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Gold/Mining/Energy : Alpine Oil Services ASL TSE -- Ignore unavailable to you. Want to Upgrade?

To: Jason Krueger who wrote (225)	3/8/1998 5:45:00 AM
From: Anthony Wong	Read Replies (2) \| Respond to of 896

Crude awakening? Oil price drop may actually help the Peace Country gas industry. Here's why. TODD NOGIER Herald-Tribune staff Sagging oil prices may dampen the record-setting enthusiasm of oil producers in other parts of the province, but they might actually be good for the Peace Country, says an industry analyst. Don Herring, managing director of the Canadian Association of Oil Well Drilling Contractors, said drilling for lower priced heavy oil might abate slightly but exploring for natural gas could actually pick up. That's good for the gas-rich Grande Prairie region. "We could see a drop in crude oil drilling particularly with respect to heavy oil and what we'll see is some offset on the natural gas side," Herring said from his Calgary office. The association predicted 16,600 oil wells would be drilled this year, 15 per cent higher than last year - the best year on record. Crude oil prices, scraping near the bottom of the barrel (between $15 and $17 US per barrel) threaten to throw those projections off. But that might only mean a slight shift in work from the eastern half of Alberta to the northwest, speculates Herring. Alpine Oil Services Corp. has drilling and servicing operations scattered throughout the province but the Grande Prairie region is among its busiest, according to local production base manager Mike Ley. His local crew of 60 is working "flat out" 14 hours per day, seven days a week, trying to keep up. When asked how long his workers can keep it up, he laughed and replied, "til they all fall over." Dave Barclay of Alberta Gold Well Servicing Corp. Ltd. said his 110 workers are so busy he's having to turn away business. And it's only going to get better for the region, suggests Herring. A new push for deeper seated gas reserves and lighter oil will keep work crews in the field longer which should maintain the health of the industry despite a potential drop in the number of drills projected in earlier forecasts, he said. Alberta Energy Company Ltd., announced in February it was shifting resources away from heavy oil and into gas exploration. Turk Taylor of Canadian Hunter Exploration Ltd., one of the most active gas exploration companies in the region, said there is renewed excitement in gas mainly because of the possibility Alberta may be the supplier of some of the most gas-thirsty markets in North America. Alliance Pipeline promises to build a $3.7 billion pipeline from Fort St. John to Chicago, U.S. Nova Corp. and TransCanada Pipelines Ltd. await regulatory approval on their merger. Both projects would relieve a bottleneck of gas supply at Alberta's borders. Taylor said the challenge for companies like his is to find enough gas to fill the pipelines. "It's a little more difficult to find the big gas . . . but whenever someone, it doesn't matter who it is, finds a big volume, well it just buoys everybody else up and away we go." Taylor said the high times are sure to last into the new millennium. And for those worrying about fluctuating commodity prices, Herring says even if drilling activity cools somewhat, the level will still likely be a lot higher than the last economic slowdown. "In 1992 we drilled just over 4000 wells so we're so far different from that." bowesnet.com