Nova Scotia's Premier Unveils $35MM Onshore Rig Construction Project

Government of Nova Scotia

A $35-million project for the construction of the first two onshore drilling rigs ever built in Nova Scotia was announced in Sydney on Oct 17.

Premier Rodney MacDonald said the rigs will be built for Nabors Canada by Laurentian Energy Corporation at its Sydport facility in Sydney.

"I acknowledge and applaud the hardworking men and women of Nova Scotia who have proven they can take on projects such as this," said Premier MacDonald. "This work builds on the success of the Offshore Strategic Energy Agreement between the province and EnCana Corporation and shows what happens when a government is committed to creating jobs, when businesses believe in Nova Scotia, and when a capable, well-trained and reliable work force is determined to put out a superior product."

Also taking part in the announcement were Peter Shankel, drilling manager for EnCana's Deep Panuke project, Duane Mather, president of Nabors Canada, and James Wooder, CEO of Laurentian Energy Corporation.

"EnCana is pleased to support this initiative," said Shankel. "Laurentian has proven that it can do good, solid work on the fabrication of rig modules and here is the opportunity to step up to the manufacturing of entire rigs."

Mather said Laurentian workers did such an excellent job on the rig modules in 2007 that Nabors had no hesitation in awarding this new project to the company.

"Nabors Canada is excited to participate in this project," said Mather. "It gives us the opportunity to acquire additional drilling rigs more quickly in this very competitive market by using very qualified and experienced workers here in Nova Scotia."

Wooder said this second contract with Nabors is a big vote of confidence in Nova Scotia workers. "It will allow our employees and subcontractors to complete the rig manufacturing learning curve and position the company to continue to service the western Canadian oil industry from right here in Cape Breton," he said.

Wooder said Dartmouth company RKO Steel, will be doing some of the fabrication work. The project, already underway in Dartmouth and Sydney, will provide at least 150,000 hours of work or about 75 jobs.

"What is really significant here is the fact that, in a relatively short period, we have developed the capacity to build this type of land rig right here in Nova Scotia," said Premier MacDonald.

The premier attributed this to several factors including the willingness of EnCana to take Nova Scotians to Alberta to learn the skills and technology required to build land rigs, Nabors' foresight to expand its supply base and invest money and resources to develop the rigs in Nova Scotia, and Laurentian's strong performance in the relationship it has forged with Nabors.

The two programmable AC electric drilling rigs will have cantilevered masts that extend to a height of 42.6 metres (142 feet), with top-driven drills and a load capacity of 247,500 kilograms (550,000 pounds). They incorporate state-of-the-art technology that Nabors has developed and is transferring to Nova Scotia workers through this project. All fabrication, electrical, hydraulic, mechanical, welding, painting and sandblasting work will be completed in Nova Scotia, including final assembly and commissioning.

Laurentian gained experience constructing rig components in 2007 as part of an earlier contract with Nabors, which also was facilitated by EnCana. That work involved building components for Nabors' heli-rigs, giant onshore drilling rigs transported to remote areas by helicopter. It was part of EnCana's commitment to the province, under the Deep Panuke development agreement, to commit financial and human resources to help develop the capability to manufacture onshore rigs in Nova Scotia.

Nabors Canada, based in Calgary, is the Canadian arm of the largest drilling company in the world, Nabors Industries Ltd. of Houston, Texas.

Laurentian Energy owns and operates Sydport Industrial Park located in Edwardsville, Cape Breton with direct access to Sydney Harbour.