Great Plains Well Servicing

Source: Exec Digital Canada

Date :12/12/2007 12:01:43

Gord Moug thought he had seen it all. Nothing prepared him for Great Plains’ new service rigs however.

Written by Ian Armitage and Produced by Jason Wright

Great Plains Well Servicing Corp., part of Savanna Energy Services Corp., operates a fleet of newly manufactured free-standing single and mobile double service rigs throughout the Western Canadian Sedimentary Basin (WCSB). The company currently fields 30 rigs, 14 of those being free standing single service rigs, eleven being mobile double service rigs, five being mobile skid double service rigs and another four being free-standing.

The Great Plains service rigs are the safest and most technologically advanced rigs in western Canada. They are about 20 percent lighter than comparable conventional rigs, but with a 25 percent greater hookload and braking capacity.

Lighter, faster, stronger and safer than ever before, the rigs incorporate significant advances in PLC control systems and substantial fuel efficiencies. This new control system is operated with a joystick, not a brake handle. The rigs have electronically controlled engines and transmissions and a new gear box with a single outboard disc clutch. In addition, the drawworks are equipped with air-cooled disc brakes that require no setting after installation. Finally, consistency of the equipment components across the fleet enhances reliability and accelerates any necessary repairs.

Consistently high levels

The fleet has consistently operated at higher than average utilization rates to date and expects to capitalize financially from cost savings on newer equipment. Talking further about this, Vice President and General Manager of Great Plains Gord Moug explains: “We have operated at high levels for a number of years and our fleet will enable us to continue doing so in the future. Lighter, faster, stronger; safer than ever before, our rigs work a lot better.

“The difference between our equipment and let’s say a regular well servicing company is that our rig equipment has all modern features on it,” he continues. “It would be just like going from a 1960s car to a new vehicle with all the safety features that are built right in. You can expect our rigs to do their job and do it right the first time.”

Slowdowns – the good, the bad and the ugly

Gord, who has worked in the industry for almost 25 years, has been with Great Plains Well Servicing since its inception. He has seen the industry go through numerous ups and downs, but is always excited by the challenges of working in the sector. “Over the years we have seen the number of wells drilled on a per year basis go up and a lot of equipment added to the industry,” he says. “Subsequently, there are a lot of companies providing similar services and the market has become a little saturated in some areas which makes things more competitive in slower times.”

He has seen a number of slowdowns, similar to the one currently facing the industry, and believes the current downturn is due to a number of factors including commodity prices, governmental interference and a general glut in the market. “A slowdown is sometimes hard to judge,” says Gord. “It is hard to predict how long they are going to last. We have the high Canadian dollar and a low natural gas price affecting us and are also suffering the affects of the royalty review that the Alberta Government has thrown up over the last few months. It has taken producers time to digest what the implications of that will be and how it will affect budgets going forward.”

Despite the troubles, it looks like a good winter for Great Plains Well Servicing. “The next 120 days are going to be vital. We need to get the bulk of our work done in that time.” Indeed, it is going to be a very slow summer season next year – Q2 and Q3 2008 will be almost non-existent for activity.

Signs of improvement

There are approximately 1100 well servicing rigs registered with the CAODC – the association that represents the interested of 99 percent of the industry. According to Gord, 75 percent of the main carriers of those rigs were built prior to 1984. Some equipment is even over 30 years old. “This is old equipment that has had its day,” says Gord. “With the slowdown here, some of that equipment is going to be taken out of the industry.”

The boom in the market also brought an influx of workers to the WSCB, which meant the overall competency levels were a concern. However, the market saturization has seen this decline, and now those who want to work in this industry are here to stay, for the time being. “The people that wanted to be in this industry are staying around, and the labor force is highly experienced as a result. Our biggest challenge now is not finding experience; it is retaining those people by keeping them busy enough to earn an adequate amount of money to sustain the high cost of living in Alberta.” Often, if a downturn takes hold these workers will leave for pastures new. Gord is striving to make sure this doesn’t happen.

As a result, Great Plains Well Servicing Corp. looks after its staff, running numerous training programs and creating an atmosphere in which people are happy and rewarded for outstanding work. It even offers staff full dental and health benefits, as well as the opportunity to work their way up through the organization. “As much as we can we will promote from within,” says Gord. “People have to feel that they can progress.”

Gord is of the opinion that the well servicing industry won’t return to normal levels until late 2009 or early 2010.

Only then will we see sustainable activity in the WSCB. Despite the concerns, he believes it could ultimately be beneficial to the industry as a whole: “The slowdown will bring prices into line. Hopefully, service companies and operators will learn and be a little smarter going forward about working at a sustainable level. Only then will we have the right amount of work and labour for everybody to make some money.” With a constantly changing and fluctuating market, Great Plains is working hard to ensure its place in the industry.