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Grande Prairie Daily Herald-Tribune • Tuesday, February 21, 2012

Tuesday, February 21, 2012

2012

780-532-1110 • dailyheraldtribune.com

B7


B8 Daily Herald-Tribune • Tuesday, February 21, 2012 B8 Grande GrandePrairie Prairie Daily Herald-Tribune • Tuesday, February 21, 2012

business and industrial visions

Retail sector on the rise Both Prairie Mall and downtown businesses recording increased sales in the last year

KIRSTEN GORUK Herald-Tribune staff A look ahead to retail and tourism for the coming year looks promising, w ith the predict ion t hat people in Alberta are travelling in their own province and even better, spending some of that time and money in Grande Prairie. “It was actually one of the best years the mall has ever had in terms of sales persquare-foot,” sa id L ionel F r e y, m a rketing director for Prairie Mall. “We’re FREy a lready up Great year from last

yea r ’s nu mber s c ompa ring January and February of last year. Based on that, 2012 looks very promising as well.” Frey attributes last year’s success and his optimistic outlook for 2012 to a number of factors. “I think consumers are a little more confident than they have been; that’s definitely a major contributor. I think the area itself has been busier as well, just in terms of other sectors such as the oil and gas sector. It all has an impact on the retail sector,” he said. In the last year the mall renovated Coles and added several new businesses including David’s Tea, Jugo Juice and Aéropostale. Recently it was announced that in 2013 a $10 million project will convert the current Zellers into a

Target. “We’re always developing the mall with n e w m e rchants moving in; t hat RICE w ill never c h a n g e . I Downtown up think bringing in more diverse stores and offering a variety of different things that consumers haven’t seen before is t he k ind of pat h we’re on,” Frey said. T he ma l l isn’t t he on ly establishment celebrating a good year of retail. Helen Rice, executive director of the DownTown Association, said that 2011 went extremely well for businesses. “We of course don’t gather

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statistics the way you do in a mall, it’s more just conversation, but for any of the information I’ve got sales were up in the neighbourhood of 10 to 11%,” she said. Rice added that part of that increase is tied to the strong marketing plans each business uses. “The majority of the businesses are owner operated, there’s that enthusiasm that comes t h roug h. It t ra nslates to customer service and I think in today’s economy, that’s what people are looking for: Quality and value.” With the decision to build a new hotel on the old York Hotel’s site at 101 Street and 101 Avenue, businesses are excited for what it will mean

“It breathes a whole lot of enthusiasm into downtown.” Helen Rice for the future. “You put a $30 million facility in there and you’ll revitalize the whole area. I know that there are several downtown businesses already thinking and planning ahead into how they can tie in and spiff their premises up. It’s breathes a whole lot of enthusiasm into downtown,” Rice said. Looking toward the coming

tourist season, the association plans to continue working closely with the Grande Prairie Regional Tourism Association. This year executive director Ainsley Lamontagne explained that the focus is on provincial travellers. “We’re focusing our attention more instead of trying to hit a bit of everyone,” she said. “Even though the overall numbers have stayed around the same, over the last year we’ve seen a really large rise in A lbertan t ravellers. So that’s something we’ve been working towards this year; we’ve been marketing specifically towards Alberta.”

Continued on B9


Grande Prairie Herald-Tribune• Tuesday, • Tuesday,February February21, 21, 2012 2012 Grande Prairie DailyDaily Herald-Tribune

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business and industrial visions

optimism in the oilpatch Drilling expected to rise 4% over last year Dan ILIKa Herald-Tribune staff

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Centre 2000 welcomes thousands of tourists as they travel through Grande Prairie each summer.

Great experiences a focus for tourism sector this year

Continued from ?? While Travel Alberta looks to the U.S. and other provinces, Lamontagne will travel to expos in Edmonton, Calgary and a few in the Northwest Territories. “Their programming for marketing this year is: Remember to breathe. So they’re really looking at the experiences and feelings that they evoke and we’re hoping to start a program for our website that works on the same principal,” she said. Pa r t o f a n e w s t rat e g y

includes hosting weekly “meat and g re e t ” b a rbecues during the nine peak weeks in the season. Lamontagne Residents Exploring options and visitors can come and learn about a new agricultural perspective each week from some who works locally. As a newcomer to her position, Lamontagne is open

to exploring new options to keep this vital industry alive and well. “It’s incredibly important. It’s really obvious to look around to see the tourist who sticks out and is different, but every time a visitor comes, whether it’s friends or family coming to see you, they’re still from out of town and put their money into our local economy.” kirsten@dailyheraldtribune.com Twitter:@DHTKirsten

The oil and gas industry seems to be on the upswing despite del ic ate c i rc u mstances as the winter season draws to a close. The Petroleum Ser vices Association of Canada (PSAC) reduced its forecast number of oil wells drilled across the nation and Alberta, with low natural gas prices and labour shortages as the main cu lprits a lt hough projections remain higher than last year’s final numbers. “We’re busy,” said PSAC president a nd CEO Ma rk Salkeld of Calgary. “It’s very optimistic out there.” C om i n g i nt o t he y e a r, PSAC forecast just more than 15,000 wells to be drilled across Canada, but decreased that number late last month by 11%, or 1,700 wells, bringing the projected number to 13,350. PSAC still anticipates an increase of 4% over 2011 drilling numbers of 12,917 wells, and 2% grow th in A lberta with 8,267 wells expected to be drilled. The updated forecast is based par t ly on low pricing across the industry, with

natural gas prices hovering around $3.25/mcf and crude oil prices of about $90/barrel. High reserves and low winter consumption have both cont r ibuted to maintaining low prices, Salkeld said, along w ith improved production that makes the most of the materials extracted. “There’s nothing superexciting peeking its head out to indicate that gas prices are going to turn around in the very near future,” he said. The milder than normal temperat u res t his w inter are also causing some fear, according to Sa l keld, but optimism still reigns. “Now there are a little bit of nervous shakes about the brea k up a nd w hat t hat ’s going to do to us and we’re trying to rub off the crystal ball going into spring and summer. But all in all it’s a nice oilpatch.”

LABOUR BOTTLENECK The skilled labour shortage projected by PSAC and other industry experts has hampered t he indust r y some, with Salkeld describing the situation as a bottleneck. “We saw the frustrations

with human resources and tr ying to track labour and retain labour and keeping people from jumping (ship),” he said of the growing labour concerns. According to Salkeld, PSAC is working with the federal and provincial governments to combat such shortages, particularly in the west. Salkeld said the provincial and federal governments need to develop an initiative to encourage Canadians to move west and make it easier for skilled foreign workers to work in the industry. “They’re hesitant with the immigration side of things,” he said. According to Salkeld, he has witnessed firsthand the impact an arduous process is having on both employers and prospective employees looking to come from abroad and work in Canada’s oil and gas sector. “I’ve got member companies that need professionals like engineers and we don’t have any,” he said. Salkeld said it can take member companies as long as 10 years to train a skilled, mu lt i faceted eng i neer to work in the industry. Continued on B10

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B10 Daily Herald-Tribune • Tuesday, February 21, 2012 B10 Grande GrandePrairie Prairie Daily Herald-Tribune • Tuesday, February 21, 2012

business and industrial visions

Finding skilled labour may become an issue Continued from B9 “We’ve got g uys applying to work in Canada from Ireland,” he said. “There’s valve engineers over there that would come and work in our (industry but) it will take them a year to work through the Canadian process to get in here.” Some of t hose work i ng outside raw material collection and production shared Salkeld’s sentiments. “I think we’re just on sort of the edge of a huge skilled labour shortage in Alberta,” said Neil Shelly of Fort Saskatchewan, executive director of the Industrial Heartland Association. Coming off an oilsands conference in Calgary, Shelley – whose orga n izat ion

works in t he value-added side of the industry – said that shortage was the numberone topic. “I think there’s $130-billion in investment in the oilsands planned over the next eight years,” he said. “Do we actually have the people to (work them)?” In spite of what seem to be negative circumstances, Salkeld and Shelly said all aspects of production seem to be r u n n i ng f u l l stea m ahead. “Having said all that, it’s a ver y optimistic, exciting oilpatch right now,” Salkeld said. “It’s just frustratingly busy.” dan@dailyheraldtribune.com Twitter:@DHTDan

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There is a lot of optimism in the oilpatch these days.

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Grande Prairie DailyDaily Herald-Tribune February Grande Prairie Herald-Tribune• Tuesday, • Tuesday, February21, 21, 2012 2012

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business and industrial visions

Local oilfield service companies finding steady increase

Cash Crop

DAN ILIKA Herald-Tribune staff

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Producers in the Peace Country had a good year, particularly in canola, in 2011. Many are watching the weather this spring, hopeful for just the right amount of moisture to get things growing.

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The oil and gas outlook may not be back to boomlike levels of a decade ago, but business is positive in the Peace Country, according to experts. Canadian Association of Oilwell Drilling Contractors (CAODC) president Mark Scholz of Calgary said wells across the Peace were sitting around 89% utilization for the week of Feb. 13. “Overall activity is quite strong in that area,” he said. “There’s no question that we’re seeing some good activity there.” These numbers don’t show much variance from 2011, according to Scholz, though things slowed down slightly in early January. “We did see a bit of a struggle at the beginning of January because of the (unseasonably) warmer temperatures,” he said. “They did have a little bit of an impact with overall drilling activity because part of the struggle with some of the locations we have to

“Moving forward and as of today activity is very strong throughout the Peace as well as the rest of the province.” Mark Scholz access in northern Alberta need to be quite cold and the ground to be frozen.” Still, activity has rebounded, Scholz said, and look positive moving ahead. “Moving forward and as of today activity is very strong throughout the Peace as well as the rest of the province,” he said. Grande Prairie’s Alpine Pumpjack Services operations manager Scott Nellis said there’s no signs of a slowdown, as pumpjack installs are booked through March. “Business has been very busy,” he said. “I think it’s

going to stay steady all year.” Nellis said Alpine was busy through 2011 but looks to be even busier this year. “Right now we’re (installing) two a day, five days a week,” he said of the number of pumpjack installs Alpine crews are doing in the area. “We’re booked probably three weeks in advance right now.” Jarvis Dawson, president of local oilfield hauling firm, JDA, said the winter season has been busy but expressed some concern of a slump in 2012 in the region’s natural gas industry. “It’s been flat out but the short-term doesn’t looked very good,” he said. “It’ll probably slow down a little bit.” Dawson said liquid-rich gas production looks positive but dry gas wells look to be slowing down, possibly through the summer months. “We expect to be busy just not as busy,” he said. “I expect that by fall natural gas might not be fully recovered but it will be busy again.” dan@dailyheraldtribune.com Twitter:#DHTDan


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Grande Prairie Herald-Tribune • Tuesday, February 21, 2012 Grande PrairieDaily Daily Herald-Tribune • Tuesday, February 21, 2012

business and industrial visions

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The downturn in the lumber market in the U.S. has Canadian forestry companies looking to Asia to diversify.

Forestry industry looking to new markets Slump in the U.S. having an effect on Canada AARON HINKS Herald-Tribune staff

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The third-quarter results from the Alberta Forest Products Association took a cut in production and value compared to last year’s results. According to figures released by AFPA, lumber companies produced 720 million board feet (mmfbm) between July and September 2011 w ith a value of $172.9 million. Total production volumes were down 12.1 mmfbm, or 1.7%, from 2010 third-quarter results. Stronger prices led to a $3.3 million, or 1.9%, increase in values. Panelboard has similar results. AFPA member panelboard operators produced 273 million square feet of 7/16 inch equivalent in the 2011 thirdquarter, valued at $67.5 million. Production was down 11.3 million square feet, or 4%, and value decreased $5

million, 6.9%, compared to the 2010 third-quarter. “From the lumber and panelboard side, historically our strongest market is in the United States (and) they’re going through a tough time right now” said Bruce Mulligan, director of communications for AFPA. “There’s no doubt that a high U.S. dollar is another challenge that we do face,” he said. “We’re working to mediate those challenges. We have a number of initiatives both at the association level and the individual company level to make relationships stronger in Asia to diversify those markets.” AFPA strides to improve the efficiency of its members mills and increase environmental performance by using less water. “Also to get more out of every piece of wood, whether that be bio energy or cutting it in the most strategic way,”

Mulligan said. Though the pulp and paper production and value has slightly decreased, it’s the strongest of the three products. AFPA’s pulp and paper sector total production in the third-quarter of 2011 was 379,000 air dried metric tonnes (ADMT) valued at $308.2 million. Production was down 16,900 ADMT, 4.3%, from the 2010 third-quarter results and values declined $48 million, or 13.5%. “It’s no secret that wood products remain challenged,” said Wayne Roznowsky, public affairs manager for Weyerhaeuser Canada. “Pulp is a better picture. It’s been clear that pulp has been a pretty good business for the last couple of years. I think there was a softening of prices towards the end of the year but pulp has been a pretty good story.”

Continued on B13


Grande Prairie DailyDaily Herald-Tribune Grande Prairie Herald-Tribune• Tuesday, • Tuesday,February February21, 21, 2012 2012

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business and industrial visions

Environment, safety important focus locally Continued from ?? AFPA will work towards preparing itself to take advantage of the economic opportunities that a turn around is going to present, said Mulligan. “Our industr y is a ver y important economic driver in about 50 communities around the province,” Mulligan said. “It’s really important that we take steps now to ensure that it’s going to be healthy and strong for the future. We’re confident in doing that.”

GoinG Green Weyerhaeuser is now clos-

ing in on the installation of its $70 million evaporator project. It took 18 separate loads travelling more than 1,200 kilometres for the vessels to reach the Weyerhaeuser facility, south of the city. The equipment was manufactured in China and Thailand. It was shipped to Vancouver, Wash., before it was barged to Lewiston, Idaho. The equipment then travelled by road from Lewiston to Grande Prairie. It took approximately four months for every vessel to reach Weyerhaeuser. The new investment will

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With the retirement of Canfor’s large portal crane, the company has moved to cutting shorter logs in the field.

free up to 100,000 pounds of steam per hour. This will reduce more than 140,000 tones of CO2 from the atmosphere. Ten tonnes of CO2 is the equivalent to the emission of one truck, meaning the CO2 reduction is the equivalent of taking 14,000 trucks off the road. The installation of the evaporator was initially slated to be complete by March 2012. The project has been pushed back until the fall. “A lot of it was just equipment, delivering the vessels pushed our schedule back,” said Roznowsky. Last year Weyerhaeuser was awarded with the safest pulp mill in North America. “It’s a whole year without a recorded injury for our employees and that’s great. We’re very proud of that,” Roznowsky said. Canfor also celebrated a milestone this year. After 25 years in operation, the iconic portal crane in the log yard along Wapiti Road was recently retired. The crane, which cost $3.6 million in 1985, will be dismantled this year. To subsidize the retirement of its crane, Canfor has switched to a cut-to-length program. Trees in the bush are cut into 16 or 20-foot lengths before being hauled to the Canfor mill. The cuts will eliminate the need for the crane and will result in safer transportation on Alberta’s roads. aaron@dailyheraldtribune.com

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Weyerhaeuser’s new evaporator project is expected to come online sometime this fall.

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Grande Prairie Daily Herald-Tribune • Tuesday, February 21, 2012

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Business and Industrial 2012