Saying the Alberta oilpatch is slow might be the understatement of the year. Or the decade.
Of course it’s always slow during break-up. But the difference this time, says Shawn Gramlich – Slave Lake town councillor and oilfield worker – is many people aren’t going to have any work to go back to after break-up is over.
Some guys are talking about this time next year,” he says.
Gramlich says the usual tactic for companies during break-up is to keep their people busy cleaning up in the shop and that sort of thing. Or if there are layoffs, they would be brief, and people with “their pockets full of winter pay,” would be out spending it in local shops, restaurants and bars.
But not now. With the double-whammy of low oil prices and the COVID-19-induced economic slowdown, chances are a lot of oilfield workers will be idle for some time.
Gramlich says locally, he’s heard about “a ton of layoffs.” Companies are downsizing and hoping they get jobs, but with the price of Western Canadian crude oil near the bottom of the barrel, chances of any drilling are pretty slim.
“You can only keep paying employees for so long,” he says.
In the bigger picture, getting pipelines built and oil to tidewater is important, “but if there’s nobody buying oil….”
Murray Broadhead, owner of Apex Well Servicing in Slave Lake, is not feeling too optimistic about the prospects.
“Typically we’ve got 10 – 15 units working,” he says. “Now – none. It’s not looking good.”
Roger Tang, the Deltastream Energy CEO, is one of the most upbeat people in the industry. He says by the end of this month all his company’s wells in the Marten Hills will be shut in.
That means no oil flowing in the brand new pipeline built especially for the new production from Deltastream and others in that area east of Slave Lake.
“Nobody wants the oil,” say Tang. “Right now we’re only making a dollar a barrel!”
Tang is confident the price will rise. By how much, and how long it takes to get back to where it’s possible to make a profit is hard to say.
“COVID won’t last forever,” he says. “Let’s give it a year, or eight months.”