Sedgewick, Alta.– Very few companies in the oilpatch last 60 years. Fewer still remain as the same legal entity throughout that time. But on Feb. 22, Arnett & Burgess Pipeliners Ltd. hit six decades in operation.
The company recently transitioned to its third generation running the business. Carey Arnett became president in January although her father Tom Arnett is still CEO. Carey spoke to Pipeline News on March 20.
The company was founded by Les Arnett (Carey’s grandfather) and Ray Burgess in 1957. Les became one of the founding members of the Canadian Gas Association in 1959. Ray Burgess sold his interests in the business to Les Arnett in 1968 to pursue an opportunity in Australia.
The Arnett family has run the company for its entire lifespan, although Carey said that, “The people who have worked at A&B have run it. We’re here to support the guys who run it.”
The company established permanent roots in Sedgewick, Alta., in 1974. Tom Arnett, Les’ son, became president in 1988. In 1996 they built new offices at Sedgewick.
The 21st century saw the establishment of several field offices across the west. In 2002 they opened a field office in Bashaw, Alta. Another was opened in Athabasca, Alta., in 2008.
Six years ago A&B opened an office in Regina, and two years later set up shop in Estevan. Their current Estevan location is immediately adjacent to the printing plant that prints Pipeline News, on the west side of the city.
In 2014 Quanta Services acquired A&B. It includes Banister and O.J. Pipelines among its 21 onshore oil and gas infrastructure divisions. It also has numerous electrical power divisions.
“We are shareholders within the larger entity,” Arnett said. “We all run as basically independent owner operators, but with the governance expected of a public company,” she said.
In 2015, Arnett & Burgess Pipeliners (Rockies) LLC was established to service the northern Rockies and Bakken infrastructure needs. And if you’re wondering why those Bakken needs aren’t out of Estevan, it’s because in 2016 the company established a presence in Watford City, N.D., in the North Dakota Bakken field. “We’re really busy in North Dakota right now,” she said, with about 50 workers there. A&B Pipeliner’s affiliation with Quanta made it much easier to start operations in the United States, since they already had established business apparatus for things like health care plans. That’s not much of a consideration in Canada.
Last year the company opened a new office and fab shop at Sedgewick.
“This past winter we had about 650 people at peak in the field, plus additional staff in the office,” said Carey. Their manhours have been at pretty much record levels, but prices are still “compressed” due to the downturn in the oil sector.
Carey said they have “fairly diversified and loyal customers.”
In Saskatchewan, they’ve been reasonably active. The construction of the Regina bypass meant there was work to be had relocating pipelines, out of the way of the new bypass. They’ve also worked on pipeline integrity projects and even in the potash sector.
For 2017, she said, “I think it’s interesting for us. We’re expanding in capacity and geography.”
While there are major mainline projects in the works for Canada, she noted they are not a mainline, big-inch pipeline contractor. Rather, their forte is in medium-diameter work.
Since the new year, Pipeline News has been asking nearly everyone when they feel they will be able to start bringing the rates they charge their clients back up. Carey noted that different areas of the industries had been hit with various cuts, and they were not uniform. She added there has been tremendous inflation of costs, with the low Canadian dollar making buying equipment much more expensive. While labour costs may have gone down 10 per cent, the cost of equipment has gone up 35 per cent.
The rate cuts have come to an unsustainable level, and she fears the inelasticity of quality inputs will mean price inflation if things go up too quickly.
Also, there’s been a big exodus of workers in the industry. “Any pipeliner not from here went home,” she said. When it’s time to start bringing people back into the industry, it will be a challenge, as you can’t just put anyone to work. Carey pointed out there’s a difference between a labourer and a pipeline labourer, for instance.
“Competency is so important,” she said.
