Maidstone– “There’s definitely a lot more traffic. Traffic-wise, that means dollars,” said Kevin Pike, partner in Maidstone’s Keranda Industrial Supply Ltd.
The supply store caters to both the oilfield and agriculture, and that’s a good thing, too, since agriculture picked up some of the slack of the downturn that has impacted the patch since 2014.
“We’ve been pretty steady,” he said on Feb. 21. Their business supports both the oil sector and agriculture.
Maidstone, in a way, has been an early leader in the steam assisted gravity drainage (SAGD) method of heavy oil extraction, with the Pike’s Peak plant north of the community having several decades of operation under its belt, and Pike’s Peak South was built nearby a few years ago, not far from where Kevin Pike lives.
Husky is looking at several thermal heavy oil projects in the area, each 10,000 bpd. The Rush Lake thermal plant, roughly 16 kilometres due east of Maidstone, has a large pad cleared for Rush Lake 2, the second project there. Others are in consideration for the region, including Dee Valley, 10 kilometres north of Maidstone.
Once these operations get going, however, they don’t have a lot of supply store needs.
When Keranda started 37 years ago, about 30 per cent of their business was oil, and 70 per cent was farm and urban. Oil grew to the point where it was 70 per cent of the business. Now things are about 50/50.
“Ag was stable,” Pike said, but added, “Mind you, the last three years have had really nice crops. Farmers are builders. If they’re doing well, they’re putting up shops, etc.”
However, the last harvest was a tough one. “Guys were swathing in the snow,” Pike said.
When it comes to oilfield supply, Keranda is a classic “rope, soap and dope” store, carrying the usual items crews need to keep things working in the field. There’s lot of hosing, cam-locks, filters, hydraulics and tools being picked up for workers.
“We do supply a lot of things to the oilfield, like mechanics – tune-up kits, material,” Pike said.
They don’t see a big spike in business when a new thermal plant is built, as much of that is supplied from elsewhere.
In June 2016 business flattened out then started to pick up slowly. Pike said, “We found our bottom about eight months ago. Year-to-year, we’re going up slightly.”
“Sometimes slow growth is better than the pounding when it gets out of hand,” he said.
Unlike most oilfield services companies Pipeline News has spoken to over the past year, Keranda did not go into layoff mode when the downturn hit.
“No, I wouldn’t lay anyone off. They’re too hard to train,” he said. It resulted in the company dipping into its coffers, but they still have the people they had in 2014, 11 in total.
“We’re definitely more organized than we used to be,” he said. They tore sections of the store apart and got things organized during the downturn. The benefits of that work will be long-lasting. “If it speeds up again, everyone will have to shift one gear. A lot of things are organized a lot better,” he said.
For 2017, Pike said, “We’re optimistic. We’re always optimistic. That’s why we kept all our staff.”
