N E W S / O P I N I O N / E V E N T S / R E S O U R C E S A N D M O R E > > >
by Eduardo Manrique and Donovan Symonds The merger of Norwest, Applied Hydrology International, and Questa Engineering Corporation has created a powerful entity that is more than a sum of its parts. Where do our integrated services intersect and what will our strategies be for us and our clients in the next ten years? This question can only be answered by looking at one issue at a time. Lets start with carbon dioxide. The efect of increasing atmospheric carbon dioxide (CO 2 ) concentration on global warming has been one of the most important environmental debates of the past decade. Because CO 2 emissions are part of the value chain from coal mining to CO 2 sequestration (Figure 1), its importance to our companies and to our clients cannot be overstated. Although an important number of countries have not ratifed the Kyoto agreement, some of them, notably the United States, are heavily involved in clean coal and CO 2 sequestration programs. CO 2 emissions trading, carbon credits, and concepts such as zero emission power generation from coal (DOEs FutureGen) will have an impact on the future business and operations of our clients and us. Many consider CO 2 sequestration truly a win-win solution. It would enable utilities to generate power from indigenous, predictable and low cost coal while drastically reducing atmospheric CO 2 emissions. These efects are further magnifed by the recent increases in gas and oil prices and concerns related to unstable Middle East oil supplies and nuclear proliferation. It is widely accepted that the most important way to reduce CO 2 emissions is through sequestration in geologic formations, one of Questas strengths. It can be implemented using two strategies: frst, storing CO 2 in saline formations, i.e., deep aquifers and depleted oil/gas reservoirs; second, and the most evaluated approach, injecting CO 2 in wells to produce hydrocarbons, known either as Enhanced Oil Recovery (EOR) or Enhanced Coalbed Methane (ECBM). The second strategy is preferred because CO 2 fooding from natural sources is a proven and an increasingly used technology for boosting oil production in mature oil felds. More importantly, increased oil or gas production represents an incentive to generate the capital to fund these kinds of projects and increase oil and gas reserves. However, it must be recognized that the costs of purchasing CO 2 from power plants will be higher than the costs of CO 2 from natural sources (Figure 1). CO 2 sequestration projects from anthropogenic sources and especially in ofshore felds require the development of government incentives and policies that promote investment in the CO 2
infrastructure. Continued high oil and gas prices will tend to accelerate this investment. If we look at oil production trends in the United States and only those coming from CO 2 injection projects during the last 20 years, the number of proposed or ongoing initiatives of EOR-CO 2 injection projects from international anthropogenic sources (Table 1) shows that CO 2
sequestration in geologic formations will play a key role in coal, gas, and oil industries as well as in power generation sectors in years to come. Contd on Page 3 Just Another Day i n Paradi se > p2 Questa Cour ses > p3 Nor west s Successi on Pl anni ng > p3 Presi dent s Message > p4 Vancouver Doubl es > p4 Mozambi que > p5 From the Ri ddl e Master >p5 Ashl and Of f i ce Rel ocates >p6 CO 2
A Business Opportunity Figure 1: Schematic of integrated power generation with CO 2
sequestration. N E W S / O P I N I O N / E V E N T S / R E S O U R C E S A N D M O R E October 2005 Just Another day in Paradise! by David Wright In July 2001 we were approached by AXYS Environmental Consulting Ltd., of Calgary for assistance with a proposal for Caves of Barbados, one of their repeat clients. The work would be to produce an integrated development program for Harrisons Cave and its associated sites and would involve such people as cave specialists, environmentalists, land use planners, engineers and economists. Specifcally AXYS was looking for expertise in emergency response planning and underground mine rescue; a task ideally suited to David Wright from the Calgary ofce. Harrisons Cave, located in the centre of Barbados, is a series of natural underground caverns that was developed as a show cave during the 1970s. At the opening ceremony, it was estimated that 100,000 people would visit the cave annually. However, by 1997 over 190,000 persons per year toured the cave and it is presently one of the most popular land- based attractions in Barbados. AXYS were awarded the job in early September 2001, a few days before the events that were to become collectively known as 9/11. The aftermath of those events decimated the tourism industry and, as time passed, the idea of a mining job in Barbados faded; that was until December 2003 when we received a call announcing that the Barbados job was a go, and how soon could we be ready. Working with Charles Yonge, the owner and operator of Canmore Caverns Ltd. and a recognized cave expert, a hazard assessment was completed; a risk matrix then prepared and an Emergency Response Plan developed. The intent was to provide a plan together with a recommended list of rescue and safety equipment which would allow fexibility without compromising safety. The very high humidity in the cave environment really gave us a challenge when it came to using our standard gas detectors and mine ventilation measuring devices. However we were able to apply some special calibration that allowed the instruments to function adequately. We found that ventilation air quantities and oxygen content were very low and while it would have been easy to recommend the installation of large fans, we had to remain sympathetic to the many cave features that would be afected detrimentally by even the smallest amount of drying out. Emergency access to the cave system, in the event of the main entrance being blocked, would be by natural cave routes which can be very difcult to negotiate by untrained personnel, efectively classifying the cave system as a confned space. To counter this worst case situation we developed conceptual designs for the construction of a vertical escape shaft that would also be equipped with high pressure and high fow fans capable of rapidly exhausting contaminated air from the cave system in the case of a fre or similar emergency. The shaft would then be used to send in rescue workers and evacuate visitors and staf. This was one of those projects where it was necessary to think outside the box and while it was sometimes a challenge working within such a diverse team it was nevertheless a very rewarding experience. Thanks to Jef Green, AXYS; Charles Yonge, Karen Rollin, and Chesterfeld Mayors, Barbados Fire Chief for their commitment, foresight and guidance. While all of this work was taking place we were able to spend a few days on the island of Barbados, often called Little England by the locals. Very friendly people, beautiful beaches and scenery, ideal weather and afordability make this a wonderful place to vacation, let alone work. When you do go to Barbados be sure to visit Harrisons Cave, drive the west coast, and visit Bridgetown and St. Lawrence Gap. You wont be disappointed. If you are interested in caving and live in, or visit, the Calgary area, visit Canmore Caverns where you can take in a wild cave tour. Again, you will not be disappointed. Useful links: http://canadianrockies.net/wildcavetours/ http://harrisonscave.com > Cont ac t Davi d Wr i ght , Seni or Pr oj ec t Manager and Manager, Saf et y, Heal t h and Envi r onment Nor wes t Cor por at i on, Cal gar y Tel : 403-237-7763 or dwr i ght @nor wes t cor p. com 2 O C T 2 0 0 5 N E W S / O P I N I O N / E V E N T S / R E S O U R C E S A N D M O R E Norwests Succession Planning CO 2 A Business Opportunity (contd from Page 1) Project Countr y Buracica and Rio Pojunca Oil Fields Brazil Weyburn Project Canada Ivanic Oil Field Croatia Sleipner Norway Recopol CO 2 -ECBM Poland Forest Reser ve & Oropouche Oil Fields Trinidad West Pearl Queen Field, CO 2 -ECBM Allison Unit and CO2 Injection in Saline Aquifer (Frio Formation) United States CO2 for EOR North Sea (CENS) North Sea 2000-mile CO2 Capture and Distribution in Gulf of Mexico (Kinder Morgan) USA/Mexico The issues are: What are the optimum methods for separating and concentrating CO 2 from the fue gas stream? What are the best formations to store the gas? Where are these formations? How much of the gas, if any, will leak from the strata either back into the atmosphere or into adjoining strata? What efects will such leaks have on the environment, particularly sub surface hydrology? And lastly, What will this all this cost and can some of the costs be ofset against enhanced oil or gas recovery? Norwests combination of oil and gas and CO 2 modeling expertise (Questa), our historical knowledge of geology and the coal industry and know-how in predicting liquid fows (Applied Hydrology) enable us to ofer unique expertise to research and industrial groups looking into sequestration applications. Current environmental trends and the level of activity related to CO 2
sequestration from power generation plants and many other industries suggest that the Norwest companies and our clients have potential business opportunities by joining all of our expertise in the chain of value from coal mining to CO 2 sequestration using EOR, ECBM, and other economic strategies. Short Courses During the past ffteen years, Questa has ofered successful industry short courses in the United States and throughout the world. Its professionals are leaders in the oil and gas industry and course instructors come from its senior engineering staf. In addition to the very popular Oil Field 101 course for nontechnical people held twice a year, Questa ofers multiple coalbed methane short courses, including an Introduction, Reservoir Analysis, Completions and Development, and the Infuence of Geology on Coalbed Methane Plays. Other ongoing short courses ofered are Enhanced Oil Recovery Processes, Successfully Awakening Mature Oil Fields, and Applied Oil and Gas Property Evaluation. All short courses can be customized and presented in-house to provide cost-efective training. In-House Courses In addition to its extensive list of short courses that can be tailored to a frms needs and given in-house, Questa now ofers a fve-day overview course in coalbed methane and a three-week detailed coalbed methane course from exploration to production that includes feld trips to more than fve facilities and one day fully devoted to water management. For more information : www.questa.com or call 303-277-1629 This past year has marked a record baby boom for the Norwest Group. There have been nine new little ones join the ranks over the course of the year. Due to careful resource planning, the children seem to be equally spread over the departments: Geology, Engineering, Geotechnical, Hydrology, Administration, and Accounting are all represented. Perhaps these kids will be working for you in 20 years... Fr om t op Lef t t o Ri ght : De nay a B o e s e, Ma t e o C a ni z a l e z ( Zul ua ga), Br y n Wi l s o n, Abi ga i l Ko s , Ar a nt z a Pe r e i r a a nd J a c o b Mc E nt i r e . Cent r e Lef t t o Ri ght : T he T hr e e Mus k a t e e r s Ama nda L e e, Rhe t t S awy e r , a nd Te y a h Br a i t hwa i t e . Questa Courses > Cont ac t Eduar do Manr i que, Seni or Res er voi r Engi neer Ques t a Engi neer i ng Cor por at i on (Gol den) Tel : 303-277-1629 or emanr i que@ques t a. com OR Donovan Symonds , Chai r man Nor wes t Cor por at i on (Sal t L ake Ci t y) Tel : 801-539- 004 4 or ds ymonds @nor wes t cor p. com 3 E N E R G Y , M I N I N G , A N D E N V I R O N M E N T A L C O N S U L T A N T S Presidents Message
Norwests mergers with Questa Engineering and Applied Hydrology were justifed on the basis of the whole being greater than the sum of the parts. We were convinced that 2+1+1 was greater than 4 and we are now pleased to confrm that it is closer to 7! Questa Engineering merged with Norwest in 2002 and Applied Hydrology joined us in 2004. The idea was that by joining forces we would be much stronger and grow much faster than we each would on our own. Im pleased to announce our success. Sales and profts for the combined company are at record levels and we are well ahead of our own projections for 2005. We are currently completing over US$2.5 million worth of consulting and engineering assignments each month. While most of the work is in North America, we are performing an increasing amount of work in Asia, Africa, Europe, Australia and South America. Our original, somewhat ambitious, growth target of 20% per year is looking rather conservative. Each business unit is securing work in areas where they had little or no involvement before. Questa is working through our Australian ofce on coal mine methane reservoir modeling for one of Australias main coal producers; Applied Hydrology was recently awarded a large contract for hydrological work in the Athabasca oil sands. This broke new ground for them and our already very busy Canadian business unit. Our Salt Lake City ofce is heavily involved in a number of green feld exploration projects in Mongolia and Mozambique; some of the initial introductions came through our Calgary and Vancouver ofces. We now have over 160 full time staf, plus another 50 associates and our most challenging issue is fnding additional good people. All of our ofces are hiring, so let us know if you are aware of a good geologist, mining engineer, reservoir engineer, hydrologist, environmental engineer or technical support person who wants to join a progressive team. The increased diversity provided by the oil and gas group, combined with a team of hydrological specialists, has enabled us to collectively seek out and secure larger and more diverse projects in areas that Norwest would not have considered before. In addition, Norwests network of contacts throughout the world has enabled Questa and Applied to provide valuable services in regions and countries where they had not competed before. Obviously the increases in energy, energy minerals and metals prices have created an expanding market for us. But our larger and more diverse pool of specialists has enabled us to latch onto the snowball and see it dramatically increase in size as it rolls down the hill. The eforts of our existing staf have carried us thus far. It is especially gratifying to see the younger professionals take on additional responsibility. There are a lot of extra hours being worked throughout the company and we would like to thank everyone for all of your extra efort, time and commitment to quality. These are exciting as well as changing times. The challenges ahead are to maintain the growth, to continue to provide top quality services to our clients and to retain the pleasant and satisfying working environment for all of our employees. The recent mergers have successfully opened many new doors for the combined company and added two teams of highly qualifed and dedicated professionals. We have a tremendous team, well equipped to serve an expanding energy minerals business world wide. As we work together to solve the equation, were proving that 2+1+1 really does equal 7. Norwest Vancouver doubles in size It was over a year ago (July 2004) that the Norwest Vancouver folks moved to their new ofce at Oceanic Plaza, 1066 Hastings Street. Since moving, the number of personnel has doubled and were still looking to add a few more. This photo was taken on the plaza adjacent to the ofce. Featured from left to right: Gord McKenna, Kevin Lin, Jay Horton, Jocelyn Bissett, Calvin Boese, Richard Dawson, Tim Peterson, Michael Graham, Erin Olauson, Sean Ennis, Peter Ershov, Colin Boese, and Chris Wattam. 2 + 1 + 1 = 7 > Donovan Symonds , Chai r man, Nor wes t Cor por at i on J oe Ai el l o, Pr es i dent , Nor wes t Cor por at i on, Canada Bob Evans , Pr es i dent , Nor wes t Cor por at i on, USA J ohn Wr i ght , Pr es i dent , Ques t a Engi neer i ng, USA Mi ke Day, Pr es i dent , Appl i ed Hydr ol ogy I nt er nat i onal , USA 4 Congratulations to all the participants and winners who demonstrated their abilities in problem solving and having fun with last issues monthly riddle. A job well done! from the riddlemaster Recently, Compahania Vale do Rio Doce (CVRD) won the right to explore coal in Mozambique. CVRD has retained Norwest to provide review and oversight services for this ambitious undertaking. Bob (Mac) McCurdy, semi- retired Norwester and Terry Gulliver, Sr. Hydrogeologist of AHI have made several visits to the Moatize project site, one of several coal deposits in northern Mozambique, located near the Zambezi River. The area has a long history of both surface and underground mining that dates back to the days of Portuguese colonial rule. Recently, Macs role was expanded to full time geological advisor along with addition of John Trygstad, Manager, Coal Processing & Utility of Norwest is now providing review and oversight services for the development of the coal processing and handling complex. Both Bob and John will be making frequent trips to Mozambique and South Africa over the next year joined every few months by Terry. Wherever one goes in the world, some things never change. As the photographs show, people always gather around a work site. In this case, an exploration hole is being drilled in a While exploring a deserted island in the middle of the pacifc, our band of rough and tumble, not to mention bloodthirsty, consultants comes upon a chest containing one hundred gold coins. Our consultants, in order of seniority are Steve, Sue, Sean, Don and Mary Lou. The dilemma: how to divide the spoils? Being a fair-minded and reasonable group, they agree on the following process. The most senior consultant (Steve) proposes a solution and then everyone votes on the proposed solution. Provided that at least half of the consultants vote in favor of the proposed split, then the coins are divided in accordance with the proposal. If the proposal is not accepted by at least half of the group, then the senior consultant (Steve) is dispatched (killed) and they start over. The most senior (surviving) consultant (Sue) proposes her plan for dividing the coins, and then they vote on the proposal by the same rules and either divide the coins or eliminate the Sue as the case may be. The process continues until one plan is accepted. Suppose that you are in Steves shoes. What division do you propose? All of these consultants are extremely logical and greedy (uncharacteristically) and all relish the thought of living to a ripe old age. Gold on the Island Be one of the next fve lucky winners: Five winners will be drawn from all those with correct responses submitted to Theresa Murphy by March 31, 2005 Congratulations to all the participants and winners who demonstrated their abilities in problem solving and having fun with last issues monthly riddle. A job well done! Carl Spangler, Denver, CO, USA; Luc Savoie, Calgary, AB, CANADA; Aruna Sood, Calgary, AB, CANADA The previous winners from last issues riddle were: S o l u t i o n t o Ma r c h s 2 0 0 5 R o o m a t t h e e n d o f t h e h a l l Chris assigns the numbers 1, 2 and 3 to the switches. He turns switch 1 on and the other two of. He waits 10 minutes, then turns switch 1 of and switch 2 on. Chris immediately goes to the room for the solution. If the light is on, then switch number 2 controls the light. If it is of, but the bulb is warm, then switch number one is the controlling switch. If the light is of and cool, then switch 3 controls the light. riddle solution l a s t i s s u e s neighborhood in the town of Moatize. The man on the left is Norwests Bob McCurdy. The kids, with little brothers and sisters in tow, perch themselves on the edge of a large tree to watch the show! Moatize, Mozambique by John Trygstad > John Tr ygstad, Manager, Coal Processi ng & Uti l i t y, Nor west Cor por ati on, Sal t Lake Ci t y Tel : 801-539- 0044 OR j tr ygstad@nor westcor p. com E N E R G Y , M I N I N G , A N D E N V I R O N M E N T A L C O N S U L T A N T S 5 for more information on: Theresa Murphy Tel : 403 237 7763 Emai l : t mur phy@nor wes t cor p. com David Wright Fax: 403 263 4086 Emai l : dwr i ght @nor wes t cor p. com visit us on the internet @ www.norwestcorp.com is a publication for the employees, clients and friends of Norwest Corporation. EDITORS Printed in Canada on Recycled and Recyclable Paper. Norwests Board of Directors recently approved the move of our Eastern U.S. ofce, now being led by the very capable industry veteran Paul Goad, from Ashland, Kentucky to Charleston, West Virginia. The goal for this ofce is to expand similar to the growth experienced by our Vancouver ofce. Charleston, the capital city of West Virginia, is the business, legal, and fnancial center of the area. It is located in Kanawha County, which has a population base four times that of Boyd County where Ashland is located. A Charleston location also allows access to mining professionals from the surrounding areas. Norwest will be more conveniently located for both our existing and potential clients by relocating to Charleston. The Eastern U.S. headquarters ofces of both Arch and Peabody are here, along with a Foundation Coal regional ofce. ICG is presently in the process of relocating their main headquarters from Ashland to the Teays Valley area just west of Charleston. Several land companies have ofces in the vicinity. Also, Charleston is home to a large number of the major fnancial and legal groups that work within the mining industry. A fnal reason in support of the move is the improvement in air travel access, again allowing us to better serve our clients. The nearest airport to Ashland is at Huntington, West Virginia, which ofers service to only two cities. The Charleston airport provides access to six carriers and nine cities. The Ashland ofce was established in 2000 by Don Arrowsmith, former Senior Vice President and Director, who lived in Ashland at the time. Don did an outstanding job in starting the ofce and enhancing Norwests presence in the Eastern U.S., and we congratulate him and wish him the best in his new position as President and COO of Triad Mining. We leave Ashland with fond memories, but the time has come to advance to the next stage in our development. We look forward to continuing improvement in servicing our clients by growing our business in Charleston, and adding to the Norwest family! Aerial view of Charlestons city centre situated in the heart of the Kanawha River Valley. Arrow indicates new ofce location at the Kanawha Valley Building. Ashland, Kentucky Office to Relocate by Kevin Whipkey > Cont ac t Kevi n Whi pkey, Sr. Pr oj ec t Manager Nor wes t Cor por at i on, As hl and Tel : 801-539- 004 4 or k whi pkey@nor wes t cor p. com OFFICES CANADA Calgary, Alberta Tel : 403 237 7763 Fax : 403 263 4086 Emai l : c al gar y@nor wes t cor p. com Vancouver, British Columbia, Canada Tel : 604 602 8992 Fax : 604 602 8951 Emai l : vancouver @nor wes t cor p. com USA Salt Lake City Tel : 801 539 0044 Fax : 801 539 0055 Emai l : s l c @nor wes t cor p. com Golden, Colorado, USA Ques t a Engi neer i ng Cor por at i on Tel : 303 277 1629 Fax : 303 277 0119 Emai l : ques t a@nor wes t cor p. com Denver, Colorado, USA Appl i ed Hydr ol ogy I nt er nat i onal Tel : 303 782 0164 Emai l : appl i edhydr ol ogy@nor wes t cor p. com
Ashland, Kentucky, USA Tel : 606 920 9833 Fax : 606 920 9664 Emai l : ashl and@nor wes t cor p. com Pittsburgh, Pennsylvania, USA Tel : 724 255 9905 Fax : 724 225 9903 Emai l : pi t t s bur gh@nor wes t cor p. com INTERNATIONAL Beijing, China Tel : +86 10 6466 4848 Fax : +86 10 6466 7489 Emai l : guoj i uhong@nor wes t cor p. com. c n Newcastle, NSW Tel : + 61 02 4975 5228 Fax : + 61 02 4975 5220 Emai l : aus t r al i a@nor wes t cor p. com 6