

Muskwa as well as the new Slater River play in the Northwest Territories.

“In total, we drilled 32 horizontal resource wells, bringing our total number

to 66 over the fi rst nine months of the year,” said Peabody.

“Th is includes a horizontal well at our Rainbow Muskwa shale oil project

in northwest Alberta.

“We plan to drill six more wells this year to better understand the sweet

spots with this play. In the Northwest Territories at our Slater River project, the

work there is proceeding on schedule.”

Plans are also underway to construct an all season access road this winter

and further evaluate two vertical wells drilled in the area last year.

“Looking ahead, we are expecting to drill a further 31 resource wells across

our oil resource portfolio over the remainder of the year,” said Peabody.

“Overall, we are on track to meet our goal that we set out in 2010 of having

one third of our production from Western Canada coming from resource plays

in 2016.”

Husky is also focused on getting the most value for its capital spending

to develop its liquids-rich gas properties in the producing Ansell and Kaybob

plays in west central Alberta given low natural gas prices.

Two wells were drilled at Ansell in the quarter, bringing the number of

wells drilled to 14 for the year along with 38.5 net well completions.

Up to four more wells are planned at Ansell for the remainder of this year.

“We still consider Ansell as a core asset and it certainly has lots of poten-

tial. However, with the current price environment we have been shifting some

of the capital into our oil plays,” said Peabody.

A second Duvernay horizontal well was completed and tested at Kaybob,

while a third Husky well and a partner-operated well are on track for comple-

tion in the fourth quarter.

One well in the play is currently on production.

Husky also continued to make progress with the fi rst phase construction

of its Sunrise Energy oilsands project in Alberta in the quarter.

Th e phase is it approximately 50 per cent complete with all of the wells

drilled.

Modules for the central processing facility and fi eld facilities are being

delivered and installed with fi rst oil production due in 2014.

In the Atlantic region, maintenance is now complete on the off shore

SeaRose facility while the Terra Nova facility will resume operations in the

fourth quarter when maintenance is complete.

Husky also reports its Liwan gas project in the South China Sea is 75

complete with fi rst production expected in late 2013 or early 2014.

Ghosh told investors during the conference he is personally focused on

project delivery on key milestones and growth pillars.

“Overall, we remain on course in executing our business plan and contin-

ue to make steady progress and setting the stage for major growth projects,”

he said.

Page 78: Pipeline News December 2012

C16 PIPELINE NEWS December 2012

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Calgary – BlackPearl Resources Inc. continues

to derive most of its operating cash fl ow from heavy

oil production on lands owned by Onion Lake Cree

First Nation at Onion Lake.

Th e most signifi cant increase in production in

2013 however, is expected from the Mooney alkali

surfactant polymer (ASP) fl ood project in north

central Alberta.

Exit production levels for 2013 are expected to

be between 11,000 and 12,000 barrels of oil equiva-

lent per day – 10 to 20 per cent higher than 2012.

Th e Calgary-based company is planning a

capital expenditure of about $140 million to $160

million in 2013 for the continued development of

its core heavy oil projects.

Th ese include the expanding Blackrod steam

assisted gravity drainage (SAGD) pilot project

near Fort McMurray, the expansion of Phase 2

at Mooney and a planned 12,000 barrel per day

SAGD project at Onion Lake.

“We continued to move all of our projects for-

ward during the quarter,” said BlackPearl president

John Festival with the release of third quarter fi nan-

cial and operating results on Nov. 7.

“Th e commercialization of the Blackrod SAGD

project is rapidly moving ahead. We are assem-

bling our project management team and will select

engineering, procurement and construction (EPC)

contractors in the next few weeks.

“Response from the Mooney ASP fl ood is very

encouraging and gives us confi dence we will be able

to achieve our anticipated production levels for the

fl ood during 2013.

“Production from Onion Lake continues to be

our main source of operating cash fl ows and we will

continue our conventional development program

while we advance a thermal development plan.

“Our next step is to put in place our fi nancing

strategy for the continued development of these

projects, which we expect to fi nalize in the next few

months.”

Festival expects the 2013 capital program will

be funded from anticipated cash fl ow from opera-

tions and existing credit facilities.

“We have a lot of fl exibility in our capital pro-

gram and can adjust capital spending if required,”

he said.

“In 2013, we also expect to put our longer term

fi nancing strategy in place to fund the fi rst phase of

development at Blackrod.”

Over 40 per cent of the 2013 capital budget

will be directed at the Blackrod SAGD pilot that

will be expanded with a second well pair along with

the start of EPC work.

Th e company has received regulatory approval

to expand the pilot. A second horizontal well pair

will be drilled in the fi rst quarter of 2013.

Th e initial well has produced more than

100,000 barrels of oil since start-up and reached

commercial production rates over 400 bpd in May

when it was taken down for a month for well ser-

vicing.

Th e well was brought on production in June.

“Now that we have confi rmed the reservoir can

perform at commercial rates, we have begun testing

alternate operating strategies in an eff ort to better

understand the best way to operate these wells and

potentially incorporate these strategies in the fi nal

commercial development design,” said Festival.

“Some of the items we have been testing since

the well was brought back on production include

changes to the steam delivery system to ensure

uniform heat distribution, diff erent pump types,

and testing diff erent steam chamber operating

pressures.”

BlackPearl fi led for a commercial development

application for Blackrod with Alberta regulators in

May.

Page C17

BlackPearl targets $140M to $160M capex

Page 79: Pipeline News December 2012

PIPELINE NEWS December 2012 C17

Kenilworth Combustion Main Offi ceContact Heine Westergaard 1-780-744-3974

Nomad Electric in Northern AlbertaContact Clint Ferriss 1-780-624-2447

Pronghorn Controls in Southern and Central AlbertaContact Stan Neu 1-403-501-4895

CCR Combustion in East Central AlbertaContact Kevin Moan 1-780-872-0706

MAIN OFFICE 1-780-744-3974 FAX 1-780-744-2242

www.kenilworth.ca

Page C16

Blackrod has the long term potential to sup-

port an 80,000 barrel per day SAGD development.

At Mooney, BlackPearl will continue to

develop its Phase 2 lands in 2013 with 20 to 25

horizontal wells to be drilled.

Th e company will also upgrade the road and

pipeline infrastructure on the expansion lands with

the expectation the land will be converted to ASP

fl ood injection in late 2013 or 2014.

In 2011, BlackPearl completed the fi rst phase

of its ASP fl ood on a portion of the fi eld to en-

hance production and signifi cantly increase overall

oil recovery.

Early November production from the ASP

fl ood was more than 1,200 bpd with peak produc-

tion levels of 3,000 to 4,000 bpd expected to be

reached sometime during 2013.

Mooney production from the ASP fl ood area

in the third quarter was 843 bpd, an 11 per cent

increase from the previous quarter of 2012.

Total fi eld production at Mooney was 2,500

boepd.

Th e company plans to drill 15 to 20 horizontal

wells by the end of 2012 and into the fi rst quarter

of 2013.

A portion of these lands could be added to the

existing ASP fl ood as early as the fourth quarter of

2013.

In other third quarter news, the construction of

a heavy oil processing facility to handle the increas-

ing fl uid volumes from the Mooney area was com-

missioned in September.

In 2013, BlackPearl will continue primary

heavy oil development, drill 20 to 30 vertical wells

and upgrade water handling facilities at Onion

Lake.

Production at Onion was lower in the third

quarter at 5,889 boepd compared to 7,065 boepd a

year earlier, due to natural declines and limited new

drilling to off set the decrease.

However, work is underway to drill 11 more

conventional wells by the end of 2012 to add to the

seven drilled in September which will be completed

or put on production in the current fourth quarter.

“Th is recent drilling has extended the pool to

the south and has increased our primary drilling

inventory in the area,” said Festival.

“In addition, some of the recent wells drilled

indicated that the net pay is likely suffi cient to ex-

tend our planned thermal SAGD development.

“Regulatory authorities are continuing to re-

view our 12,000 barrel per day SAGD commercial

development application.”

BlackPearl’s total oil and gas production in the

third quarter average 9,340 boepd, up 14 per cent

from the same period in 2011.

Th e increase is mainly attributed to production

from the ASP fl ood at Mooney and drilling last fall

on the Phase 2 expansion lands.

In marketing news, BlackPearl has begun to

ship between 1,200 to 1,500 bpd of its Onion Lake

and Mooney heavy oil volumes by rail to the U.S.

Gulf Coast and west coast of British Columbia to

avoid pipeline bottlenecks, particularly in the mid-

continent.

“Although shipping by rail is more expensive

than shipping by pipeline, the improved sales price

for our oil more than off sets the increase in trans-

portation costs,” said Festival.

This is a BlackPearl Resources’ bone yard photographed in October 2010 at Onion Lake. File photo

Page 80: Pipeline News December 2012

PIPELINE NEWS December 2012 C19C18 PIPELINE NEWS December 2012

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Equipped with:On-Trux Roll-off Kit with Retractable Stinger (Galvanized Version) comes with Wireless 8 button controls, Paccar PX6 - 280 HP Engine, Allison Automatic Rugged Duty Transmission, Hydraulic Brakes - No Air Endorsement Required, 8K Rated Front Axle and Taperleaf Suspension, 13.5K Axle Rated at 11.5K, 13.5K Rated Taperleaf Rear Suspension, 9 7/8” x 1/4” Frame Rails, Removable tow hooks in front bumper, 45 Gallon capacity Fuel Tank, Air, Tilt Steering, Cruise, AM/FM Radio, Power Windows and Locks, Kenworth Aero Heated Mirrors, Integral Convex Heated Mirrors, High Back Cloth Air Cushion Seat with Passenger 2 man Cloth Bench, Projector Style Halogen Headlamps.

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

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Page 81: Pipeline News December 2012

C20 PIPELINE NEWS December 2012

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Page 82: Pipeline News December 2012

PIPELINE NEWS December 2012 C21

2000 FORD F550Stk # C07269 c/w deck,

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2004 KENWORTH T300Stk# 975282 c/w 14 ft. deck, RO stinger model ITC-85-2 crane safety certified until June/2013

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24 HOUR SERVICE24 HOUR SERVICE

Racken Enterprises.indd 1 8/21/08 1:00:06 PM

By Geoff Lee

Lloydminster – Ke-

nilworth Combustion is

heading into 2013 in a

larger facility in a new

location to meet the

demand for its pre-as-

sembled line of natural

draft process heater

modules.

Th e Canadian-

owned company manu-

factures process heater

modules for heating

tanks, dehydrators,

line heaters, treaters,

refridge units, free

water knockouts and

re-boilers.

Kenilworth is now

fully operational at its

new 7,200 sq.-ft. offi ce

and shop complex on

six acres of farmland

after moving a few

kilometres west of their

previous location in Is-

lay, Alberta in October.

“We needed to

get into a bigger facil-

ity. We had maxed out

our accommodations,”

said company president

Heine Westergaard,

who bought himself a

total 86 acres for family

and business use.

“We either needed

to build a new shop or

move into a place that

would get us some more

square footage.”

Th e new site

includes a 7,000 sq.-

ft. indoor cold storage

building for the compa-

ny’s modular designed

units and another shop

for electric and wiring

installations.

“We focus on the

natural draft market

from 35,000 BTU to

20 million BTU,” said

Westergaard.

“Th ere was a gap

in our product line.

We started at 100,000

BTU and then went

up. We’ve added a

new product which is

35,000 to 250,000 BTU

specifi cally geared for

the small utility heater

market.”

Kenilworth is

featuring the 35K BTU

unit at the Federation

of Alberta Gas Co-ops

2012 Trade Fair and

Conference in Edmon-

ton on Nov. 26-27.

“We’ve got several

of these units out in in-

dustry already. A lot of

the setups we put them

onto are solar power

so they are low power

consumption – they are

half an amp draw,” said

Westergaard.

“We also provide

the solar package for the

units. We are getting

more into the electri-

cal side of it. We just

thought it was time to

explore that avenue.”

Th e new shop also

allows Kenilworth to

expand its produc-

tion and inventory of

larger modular units

over 1 MMBTU with

the valve train pre-as-

sembled, mounted and

wired into its enclosure.

Page C22

Kenilworth celebrates new manufacturing base

Heine Westergaard, president of Kenilworth Combus on, steps out of his new 7,000 sq.- . cold storage facility for base process heater modules and ame arrestors. The company moved to a new six acre loca on a few kilometers west of their previous loca on in Islay, Alberta in October and November.

Page 83: Pipeline News December 2012

C22 PIPELINE NEWS December 2012

Page C21“Th e valve train will actually adapt to multiple sizes of fl ame arrestors,” said

Westergaard.

“In the one to fi ve million BTU range, we can utilize three diff erent fl ames

arrestors on one valve train. It makes it very eff ective for the end user.”

Th ere are also three diff erent burner sizes from 1.5-inch to six-inch diam-

eter for each process heater module.

“If a customer has a requirement that changes as far as heat goes, we can

either change the fl ame arrestor or change the burner, and they can utilize that

valve train,” said Westergaard.

“It gives us more options to utilize existing equipment.”

Th e Kenilworth process heater module is the only system on the market

that is CSA code compliant when it arrives on site pre-assembled and function

tested.

“We can pre-assemble up to 10 million BTU – wired, fi red and ready to

go,” said Westergaard who added the in-house manufacturing process can

mean a 30 per cent cost saving to the client.

“Because we do everything 100 per cent to code, when it comes for ap-

proval, the inspection process is very simple,” he said.

“We are able to assemble it in a controlled environment. We can eliminate

delays in the fi eld. You don’t have to worry about wind conditions or other

weather conditions as well as the travel to site.

“It’s all built the same. We’ve got a very good quality control program that

covers all aspects of fabrication, assembly and shipping.

“We also put it onto the test bench and we fi re the equipment with gas, so

it’s actually been in a process. It’s going out the door ready for use.”

Kenilworth is also an industry leader in the capture of fugitive BTEX

emissions created by glycol dehydrators in gas processing.

Th e company’s BTEX and VRU (vapour recovery unit) process heater

modules have been developed over the last 10 years and have proven to be ef-

fective at a fraction of the cost of other systems available.

What makes Kenilworth’s process heater modules stand out from the com-

petition is their patented fl ame scavenger low pressure burner that is also used

in their fl ue gas recirculation system and BTEX and VRU systems.

Page C23

Kenilworth Combus on keeps a selec on of di erent sizes of ame arrestors in its cold storage building. The company’s 1 MM to 5 MMBTU process heater modules can be equipped with mul ple sizes of ame arrestors. The company ships all of its modular units fully assembled and func on tested.

There is plenty of room to manufacture process heater modules in this new 7,200 sq. . shop and o ce. The building is heated with a process heater module.

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Page 84: Pipeline News December 2012

PIPELINE NEWS December 2012 C23

Install and remove studded T-posts even in frozen ground with one tool –

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Page C22“We are able to take and utilize a low pressure wet fuel in our systems

without having issues of freezing off in the winter,” said Westergaard.

“We can take and run on multiple fuels with diff erent BTU values, so we

can take propane and natural gas in the same burner using the same orifi ce

with the same setting, without having to take and change anything.

“Th ere is nobody else in the market that can do that.”

Kenilworth has teamed up with Calgary-based Pronghorn Controls Ltd. to

sell, service and distribute their process heater module products to more clients

throughout Western Canada.

“We have done a lot of work with Pronghorn Controls. Th ey actually do a

lot of marketing and cover the southern Alberta area for us,” said Westergaard.

“It’s a good way for us to expand our business but focus on the manufac-

turing side of it, and have them to do the service and the installation.

“We are still active in service and installation. We have service units roll

out of here every day that do preventative maintenance, service, installation and

commissioning.”

Kenilworth, which has new products coming on line, has more than 50

gasfi tters, electricians and instrument mechanics trained as burner service tech-

nicians across Western Canada.

“By June 2013 we will have another line of products that will be pretty

interesting,” said Westergaard who doesn’t want to tip the competition yet with

details.

Westergaard added he is proud to be manufacturing in Canada and said he

would like to think that being a Canadian manufacturer carries some weight

with customers.

“Th ere’s quality behind a Canadian-made product. We’ve seen there are

Westergaard, houses an inventory of base process heater modules up to 1 MMBTU in a new 7,000 sq.- . cold storage building at his new loca on. The base unit is built from a modular design with the valve train pre-assembled, mounted and wired into its enclosure.

markets in other places that are opening up to us.” he said.

“I can say that I am a very proud Canadian. I take great pride in Canada

and the province.”

Page 85: Pipeline News December 2012

C24 PIPELINE NEWS December 2012

SEWEURODRIVE

www.kelro.com

Commercial Air ConditioningHeating and Refrigeration24 Hours Sales and Service

Safety Certified780-875-5000 Lloydminster AB

By Geoff LeeVermilion – Leading Manufacturing Group

Inc., founded by Lee Gottschlich in 2010 with a

head offi ce in Nisku, a sales offi ce in Calgary, and

an oilfi eld tank manufacturing facility in Vermilion

and will be expanding to Battleford.

LMG is also completing a new 5,000 sq.-ft.

paint and coating facility at its Vermilion plant

where Gottschlich provided details of his growth

plans in Alberta and Saskatchewan during an Oct.

26 interview.

“We have the Battleford property. It’s prepped

and ready for the fi nal documentation from the

town before we can take title to the property,” said

Gottschlich.

If construction is on target, the new 25,000 sq.-

ft. facility could be ready by the spring of 2013 to

manufacture the same 1,000 to 3,500 barrel oilfi eld

storage tanks that LMG fabricates in Vermilion.

Th e new 20 acre site is located at 18th Street

and 6th Avenue in Battleford and involved a proper-

ty swap requested by the town to move the original

location further away from residential development.

Th e land issue set back plans for a September

2012 opening at the original site, but Gottschlich

said the new location is good and will provide work

for up to 50 employees at start-up.

“Th e site is serviced, but we are doing the de-

veloping ourselves,” he said.

Gottschlich said a few LMG employees in

Vermilion who call Battleford home may relocate to

the area when the new plant is operational.

Th e company is actively recruiting for welders,

foamers, labourers, crane operators and other posi-

tions for the Battleford start-up.

Gottschlich said the Battleford tank manufac-

turing facility will put LMG closer to its provincial

customers north and south of Highway 16 and cut

costs.

“It will be closer to the Saskatchewan market.

Th ese large tanks are expensive to truck so trans-

portation will be much more competitive,” he said.

Vermilion was chosen for the site of LMG’s

fi rst tank manufacturing plant on the basis of its

proximity to highways 16 and 41. Page C25

LMG to expand to Battleford in 2013

Humberto Valdez, le , and Cory Pomerleau hook a plate of steel to an overhead crane for unloading at the LMG plant in Vermilion.

Page 86: Pipeline News December 2012

PIPELINE NEWS December 2012 C25

Page C24

“We ship to Cold

Lake, Bonnyville,

Wainwright along

Highway 41 which is

the main corridor,” said

Gottschlich.

“Th e crossroads

of Highway 41 and

Highway 16 to me is

one of the biggest assets

we have with the plant

here.

“It doesn’t matter

whether we are in Ed-

monton or Battleford,

our steel comes down

Highway 16 – whether

it comes from Regina

or from Vancouver or

Portland.”

LMG precuts its

steel plate in Nisku

where they opened a

prep shop in January

equipped with an 11.5

ft. by 55 ft. high defi ni-

tion plasma table.

At the Vermilion

plant, the steel tank

pieces are put together

with a combination of

stick, MIG and sub-

merged arc welding in

an horizontal assembly

process.

“Everything is

basically in the down

fl at position. Nobody

is working in the air

or off scaff olds,” said

Gottschlich.

“It’s safer and we

can use the sub arc pro-

cess which is an excel-

lent process for weld-

ing the plate. We can

make tanks 23.5 feet

in diameter and 40 feet

high. We are going to

be going to 48 ft. high

with our new paint and

coating facility.”

Th e 5,000 sq.-ft.

paint and coating addi-

tion is 65-ft. in height

or “50 feet under the

hook” in shop talk with

a 20-ton crane capacity.

Th e new wing can

paint, coat and insulate

up to three 2,500 bar-

rel tanks at a time and

will be equipped with

a $200,000 blast media

recovery system capable

of recovering shop dust.

“We are just in the

fi nal stages of complet-

ing our new sandblast-

ing and paint facility

which will be in opera-

tion in December,” said

Gottschlich .

“We are just fi nish-

ing the closing in next

week (Oct. 29) and then

we will be doing the

inside work.

“Building trades are

hard to get. I have used

the urethane foam panel

for construction instead

of the typical foil back

insulation.

“It’s a much better

insulation factor. Th at

means it’s lined all the

way up to the roof.”

LMG has also

purchased a 10 acre

property east of the tank

fabrication plant for

additional storage as the

demand for their prod-

ucts continues to grow.

“Th e volume has

continually grown. It’s

all a function of what

the manpower load is

and the type of tank,”

said Gottschlich.

“It takes a lot more

man-hours to build a

3,000 barrel tank than

it does to build a 1,000

barrel tank.

“As I always say, a

customer will forgive

you for being late, but

not for a bad job. If you

build a quality prod-

uct, there is defi nitely

demand for it.

“Th e demand is

there. In the last year,

we doubled in manpow-

er. We probably went

from 50 to well over

100 employees.”

A lot of new hires

are taking their ap-

prenticeship training at

the Vermilion campus

of Lakeland College

where a career fair

was held the same day

Gottschlich provided

his company update.

“We have quite a

few people come from

Lakeland and our ap-

prentices all go to Lake-

land,” said Gottschlich.

“We’ve got three

apprentices that should

be back next week from

Lakeland (after) com-

pleting their second

year.

Page C26

LMG manufactures 1,000 barrel to 3,000 barrel oil- eld storage tanks at its 45,000 sq.- . Vermilion plant

where they also fabricate frac tanks. The company plans to begin construc on in 2012 on a new 25,000 sq.- . tank fabrica on plant in Ba leford that will em-ploy about 50 workers at startup next spring.

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Page 87: Pipeline News December 2012

C26 PIPELINE NEWS December 2012

MUNICIPAL COMMERCIAL INDUSTRIALOIL & GAS UTILITY

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Cummins Western Canada has a wide range of products, parts, and services for all of your oil & gas, automotive, power generation and construction needs. We also have ReCon ISX and N14 engines, Juniper 2.4L engine, 8.3L and 5.9L natural gas exchange longblocks available.

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Page C25“We use the foreign worker program where we can, so we’ve got people

from Mexico and various countries. It’s always a task to hire people.”

Th e most popular product LMG workers build in Vermilion is the 1,000

barrel tank for heavy oil well sites. Th e plant also makes a lot of 3,500 barrel

tanks for batteries or water disposal facilities.

LMG has also found a new growth market with the manufacture of frac

tanks for use in hydraulic fracking operating in the Bakken oil play in south-

east Saskatchewan and the Montney shale gas play in British Columbia.

“Th ey are a movable tank that is 12 feet high and 105 to 165 feet in

diameter depending on what confi guration they are,” said Gottschlich. “Th ey

basically are the equivalent of 16,000 barrels.

“We make the assembly pieces so they can go to the site and they just hook

together. Th ey get a rubber bladder that goes inside that seals them and then

they are fi lled with fresh water.”

As for what it means to be a Canadian owned manufacturing company,

Gottschlich said this: “We have some patriotism and we get support because

we are local and Canadian.”

He went on to add that Vermilion has been very accommodating to the

company since its inception.

“Th e community is pleased with the number of people we have brought in

and have moved here,” he said.

“A lot of people have moved here. It’s a great town to live in and work out

of.”

Gottschlich also likes to spend as a much time in the shop as he can when-

ever he is in Vermilion.

“I enjoy the area, I enjoy the work, I enjoy the plant and I enjoy the peo-

ple,” he said.

“When I am here, I am out there half a dozen times a day. I am not a sit

behind the offi ce type guy. I have good sales people in Calgary and I’ve got very

good QC and supervision here.

“I used to be in the shop, so I miss the shop.”

The blue pieces in the foreground of this photo are the main parts of a new blast media recovery system to be installed in the new paint and coa ng facility under construc on at the LMG plant in Vermilion.

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Page 88: Pipeline News December 2012

PIPELINE NEWS December 2012 C27

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Lloydminster – Target Safety Services celebrated six years of growth and

success as a safety solutions provider on Oct. 1 with more good news ahead in

2013.

Th e Lloydminster-based company has the contract to provide in excess of

200 safety personnel for spring and fall turnarounds in 2013 at the Lloydmin-

ster Husky Refi nery and Upgrader.

Th e company also expects to fi nally begin construction on a new building

in Lloydminster next spring and will gear up for more client turnarounds in

2013 from its branch locations in Red Deer and Bonnyville.

Target Safety, which was founded by Clint McKinlay, Lloydminster gen-

eral manager, and vice-president Craig Dore, company president in Red Deer,

has been experiencing a strong year in 2012.

“It’s been a good year so far. It all comes down to people. You can have the

best equipment and the best processes, but if the people working for you don’t

share your vision or your inspiration, it’s all for naught,” said McKinlay.

“You have to have the people to act out the company vision.

“Craig and I have fi ve year plans. We will eff ectively be in year two of our

second fi ve-year plan in 2013 and continue growth.

“Our vision is to inspire our people to help us become the most successful

safety company in Canada, so we have pretty lofty dreams,” added McKinlay.

“Th ose are the marching orders and every day, we will get a little closer to

that goal.”

Target Safety has grown to deliver safety training, technical rescue, in-

dustrial or health-related services, safety equipment and safety management

systems led by its core of safety veterans.

“Our people are by and large the most important aspect of what we do on

a daily basis. We’ve managed to put together a very good, experienced manage-

ment team,” said McKinlay.

“Recruiting has been a primary objective of ours throughout the years to

make sure we are fi nding the right people. We are very fortunate in the staff

that we’ve collectively developed together.”

McKinlay and Dore launched Target Safety in Lloydminster then quickly

opened a second branch in Red Deer.

Th e Red Deer location has expanded to include a classroom and a 40-ft.

high angle and confi ned space rescue simulation tower called Goliath which is

used for staff training and certifi cation.

Red Deer is the site for a quality assurance and quality control program for

its extensive inventory and maintenance of safety equipment.

In 2008, the company opened a small offi ce in Bonnyville before relocating

to a larger building in 2011 where they continue to grow – according to plans.

“Th ere have been some curve balls that have been thrown at us that were

out of our control in terms of the world economy crash and the royalty tax hike

for oil and gas producers, but we managed to work past those and continue to

grow,” said McKinlay.

Th e biggest growth area for the company is its industrial safety services di-

vision thanks to a big break in 2010 when it landed its fi rst Husky turnaround

safety contract.

“Th at was a big challenge. Th e company was growing at the time of secur-

ing that contract,” said McKinlay.

“It was a big step for us to be able to successfully execute it. We are here to

say we did it and we look forward to doing it again.

“We have the Husky Refi nery in April, and then the Upgrader goes down

in September, and that will be in excess of 200 safety persons for us for about

45 days.

Page C28

Target Safety Services general manager Clint McKinlay says 2013 is shaping up to be one of the busiest years yet for the company with scheduled turnarounds for clients served by their loca ons in Lloydminster, Red Deer and Bonnyville. There is also a planned spring construc on start on a new building in Lloydminster.

Target Safety to start new building in spring

Page 89: Pipeline News December 2012

C28 PIPELINE NEWS December 2012

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Page C27“We executed it in 2010 and it

will be roughly the same size in 2013.

It’s defi nitely one of those jobs that

we look forward to.”

Target Safety delivers everything

from turnarounds, safety watch super-

vision, spark watches, confi ned space

entries, emergency response teams to

safety advisers for drilling, comple-

tions and earth works through its

industrial division.

“We’ve really branched out in the

terms of the level of service that we

provide,” said McKinlay.

Another upcoming milestone for

Lloydminster operations will be next

spring’s offi cial sod turning on a new

16,000 sq.-ft. facility to be located in

the Robinson Industrial Park.

“We have outgrown our offi ces.

Th e human resources that we have

between administration, operation

and management – the building we

are in has worked quite well for us for

the previous fi ve years – but we are at

the point where we need more room,”

explained McKinlay.

“We have the extra equipment

around, we have more people. A big-

ger, newer facility is going to set the

bar for our company. Lloydminster is

our head offi ce.

“It’s the only area that we are in

where we are not in a new building, so

we’re going to fi x that.”

McKinlay said the drafting and

architectural plans for the new build-

ing were almost complete by Oct.

31 when he provided an update of

company news.

Page C29

Target Safety Services marked its sixth year of opera ons on Oct. 1. The Lloydminster-based company is expec ng a spring construc on start on its new 16,000 sq.- . build-ing in Lloydminster. A new facility is needed to keep pace with the company’s growth.

"we have outgrown our of ces"

LAMARRE EQUIPMENT INC.

Wishing Everyone A Very Merry Christmas, and a Happy and Safe Holiday Season

Page 90: Pipeline News December 2012

PIPELINE NEWS December 2012 C29

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Page C28

Target Safety has a November 2013 move-in

date that is dependent on weather and the availabil-

ity of construction trades.

“It’s been a work in progress. Moving to a new

location is never easy, especially when you are build-

ing,” said McKinlay.

“It’s been a challenge to do that at the same

time as growing the business, but at the same time

it’s a very necessary part of that whole package. We

are looking forward to it.”

Meanwhile, McKinlay has his plate full, staff -

ing up safety teams for winter oilfi eld construction

projects and routine seasonal safety projects.

“We are actually involved in several construc-

tion projects where we will have national construc-

tion safety offi cers who will be working on projects

advising from a safety perspective and emergency

response work we have ongoing year round on other

construction projects,” he said.

“In the summer months, we ramp up for turn-

arounds, and in the winter, we work service rigs, etc

and keep our people working year round.”

Target Safety currently has about 145 active

employees as well as in-house recruiting and train-

ing for the seasonal turnaround crews.

“With our growth, our training department –

their primary function is to train our people. We

will be recruiting in excess of 200 more people next

year,” said McKinlay.

“Our training group’s primary focus is making

sure we have the best trained safety personnel the

industry has to off er.

“Some of the hires will be seasonal and project

specifi c, but a lot of those positions will be full-time

work. Unfortunately, a lot of our big volume work is

seasonal.

“It’s cyclical, but there is some predictability to

it. We just have to manage that.”

Looking back over the years, McKinlay said

safety and the perception of safety have come a long

way from just being a required position to fi ll to be-

ing a 24/7 mode of operating in the fi eld.

“Th e whole culture and peoples’ vision of what

safety does – a lot of people now see the benefi t of

having safety,” he said.

“In the old days, people would have a safety

person because they had to, and now they are peo-

ple who won’t go to work without a safety person.

Th ey are starting to see the additional benefi ts.

“What we are doing is helping them get home

to their families each day the way they went to

work, with all their fi ngers and their toes. Th eir

personal lives are benefi ting because of it.”

Michelle Wallace, le , an environmental administrator and Lauren Case, a business development manager from North Shore Environmental Consultants, spoke with students about job opportuni es with their com-pany at the Vermilion campus of Lakeland College. Nearly 50 employers were represented during a career fair on Oct. 26.

Photo by Geo Lee

Open house and career fair at Lakeland College in Vermilion

Caltech Surveys is fully equipped to take on your well site and pipeline projects, large or small, anywhere in Alberta or Saskatchewan. You can count on us to respond quickly and get your projects completed on time and on budget. From project planning and digital mapping to eld scouting, surveying and plan preparation, Caltech’s commitment to quality, service and value continues...

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Page 91: Pipeline News December 2012

C30 PIPELINE NEWS December 2012

Toll Free: 1-888-847-7778 Office: 306-672-3062 Fax: 306-672-4427Email: [email protected] us for services near you. Gull Lake, Estevan, Carlyle, Kindersley and Lloydminister

The Right Choice

For Oilfield

Waste Bin

Rentals

Lloydminster – In

the coming months, you

can expect to see a lot

more heavy oil tanks

equipped with a CSC

200 combustion safety

control from Canadian-

owned ACL Manu-

facturing Inc. based in

Sundre, Alberta.

Th e CSC 200 is the

latest combustion con-

trol on the market from

ACL Manufacturing

Inc., a company that de-

signs and manufactures

natural draft burners,

combustion controls and

ignition systems for the

oil and gas industry.

Th e CSC 200

provides burner ignition

and fl ame fail as well

as monitoring of two

thermocouple inputs

which can be utilized

for temperature control

in process applications

such as tanks and line

heaters.

Th e privately-

owned Canadian com-

pany brought the CSC

200 combustion control

to the Lloydminster

Heavy Oil Show in

September where it got

a warm reception.

General manager

Andrew Pearce was on

hand at the company’s

booth to promote the

product that is designed

to be used in conjunc-

tion with an ACL

combustion module for

a complete safety com-

bustion device.

“Th is is appli-

cable to heavy oil tanks

mostly. Every heavy oil

tank has a burner in it

to get it up to 70 or 80

degrees Celsius so they

can truck it around,”

said Pearce.

“It lights and main-

tains the burners and

also – with temperature

controls – it shuts them

off when they get to

temperature. Th ey can

run pilotless or with a

constant pilot. It saves

on fuel gas.

“Also, it can run it

with lower power con-

sumption with solenoid

drivers – so it saves your

power needs for solar

applications.

“Combined with a

high effi ciency burner, it

puts a lot more heat into

the process and it can

reduce your fuel costs

as well, but also puts a

lot more heat into the

process.”

Th e CSC 200 is

designed with an easy

on-off switch and is

enclosed in a corrosive

resistant and weather-

proof body.

Th e product is

also applicable for line

heaters, treaters and any

natural draft burn-

ing heated equipment

where accurate tem-

perature monitoring of

control is required.

“CNRL in

Bonnyville is using a

lot of them now,” said

Pearce.

“We are just talking

with some guys here,

and they are working

so well they don’t get

any callbacks, and the

operators love them for

the simplicity and the

way they work.

“Th is particular

control has been out a

few months now, so this

is our latest control that

we have.

“We are also adding

more Modbus com-

munications onto it.

We are working on new

controllers all the time

too.”

ACL was estab-

lished in 1991 by Chris

Aldrich and is recog-

nized as an innovator in

providing safe and reli-

able control equipment

for industrial heaters,

incinerators and fl are

ignition systems.

“We are in Sundre,

and we are also pushing

into the U.S. We are in

Billings, Montana, and

have a lot of customers

down in Texas as well.”

ACL markets its

products globally and

sees a lot of growth

potential for its latest

CSC 200 combustion

control in the Lloyd-

minster to Bonnyville

heavy oil corridor.

“Th ere is a still a

lot of growth potential

– of course, there a lot

of diff erent companies

up here we’re trying to

meet,” said Pearce.

“Th ey’re drilling

lots of wells. Th ere are

a lot of tanks going

in and they all have

burners in them. We

are looking forward

to working with more

companies up here.”

Market warms to ACL combustion control

Andrew Pearce, general manager of ACL Manufacturing Inc., le , speaks with a cus-tomer at the Lloydminster Heavy Oil Show about the features and bene ts of the com-pany’s newest CSC 200 combus on control.

Page 92: Pipeline News December 2012

PIPELINE NEWS December 2012 C31

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

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

Proud to provide selection, quality and

excellence to our customers.

[email protected]

Aspen Custom Trailers

6017-84th Street S.E.

Calgary, AB T2C 4S1

[T] 403 236 2244

[F] 403 236 8829

[C] 403 813 6319[Toll Free] 877 236 2244

Lance WotherspoonRegional Sales Manager

BIG D’S LEASE SERVICE

P.O. Box 544

Stoughton, Sask. S0G 4T0

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

BackhoeMowingSnow Removal

TowingFencing

Road GraderGravel Supplies & Hauling

LECLAIRTRANSPORT

Lyle LeclairCell: 306-421-7060

General Oilfi eld HaulingCordell JanssenCordell Janssen

District ManagerDistrict ManagerDownholeDownhole

93 Panteluk Street, Kensington Avenue N93 Panteluk Street, Kensington Avenue NEstevan, SaskatchewanEstevan, Saskatchewan

PHONE:PHONE: 306-634-8828 • 306-634-8828 • FAX:FAX: 306-634-7747 [email protected] • www.nov.com

JUSTIN WAPPEL - Division Manager

401 Hwy. #4 S. Biggar, SaskatchewanPO Box 879 S0K 0M0Ph (306) 948-5262 Fax (306) 948-5263Cell (306) 441-4402 Toll Free 1-800-746-6646Email: [email protected]

Lloyd Lavigne • Kirk ClarksonOwners/Managers

6506 - 50th AvenueLloydminster, AB

Phone: (780) 875-6880

5315 - 37th StreetProvost, AB T0B 3S0

Phone: (780) 753-6449

Fax: (780) 875-7076

24 Hour ServiceSpecializing in Industrial & Oilfield Motors

Your best choice for accommodations

in Carlyle, Sk.• Full kitchen and upscale extended stay

• Complimentary continental hot breakfast• Free high speed internet

• Meeting roomReservations: 306-453-2686

RICK CORMIERManager

Box 609 Bus: (306) 634-8084Carlyle, SK Cell: (306) 577-8833S0C 0R0 Fax: (306) 453-6075www.truetorq.ca [email protected]

RESOURCE Gu de

Contact your Pipeline News Sales rep. to get

28,000 circulation on your career ad!

Speci c Targeting

Page 93: Pipeline News December 2012

C32 PIPELINE NEWS December 2012

Sun Country Well Servicing Inc. is currently seeking a:

CA

REE

R

Gu

de

Page 94: Pipeline News December 2012

PIPELINE NEWS December 2012 C33

Oilfield Construction Limited

NOW

COME JOIN OUR TEAM! We’re hiring for various

projects throughout

Southern Saskatchewan

Over 50 years strong, Arnett & Burgess

Oilfi eld Construction Limited safely

provides quality pipeline construction,

facility installation, pipeline integrity,

custom fabrication, maintenance and

related construction services to the

energy industry.

Compensation:Competitive wages

Overtime

Daily Subsistence /Living

allowance

Preferred Certifi cationsH2S Alive

Standard First Aid & CPR

Required Certifi cations Driver’s License

Ground Disturbance – (Heavy

Equipment Operators only)

For more details and other career opportunities please visit:www.abpipeliners.com

For Inquiries please call: 780.384.4050

Please submit your resume to :email: [email protected] • Fax:403.265.0922

• CONSTRUCTION MANAGER- Candidates must have previous leadership/managerial experience within the Pipeline Construction industry (mainly underground lines max 16”).This position’s home base is in Regina.

• FIELD SAFETY ADVISOR- The ideal candidate will have a CSO designation. This position will oversee pipeline construction projects in southern sk with a home base in Regina

• PIPELINE CONSTRUCTION LABOURERS

• FOREMEN

• HEAVY EQUIPMENT OPERATORS-Employee & Owner Operators with Pipeline Construction Experience

All positions require previous experience in Pipeline Construction.

Previous experience on Pipeline Integrity projects is an asset.

JOB OPPORTUNITIES:SURVEY PARTY CHIEF & SURVEY ASSISTANT

Caltech Surveys Ltd. has openings for an experienced Survey Party Chief and a Survey Assistant, based in our Unity office (working in the Kindersley, Unity, Battleford, and Lloydminster area).

Caltech Surveys offers competitive wages, excellent benefits and a company matched RSP plan.

Survey Party Chief - Ideal candidates will have a Diploma in Geomatics Technology, or equivalent; experience with RTK GPS, total stations, survey data collection and buried facility locating; survey experience in legal surveys for the petroleum industry; applicable safety certifications and excellent communication skills.

Survey Assistants – Candidates must have a valid drivers’ license. Preference will be given to those with experience & safety certifications, but neither is required.

Apply in confidence to: Dawn Boxall, Administration Manager [email protected]

We require the following:

Matrix Well Servicing

CAREER Gu de

Page 95: Pipeline News December 2012

C34 PIPELINE NEWS December 2012

THE FOLLOWING POSITIONS ARE AVAILABLE IMMEDIATELY

Interested applicants can fax to: 306-634-4258 or

email: [email protected]

MECHANICSome of the many

benefits to consider when applying for

a position at Bert Baxter Transport

in Estevan:• Full time, permanent

employment

• Full benefits packages available

• Clean, safe work environment

SERVICE TECHNICIAN

Page 96: Pipeline News December 2012

PIPELINE NEWS December 2012 C35

Page 97: Pipeline News December 2012

C36 PIPELINE NEWS December 2012