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Red Deer Advocate MONDAY, MARCH 23, 2015
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Hard times in the oilpatch
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THOUSANDS HAVE LOST THEIR JOBS DURING DOWNTURN BY HARLEY RICHARDS ADVOCATE BUSINESS EDITOR As president and CEO of Red Deer’s Predator Drilling Inc., Shane Walper spends a lot of time in Calgary. He says the steady decline in oil prices over the past nine months has created a mood of “doom and gloom” in Canada’s oil and gas capital. “There are literally thousands of people who have been let go,” said Walper, adding that the carnage extends beyond Calgary to communities across Alberta — including Red Deer. Predator has had to cut its rig crews “a lot,” he confirmed, with about 20 per cent of its office staff also affected. Those who remain have taken wage cuts. And Predator is one of the luckier oilpatch companies. It did a significant cost restructuring before the downturn, has good access to capital, and carved out a niche of “pre-setting” wells with small drilling rigs — which gives clients a cost-effective alternative to using large rigs during the early stages of drilling. Mark Scholz, president of the Canadian Association of Oilwell Drilling Contractors, offered some insight into how other drilling companies are doing. “We’re sitting at about 19 per cent (equipment) utilization and we had the worst January on record and we’ll have the worst Quarter 1, probably since 2009 and possibly all the way back to the ’90s. “I think at the end of the day, the best way to describe it is that companies are just trying to survive.” Unlike the highly publicized cuts of salaried staff by major energy companies, drilling companies are quietly idling their rigs. And when that happens, the men and women who operate them don’t get paid, pointed out Scholz. “For our crews, it’s upwards of 4,000, 5,000 people who aren’t going to be working. “They’ve got bills to pay, mortgages, car payments.” The picture isn’t any better on the service side of the industry, said Mark Salkeld, president and CEO of the Petroleum Services Association of Canada. “There are layoffs going on; there are wage rollbacks,” he said. “Right across the board, from Weyburn, Sask. all the way through to Red Deer, Grande Prairie and Fort St. John. It’s tightening up.” The latest survey by employment consulting company ManpowerGroup found that Western Canada’s mining sector — which includes oil and gas production — had the most pessimistic hiring intentions since analysis of the sector began 11 years ago. And among the 11 Western Canadian cities included in Manpower’s employment outlook for the second quarter, Red Deer employers had the lowest expectations. “Red Deer has been known historically, and again at this time, to be impacted by oil prices, recognizing the great support that is provided by Red Deer (such as servicing companies) to the oil industry,” said Randy Upright, Manpower’s CEO for the Alberta region, in an email to the Advocate. Upright said his company is working with displaced workers and also employers affected by the downturn. Charles Strachey, a local manager with Alberta Human Services, said staff at Red Deer’s Alberta Works Centre have noticed a “slight increase” in the number of energy sector workers coming in for help. But postings at the centre for oil and gas jobs have dropped significantly, he added, and no energy companies have registered for this Wednesday’s Central Alberta Career & Job Fair. Salkeld, who’s worked in the oilpatch for decades and seen his share of downturns, is encouraged by one thing. Companies are doing everything they can to avoid layoffs: reduced work weeks, wage rollbacks, elimination of bonuses, creative vacations, work furloughs and job reclassifications. That reflects the high value that employers in the oil and gas sector now place on their skilled workers, he said. Walper said he’s also seeing a spirit of co-operation among companies. Price reductions are being requested, and granted, up the supply chain. “It seems like everybody’s really banding together.”
Please see OIL on Page A2
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INDEX Four sections Alberta . . . . . . . . . . . . . . . . . . A3 Business. . . . . . . . . . . . . C2,C3 Canada . . . . . . . . . . . . . . A5,A6 Classified . . . . . . . . . . . .D1,D2 Comics . . . . . . . . . . . . . . . . . . D3 Entertainment . . . . . . . . C4,C5 Sports. . . . . . . . . . . . . . . B1-B6
Photo by ASHLI BARRETT/Advocate staff
Fanny the goat of the Thistle Hill Petting Zoo nibbles at Ayden Ouellette’s shoes during the Central Alberta Family Expo at Westerner Park in the Parkland Pavilion on Saturday morning. The family-oriented trade show ran Saturday through Sunday and featured a number of different activities including a free dance lesson, face painting, family pictures and a meet and greet with Toopy and Binoo, characters from the TV show of the same name.
Moore defeats Buchanan for PC nomination BY PAUL COWLEY ADVOCATE STAFF Red Deer County Coun. Christine Moore has made the jump to provincial politics. Moore defeated Red Deer city Coun. Buck Buchanan to become the Progressive Conservative candidate for Red Deer North, replacing five-term MLA Mary Anne Jablonski, who recently announced she would not run again. A third candidate, former city councillor and local businessman Jeffrey Dawson unexpectedly dropped out of the race an hour after advanced polling began on Thursday. Next in Moore’s sights will be holding the seat in the next provincial election, widely expected this spring. Moore said she’s ready to go. “I’m absolutely delighted. I’m really looking forward to working hard to represent Red Deer North,”
RED DEER NORTH she said shortly after the results were announced at Festival Hall on Saturday night. Moore, who was in her first term as a county councillor, said she is eager to step into a new political arena. “I feel I’ve got the breadth of experience,” she said, pointing to her years on Red Deer Catholic Regional School Board, where she became chair, and on Red Deer College’s Board of Governors. “I know the community and I know the people and it just seemed the right thing to do. These opportunities only come up once in a while.” Moore has no illusions that the job will not be an easy one if she is elected given the province’s economic situation. “I’m a hard worker and I’m up for a challenge”
Please see MOORE on Page A2
Suspected killer found dead BY PAUL COWLEY ADVOCATE STAFF A man suspected of shooting to death a 70-yearold rural Rimbey man has been found dead. RCMP said investigators identified and located the suspected killer of farmer Paul Michaniuk on Saturday but found the man deceased. Michaniuk had been found mortally wounded by passersby around 6:15 p.m. two days earlier on Medicine Lake Road, a few kilometres northwest of Rimbey. “He was in the ditch and when police arrived (he was found to be) deceased. He had suffered a gunshot wound to the torso,” said RCMP K-Division spokesman Const. Jason Curtis. Curtis couldn’t say if there were other wounds, however, the medical examiner determined the cause of death was from a single gunshot wound. Red Deer RCMP’s Major Crimes unit was contacted and their investigation led them to a single male
RIMBEY suspect, who was found dead at a residence in the Rimbey area. “We are not seeking any further suspects and we have no cause to believe the second death (involved) any criminal actions,” said Curtis. No further information was available on Sunday about the second man, whose name has not been released. Curtis said investigators are still trying to determine the relationship between the two men. Rimbey resident Bill Patey said he helped out as a driver for Paul Michaniuk and his wife Adele for the last two years, bringing them into town from the farm to go shopping and do their banking. He heard what had happened from Adele, who phoned him to tell him her husband was dead.
Please see SUSPECT on Page A2
Feds spend $43.M on medicinal pot for veterans Cost of medical marijuana for Canada’s veterans saw an increase of more than ten times what was spent last year. Story on PAGE A5
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