Growing like crazy in tough times: Cougar Wellhead

German immigrant family launched second company in 2015

Lloydminster – Peter Neufeld, a German master machinist and master millwright, brought his family to Canada in 2000 to live here a few years to see if they liked it. Now, 18 years later, his second company, started during the oil downturn, was displaying new progressive cavity pump drive heads at the Lloydminster Heavy Oil Show.

Neufeld heads up family-owned and operated Cougar Machine Ltd., which started in 2003, and its sister company Cougar Wellhead Services Inc., which started three years ago. Cougar Machine is a custom machining shop, based in Edmonton. They do the manufacturing for Cougar Wellhead.

The Cougar Wellhead drive unit is a hydraulic in-line drive. That means there is no belt drive to an offset motor. On a conventional belt-drive unit, speeds are typically changed by changing the sheaves. The Cougar unit uses a variable frequency drive (VFD) allowing much greater variation in speed. “It’s a new innovation,” he said.

These hydraulic units are targeting for the Lloydminster market. They have a sales and service location in Lloydminster.

The company has sales in Venezuela, Australia, Argentina and the United States. They have direct sales but most of their sales are done through various distributors.

Most of their drive units are in heavy oil.

Asked about Venezuela, whose economy is in tatters, he noted they are prepaid in U.S. funds.

Neufeld’s background is as a master machinist and master millwright, trades that he noted don’t have a direct equivalent in Canada. They had visited Canada before, and in 2000, they moved here with the intention of staying two years. “After one year, we decided to stay,” he said.

His son, Ronny, is a mechanical engineer, and just the week before the oil show, joined the company fulltime. His wife, Lilia, is a nurse, who is also in the process of coming over to Cougar fulltime, where she handles the bookwork. Daughter Lea is in a paralegal program in university and does human resources support for the company.

“It’s growing like crazy,” Neufeld said, noting they’ve sold over 300 drives in Alberta, adding, “We have a 500-drive backlog on our books,”

The company offers an exchange program for competitors drive units. “Instead of repairing an old drive, we give you a new one,” he said.

On the wellhead side, they have 12 to 15 people working, and on the machine shop side, its 35 to 40. About one-quarter of the machine shop work is dedicated to the wellhead drive unit manufacturing, the remainder is custom work for outside clients.

While most companies in the oilpatch have shrunk substantially in this downturn as well as during previous downturns, Neufeld sees opportunity in tough times. “In 2009, when the first hit came, for Cougar Machine, it was our best year,” he said.

That year they bought six new CNC (computer numerical control) machines.

Thus, in 2015, when this current downturn was hitting really hard, they launched Cougar Wellhead.

“In 2015, when Wellhead came up, people told me, ‘You’re nuts. Save your money to survive,’” Neufeld recounted. Instead, they developed more than 10 different drive unit models over the next three years, and typically have two to three in research and development.

“We doubled since 2014,” he said. “As you get pushed, you have to grow.”

Indeed, he’s found they’re even turning away work.

Neufeld is a big fan of shows like the Lloydminster Heavy Oil Show. He frequents a show in Europe which happens every four years, highlighting the latest in manufacturing technology. To that end, he finds that Europe is generally ahead of North America, so he’s looking for new things to stay on top, such as new CNC machines.

They have a day shift and night shift, he noted, but the CNC machines can run all night. With the lights off, the machines still make money.

As the interview progressed, a woman came along to the booth and asked for a long metal shoehorn. Every trade show typically has one or to items of swag giveaways that becomes the object of desire for that show, and arguably Cougar hit a home run. They made steel shoehorns, 72 centimetres long, with their name, Cougar, punched through in stencilled letters.

Unlike other swag, he doesn’t expect these shoehorns to rapidly be tossed away. “People will talk about it at Christmas time!” he said, with lasting impact being his goal.

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