Oil Sands Truth: Shut Down the Tar Sands

Gulf spill's ripples felt at petroleum show

Gulf spill's ripples felt at petroleum show

Oilpatch Keeping Tabs On Leak

By Dan Healing
Calgary Herald
June 9, 2010

The subsea wellhead display at the FMC Technologies booth at the Global Petroleum Show in Calgary is a tiny, perfect, clean representation of what a deepsea drilling environment should be.

But the display, with spindly threads representing pipes and cables leading from bright yellow miniature wellheads to ships and platforms floating above on a plate of glass, was designed long before the horrors of the BP oil catastrophe in the Gulf of Mexico.

As it has in the wider world, the disaster at the Deepwater Horizon offshore rig and the resulting environmental damage dominates conversations among oilpatch insiders at the gigantic show that started Tuesday and runs through to Thursday.

"It's a tragedy, that's what it is," said Rick Shalagan, Canadian sales manager of surface wellheads for Houston-based FMC.

Although none of FMC's equipment was involved in the BP disaster, the company has been hit hard, Shalagan said.

"It will affect our subsea (sales) because of the fact they'll probably stop drilling in the Gulf. There's going to be a moratorium."

"Because we're a subsea company as well as surface, it's driven our stock down in the last six weeks probably 30 per cent," Shalagan said.

Despite that, FMC added to the size of its show booth this year to highlight new work in the much-pilloried oilsands -- thanks to a takeover last year, it's promoting the sale of a new line of wellheads designed specifically for use in thermal in situ oilsands projects.

BP faces a criminal investigation and lawsuits over the April 20 explosion aboard the rig that killed 11 workers and triggered the 50-day-old oil spill, the worst in U.S. history. A six-month U.S. moratorium on deepwater oil drilling has been imposed.

The biggest indoor booth at the Global Petroleum Show this year is held by China Petroleum Technology and Development Corp., the equipment arm of the China National Petroleum Corp.

Another branch, publicly traded PetroChina, paid $1.9-billion last year to acquire 60 per cent interests in a pair of in situ projects pursued by Athabasca Oil Sands Corp. in northeastern Alberta.

Here, too, foreheads furrow when the BP well blowout is mentioned.

"We are very, very concerned," said Li Wei, Beijingbased chairman and vice-president of the technology and development corporation, in an interview with Canadian president Luke Lu translating.

"We are following all the news and trying to pick out what the real problem is. The environmental problem is a human problem, not only for one country, so China is very, very concerned.

"In China, we have lots of offshore drilling rigs, too."

Quinn Holtby, president and founder of Edmonton-based Katch Kan, which specializes in spill prevention systems, said the Gulf oil release was likely preventable.

"It's a catastrophe for the Gulf of Mexico, including the fishing, and I think it's a real black eye for the oil industry," he said.

"We've been accused in the oilsands of having 'dirty oil' but our oil's probably a little more attractive because if there's an issue there, we can clean it up. It's a little harder to clean up in 5,000 feet (1,500 metres) of water."

Al Hrabowiecki of Edmonton was representing Humble, Texas-based Forged Components Inc. at the show and said he sees both sides of the situation.

"It's affecting everyone down there because there's no offshore drilling," he said. "But, personally, I think it may be better for us in Alberta. Our northern crude might not seem so dirty anymore."

Dragon Products, the manufacturing arm of Modern Group of Beaumont, Texas, had its first appearance at the petroleum show two years ago. This year it's quadrupling its outdoor space to better show off a water heating unit designed to serve the Canadian hydraulic fracturing industry.

The situation in the Gulf affects another subsidiary, Tiger, which specializes in renting equipment to offshore drilling rigs.

"Tiger is renting a bunch of equipment right now to BP," said marketing manager Jim Newsome. "We have a rental facility in Venice, La., which is right in the heart of where all the oil is coming in and they're using a lot of our vacuum pumps and containers.

"There's a lot of tension, especially for the people in Louisiana. They're highly dependent on the fishing business, plus tourism."

Long-term, however, the diversifi ed family-owned company is expecting a significant shortfall in revenue because of the Gulf crisis.

The Global Petroleum Show is held every two years. This year's event at Stampede Park is expected to attract more than 60,000 visitors from 100 countries.

© Copyright (c) The Calgary Herald


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