SPRING 2012

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SPRING 2012

CONTENTS
5 7 9 14 21 23 25 26

Departments
MESSAGE FROM THE PRESIDENT IN THE FIELD
News and notes from the industry

DRILLING ACTIVITY FORECAST UPDATE

Activity in the Western Canadian Sedimentary Basin slows down

PSAC SPRING CONFERENCE

The only professional development conference offering knowledge and practical solutions for frontline managers, operations and eld staff

11

BUSINESS MATTERS
As employees start entering retirement age by the thousands, succession planning has never been more important

Features
COVER

PSAC IN ACTION
Advocacy initiatives from PSAC

11

EMPLOYEE RETENTION
Retaining employees takes money and effort, but the cost of losing employees is much greater. Services companies are taking different approaches to the problem

MEMBER PROFILE
Katch Kan Ltd. keeps drilling for safety and environmental solutions

A LOOK AT LEADERSHIP

17

LA BELLE ASSOCIATION
The newly formed Oil and Gas Services Association of Quebec aims to create a professional image for the sector out east

19

Up close and personal with two members of PSACs Board of Directors: Ken Bagan and John Gorman

19

STARS & SPURS

The 18th annual fundraiser presented by PSAC was a record setting event

25
WWW.PSAC.CA

21
3

FRAC FLUID TEMPERATURE CONTROL

SPRING 2012 VOL 11 No.4
The Petroleum Services Association of Canada is the national trade association representing the service, supply and manufacturing sectors within the upstream petroleum industry. PSAC represents a diverse range of over 250 member companies, employing more than 65,000 people and contracting almost exclusively to oil and gas exploration and production companies. PSAC member companies represent over 80 per cent of the business volume generated in the petroleum services industry. PETROLEUM SERVICES ASSOCIATION OF CANADA 1150 800 6TH AVENUE SW CALGARY, AB T2P 3G3 TEL: 403.264.4195 FAX: 403.263.7174 PRESIDENT AND CEO: MARK SALKELD DIRECTOR OF COMMUNICATIONS: KELLY MORRISON COMMUNICATIONS COORDINATOR: LINDA ALDRIDGE

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MESSAGE FROM THE PRESIDENT

Its Going to be Quite a Year

HE bAlMy WEATHER
that kick started 2012 was a sure-sign this year is going to keep us on our toes. The unseasonably warm weather interfered with the movement of equipment and crews in the field and was one variable that led to the Petroleum Services Association of Canada (PSAC) adjusting its 2012 Drilling Activity Forecast downward to 13,350 wells (rig released). Weak natural gas prices and labour shortages were also considered for the update, but our forecast is still Mark Salkeld, PSAC President & CEO a positive sign activity is continuing to ramp up. The number of wells forecasted still outpaceslast years final tally and PSAC is confident Canadas oil patch will be bustling throughout the year. While PSAC cannot impact gas prices, we know we can make positive inroads helping PSAC members deal with skilled labour issues. In addition to furthering advocacy efforts, PSAC will continue hosting events to deliver the information, insight and tools PSAC members require to make sound business and operational plans. From the myriad of issues related to relocating employees overseas to transportation, human capital management and risk management, there will be ongoing opportunities for personal and professional development throughout the year. For more on PSAC events and to register, visit www.psac.ca/events. While current forecasts indicate a healthy year ahead for the services sector, there are other sure signs our sector is robust and doing well. In January, PSAC hosted the 18th annual STARS & Spurs Gala benefitting the Shock Trauma Air Rescue Society (STARS). The event has become known as one of the oil and gas industrys top fundraising events in Alberta. This year, the event raised a staggering $720,000 a sure sign that the patch is productive! Industrys support of great organizations like STARS, and so many others, cannot be understated or underestimated. PSAC will continue to profile and highlight the ways in which so many PSAC members contribute actively to building dynamic and healthy communities. PSAC will continue to evolve and change with the needs of its members and will be well guided with the tremendous line up on our 2011-2012 Board of Directors. Our board collectively represents more than 100 years of experience in the services sector and adds to the long list of PSAC directors who have provided the expertise leading to PSAC growing and strengthening its voice over the past 30 years. Cheers,

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in the field
COMinG eVenTS

News, events and activities in the industry

Going Global: Succeeding in Moving Workers Abroad March 21, 2012 The Westin, Calgary, AB PSAC Spring Conference April 16 18, 2012 Sheraton Red Deer Hotel (formerly the Capri Hotel), Red Deer, AB PSAC Mid-Year luncheon April 25, 2012 The Westin, Calgary, AB enform Petroleum Safety Conference April 30 May 4, 2012 The Banff Centre, Banff, AB PSAC education fund Golf Classic July 19, 2012 Calgary Elks Lodge and Golf Club, Calgary, AB For more information on all PSAC events, visit www.psac.ca/events

Get Your Applications in for PSAC 2012 Scholarships

PSAC Scholarship Award Winners

in DeCember, the Petroleum Services
Association of Canada awarded scholarships at Keyano College in Fort McMurray to Carlo Franco Delorenzo, Welding Apprenticeship Award; Bret Merkler, Mobile Crane and Hoist Apprenticeship Award; and Mark Seibold, Canada Millwright Apprentice Award. Scholarships have also been awarded at Northern Lights College in Dawson Creek, B.C. to Johnathon Merkle in the Heavy Duty Mechanics/Commercial Transport Technician program and Lee Wetherill a student in the Millwright Foundation Trades Training program. Congratulations!

PSAC iS noW ACCePting applications for

the 2012 Education Fund scholarship program. Five scholarships in the amount of $1,000, as well as the Roger Soucy Legacy Scholarship Funded by KPMG in the amount of $2,500 are open to PSAC Regular Member employees and their children. The deadline for applications is April 20, 2012. To apply, visit www.psac.ca.

neW MeMBeRS
Regular Members Elliot & Associates Consulting Inc. Silverline Wireline Ltd. STEP Energy Services Ltd. Associate Members Fiberbuilt Manufacturing J.J. Keller & Associates Inc. Kal Tire Laricina Energy Ltd.

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DRILLING ACTIVITY FORECAST UPDATE

A Step Back

LABOUR SHORTAGES AND LOW GAS PRICES IMPACT PSACS DRILLING ACTIVITY FORECAST

the Petroleum Services Association of Canada (PSAC) released its rst update to the 2012 Canadian Drilling Activity Forecast, reducing the forecasted number of wells drilled (rig released) across Canada for the year to 13,350 wells. This is an 11 per cent decrease of 1,700 wells from PSACs original 2012 forecast released in early November 2011. However, the association notes, the revised forecast still represents a four per cent increase over nal 2011 drilling levels when a total of 12,917 wells were drilled across Canada. PSAC is basing its updated 2012 forecast on average natural gas prices of CDN$3.25/mcf (AECO), crude oil prices of US$90/barrel (WTI) and the Canadian dollar averaging $0.97 compared to the U.S. dollar. Due to skilled labour shortages, warm weather hampering the use of heavy equipment, weak gas prices related to oversupply and the ongoing uncertainty

N JANUARY,

created by the European economic debt crisis, we are seeing restricted capacity across the board, says Mark Salkeld, President and CEO of PSAC. While PSACs current forecast may be well short of the 20,000 plus well counts we were forecasting only a few years ago, the complexity and depth of current wells will keep our industry well ahead of meeting the increasing demand for oil. PSAC will present its Drilling Activity Forecast mid-year update on April 25. We are optimistic that our forecast update at the midyear point will show relative stability from our now updated forecast of 13,350 wells, though we still be feeling the effects of balmy weather and a labour shortage that is not going away, continues Salkeld. The annual Canadian Drilling Activity Forecast provides ve years of historical data, as well as forecasts for the coming year, on the number of wells drilled (rig released) in multiple regions

across Canada. Well data is further broken down in each region and reported by operator (top 20 in each area), status (gas, oil, service or dry), class (development, exploratory, re-entry), type (vertical, directional or horizontal) and depth. We are looking at new ways of presenting the forecast numbers to tie them more directly to the costs of drilling in various formations across the Western Canadian Sedimentary Basin, and we are sure the information will be insightful for people working through future nancial and operational business plans, Salkeld says. When used in conjunction with the PSAC Well Cost Study, the Canadian Drilling Activity Forecast can be used to determine potential market sizes for drilling and completion products and services, as well as pricing and activity direction. For more information about how to subscribe to the Canadian Drilling Activity Forecast or Well Cost Study, contact PSAC at info@psac.ca or 403-264-4195.

2012 CANADIAN DRILLING ACTIVITY FORECAST

(NUMBER OF WELLS)

ALBERTA: 8,267

SASKATCHEWAN: 3,739

BRITISH COLUMBIA: 640

MANITOBA: 665 TOTAL IN CANADA: 13,350

WWW.PSAC.CA

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Reinventing
EMPLOYEE RETENTION
ith an estimated 15 to 20 per cent labour shortfall in the oil and gas sector, from engineers to rig workers, employee attraction and retention has become a critical issue for services companies. In a highly competitive labour market, simply throwing money at the problem isnt effective.
You have to pay well and provide benets; those are just table stakes, says Mike Williams, Vice President of Human Resources and Communication with CCS Corp. Retention bonuses arent a viable long-term solution either, so human resource professionals across the industry are adopting a variety of unconventional retention strategies. We put a big emphasis on communication and engagement. We asked, how can we engage with you, so you want to stay? Williams says. The Calgary-based environmental services company found their retention answer lies in employee engagement. Employees are engaged in the decision-making process to help drive the company forward and the company is engaged with the community in a variety of charitable initiatives. These aspects combined help create

COMPETITIVE SALARIES, BENEFITS AND BONUSES ARE TO BE EXPECTED. COMPANIES WILL HAVE TO FIND NEW WAYS TO RETAIN TALENT TO STAY COMPETITIVE.

an environment where people want to work. However, employee retention is just one side of the story. On the recruitment side, CCS has a number of initiatives in place, including attracting foreign workers, an employee referral program, using social networks, billboard advertising, decals on vehicles, partnering with the military and television advertising. Williams doesnt expect just one of these initiatives to solve recruitment and retention issues alone, and says theyre all necessary. None of this is unique or new, but because of the competition for people, companies have to re-double their efforts and attack as many sources to keep the pipeline owing with talent coming through, he says. Obviously were in an up market, which creates demand for resources human and nancial, and there just isnt enough supply. CCS has more than 4,000 employees and has strong recruitment plans for 2012.

WWW.PSAC.CA

11

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Camp amenities have improved during the past 10 years.

Thats just us, says Williams. And other companies are probably looking at similar numbers, so the problem is getting worse not better. Creating an environment that encourages employees to remain with a company isnt something that happens overnight. It can take years to develop a corporate culture and the right programs to keep employees focused and engaged in the company. The corporate culture of Pason Systems Corp. is a big part of the companys success and has been in development since the companys early days a few decades ago. We consider it a competitive advantage to attract and retain quality people, says David Holodinsky, Canada General Manager of Pason. But we worry a little bit more about what the right thing to do is, rather than have an arbitrary [retention rate] target. If we do the right things that make people want to work, well have a good rate. Pason, which designs and rents oileld instrumentation and data acquisition systems, offers recreational benets, including yoga and Pilates instructors that come in during lunch hours. At the Calgary head ofce, theres also a weight room and cardio room on-site, a ping pong table in the lunch area, a foosball table and a road hockey rink behind the building. Pason also rents ice time for employees to play hockey once a week. The corporate culture of Pason is more than just recreation. For professional development, Pason teamed up with the University of Calgary to create specialized leadership training for employees. We have always been comfortable sending people to places like Queens University or the Banff Centre, says Holodinsky. But

they always learned different things and there was no common language or Pason-specic language. Late in 2009, Pason engaged the universitys Haskayne School of Business to create a leadership program. There are three, one-week modules taught by university professors. In the months between modules, Pason students complete assignments, readings and projects. So far, four groups, about 80 people, have participated in the program and each time, the curriculum is enhanced by feedback from the graduating class. We dont put programs in place to handcuff or keep people, says Ron Dudar, Human Resources manager. We do this as the right way to do business. Pasons corporate culture also actively engages its more than 600 employees in Canada and the U.S. with three basic principles. The rst is every employee has an obligation not just a right to challenge ideas and ask questions. The second principle is managers have to be open and transparent. That means if you come to me with an issue and concern, I cant pull rank. I cant say, this is how we do things and its my way. That doesnt work here, says Dudar. The last principle is no ofce politics, but Dudar says if the rst two principles are being followed the third takes care of itself. Employee retention strategies stretch much further than just the engagement, benets and professional programs a company can provide for their employees. Many service and producer companies employ people who work in remote locations and are away from home for extended periods of time. Making life as comfortable as possible on-site can go a long way in improving employee retention. Things have been changing fairly rapidly in the camp world in the last 10 years, says Trevor Haynes, CEO of The Black Diamond Group. Its being driven by the demand for labour. There are more skilled and technical people, like engineers, required at the sites in addition to trades people. Its a way to convince young professionals to work up there. The high-end accommodations created by Black Diamond resemble three-star hotels and during the past decade, the square footage of a standard room has increased by 25 to 50 per cent. The washroom conguration is another key aspect of improving life for employees and today, rather than 49 people sharing one washroom, theres usually a bathroom between every two rooms. The amenities included in rooms have vastly improved, too, says Haynes. Ten years ago it was rare to have satellite or even a TV, but now there are two at-panel screens per room and connections if they want to bring in a game console. Other on-site amenities at the Black Diamond lodges include exercise rooms and golf simulators. The food service has also transformed from a cafeteria-style set up, to different kiosks with different food options. The key person in a camp is the executive chef. The better facility they get to work from, theyre going to attract a better team and it cascades along, he adds. Food is very much a big driver to what people like and dont like. Figuring out what employees like and dont like will be important for all companies in the oil and gas industry. The labour shortage shows no signs of abating and nding creative ways to retain employees will a key to success. Trying to reduce turnover and engage qualied people on the other side is a big focus for us, CCSs Williams says. Obviously were in an up market, which creates demand. Resources, human and nancial, are pretty important and there just isnt enough supply.

WWW.PSAC.CA

13

PETROLEUM SERVICES ASSOCIATION OF CANADA

Spring Conference
PRE CONFERENCE SEMINAR RISK MANAGEMENT WORKSHOP
Monday, April 16, 2012
Have you ever wondered how your insurance program matches the insurance requirements in a Master Service Agreement (MSA), such as waivers, hold harmless, primary and non-contributory? Do you understand what obligations or liabilities you are accepting based on a MSA? Join PSAC for a discussion to learn about: The most common insurance clauses and terms a ecting oil and gas service companies What insurance brokers are seeing requested of service companies from MSAs and how the common insurance program responds Wording and terms that you need to be aware of and try to avoid in any MSA, unless you have speci c insurance to address those situations Strategies for best practices when reviewing MSAs To register for this seminar visit www.psac.ca/events and click on the Spring Conference registration form.

2012

DELEGATE NETWORKING RECEPTION AND DINNER

Tuesday, April 17, 2012
Featuring Keynote presentation Stressed to Kill by Sylvia Yaeger
Laugh and learn your way to becoming the boss of your stress! This interactive presentation focuses on our biological, predetermined bodily response to stress, and its link to disease. Learn a simple framework for reducing stress. Be re-energized and entertained by Sylvias sassy approach to wellness. Sylvia Yaegers entertaining presentations focus on a proactive approach to building healthy lives and workplaces. Stressed out employees make more mistakes, take more time away from work and are less safe on the job due to preoccupation, poor judgment and fatigue. Sylvias presentations invite audiences to laugh along and learn practical, powerful tools to handle stress, reduce repetitive pain strain and injuries, and prevent burn out.

2012 SPONSORS

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Industry Sponsor

To register visit www.psac.ca/events

PETROLEUM SERVICES ASSOCIATION OF CANADA

Spring Conference
RECRUIT. TRAIN. RETAIN AND REWARD!
April 17 - April 18, 2012 Sheraton Red Deer Hotel
(formerly the Capri Hotel), Red Deer, Alberta
The PSAC Spring Conference is the only professional development conference o ering the knowledge and practical solutions on transportation and human resources management, and professional development for frontline managers, operations and eld sta . With over 30 seminars to choose from, this conference o ers something for everyone from managers to eld sta .

2012

EARLY BIRD RATES ARE AVAILABLE! REGISTER TODAY!

To register or for more information, contact PSAC: E: info@psac.ca T: 403.264.4195 www.psac.ca/events

A SELECTION OF 2012 SPRING CONFERENCE SEMINARS

Operating With a Multi-Generation Driving Force Attitude Adjustment! Human Factors in Motor Carrier Safety Financial Basics for Non-Financial Professionals Making the Connection: Employee Training = Greater Retention and Engagement Recruiting New Faces to the Services Sector Keeping Drivers on the Road: Driver Retention and Strategies What Will You Do When Theyre Gone? Strategies and Tactics for Knowledge Management How E ective is Your Team? Strategies to Motivate Your Team Interviewing Tips and Tools E ective Con ict Resolution Hit the Road Jack but Dont Get Hijacked! Leveraging Social Media to Attract a Tech-Savvy Audience What Happens When Rubber Hits the Road and Why Should You Care? Understanding Stability Technology for Commercial Vehicles

For a complete listing and full descriptions of courses visit www.psac.ca/events

Program Sponsors

Delegate Lounge Sponsors

Alberta Institute, Purchasing Management Association of Canada DRIVING FORCE Enform FP iMarketing J.J. Keller & Associates, Inc. Mentor Engineering Province & State Permitting Spira Data Corp. Vital Bene ts Inc.

To register visit www.psac.ca/events

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Eastward Bound
SERVICES COMPANIES IN QUEBEC ARE PREPARING FOR INCREASED ACTIVITY IN THE PROVINCES OILPATCH
BY STEVE MACLEOD
MARIO LVESQUE IS CONFIDENT business will be booming for
Quebecs oil and gas industry in a couple of years. Hes also condent the provinces services sector will be ready. At least, thats the goal of the newly formed Oil and Gas Services Association of Quebec (OGSAQ). OGSAQ launched in January with 30 member companies and aims to be the primary source for exploration and production (E&P) companies who need access to local services and workers for their activities in Quebec. The not-for-prot association also plans to help local companies learn what is required to become an authorized service provider and offer information to individuals about careers in the oil and gas industry. My goal is to make the industry out east as professional as it is out west, Lvesque says. Were not going to have any industry out east for two years while theyre doing environmental studies. Since there wont be a lot of work, theres time for us to organize and everybody can be on top of their game when the industry starts. Quebecs edgling shale gas sector came to an abrupt halt in March 2011. The provincial government placed restrictions on hydraulic fracturing and before activity continues, environmental studies need to be completed in the Utica formation of the Lower St. Lawrence region. Regardless of the outcome of the environmental review, Lvesque says there are other oil and gas opportunities in La Belle province, including conventional and tight oil plays. Lvesque has been involved in the oilpatch for 15 years, most recently as owner of Seismotion, a permit and landman company. Through OGSAQ, Lvesque hopes to create opportunities and training so that other Quebeckers can benet from responsible oil and gas development opportunities. The oil and gas services industry uses cutting-edge technology, has an excellent safety record, offers good wages, a variety of career paths and I am proud to be associated with it, Lvesque says. Creating this association is a way for me to share my experience of the industry and help other Quebeckers interested in working in this eld. Lvesque hopes by creating standardized training and partnering with universities and colleges in Quebec, it will create a sense of professionalism for the services sector and improve the image of the oil and gas industry in the province. It will be a big help to prove to people we are professional, we know what were doing and people dont have to be afraid of what were doing, Lvesque says. Lots of people dont understand and lots of information is coming from outside the industry. If OGSAQ can accomplish the goals it has set out, Lvesque says 10,000

Mario Lvesque has spent 15 years in the industry and hopes the services sector in Quebec can emulate the professional image in western Canada.

new jobs can be created in Quebec in shale gas operations and that business will be around for at least 20 years. Mark Salkeld, president of the Petroleum Services Association of Canada (PSAC) says getting all those skilled workers in place will take time. PSAC has been delivering similar services for more than 30 years to its members, which includes more than 250 companies across Canada. We are thrilled to see a services sector association in Quebec and look forward to building a strong and collaborative relationship with them, Salkeld says. Having enough skilled labour is continually one of our industrys biggest issues and preparing now for an eventual industry in Quebec is essential. This is an opportunity not only for skilled workers in the province, but for those Quebeckers currently working in Albertas oil and gas elds to bring back their skills and expertise to their home province.

WWW.PSAC.CA

17

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ANNUAL FUNDRAISER RAISES A STAGGERING $720,000

presented by the Petroleum Services Association of Canada (PSAC) showcased the generosity and commitment of the services sector. The 2012 event in support of the Shock Trauma Air Rescue Society (STARS) brought in $720,605.73, a record amount. During nearly two decades of the long-running partnership, more than $5.3 million has been raised. This partnership between PSAC and STARS has been well nurtured over the past 18 years, says Mark Salkeld, president and CEO of PSAC. The STARS & Spurs Gala is a one-of-a-kind industry event and the money raised by our collective efforts is more important than ever. As long as STARS increases our ability to access emergency medical services, our support will not waiver. We congratulate STARS on another year of critical work in our community, and look forward to many more years working together. More than 1,000 people attended the gala on January 21 at the BMO Centre in Calgary. The event included a moving speech from STARS Very Important Patient for 2012, Darren Zatwarnitski and his family. He spoke about everything he has accomplished since being transported in the STARS helicopter in 2003 following a motorcycle accident. Gala guests also enjoyed a performance by Canadian Country Music Award winning band Doc Walker, rafes, auctions, dancing and the chance to network, all with the help of guest emcee Dave Rutherford of QR77. We are truly honoured and grateful to receive such amazing support from PSAC, its members and the STARS & Spurs Gala committee, says Dr. Greg Powell, CEO of STARS. Funds raised at this gala contribute signicantly to our mission of providing emergency medical care and rapid transportation to critically ill and injured patients.
The Gala was a huge success, raising $720,605.73 for STARS. From left to right, MC Dave Rutherford, Indian Princess Amelia Crowshoe, STARS Board Member Doug Ramsay, CEO of STARS Dr. Greg Powell, PSAC President & CEO Mark Salkeld, and STARS & Spurs Committee Chair Lucas Mezzano.

HE 18TH ANNUAL STARS & SPURS GALA

2 From left to right, Tracy Edmonds; Premier Alison Redford; Mike Edmonds, Chair, PSAC Board of Directors; Elizabeth Aquin, Senior Vice President, PSAC; and Mark Salkeld, PSAC President & CEO enjoy the VIP reception. 3 Minister of Service Alberta Manmeet Bhullar, left, and PSAC board member Ray Mills. 4 John Gorman, Second Vice-Chair, PSAC Board of Directors, and incoming STARS & Spurs Gala committee chair. 5 Mark Salkeld, PSAC President & CEO greets guests at the 18th Annual STARS & Spurs Gala Presented by PSAC.

WWW.PSAC.CA

19

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BUSINESS MATTERS

The Next Generation

AS EMPLOYEES START ENTERING RETIREMENT AGE BY THE THOUSANDS, SUCCESSION PLANNING HAS NEVER BEEN MORE IMPORTANT
BY STEVE MACLEOD

15 to 20 years its estimated more than 1,000 Canadians will reach retirement age each day. This means now is the time to prepare for the post-baby boom workforce with succession planning to avoid what could potentially be bust situations for businesses of every size. Succession planning requires different strategies depending on a companys size and quite often includes two key options: creating new business owners or new leaders. SELL IT OFF Small business owners looking to retire typically have four exit strategies: sell to a family member, sell to management, sell to a third party, or take the company public. Considerations for many of the strategies are similar, says Rhys Renouf, National Energy Services Leader and Managing Director of KPMG Corporate Finance in Calgary. Your exit strategy should be part of your business plan and you should be reviewing that plan and evolving it as your business grows and your business realities change. Building a solid exit strategy is part of building a solid business. To ensure operations are sustainable, consideration should be given to building a seasoned management team so that relationships with customers, suppliers, and even employees arent tied solely to the owner. All contracts should be in order and consideration should be given to the companys legal structure. Tax planning should also be done well in advance. All personal assets and redundant assets should be removed as well. Selling a business is similar to selling a house, Renouf says. Thoughtful preparation, staging and planning with professional help results in maximized value. An experienced advisory team can make exit strategy planning easier and, just like the

VER THE NEXT

plan, the advisory team should evolve and change over time depending on the needs of the business plan. Renouf says lawyers, accountants, tax advisors and transaction advisors are all professionals that will add value to your strategy. Generally speaking an organization should look at their business plan in ve year segments and update it at the end of the third year, Renouf says. As a business owner, it is important that you have a future outlook for the business ensuring that the overall business plan inclusive of an exit strategy can evolve and keep pace with the needs of the business. PASS IT ON For larger businesses, key steps in succession planning include establishing what long-term success looks like, and identifying the roles and knowledge that are necessary to deliver on that vision. With a succession plan in place, its a great time to make changes to the roles and responsibilities of positions to determine a longer-term perspective for an organization, says James Fries, partner with Cenera, a Calgary-based human resource and business consultant rm. After a company takes time to gure out what long-term success will look like and develops a plan to help employees grow into leadership roles, its time to start communicating with employees. Talk to people about their interests and intentions, he says. The number one success factor in succession planning is ambition, not intelligence or experience.

WWW.PSAC.CA

21

CERI 2012 Oil Conference Achieving Super Power Status April 23-24, 2012 The Fairmont Palliser Calgary, Alberta
The Situation: Canadas crude oil supply is landlocked Increases in supply from oil sands and from redeveloped conventional fields raise the prospect of shortages in pipeline capacity We currently have one primary customer: the US What should we do? More pipelines? More rail connections? Should we look south? Should we look west? Join us for the CERI 2012 Oil Conference For more information visit: www.ceri.ca email: conference@ceri.ca or telephone: (403) 282-1231
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22 SPRING 2012
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PSAC in ACtion
the Petroleum ServiCeS ASSoCiAtion of CAnAdA (PSAC) ContinueS to keeP the ServiCeS SeCtor front And Centre through AdvoCACy And outreACh

PSAC MeetS with energy MiniSterS FroM AlbertA AnD b.C. To ring in the New Year, PSAC staff and board members met with Albertas Energy Minister Ted Morton to discuss the current state of affairs in the industry and the issues, challenges and opportunities currently being experienced by the services sector and PSAC members. PSAC discussed several issues including the current labour shortage, and health and safety regulations, including hours of service. PSAC also held a meeting with Rich Coleman, B.C.s Minister of Energy and Mines to discuss key issues facing PSAC members operating in that province including issues related to the BC Resource Roads Act. PSAC iMProveS UnDerStAnDing oF inDUStry with QUebeC leADerS PSAC recently met with Mission Leadership Quebec, a strategic positioning initiative that allows young leaders in Quebec and their organizations to develop networks and opportunities in countries and regions of strategic interest for Quebec and Canada. PSAC helped the group increase their understanding about the oil and gas industry, specifically, shale gas as it relates to the potential impact upon Quebecs economy. PSAC also lent its support to the formation and launch of the Oil and Gas Services Association of Qubec (OGSAQ). Mario Lvesque will be the President of OGSAQ and will be working to help build a vibrant services sector in support of responsible oil and gas development in the province. PSAC leADing the ChArge to DeveloP SolUtionS For the inCreASing lAboUr ShortAge To address services sector labour issues, PSAC recently met with Cal Dallas the new Alberta Minister of Intergovernmental, International and Aboriginal Relations to present the findings of the PSAC commissioned studies on the size and economic significance of the services sector and the number of Canadians employed by the sector. PSAC also discussed with Minister Dallas recommendations for pilot projects that aim to address the labour shortage in the services sector, which PSAC is also discussing with senior representatives and elected officials in the federal government. PSAC met separately with Mike Lake, MP and Parliamentary Secretary to the Minister of Industry, as part of PSACs efforts to gain the support of federal officials as PSAC develops new program recommendations and associated policy or regulatory changes. PSAC also took its members message to Arno Doerksen, MLA for Strathmore Brooks and Parliamentary Assistant to the Minister of Human Services. PSAC will be meeting with other ministers and senior public sector officials to continue to lay the groundwork for future pilot projects that will aim to improve access for PSAC members to domestic and foreign labour pools.

PSAC MeetS with the U.S. StAte DePArtMent In addition to meeting with officials from both federal and provincial governments, PSAC met with Brett Mattei, U.S. Consul for Political, Economic and Public Affairs for Alberta, Saskatchewan and the Northwest Territories. Discussions focused on the need for collaboration when developing initiatives to respond to the increasing labour shortage in Canadas services sector, including tapping into the large contingent of unemployed workers in the U.S. with needed skills. CArgo SeCUreMent StAnDArDS ADDreSSeD by PSAC MeMber teSting PSAC member Hallmark Tubulars and representatives from PSAC made a presentation to the North American Cargo Securement Forum held in Montreal on November 28, 2011. The presentation was on the results of testing that Hallmark conducted on various load configurations for the transportation of tubular products used in the oil and gas industry. The associations Transportation Issues Committee (TIC) has been working with Hallmark on changes to the industrys Cargo Securement Best Practice that will incorporate the results of this testing into the section of the BP that deals with requirements for strip and strap configurations and belly wraps on pyramid loads. As a result of the presentation, the Canadian and U.S. transportation regulators have agreed to consider inserting a section dealing with the transportation of tubular products into the North American Cargo Securement Standard Standard 10 of the Canadian National Safety Code. PSAC ContinUeS to Strengthen tieS with other ASSoCiAtionS PSAC, together with other key industry associations met recently with the B.C.s Resource Trade Organization and its associated committees. Following a successful lunch and learn with the Canadian Association of Petroleum Producers (CAPP), PSAC staff met with the staff of the Canadian Energy Pipeline Association (CEPA) in an effort to enhance the understanding of the organizational structure, upcoming initiatives and insights into the issues confronting the membership of each of the respective associations. helPing to ACCeSS Foreign MArketS PSAC and the federal Department of Foreign Affairs and International Trade (DFAIT) has created a strategic advisory committee focusing on sectorial strategies for international business development in the oil and gas industry. DFAIT continues its outreach to PSAC members for input into a strategy document. DFAIT will also call on the advisory board to vet project proposals from around the world.

WWW.PSAC.CA

23

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MEMBER PROFILE

Katch It If You Can

EDMONTON COMPANY CAPTURES FLUID AND INNOVATION ON THE DRILL SITE

BY JESSE SNYDER
Katch Kan has come a long way from the coffee can prototype.

UINN HOLTBY asks a lot of questions. When he rst

started working as a roughneck, Holtby wanted to know if there was a better way to contain drilling uid that spilled out from a well whenever the drill was pulled out. In the old days we used to wrap pipe with plastic bags and close our eyes and hang on for dear life, while the stuff blew up all over the drill oor, says Holtby, President and CEO of Katch Kan Ltd. It wasnt exactly the answer Holtby was looking for, so he decided to patent a spill reduction kit in an effort to make working on the drill oor safer. Holtby created a miniature prototype out of a coffee can, some sewer pipe and a fence post in his garage. The prototype eventually became the Kelly Kan, which is essentially a large cylinder that clasps around the wellhead. Katch Kans rst zero spill system was installed on a drilling rig in 1995. As well as the Kelly Kan, there are about nine other parts to the zero spill system, including a collection tray and a discharge hose that brings the uid to a large holding tank. While steering uid away from the drill oor aims to make operations safer, capturing the drilling uid thats trying

Capturing drilling uid in a holding tank allows companies to reuse the uid.

to escape from the well and syphoning it into a holding tank for reuse aims to make operations more cost efcient. Were always looking for improvement, and one thing that I found in some of the newer drilling contractors is they are always looking for potentially better ways of doing things, Holtby says. Since Katch Kans introduction to the market, both the product and the industry have changed immensely. New parts have been added and improved on the Kelly Kan and Katch Kan has created a number of additional offerings for both land and off-shore operations. Meanwhile, on-site spills in the industry have reduced dramatically and Holtby says zero-spill sites are on the horizon. We continue to enhance what we do because we know that there are other issues related to spillage that we may not be handling at this time, yet there are opportunities to solve by thinking ahead and coming up with a solution, Holtby says. Katch Kan has built a training facility, with full-size simulators, where new workers can be trained to use the technology. We can bring these people in and help them understand the value that we offer, and we do it worldwide, Holtby says. As well as the safety and economic impacts of Katch Kans products, Holtby says the positive environmental improvements of the zero spill system have also been a main driver for the company. The value of being proactive and minimizing our inuence on the environment is a huge advantage, he says. The public demands it these days.

WWW.PSAC.CA

25

A LOOK AT LEADERSHIP
PETROLEUM SERVICES NEWS INTRODUCES A NEW SERIES PROFILING PSACS BOARD OF DIRECTORS AND TAKES A PERSONAL LOOK AT LEADERS IN THE SERVICES SECTOR

KEN BAGAN Board Member Trican Well Service Ltd. Years in Services Sector: 35 JOHN GORMAN Vice President Canada Halliburton Group Years in Services Sector: 22 KEN BAGAN JOHN GORMAN

IF YOU COULD DO ANY OTHER JOB/OCCUPATION, WHAT WOULD THAT BE? KB: I like working with my hands and even now spend a lot of time doing ne woodwork. JG: I have two hobbies: playing bad guitar (with a voice to match) and doing one Ironman race per year. So, Id like to own a guitar shop connected to a bike shop to satisfy both passions. WHAT IS YOUR FAVOURITE BOOK OF ALL TIME? KB: Soldier of the Great War by Mark Helprin. My second favourite is probably the funniest book Ive ever read, Freddy and Fredericka, also by Helprin. Its the only book that made me laugh out loud. JG: Whirlwind by James Clavell. A must read for anyone with an interest in international postings in the oil and gas world. WHAT ABOUT A FAVOURITE MOVIE? KB: From John Irvings book, The World According to Garp, starring Robin Williams. JG: Pulp Fiction please dont think less of me! IF YOU COULD INVITE THREE FAMOUS PEOPLE TO DINNER, WHO WOULD THEY BE AND WHAT WOULD YOU SERVE? KB: I would serve bouillabaisse. I am not a student of biographies, but I think I would nd iconic historical representatives of social leadership, religion and business, and have a discussion about how the last 500 years might have been better handled. JG: The Dalai Lama, Lance Armstrong and Winston Churchill. The Dalai Lama and Lance would like a healthy salad for dinner and go to bed early after a discussion on motivation and inspiration, but Id have to sit, have a cigar and port with Churchill and talk about leadership under stress.

WHAT DO YOU THINK IS THE BIGGEST CHALLENGE FACING CANADAS ENERGY INDUSTRY AT THIS TIME? KB: Finding a formula for palatable exploitation of the opportunity while the opportunity continues to exist; and then determining what the business becomes beyond the pale of todays energy blueprint. JG: Personnel. There are a lot of other issues in the industry with respect to fracing, cementing, regulatory issues, environmental stewardship, but I think that the key issue will be retaining and attracting workers to the industry. WHAT WOULD YOU SAY IS YOUR BIGGEST ACCOMPLISHMENT TO DATE? KB: I have four children; all of them are alive and thriving. I dont know if I had anything to do with it, but it is the thing for which I am most grateful. JG: Professionally, leading Halliburton Canada from the sharpest activity downturn in September 2008 through the best year in our history in 2011. I was handed the reins in November 2008 as activity was falling off a cliff. WHAT MOTTO OR PHRASE DO YOU LIVE BY? KB: Trust those who seek the truth ... doubt those who have found it. JG: I love my job. Yeah, I stole it from Club Med, but it got me thinking when you dont love coming to work anymore, get out. IF YOU COULD TRAVEL TO ANYWHERE IN THE WORLD, WHERE WOULD YOU GO? KB: I would like to explore Africa; it is both the birthplace of the species and the site of the earliest civilizations. JG: Put me in Tahiti next week and Ill be happy. The British Virgin Islands are lovely too. I wish I had more holidays. IN 10 WORDS OR LESS, WHAT WOULD YOU SAY ABOUT HOW 2012 IS GOING TO TURN OUT? KB: More slow progress toward global economic recovery; no world peace. JG: Reality is; oil and gas are choice fuels long-term.

26 SPRING 2012

PETROLEUM SERVICES NEWS

SPRING RELEASE
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