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October 2009 Volume 10, Number 5
Corner
The Mega-Merger Hangover
When the dust finally settles, if indeed it does, what you wind up with looks very
different from what you thought you were going to have
A
lthough the Petro-Canada name will live on at its handsomely branded retail outlets,
the company that many loved to hate (at least in its infancy) is gone, absorbed by
Suncor, a company with an even longer history and, as you’d expect, a much better
historical track record. With a market cap hovering around $50 billion, the new Suncor is
about 20% bigger than EnCana, the monster created in 2002 by the so-called “merger of
equals” — AEC and PanCanadian.
But if anyone at Suncor is feeling particularly satisfied about being the undisputed
domestic energy lynchpin, they should be aware that from the EnCana example that their
status as number-one may well be short-lived.And the taste of champagne can leave a wicked
hangover.
The powers that be will pretend everything can be neatly wrapped up in a bow by a cer-
tain date, but the turmoil created within a newly merged enterprise so large and complex is
ongoing. When the dust finally settles, if indeed it does, what you wind up with is very
different from what you thought you were going to have.
How we’d end up in this business? Why did we sell that? Who hired that guy?
Just ask EnCana, which announced in May 2008 that it planned to divide itself into two
separate companies; after postponing the deal a few months later in the wake of the global
credit crunch, it was put back on the table in September 2009.
To think that such a plan would emerge within just a few years would have been pre-
posterous at the time of EnCana’s creation – when it was claimed with a great deal of flag-
waving fanfare that a certain “critical mass” was necessary, if not for survival alone, then to
offer investors improved liquidity, access to capital at lower costs and higher share prices
relative to cash flow.
Suncor is using essentially these same arguments today, ironically to absorb the com-
pany that virtually patented the flag-waving takeover in the early 80s.
But it’s apparent now that “bigger is better” no longer works for EnCana.
And so the question has to be asked: if the same market that was rewarding size above
all else just a few years ago has now discovered that “more value” can be created by split-
ting EnCana along distinct business lines, why is the Suncor-Petro-Canada merger hailed
as such a wonderful thing? Won’t that same fate ultimately befall Suncor once all its post-
merger asset shuffling is finally concluded?
There are differences in the two deals beyond the mere passage of time but, if anything,
the Suncor deal is way more complicated than EnCana’s ever was, given the merging of
downstream as well as upstream assets. It’s easy to foresee Suncor eventually splitting at
least the upstream and downstream and perhaps bringing the weaker, regional Sunoco brand
under the national Petro-Canada name and marketing umbrella.
That leaves a final question that can also be asked of the EnCana split – at inception, would
the production and net asset value of the new entity be that much greater than what could
have been generated had the businesses that went into its creation been left to grow undis-
turbed?
I have a sneaking suspicion the numbers might be closer than one would think. You can
scoff at the notion and toss out a bunch of actual and projected numbers to make your case,
but the reality is that no one will ever truly know. Precious little speculative comparison ever
sees the light of day.
There is also a huge body of data out there that would make anyone question the ulti-
mate value of these large deals, financially, operationally and socially. The latter is often over-
looked, yet many a study cites social/cultural/communication issues as the number-one cause
of failed mergers. It’s one thing to say you’re going to integrate two cultures and quite an-
other to actually achieve the integration. (Suncor has its hands full with Petro-Canada –
they’re very different animals).
In the end I can’t help but wonder if, in reality, the only people who ultimately benefit
from these big deals are those who finance and broker them, those who are in a position to
determine whether they proceed or not and can carefully orchestrate the timing, and the
armies of lawyers, forensic accountants and others who back them up and thereby garner a
hefty commission or dubious promotion for their loyalty to the cause and a few late evenings
on computer.
I’d compare it all to the formation of the so-called rock and roll supergroups of the late
60s and 70s – the hype outweighed the substance and the music itself, after the initial shine
wore off, was flat and unmemorable.
W
hile 2008 was a year of two extremes, with oil and – 72% of gas producers believe prices should recover with-
gas producers experiencing boom and bust all with- in the next two years to a level that will lead them to increase The financial crisis has reduced access to both debt and
in 12 months and many responding by cutting their their drilling programs whereas 28% believed it might take equity.As a result, 39% of survey respondents expect to rely on
capital spending plans for 2009 anywhere from 25% - 35%, they three years or longer for natural gas prices to recover to levels cash flow to support their business over the next year, while
still continue to plan for the future according to the Canadian that will result in more wells being spudded. 26% identified debt and 14% equity as their primary sources of
Energy Survey released today by PricewaterhouseCoopers (PwC). “The turbulent swing in energy prices from all-time highs financing.
– 70% of respondents expect prices to increase somewhat in the summer of 2008 to four-year lows in December is a pow- Two-thirds of respondents said access to capital and credit
over the next year and 11% believe prices will increase sub- erful reminder that the booms in commodities can quickly is critical to sustain their growth over the long-term. But
stantially. Approximately 16% said crude oil prices will stay evaporate,” says John Williamson, Partner and Canadian Energy respondents also feel that debt will likely be the most difficult
about the same in the year ahead. Leader at PwC.“At the mid-way mark of 2009, while gas prices source of financing to obtain in the short-term (over the next
– The majority of respondents said oil prices will have to continue to languish, many believe natural gas fundamentals three years), with 63% saying it will be somewhat challenging
increase to at least US$70-$80 before they would consider in- point to a recovery in 2010, which will lead to improved and 26% believing it will be very challenging. Close to 54% of
creasing conventional drilling programs, although an almost drilling activity levels. Crude oil prices have already rebound- respondents also believe it will be somewhat challenging to se-
equal number said prices will have to head north of US$80 be- ed from year-end 2008 levels.” cure equity financing in the next three years, with 33% saying
fore spending more on conventional drilling. Companies across the oilpatch are adopting a number it will be very challenging.
– Close to 57% of respondents said the ability to adapt to of measures to remain profitable, including capital budget
change is a critical requirement for their long-term sustain- cutbacks, moving operations to other jurisdictions with Operating Costs
ability; while 68% of respondents said attracting and retaining lower royalties, as well as salary freezes or rollbacks, and Fully 57% of survey respondents said they anticipate their
top talent was viewed as critical for their long-term growth. layoffs. overall operating costs to decrease over the next year, with de-
Technological innovation was seen by 40% of respondents as While industry has cut staff, many energy companies pre- clining labour and material costs helping the bottom line. Some
critical for ensuring sustainable growth. fer not to lay off employees because so much time has been oil producers now say that labour and material costs have low-
– Respondents also said they expect to increase their in- spent training them. In the survey, attracting and retaining top ered so much that projects may be economical at lower prices.
vestment into research and development (R&D) over the next talent was viewed by 68% of respondents as critical for their In addition, 76% of respondents said their land acquisition
two years, with 23% indicating they plan to boost R&D spend- long-term growth. This driver was seen by respondents as the costs would stay the same or decrease over the coming year.
ing in 2011 versus only 4% this year and 22% in 2010. most critical factor that will influence future growth. Continues on page 11
D
espite what media and naysayers may have you
it to have a 60 per cent working interest in AOSC’s MacKay River cation for the first 35,000 bbl/d phase of the MacKay River com-
believe, communities where oil and gas activity
and Dover oilsands projects for $1.9 billion. The agreement also mercial project at the end of this year.
is most active actually view the petroleum
provides for certain financing arrangements for AOSC. The MacKay River project is about 60 kilometres west of Fort
industry in a surprisingly more favourable light com- “This deal shows that the biggest energy company in the world MacKay, while the Dover project is about 35 kilometres northwest
pared to the national average. However, community res- has chosen Athabasca as their partner,” said Sveinung Svarte, of Fort McMurray.
idents still point to some key issues where industry can Athabasca Oil Sands president and chief executive. “They clearly
improve its performance. told us that’s because they like our assets the best and obviously,
Findings of a recent Ipsos-Reid public opinion survey, they (oilsands) are the crude oil story.”
conducted on behalf of PSAC, suggest that communities The projects are located in the centre of the Athabasca area in
within the WCSB where oil and gas activity is taking northeastern Alberta and have been assessed by an independent
place – as in those communities that actually live with third party to contain roughly five billion barrels of bitumen. The
industry activity on a regular, if not daily basis –don’t deal basically allows for three billion of those barrels to be sold to
think the industry is all that bad. This is in stark com- PetroChina, said Bill Gallacher, chairman of the Athabasca Oil Sands.
parison to what industry and the public were led to Oilsands projects require a huge investment, and now “we have
believe during the royalty review process in 2007/2008, a fully funded business model to go forward,” he said. "Oilsands
and varies widely from similar surveys that have taken projects are very capital-intensive long-term investments and dif-
a more national perspective. ficult to fully finance in the traditional equity market.
The survey was undertaken as a strategy for indus- “AOSC therefore decided to look for joint venture partners, and
try to listen to the public, hear and understand their these strategic joint venture arrangements with PetroChina, one of
concerns, and ultimately be able to address those con- the world's largest energy companies, can ensure that the MacKay
cerns, in an effort to protect industry’s social license to River and Dover projects will be developed in timely manner, “We will remain as operators for the time being of the two assets,”
operate. which is excellent news for Alberta and the rest of Canada.” Svarte said.
Against a backdrop of typically negative media cov- The deal is expected to close Oct. 31, Gallacher announced in Commercial oil could flow by 2014, with subsequent phases
erage and seemingly negative public attitudes towards a conference call. It is pending government approval, but AOSC reaching 150,000 bbl/d of production.
industry, the results of the survey were pleasantly sur- executives say they don't foresee any obstacles. PetroChina is not the only Chinese firm to show interest in
prising with 60 per cent of respondents having a Some of them recently visited several oil facilities in north- northern Alberta's oil reserves. Sinopec Corp. has a 50 per cent
favourable opinion of the industry, while another 20 per eastern China where PetroChina operates a number of heavy oil stake in the Northern Lights project 100 kilometres northeast of
cent of people are indifferent. That means only two in projects using sophisticated technologies, including various SAGD Fort McMurray.
10 people hold a negative view of the industry, which, processes and firefloods. A Scotiabank commodity report says that Chinese oil con-
for any industry, is a pretty good number. “I was pleasantly surprised at the operations we’ve seen. It was sumption has increased 3.5 per cent this year and in July was at
Eight out of 10 respondents gave industry top ratings very, very impressive,” Gallacher said. 8.1 million barrels per day.
for providing jobs and supporting the local economy.
And, nearly three quarters of respondents noted indus-
try’s community participation - such as donations, vol-
unteering, and sponsorships – as clear positives.
Respondents also gave industry relatively positive marks
for treating residents and property with respect.
However, before becoming too self-congratulatory,
it is important to note that the survey also highlighted
some very specific areas for improvement. One of the
prevailing themes of the survey is that industry is falling
flat when it comes to communication. The benchmarks
for listening and responding to community concerns,
and just communicating in general about activity are all
below where they should be.
The survey shows that 50 per cent of people feel
industry needs to do a better job on this front. Almost
two-thirds of those surveyed are asking for more infor-
mation from industry, which according to Ipsos-Reid is
a startlingly high number compared to other industries.
Some of the specific concerns noted by residents
relate to driving habits, minimizing mess, reducing noise,
and protecting public health and safety.The number one
concern, which is shared by a majority of respondents,
relates to protecting the environment.
The detailed findings of the survey provide a lot of
ammunition, both in support of industry, but also in sup-
port of some improvements that need to be made. It is
critical for issues to address these issues now, in advance
of the next upturn, so that industry can remain in good
public favour.This is certainly something that PSAC will
continue working on, on behalf of Members, and is
something that other industry stakeholders may want
consider as well.
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Macroeconomic Drivers
Industrial and consumer demand for oil products
around the globe have fallen considerably as the reces-
sion remains firmly entrenched in much of the devel-
oped world.This has led to a rapid building of stockpiles,
pushing prices to very low levels by recent standards.
Global stimulus packages should help to lift economic
activity as we move through the second half of 2009,
boosting oil demand and prompting prices to resume
their long-term upward trend.The WTI price is expected
to average $103.38 in 2013.
Exports
Trade is a vital part of the oil extraction industry.
Domestic demand in Canada will be particularly weak this
year and next thanks to a weaker economy (see Chart 7),
but demand will pick up near the end of the forecast as
domestic refining capacity increases. Crude oil is feedstock
for refineries, and companies prefer to export refined
E
arlier this year CAPP conducted a survey of producers to grow, although the pace of development has slowed,” said Greg conservative outlook in the Operating & In
determine planned production of oil through 2025. CAPP used Stringham, CAPP’s Construction Case includes only projects
this data along with other inputs to prepare its annual forecast, Vice-President, Markets and Oil Sands.“Producers expect continued currently in operation or under construc-
which this year provides both a Growth Case and an Operating & In demand for the security of supply that crude oil from Canada provides tion. This case represents a minimum growth
Construction Case. to the North American energy market.” outlook. Both cases are presented in the
“CAPP’s Production Forecast indicates that even with delays due to The Growth Case represents expected production and assumes chart below:
current economic circumstances, oil sands production is expected to the current investment climate will improve over time. The more
Total Canadian Crude Oil Production (million barrels/
day) - including oil sands
2008 2015 2020 2025
--------------------------------------------------------------------------------
Growth Case 2.7 3.3 4.0 4.2
--------------------------------------------------------------------------------
Operating & In Construction 2.7 3.0 3.0 2.8
--------------------------------------------------------------------------------
Canadian Oil Sands Production (million barrels/day)
--------------------------------------------------------------------------------
Growth Case 1.2 2.2 2.9 3.3
--------------------------------------------------------------------------------
Operating & In Construction 1.2 1.9 2.0 2.0
--------------------------------------------------------------------------------
www.oilgas.net
W
orld oil demand is set to oil was replaced by readily
grow next year for the first available substitutes like coal,
time since 2007 and return gas or nuclear,” Mr. Burkhard
to pre-recession levels by 2012, said. “Today, global demand
according to IHS Cambridge Energy growth is coming from the
Research Associates (IHS CERA) in its transportation sector in emerg-
quarterly World Oil Watch report.The ing markets where there are
rebound would mark a turnaround fewer large-scale options for
from the largest drop in global oil switching fuels.”
demand since the oil crisis of the Overall, emerging markets
early 1980s. will drive the recovery of oil
IHS CERA expects oil demand demand. IHS CERA expects oil
growth to resume by 900,000 barrels demand to increase from 83.8
per day (bd) in 2010 and return to its mbd in 2009 to 89.1 mbd in
2007 high of 86.5 million barrels per 2014. 83 percent (4.4 mbd)
day (mbd) by 2012—a five year turn- will come from non-OECD
around. countries. China alone is
“There are a lot of questions as to expected to account for 1.6
whether things will be ‘different this mbd of cumulative growth. Just
time’ in terms of the recovery of oil 900,000 bpd of growth is ex-
demand,” said IHS CERA chairman pected to come from OECD
and Pulitzer Prize-winning author of countries.
The Prize, Daniel Yergin. “While the “This near-stagnation of
answer is that it will be shorter, it is oil demand growth in the
still going to take a substantial industrial countries of the OECD
amount of time.” highlights several structural
Oil demand dropped by 2.8 mbd changes,” Burkhard said.
from its high point of 86.5 mbd in “Decreasing oil intensity associ-
2007 to 83.8 mbd in 2009. The last ated with economic growth,
time that the world experienced such higher fuel efficiency, the dis-
a severe decline in oil consumption placement of conventional oil
was in the early 1980s and it took with renewable energy sources
nine years for demand to return to the and a slower pace of growth in
1979 pre-recession high.A five year turnaround—while still a substantial amount of time—would transportation fuel consumption – all these point to a leveling off of demand in the industrial world.”
be swift in comparison. While the trajectory of oil demand seems certain, Burkhard pointed out that, as always,
The key differences between the current recovery and that of the 1980s are demand from future events large and small could alter the course of demand.
emerging markets and fewer options for substituting fuels on a global scale, said IHS CERA glob- “While our base case suggests that 2012 will be the year that global oil demand recovers to
al oil managing director, Jim Burkhard. 2007 levels, we continue to research the alternative scenarios that could alter the balance in the
“In the 1980’s the largest area of the demand decline came from power generation, where oil market,” said Burkhard.
F
or those working in the field operations of the oil and gas sector, the concept of entering data just once has
been a much desired but generally unachievable objective. All too often, capturing the data from the field is
a haphazard, disorganized and frequently duplicated process, and many executives and field workers alike
despair at the inefficiencies and inaccuracies that stem from these problems.
Traditionally, data has been captured on a clipboard, log book or the inside of a pack of smokes. Sometimes,
information can be recorded and then re-recorded as often as five times before it is finally entered into the correct
systems and properly processed. Administrative staff often have to be specifically hired to direct this flood of data
from the field, and to re-enter it in the back office. Errors are inevitable as the same information is entered and
re-entered, and delays are unavoidable as paper-based records get lost or simply held up on their way between the
field operations and headquarters.
The key factors for any field-based company are to maximize production and minimize downtime. What is
required is a way to address those needs through effective data collection, analysis and integration with a compa-
ny’s existing analysis tools. And today, thanks to advances in software and mobile computing, there are now options
for oil and gas companies that want to improve the accuracy with which they capture data in the field, whether it
be at a gas well, plant, oil battery, pump jack or lease. But how best to roll out such new technologies?
What should come first when building an IT strategy for a field-based organization, the field or the office? Given
the evidence, for most companies the answer to date has been the office. But why should this be the case? If the
work is being conducted predominantly in the field, why is the IT infrastructure supporting that work built from
the back office out?
Back to front?
Consider a typical rollout of a new enterprise software system. Invariably, the IT plan starts with the creation
of a new system in the back office, which is then eventually rolled out to the field. Often, the company’s manage-
ment in the field has little or no idea about the existence of the new system until it has already been implement-
ed. Perhaps the reason for doing this is that it’s simply easier to train the office staff during implementation, or
maybe companies would rather ignore all the complex processes presented by the field in favour of forcing
acceptance of a new way of doing things from the office outwards.
Either way, the result is that these field processes are often left as manual steps to be completed in the same
way they have always been. Field staff end up frustrated because the new system fails to address the administra-
tive headaches they deal with on a daily basis. Company executives may be pleased with the final outputs gener-
ated from the new system, but they may well not realise that the whole process is far from optimised, and that
their final data is still the product of a series of time-consuming and error-strewn manual processes.
T
he Board of Directors of EnCana Corporation has unani- announced our plan to split in May 2008,” Eresman said.
Data capture and contractors mously approved plans to proceed with a corporate Well advanced reorganization plans lower transac-
For large oil and gas companies, the cost of using electri- reorganization to split EnCana into two highly focused tion risks
cal contractors and other skilled trades can add up to billions energy companies: one a natural gas company – EnCana “Our extensive work in the past year has helped re-
of dollars a year, and yet projects often suffer from lack of cen- (GasCo), which has an outstanding portfolio of prolific shale duce the risks associated with the transaction.We have
tralized oversight and control. Project costs easily and fre- and other gas resource plays across North America, and the other received tax rulings from the Canadian and U.S. feder-
quently spiral out of control. Recent drops in commodity an integrated oil company – Cenovus Energy Inc., which has in- al tax authorities that confirm, subject to the terms of
prices have been a rude awakening for many industry giants, dustry-leading enhanced oil production and top-performing the rulings, that the transactions will not be taxable
who have committed billions of dollars to projects that have refineries, as well as an underlying foundation of reliable oil from a corporate and shareholder perspective.We have
invariably exceeded budgets by huge margins. and gas resource plays. This transaction – expected to close secured committed financing for Cenovus that will sup-
In a recessionary economy, contractor companies are an November 30, 2009 – is designed to enhance long-term value port its independent business plan. We have acquired
easy target for cost-cutting. This leaves contractors squeezed for EnCana shareholders by creating two sustainable, and built much of the infrastructure for Cenovus’s in-
to deliver their services more efficiently, and operational effi- independent, publicly traded companies, each with an ability to formation technology systems. The leadership teams
ciency has now become a major pain point in the contract pursue and achieve greater success by employing operational have been identified and employees have been assigned
services sector. strategies best suited to its unique assets and business plans. to new or continuing roles in each of the proposed
Due to the same field data collection challenges faced by EnCana first announced the proposed corporate reorganiza- companies. Having completed this foundational work,
oil companies in, it is almost impossible to track the costs and tion on May 11, 2008 and was advancing plans for the split last and with the return of financial market stability, we are
status of a given project with any kind of real-time accuracy, fall when the global debt and equity markets experienced un- proceeding with this value-creating transaction in a
or to gain the kind of intelligence needed to inform a proj- precedented turmoil and volatility. Given that uncertainty, prompt and prudent manner,” Eresman said.
ect owner how specific variables are affecting the budget. EnCana announced on October 15, 2008 a revision to the orig-
Most important of all, the whole process takes a significant inal reorganization schedule and delayed seeking shareholder Continuing tradition of focused execution to
period of time, meaning invoices to customers are delayed, and court approval for the transaction until clear signs of stability deliver enhanced value and capture competitive
payments delayed while invoice details are contested, and returned to the financial markets. opportunities
management of cash-flow becomes an increasing challenge. “We believe the conditions are now favourable to proceed Since its formation in 2002, EnCana has established
As these headaches become more pronounced in the in- with the split. Equity and debt markets have improved signifi- a strong track record of value creation through the con-
dustry, new technologies are being developed to help con- cantly with debt financing available at reasonable cost. Global tinued pursuit of low-cost natural gas and oil produc-
tractorsimprove their business efficiency and keep up with and national economic indicators suggest that the world’s tion, growth in proved reserves and an innovative
the increasing demands of their customers. economies are showing promising signs of recovery.As well, the strategy of developing unconventional natural gas and
Singletouch has developed a comprehensive data-capture strategic rationale for creating two leading energy companies oil resources in North America. That success is found-
platform for electrical contractors working in industrial con- remains as sound as ever – the conversion of one leading un- ed in the central belief that companies with a disci-
struction that enables real-time input of information conventional resource company into two independent, premium plined focus on establishing leadership in their core
entities unlocks greater long-term shareholder value from in- business will earn increased value recognition of their
dustry-leading North American energy assets,” said assets, capture competitive opportunities and be best
Randy Eresman, EnCana’s President & positioned to effectively respond to changing markets.
Chief Executive Officer. With this planned split into two companies, each man-
“While natural gas agement team will focus more directly on the critical
prices are currently success factors in its respective businesses. They will
low, we have re- be better equipped to direct their strategies and op-
duced our erations towards building value by tailoring practices
in the field – one time, easily and near-term and execution to fit the unique nature of their assets.
accurately – thus eliminating the paperwork headaches that The two companies will be focused on achieving at-
have plagued the industry. Details collected in the field are commodity tractive total shareholder returns through a combina-
instantly accessible at head office and seamlessly integrated price risk by hedging tion of growing production and reserves, achieving
into backend systems, expediting payroll, accounting and proj- a significant portion of strong refining margins, paying a meaningful dividend
ect reporting. our expected production for and by investing free cash flow in share buy backs.
Singletouch is a comprehensive solution that easily the 2009-2010 gas year. We are a With greater transparency and focus, the investment
integrates and shares data with traditional accounting, payroll leader in low-cost natural gas pro- community will be able to more easily follow and more
and other reporting software, in addition to generating its duction and our continued pursuit of accurately assess and value these companies.
own customizable reports. Once data have been entered, that objective helps us enhance our
project managers and office administrators can use the data for competitive position during periods of low EnCana shareholders to own one share in
invoicing and reporting, even before the team has returned commodity prices. Over the longer term, we each of the two companies
from the site. believe the current low natural gas prices are The proposed transaction would be
not sustainable and we expect a implemented through a Plan of
Enter data once recovery in prices in 2010,” Eresman said. Arrangement under the Canada
In an industry where cash flow is critical, and timely and Business Corporations Act and
accurate billing essential, this back-office integration eliminates Strengthened foundation for creating two leading is subject to shareholder
paperwork bottlenecks.Accurate details are entered in the sys- energy companies approval, approval of the
tem only once, at the time and point where the transaction “In addition, the financial and operational strength of Court of Queen’s
occurs, and delivered instantaneously to all stakeholders, elim- each company’s asset base has improved during the past year.
inating the logjams and errors traditionally associated with the Additional drilling in our natural gas shale plays has advanced
filing of paperwork and subsequent re-entering of details to our understanding of their enormous potential and increased
create invoices and reports. our confidence in our ability to grow these prolific new nat-
At any time, built-in reports provide an up-to-the-second view ural gas supplies from the Montney, Horn River and Haynesville Bench
of project completion status, with all work and materials accu- plays.With the start up of two new phases at Foster Creek and of Alberta,
rately accounted for, and actual performance against budgets continued production increases from Christina Lake, gross pro- receipt of ap-
and schedules easily reported to the customer. duction from these enhanced oil recovery projects now exceeds propriate regulatory
Ultimately, Singletouch has designed a solution for con- 100,000 barrels per day, a significant milestone in the long- approvals and satisfaction of
tractors that will not only help them to conduct their busi- term oil growth plan for the assets that will be transferred to other customary closing conditions. Under the pro-
ness more effectively, but also provides their oil and gas Cenovus. Construction of our coker and refinery expansion posed transaction, EnCana common shareholders will
company customers with unparalleled insight into their busi- (CORE) project at the Wood River refinery is past the mid- retain their EnCana shares and receive one Cenovus
ness, with accurate, timely reporting on the budget and point. It is on time and on budget, and is expected to start up common share for each EnCana share held. EnCana in-
status of major projects. If you aren’t getting this kind of expanded capacity in early 2011. And overall, looking at the tends that the initial combined dividends of the two
information from your contractors, then maybe you need to financial position of EnCana, our debt at August 31, 2009 was companies will be approximately equal to EnCana’s
ask them why not. about $8.2 billion, down about 19 percent from when we first current dividend of US$1.60 per share annually. Future
I
t’s understandable to think this recession has put a mary force in driving the national economy.
damper on “green” or environmentally friendly busi- image with both customers and suppliers.” Since its inception in 1979, as a small event in British Columbia, Small
ness practices. Going green or staying green may be a Tax credits and incentives for energy efficiency and Business Week® has grown substantially in both size and scope. Now a
luxury many struggling businesses simply can’t afford other green incentives are being pushed from Ottawa all nationwide celebration of entrepreneurship, Small Business Week (SBW)
these days. the way down to local municipalities. Most utilities now continues to pay tribute to the important contribution that small busi-
But while that may have been the case for past down- offer businesses incentives to reduce energy use. Hydro nesses make to the national economy. SBW activities provide established
turns, times have certainly changed. For starters, many Quebec, for example, offers financial assistance for elec- and prospective entrepreneurs with training and development oppor-
green initiatives save companies money. tricity-saving industrial equipment, systems or processes. tunities, and create a forum for networking and sharing ideas. Events in-
Catherine Swift, president and CEO of the Canadian clude conferences, trade fairs, seminars, workshops and business
Federation of Independent Business (CFIB), which repre- Keeping ahead of the law and public opinion luncheons. BDC branches, with the assistance of numerous local public
sents 105,000 small businesses nationwide, says she’s seen Lower operational costs aren’t the only reason to reduce and private sector organizations, play an active role in planning and pub-
no indication from her members that saving the Earth is energy use. All levels of government, including local, are licizing these events.
taking a back seat to saving the business. introducing laws and regulations that will require compa-
“One reason is that for smaller companies, the recession nies to reduce waste and embrace more sustainable busi- SBW theme: Your dream, your business, your passion
hasn’t been as dire as for large firms that are driven by the ness practices. Entrepreneurs are idea people – filled with ideas, aspirations and
stock markets. Our members are privately owned compa- For example, once cap and trade rules become more objectives. They see an opportunity at every turn and are continuously
nies, and among them, we’re continuing to see a focus on widespread, Bergeron said companies will need to be care- looking for improvement. An entrepreneur’s life is frenetic, powered by
environmental practices,” she says. ful about how much carbon they produce. a seemingly unlimited vitality. The entrepreneur’s tenacity is surpassed
A 2007 CFIB survey found that energy conservation “Reducing your energy use – and thus, your carbon only by a strong passion for business.
ranked as the second most important environmental issue footprint – should be part of any business plan. You can The theme of Small Business Week 2009,“Your dream, your business,
after recycling of materials, with 83% of its members hav- start with something as simple as reducing your corpo- your passion”, reflects the energy and efforts of Canadian entrepreneurs
ing already implemented energy conservation changes. rate travel by using inexpensive videoconferencing tech- of all ages and pays tribute to their important contribution to the
While about half of respondents said cost savings was a nologies like Skype,” he says. “But the most important strength of the economy. It will also be the background for all the
factor in making changes, 81% said they were motivated building block should be an energy efficiency audit of activities that will take place throughout the Week.
by their own personal views. Swift says that trend appears your workplace. ”
to be holding. Business owners that act early will find themselves at
“These companies are motivated primarily by the a competitive advantage when new rules are imple-
owner’s personal views about the importance of protect-
ing the environment for future generations. Embracing
mented.
“At some point, the consideration of environmental and
Young Entrepreneur Awards
environmental practices isn’t something you usually have social issues will be mandated, so for business this becomes
T
he Young Entrepreneur Awards (YEA) were established by BDC in
to convince them to do,” says Swift. a central risk factor. It also becomes an opportunity. 1988, and are presented each October during Small Business
Of course, it’s always nice if a company can help the Companies shouldn’t wait until the economy picks up,” Week®. One winner in each province and territory is selected to
environment and its bottom line at the same time. A quick says Melissa Shin, managing editor of Corporate Knights, a receive the award in recognition of their spirit of innovation and busi-
Google search will turn up thousands of web pages on magazine focusing on corporate responsibility. ness acumen. Nominees must be young entrepreneurs between the ages
how companies of all sizes can be both green and prof- of 19 and 35.
itable. Attracting a green workforce Nominations may be submitted by individuals, associations, organi-
First, there’s the low-hanging fruit, things like printing Companies that don’t embrace environmental prac- zations, and various levels of government.Young entrepreneurs may also
on both sides of paper, recycling, switching to energy- tices could also find themselves as a competitive disad- nominate themselves.
efficient light bulbs, turning down the thermostat and vantage in attracting young, skilled employees. Today’s All nominees are judged using the same criteria: the company’s suc-
shutting off idle office equipment. Natural Step Canada young workers are more environmentally aware than pre- cess and growth potential, innovation and community involvement.
(www.naturalstep.org) has a free sustainability toolkit that vious generations, and they’re bringing those values into The panel also considers the company's export performance, the entre-
can be downloaded from their website. Another helpful their workplaces. preneur’s age when the business was established, and any special chal-
resource is a book authored by Bob Willard entitled “The “BDC, for example, is heavily paper-based and this be- lenges that were overcome.
Business Case for Sustainability”. comes an irritant for our younger employees who view Winners are selected by a panel of judges comprised of business pro-
According to Willard, integrating sustainability strate- paper as a waste of resources,” says Bergeron.“They’re put- fessionals, entrepreneurs, members of local Boards of Trade and
gies can increase profits up to 38% for large companies and ting pressure on us to move more quickly to change our Chambers of Commerce, and BDC employees.
66% for small- or medium-sized companies over a five-year ways, and we are. Each year, the awards ceremony is held in a different city. Award
period. A lot of these savings can be achieved by reducing Companies that incorporate environmental responsi- recipients are presented with a commemorative trophy, and applauded
energy costs. bility into their mandate will also tend to have more loyal by the business community for their hard work and ingenuity.They ben-
“If your energy costs are high, you certainly have an employees who are more willing to make sacrifices, if efit from nationwide media visibility, unparalleled opportunities for net-
incentive to reduce them,” says Michel Bergeron, Vice needed, during a recession. working with other entrepreneurs, valuable media training and many
President, Corporate Relations at the Business Development “Embracing environmental and socially sustainable skills development opportunities. The 2009 YEA gala will take place in
Bank of Canada. “But even if they aren’t high, cutting practices is a great way to retain your staff in an econom- Ottawa on October 20.
your energy costs can give your company a competitive ic downturn,” says Shin.
C
olfax Corporation a “The lone worker legislation may be new, but
global leader in fluid- we’ve been doing some real pioneering here in
handling solutions for Calgary on this topic for some time,” said Steve Roberts,
critical applications in the vice-president for Rogers Wireless in Alberta. “We’re proud to
most demanding environ- partner with innovative companies like Blackline GPS, Premier GPS
ments, has unveiled a new and NelTrak to create and provide simple wireless technologies that
approach to handling high- help keep people safe, no matter where and when they’re working.”
and low-viscosity fluids that Until recently, there have been few options available for employers to meet
require high pressure boosts lone worker requirements. While some use costly call centers to check in on workers, others
in the transport of crude oil. opt for a low-tech solution like having workers call into the office.
The Colfax line of rotar y Rogers Wireless has worked with its local partners to improve lone worker safety by pro-
positive displacement (PD) ducing well-tested, reliable and portable wireless safety communication products.
screw pumps not only For a tiny, fits-on-the-hip option, there’s the Loner by Blackline GPS, a manufacturer of com-
delivers the unsurpassed relia- munication technology security, tracking and monitoring devices. The size of a mobile phone,
bility required in crude oil the Loner is worn by the lone worker and constantly provides its GPS location. It also includes
transport applications but a panic button for emergencies and motion detector that tracks lack of motion which can in-
responds to growing Oil & Gas dicate a worker in distress.
industry demands for higher The SafetyBerry is a BlackBerry application by Calgary’s Premier GPS. Available on the
energy efficiency and greater BlackBerry Curve and Bold, it offers advanced real-time GPS tracking functions and ways for lone
environmental responsibility. workers to indicate distress or check in with their employer with the click of a few keys.
“Rotary pumps have been For oil and gas workers traveling alone in their vehicles, NelTrak, a Calgary wireless solutions
the standard in delivering high-efficiency, low-maintenance solutions for critical fluid handling provider, offers several options including a GPS unit with built-in panic button that is installed
in the past,” said John A. Young, president and CEO of Colfax. “But the perception that screw in vehicles, a FOB that workers can carry with them, and a portable unit that can be strapped
pumps mean higher expense is simply outdated, preventing oil transport companies from taking onto an ATV or sled. Each option can be monitored 24/7 by highly trained oil and gas special-
full advantage of their significant benefits for energy savings and reduced environmental impact ists in a technical centre—a one-of-its-kind approach in the oilpatch.
in these applications. “These are all home grown solutions,” said Roberts.“They are great examples of Alberta busi-
“In fact, rotary PD screw pumps actually offer tremendous cost advantages,” he continued. nesses pioneering in technology to promote worker safety in an easy and affordable way.”
“A typical Colfax solution on a single 250,000 BPD crude oil pumping station in Western Canada To further ensure lone worker safety, especially in Alberta’s oil and gas industry, Rogers
– using three rotary PD screw pumps operating in parallel with one standby pump – delivers a Wireless announced in June a $42 million expansion of its world-standard GSM wireless voice
29 percent reduction in combined capital, energy and maintenance costs over a five-year period, and data network. The expansion adds 49 new wireless sites expanding coverage throughout
when compared to the traditional centrifugal pump solution of two pumps operating in parallel the energy heartland.
with one standby pump. That translates into more than $7 million in savings to own and oper-
ate a rotary PD screw pump solution over five years, a concept that we call Total Savings of
Ownership at Colfax.”*
“We’ve also taken the lead at Colfax in developing various shaft-sealing solutions, for the
industry to address market demand for reduced process fluid emissions,” Young noted. “Like the
Nexen helps build the next
rotary PD screw pump designs themselves, they are efficient and reliable, providing operators
with the highest level of safety.”
generation classroom
According to Mike Moore, a product specialist in crude oil transport for Colfax Americas –
the division responsible for Colfax customers in North and South America – Western Canada rec-
Nexen Theatre is one of the most technologically
ognized early on the advantages of the screw pump’s simple, but robust design. “Oil companies equipped conference facilities in Canada
have used screw pumps to move crude oil to market for the past 30 years; and in Alberta and
Saskatchewan, screw pump lines manufactured by Colfax handle 4.8 million barrels of crude oil
N
AIT is celebrating the official opening of the Nexen Theatre with the announcement
each day,” he said. of a $1 million donation from Nexen. “Industry partners such as Nexen are critical in
The hydraulic principle behind screw pump operation delivers both high volumetric and providing our students access to the latest technology,” says Dr. Sam Shaw, NAIT’s
high overall operating efficiencies, he stated, in addition to offering long mean time between President and CEO. “Nexen has made a significant contribution to build a high-tech distance
repairs (MTBR) and ease-of-maintenance features for field servicing, which combine to maximize education facility. Nexen’s leadership as a company is shown in their support for NAIT to have
operational uptime. Other value-added advantages of these pumps include: Constant flow, even the technology to train workers anywhere, anytime, to be globally competitive.”
in the presence of varying system backpressures Non-pulsating flow, without the need for pul- “As a company with operations across Canada and around the world, Nexen knows first-
sation dampeners Low noise and vibration levels, minimizing foundation requirements hand the importance of effective communication,” said Marvin Romanow, Nexen President and
Keith Schafer, vice president of sales and marketing for Colfax Americas, underscored the com- CEO. “This next generation classroom will
pany’s commitment to expanding the use of rotary PD screw pump systems throughout the allow students the ability to communicate and learn in a virtual environment.The advances
industry.“Colfax’s strong portfolio of screw pump designs from global brands Allweiler, Houttuin, in technology that this facility offers will greatly enhance student learning and development.”
Imo, Tushaco and Warren means that we can provide more product solutions than any other PD Some of the features the theatre boosts include a 19 foot by 7.7 foot screen, a 103-inch plas-
pump manufacturer on the globe. But product is just the beginning of our Total Solutions ma screen, a high definition camera with remote capabilities, Dolby sound and five computer
approach.We also bring deep expertise in critical Oil & Gas applications, including crude oil trans- stations connected to the screen which allows for group work.
port, and provide ongoing service and support to our customers, from assessing their specific “The Nexen Theatre is about possibilities,” says Dr. Shaw. “The equipment is the most tech-
needs to designing and implementing solutions that meet those needs to providing ongoing mon- nologically advanced available for this type of facility, so I am very excited about how it is going
itoring and maintenance. to be used to enhance our students’ learning experience.”
“As true partners, we help our crude oil transport customers – and ideally the Oil & Gas NAIT is one of the preeminent institutes of technology in Canada, providing real-world
industry at large – balance reliable and efficient performance, fiscal responsibility and environ- education in business, advanced technologies and skilled trades to more than 84,000 learners
mental stewardship with fluid-handling solutions that improve business and grow the bottom line,” worldwide. Known for student success,
Schafer concluded. NAIT also engages with business and industry in applied research and innovation and pro-
www.colfaxcorp.com vides corporate training around the world.
PFM Manufacturing, Inc. Build one of The Most Versatile, Most Extreme,
Heavy Duty Remote Access Vehicles for Oil and Gas Exploration
Question / Answer
A
s Natural resources are often located in remote swampy areas, accessing these areas by
helicopter can prove be expensive. The Land Tamer has been identified as an economic Q: How does the Land Tamer’s hydraulic gear drive system work?
means to keep costs down when servicing remote gas line well heads. The Land Tamer’s® A: The Land Tamer’s hydraulic gear drive system utilizes the proven benefits of a closed loop
unique drive system allows the installation of tracks over the tires for year around use in any hydraulic drive system that is found in mobile and construction equipment applications, such as
terrain type. This is a unique capability and strength of the Land Tamer’s® go-anywhere, any- skid steer loaders, etc.
time, easy mission configurability. Q: What is a closed loop hydraulic drive system?
A: Closed loop system means that hydraulic oil flows from a pump to drive a motor and back
to the pump completing the loop. Most closed loop drive systems utilize a variable flow displace-
ment pump that flows to the drive motor. Nearly all the hydraulic oil flow from the pump drives
the hydraulic motor in a closed loop system, but a small percentage of the hydraulic oil redirected
through a cooler and back to the tank.The Land Tamer utilizes commercial grade, Made-in-America
Eaton Hydraulics tandem pumps and motors, in which one pump drives the left motor and the
other pump drives the right motor. The left drive motor delivers torque to the left side wheels
and the right motor drives the right wheels. The benefits are proven reliability and availability.
Q: How is the torque delivered from the hydraulic drive motors to the wheels?
A: A pair of powerful Eaton 6000 Series hydraulic motors is connected to parallel reduction gear-
boxes that are coupled to a set of right-angle gearboxes at each axle on each side of the vehicle.
This parallel gearbox is coupled to a common drive shaft that supplies equal torque to all axles on
each side of the vehicle.
Benefits – this system allows maximum torque to all wheels no matter which tires have the
most traction with the ground. Maximum torque from the engine and pumps can be delivered no
matter how many wheels are off the ground as when crossing ditches or large obstacles. Virtually
no maintenance or adjustments are required either.
Continues on page 24
Storied History
PFM Manufacturing, which was founded by Patrick F. Miller Sr. in 1998, was successful in
developing, patenting and introducing the new Land Tamer 6x6 ATV to fill a niche in the mar-
ketplace for a heavy-duty, low-impact, commercial grade amphibious all-terrain vehicle.
As the company’s commercial market grew for the Land Tamer ATV, it became apparent that
a larger Land Tamer ATV was needed. In 2000 the Land Tamer 8x8 model was introduced to
fill the need for a heavier hauling amphibious vehicle. In conjunction with introducing the Land
Tamer 8x8 ATV, commercial customers demanded a diesel model. Consequently, in 2001 PFM
introduced the first diesel engine powered Land Tamer 8x8 ATV.
In 2005 the name “Remote Access Vehicle” (RAV) was chosen to differentiate the Land
Tamer from other ATVs. Coinciding with the new name reference were new design im-
provements and upgrades to the vehicle that made it even more capable and more versatile
than ever before.
“The new 2005 Land Tamer II RAV featured taller, more durable truck or Ag tires, higher
ground clearance, larger cargo capacities, and a sealed hydraulic gear drive system,” he says.
“Other upgrades included a simple to use T-handle or electric joystick control, and a more pow-
erful, external mounted water propulsion system.”
In a paper delivered at the International Conference on observed that the most successful yards in his study utilize complete
Computer Applications in Shipbuilding (ICCAS) held in Shanghai, Dr. models consisting of geometric and attribute information. Each model
Oskar Lee explains how these shipyards have managed to achieve was not merely a drawing or a series of drawings. Rather, the model
such impressive results. was contained within a database from which drawings, machine cut-
According his analysis, the most successful shipyards link the ting code and other information could automatically be derived and
geometry and associated material data from 3D models to data- shared amongst various departments.This dramatically simplified the
bases such as ERP systems so that information can accurately be ability to accurately make changes, thus increasing productivity.
shared and utilized by various departments to plan efficient pro- All of the shipyards in Dr. Lee’s study used ShipConstructor soft-
duction. In this manner, critical path issues are identified and re- ware during the detail design process. Because ShipConstructor
sources effectively deployed. uses a data-rich 3D model capable of linking to other databases, the
His research also indicates that effective change management is use of ShipConstructor was a key reason for the shipyards’ pro-
important due to frequent modifications requested by owners and ductivity in oil rig fabrication.
classification societies. To accommodate these changes, Dr. Lee www.shipconstructor.com
W
ood Group Logging Services, part of international energy services company
release. What bits are used, what mud John Wood Group PLC (“Wood Group”), has introduced a new cement bond
weights are applied, important notes evaluation service designed for deeper wells with wellbore conditions up to
and comments from the rig manager,
500° F (260° C) and 30,000 psi of hydrostatic borehole pressure.
etc. all recorded on a daily (sometimes
The service is accomplished in a single well logging run by using a new 360° radial
hourly) basis. Thanks to this readily
available information, our collective measurement that identifies potential channelling, void areas around the casing and in-
knowledge on drilling techniques and adequate bonding. The resulting evaluation confirms intervals of good cement bond that
strategies throughout our province is adequately isolate zones, and minimizes nonessential remedial cementing.
unmatched. “This new cement bond evaluation service is expedient and cost-effective, and builds
This information is critical to well planning, benchmarking drill performance, and analysis upon our reputation for providing outstanding service in hostile downhole conditions”
on past wells drilled…an imperative practice to any efficient drilling department or service stated John Paul Jones, president of Wood Group Logging Services. “The service expands
company.
the operating range for cement bond evaluation and will enable our clients to make bet-
It’s not enough to know your own wells: you need to know what’s going on around you.
Tour sheets hold very valuable information, but in a very inaccessible format. It is very time ter informed decisions on deep high value wells.”
consuming, depending on photocopies and trips to the ERCB Core Research Center to access
this data, yet that is the only way that companies can review tour information on-demand. In
cooperation with CAODC, companies have built advanced systems to capture this information
in a digitized format…and yet the information is still stored publically in paper/hardcopy
format only.
The challenge is now to make it available to those who need it. XI Technologies has
responded to demands from the drilling industry for better access to this vital tool for diligent
drilling practices.
XI discovered a clever way to make this data available to the industry…share it. There’s no
secret that operators/service companies have their finger on the pulse of their offsetting com-
petitors…there are also no secrets contained in tour information, considering the sheets are
publically available.
Through XI’s TourXchange agreement, operators have mutually agreed that the value of this
information (in digital form) is immeasurable in terms of drilling efficiency, cost savings, and over-
all drilling performance. Therefore, in order to access digitized tour records of offsetting oper-
ators, they have endorsed the philosophy by offering their own digital data into the collective
TourXchange database. The program is simple – share the digital version of the already-public
tour sheets and in turn, they can access the digital tour reports of existing participants.
Acceptance of this program has been quite positive so far, building a database of over 40,000
wells worth of digital tour data. As the concept gains further recognition, the TourXchange data-
base will eventually contain a major portion of the digital drill records throughout Western
Canada in the next year.
Researching pacesetters, understanding the problems of historical wells that offset your
locations, and having a general knowledge of best-drilling-practice is key to prudent drill planning.
Data is the key to building these types of analytical tools, and now the industry can finally make
use of the information that was previously locked away in paper documents.
“They went and got my things for me out of my office, and ‘allowed' me one phone call,” he
recalls, “it just happened to be April 1st.”
Spence was shocked.While his company had been letting people go since January, his cowork-
ers were as surprised as he was. He'd been an exploration manager with Talisman Energy for 22
years and, just one month before, was given a glowing performance appraisal. There was no
advance notice.
Two minutes after being informed he was let go, a representative from Toombs Inc. – a career
transition service – introduced herself to Spence. Almost four months later, Spence is in a very dif-
ferent position indeed. On July 27, Spence started his new job, as exploration manager with
TransGlobe Energy. He chose the position with TransGlobe over another excellent offer from a
different company. His compensation package is “equal or better” than his equivalent position at
Talisman. As Spence freely admits, however, he got there with significant help.
“We help people (who have just lost their jobs) in a variety of ways,” says Kathleen Wollenberg,
vice president and general manager of Toombs.
“For people (like Spence) who haven't had to look for work in years and years, it can be very
scary –looking for work is a process that requires a lot of different skills.”
At the professional career level, simply skimming the classified ads just isn't good enough. It's
not unlike fishing – the big fish aren't caught with luck, but with patience and skill. For many pro-
fessionals suddenly thrust back into the marketplace, they need to re-learn even the most basic
but necessary skills – including the seemingly basic skill of resume writing.
“I'd always kept my resume up to date, but again, it had been 22 years since it saw the light
of day,” says Spence. “Things change in 22 years – especially style and format.”
Spence attended a resume workshop, with about 12 other Toombs clients, which included in-
struction, time to re-write, and one-on-one counselling and proofing. The result? A much better-
looking, and in Spence's case, concise resume.
“It was six or seven pages before, which I had thought was more impressive,” he chuckles.“It's
about half that now, with nothing missing and much more concise reading.”
Another vital career management skill many professionals lack, says Wollenberg, is just learn-
ing who’s really hiring: she estimates “a full 80% of jobs at this level aren’t advertised. Even if they
are, she adds, they're usually still hired through referrals and networking.
“Our program really emphasizes the importance of networking,” says Wollenberg.“So many peo-
ple have told me they’d always blown it off, but the light goes on and they say ‘I get it now.’”
“Networking is so important – you need to have a lot of people in your camp” agrees Spence,
adding that one of his two offers came via a colleague in a similar position.
Skills aside, Spence says one of the most important things Toombs did for him was also one of
the simplest: it gave him a place to work.
“I felt lost without an office,” says Spence. He’d had an office downtown for 22 years. He was
used to working in a professional setting, and wasn’t comfortable working from home.To address
this feeling of disorientation, Toombs gives its clients access to a “bullpen office,” with computers
and private booths to make calls.
“Toombs was like a transition home,” Spence laughs.
In a buyer’s market for work, mastering as many career management skills as possible is vital.
While Alberta’s unemployment rate is the lowest in the country, it’s still on the rise. In June, it
reached the highest percentage since November 1996 – 6.8%, up from 6.6% in May.
Companies forced to let some of their people go can still help them by engaging a career tran-
sition service, says Briar McGinnis of Alberta Employment and Immigration. “I think there’s more
overall sensibility now than before – at lot of companies hire private contractors to assist after
layoffs,” he says.
The Alberta government also offers career transition services, he adds, up to and including
financial assistance.
S
imple, portable, and easy to use are deceiving
words for such complex technology, but this is
exactly how Inmarsat’s Broadband Global Area
Network (BGAN) service works. The BGAN system
utilizes three powerful Inmarsat 4 (I-4) satellites to
provide broadband coverage anywhere in the
world. On Thursday, Sept 10, Inmarsat, their
distribution partner Stratos Global, and service
provider Infosat Communications LP came to-
gether in Calgary to demonstrate the technology
behind the BGAN terminals and their applications
within the oil and gas industry.
After a brief introduction and explanation of sev-
eral BGAN features, Guy Mariz of Inmarsat gave the
step-by-step demonstration showing how quickly
and easily a BGAN terminal is set up.
Within five minutes, including a detailed expla-
nation of each step, the Explorer 700 terminal was
up and running.The BGAN terminal had located the
satellite, registered the user, and accessed the inter-
net, all through Mariz’s laptop. A quick Google
search illustrated the connection speed.
The Explorer 700’s standard variable bit rate is
492 kbps, but if a guaranteed service rate is need-
ed streaming at 384 kbps is possible, explained
Mariz.
“Automatic setup is also possible,” Mariz says.The
BGAN terminal uses a single SIM card which is pro-
grammable for specific users, streamlining the setup
process.
“BGAN excels as a mobile device,” he says, “You
only pay for what you use, per megabyte or per
minute.”
BGAN terminals are able to simultaneously uti-
lize voice and broadband data transmissions. Mariz
demonstrated this by simply plugging in a regular
telephone and placing a call. By building upon Inmarsat’s global satellite coverage through the I-4 network, and Stratos
“BGAN gives anyone the connectivity they would enjoy in an office anywhere in the world,” Global position as the only first tier BGAN service providers in Canada, Infosat offers 24/7 cus-
he says. “Essentially you can replicate your office.” tomer support and the right BGAN solution to resolve unique communication challenges in
The terminal uses Launch pad, a simple interface, and is compatible with all Microsoft prod- the industry.
ucts, Citrix and many FTP programs. There are several terminal types based around the needs
of industry. Many terminals offer Ethernet, Bluetooth and USB connections for a variety of lap-
tops. One BGAN terminal has the ability to support 11 simultaneous users.
There are several different access terminals available, each with their own unique features.
Each access terminal is designed for portability and will fit easily in a laptop bag or briefcase,
making it ideal for use in remote locations, man alone situations, and at the exploration phase.
BGAN easily allows workers to remaining in touch, instantly sending photos, reports, and
updates back to the office.
Next, BGAN’s video conferencing capabilities were highlighted as he connected with a col-
league in Inmarsat’s London, England office.
“We’ve had many requests for video conferencing from our oil and gas clients,” says Dale
Gamber, Infosat communications vice-president of sales and marketing. The video conferenc-
ing capabilities are becoming more commonly used all the time, says Gamber.
“It’s surprising what a powerful tool it is. Companies are able to get their message out to
everyone at the same time,” he says.
Two additional products were demonstrated using the BGAN network, a Frontline
Communicator by AudiSoft Technologies and AFIANT Satellite Network Video Management
System by Modern Security Solutions LTD.
The Frontline Communicator is a small portable device with a small camera attached to a
headset, for hands-free use, and its own interface. The communicator was designed with
telemedicine or off-site expert advice in mind. Users are able to connect to the BGAN net-
work, and communicate through voice and live video, with an expert who may be located
half a world away.
The AFIANT Satellite Network Video Management System is a unique security offering
jointly offered through Stratos Global and Modern Security Solutions LTD. AFIANT provides
a cost effective solution for video surveillance and monitoring of remote assets.
By utilizing the BGAN background IP channel, user’s can implement motion triggered record-
ing, and view or manage the information from anywhere in the world.
“The balance BGAN strikes between portability and data capacity makes it the prefect
solution for our customers,” says Sarah Crew, Infosat’s sales and marketing coordinator. “The
portability and easy use of the terminals are where BGAN really shines.”
Infosat Communications LP is a complete communications solutions provider located in
Calgary,Alberta.As one of North America’s leading providers of satellite communications, BGAN
was a natural addition to Infosat’s services.
T
he Jumbotron design utilizes GHT’s latest Aluminum Technology
Pumps from Moyno, Inc. provide to cut more than 50% of the weight out of previous
numerous performance enhanc- 3000HP designs, 30% out of 2500HP designs and
ing benefits in upper- and lower-deck even cuts 27% out of the 2250HP designs.
FPSO applications in the oil and gas in- Combined with our industry partners we are able
dustry. to help the industry design some of the first Canadian
Moyno Progressing Cavity Pumps pro- road legal 3000HP Frac Pumpers in the market today.
vide the ultimate in positive displacement The math was easy.
pump versatility as they are capable of With an average well requiring up to 50,000 HP to
cost-effectively handling clean and oily Frac the current fleet of 2250HP pumps requires a mini-
liquids as well as corrosive fluids and mum of 23 units at site. A fleet of 2500HP pumps requires 20
thick, abrasive slurries and sludges, even units at site. The cost savings of getting to 3000HP boils down to the
with viscosities over 1,000,000 cps. The math. With a 50,000HP well, it only requires 17 units on site vs 20 or 23
product line includes models capable of units previously. That’s an immediate 15% improvement (compared to 20 units) or a 26%
generating flow rates up to 2,500 gpm improvement when compared to 23 units on site. When the capital cost of the fleet and the
and pressures to 2,100 psi. Moyno pumps labor to operate the fleet is factored in, it’s adds up as a major cost savings for the industry.
are well-known for low maintenance, dependability and long service life which result in low overall If the math was that easy, why was it never done before? The issue was always the weight
total cost of ownership in both top-side and hull-side applications.Their high performance, progressing of the radiator. To get an extra 500HP cooled you needed
cavity design results in a gentle, low shear, pulsation-less discharge. larger radiators than 2500 or 2250HP units. Larger radiator
A variety of proprietary Ultra-Flex® stator elastomers and Ultra-Shield® rotor coatings sustains peak meant more weight. More weight on the cooling system
pumping efficiencies, minimizes maintenance and extends useful service life even in the most cor- added up with more engine wet and a heavier transmission
rosive and/or abrasive service environments. meant the units could not pass legal road bans.
Typical Moyno Progressing Cavity Pump applications include the following: GHT combined with a few select industry partners and
• Desalter • Oily Bilge Water reduced weight on our cooling system by 50% in the
• LP and HP Flare • Diesel Fuel Generator Feed 3000HP application and are able to certify the 3000HP
• Closed Drain • Drilling Mud Transfer pumps as road legal.
• Sludge Drain Contact GHT today for more information.