Monday, January 19, 2015

Candid Thoughts on Being an Oil Patch Worker and Owning a Home in Fort McMurray Part II

On ground level within the small box of my own daily existence, I've noted a cooling off in the housing market and cheaper prices at the pumps.  Gas prices in my little corner of Fort McMurray are almost down to the level they were when I first came here in 2009.  My work has been affected insofar as my work schedule will be changing once again this coming week.  This is something I used to freak out over a little as I AM a creature of habit.  But this will be the fifth different work schedule I've had now so I adjust and deal with it.  I'm actually not seeing a reduction in hours but they are just distributed a bit differently.  For about a year I had been working 7 on/7 off.  Having worked as many as 18 days with three days off, I found that having an entire week off a bit trying at times.  Not so bad during the summer but a bit painful during winter.  I figure if it's going to be cold and dark I'd rather be working and getting paid for it than at home.  With the shutdown coming this spring I should be able to pick up some overtime easily enough.  Perhaps not quite at the level I was getting a year or two ago but I'll take what I can get.  I'm not one of those people who simply came here to make "hockey sacks of money", to use the phrase of the Edmonton police chief that I alluded to in a recent post.  I came to make a life for myself.  My son was born here and of course, I bought my first house here.  The mortgage on said house is up for renewal in a couple months, just to make life interesting.  But again, I like to keep a level head and think long term.  Whining and griping about the situation or about Fort McMurray as perhaps some are wont to do,  doesn't really solve anything in the long term.

For the curious, I know it costs Suncor $37-and-change to produce a barrel of oil.  I don't have the exact figure but I know its between $37 and $38.  So selling currently at a little under $50/barrel, they don't make loads of cash like they did when the price was over $100, but they stil make something.  If it drops below the $37 threshold, things will get interesting but as I mentioned in my previous post, they have other products on the market like diesel to help smooth out the bumps in the road, at least for the short term.  

One good thing about living in town is that I expect locals will have an easier time of this than those in camp.  I've already heard stories of cuts being made to camp and I know that within my own trade that first year apprentices will no longer have the camp option.  It just makes better business sense to have people from town in times like this.  Suncor saves money on camp costs.  I keep working.  And everyone is happy.  The area I work in is important for the overall maintenance of the upgrading area in which I play my own small part.  I suspect that oil would have to drop quite drastically before the yard I work in shuts down.    Pretty much every other trade on site needs scaffolders to do their job.  Unless the work is right at ground level (and most often it isn't) everyone from insulators to pipe fitters to mechanics to welders to electricians often needs scaffolding erected in order to do their job.  Another fortunate thing is that with tenants I can absorb some of the extra costs of potentially working less hours.  (There have been a couple times where this has been a big help.)  They also serve as further sources of information about the happenings at both Suncor and Syncrude, the two big players in this industry.

Of course, while this is my first experience here with a downturn, this is far from the first time this has happened here.   I would be lying if I said I wasn't a bit concerned but I'm not in any sort of freak out mode either.  I don't mean to sound like an expert on this entire issue.  I certainly am not.  Perhaps the best that can be said is that I intend to weather the storm, keep my ear to the ground and be smart about things.....and stay positive too.

Sunday, January 18, 2015

Candid Thoughts on Being an Oil Patch Worker and Owning a Home in Fort McMurray Part I

I recall during the first year of my history degree circa 1996 that there were 5 main areas of history.  A few chuckled as the teaching assistant wrote the acronym S.P.E.R.M. on the board.  Along with the subject of my first undergraduate paper of my degree, this is one of the few things I recall from back then with any degree of clarity.  "S" for Social, "P" for Political, "E" for Economic, "R" for Religious and "M" for Military.  I'd have to say my strongest areas were political and military. Indeed that first paper I wrote, on the Spanish Armada of 1588, proved to be a good indicator of my future focus on things political and military.  Social history for me wasn't much of an interest but as it turned out, it grew on me and if I can tot my own horn, one of my best papers was a social history senior undergrad course.  I don't recall the exact thesis but it focused on the concept of the extended family units (zadrugi) of what is now part modern Serbia.  Religious history came up when it melded in to political or social aspects of a given topic I happened to be reading up on.  So now that brings us to the last area of history, economic.

Economic history was never really a focus for me.  Other than a reference to the Great Depression or a paragraph or two on why, say Nazi Germany only fell further and further behind the Allies in the Second World War, this wasn't an area I felt comfortable delving in to with any degree of comfort or knowledge.  In my defense, hey....there are FIVE main area here.  I suppose I can only focus on so many of them.  I do find myself wishing I had taken at least one economics course but c'est la vie.

I bring this trip down memory lane up as a segue into our present situation here with the price of oil taking a bit of a beating.  I've had a few people ask me how I'm doing, what I think will happen and so forth but I must admit I'm not an expert.  I can however, by way of compensation relate what I've found out so far and how this has effected me.

This is my first big downturn here.  I missed the first big drop in 2008 when I was living in Nunavut.  I have to say that compared to Nunavut, I thought prices here were pretty reasonable on most goods.  I'm not a big consumer of "stuff" but it wasn't until I started hearing other people comment about high prices here and I had been to Edmonton a few times that I began to realize this.  I DID know that houses were expensive here and have to laugh when I recall a radio spot I heard when I first moved here for some town homes...."Affordable family housing starting at 469K".  Granted, I did check out one of these units and they ARE nice.  I suppose the "affordable" part is in the eye of the beholder.  That was almost 5 years ago now.  Oil was recovering from its 2008 drop with market prices rising those prices actually don't look as insane now.  Ah, perspective.

So anyway, I did buy a house here eventually.  A first time home owner and it happens to be in the Fort McMurray market.  I'm not sure how many people fit in to that category but we must be a select group I would think.  No, I'm not rich.  I don't have a pool of bitumen lying under my house that I can tap in to (and I wouldn't own it any way even if there was one).  I'm a market's worst nightmare and I think that's helped.  ME at least.  I just don't buy a lot of "stuff".  I don't really need it.

Anyhow, while I've tended to be good with a budget, it would be nice to have a bit more of an economics background just to navigate my brain through the latest economic turmoil.  Lots of people buy houses.  I just happened to turn it in to an extreme sport by getting in to one of the craziest markets in the country in a community whose economic base is centred around one commodity  But the men with the white coats haven't shown up on my door step so there you go.  So far, so good though.  

So here is some of the "stuff" that's been floating around in my brain lately.  Most of the hard info comes from random conversations with the higher ups at work and other people I know, living either in camp or in town here.  Any errors, mistakes or wild delusions are of course, my own.  As I site here typing this a barrel of West Texas Intermediate sits at $48.69US/barrel.  It costs Suncor, where I work, a little over $37 to produce a barrel of oil.  I can't recall the amount exactly but have been told it lies between $37-$38.  Obviously, they aren't making as much if it were over $100 as in the past but they can still make a profit.  (Checking the price of oil has become more a regular  daily habit as of late than collecting the mail.)

Concerning for sure but I'm not in a full on panic.  Suncor is big boys in the oil sand game and has been here awhile.  I've been told that because of their size and diversity they are in a much better position to withstand the beating oil is taking than some of the smaller players on both sides of the border.  Suncor here produces a lot of diesel here as well (it isn't just ALL oil) and the fact that it supplies other sites with diesel for all their heavy equipment along with the high price of diesel, means that they can, to a certain extent, make up a bit for short falls in oil.  As for how long this will go on idea.  I know OPEC wants to squeeze out the smaller players and no doubt some will be feeling the pinch.  Of course we aren't impervious to world events here but perhaps are in a better position than most to weather the storm.

So that in a nutshell is my view of the big picture (such as it is).  In Part II, I'll comment more on how how this impacts me on a everyday level.

Saturday, January 17, 2015

Fort McMurray Sports Mecca

I know many words come to mind when a person thinks of Fort McMurray.  Some of them aren't always flattering.  For me, personally, Fort McMurray is home.  I live here, bought my first house here. My son was born here.

The words "northern sports mecca" don't really spring to mind.  But that seems to be what is happening here as our community is  lined up to host several sporting events over the coming months.  This March,  Keyano College will play host to Alberta Colleges Athletic Conference's  basketball championship.  Next year, the college hosts the Canadian Colleges Athletic Association men's basketball championships. And that's just basketball.  The Grand Slam of Curling returns to MacDonald Island March 19-22 for curling fans.

This coming June (June 13, to be exact), the newly opened Shell Place will host the Northern Kickoff, an official pre-season game between the Edmonton Eskimos and the Saskatchewan Roughriders.....the most northern CFL game in league history.  TSN will be covering the game.

Then August 7-16,  Fort McMurray plays host to the Western Canada Summer Games.  Next summer, it's the 2016 Baseball Canada Cup.

Definitely tons on the go and it's great to see the community have a chance to shine on a national stage.

Friday, January 16, 2015

Say What?

When I first read the tripe of Edmonton police chief Ron Knecht regarding my community as a source of terrorism funding, I rolled my eyes and probably uttered an expletive (sorry mom).  I've grown used to the so-called "experts" out there spouting off about the region.  The vast majority of this tripe isn't based on fact but since I can't obviously respond to every piece out there I've learned to grow selective in what I respond to.  This latest nonsense though is so irresponsible that I can't let it pass.  Apparently, Fort McMurray is a hot bed  for terrorism.   At least according to the Edmonton Police Chief.

Give me a break, Chief Knecht.  Perhaps you should look in your own backyard first.  To insinuate that somehow this is a problem specific to Fort McMurray is absolutely ridiculous.  In case you haven't noticed, oil has been sliding for several weeks now. There are no hockey sacks full of money to be found.  And yes, I know you may have had the Ottawa shooting suspect in mind but one outlier doesn't prove a case for a rampant problem. And when pressed for a solid number by Global News, Knecht waffled.  "There's no way of telling.  We know there's some but there's no way of putting that down to a number."  The man should be a politician.  So there MIGHT be a problem.  We're not sure of exact numbers but regardless we think there could be.  Um, okay.

Of course all reports of home grown terrorists heading abroad out of this province at least, have come out of of either Edmonton or Calgary.  If there were any reports of individuals coming from our region, the Chief is silent.

Oh, and by the way. our international airport has exactly ZERO flights to either Europe or the Middle East.  As a matter of fact, the closest international airport with flights to Europe happens to be in....well, Edmonton.  Oops.  If Knecht is worried about security checks.  Well HE'S the police for crying out loud.  Don't blame my community because you are unable to do your job, Chief.   This is a national issue, Mr. Knecht.  It certainly isn't limited to one community and to hint otherwise is highly irresponsible.  Our community faces enough challenges ahead with falling oil prices.  There is no need to add to this with fear-mongering, finger pointing and vacuous thinking.

Thursday, January 15, 2015

The Wheel Turns But The Hamster Died Long Ago

You have to love it when politicians and overpaid bureaucrats waste your hard-earned money (and time) just in order to state the obvious.  Witness the case of the beleaguered Northland School Division.  In January 2010, then Education Minister Dave Hancock fired the entire board of trustees and placed them with on government-appointed trustee appointed by the government.  At the time, I felt this was long overdue.  It was obvious to anyone capable of drawing oxygen that the school board was a complete mess....too many bureaucrats, too much wasted money, deplorable staff housing conditions and most egregious off all of course, its utter failure (as witnessed by its abysmal provincial test scores) to do what it is supposed to do...namely, educate students.

After several rounds of consultation with its stake holders, a report was issues detailing a number of recommendations.  If memory serves me correctly it was something in the neighborhood of 24.  Twenty-four ways to help deal with the mess.   Rather than adopting all or even a few of them, Minister Hancock adopted a grand total - the recommendation to hold further meetings and consultations.  Because if there's one thing politicians love it's talk....and by extension, all that resultant paperwork. At the time, Hancock justified this by saying that well, it's not my place to come in an act like a dictator and tell people what to do.  How is this consistent with arbitrarily firing the entire board of trustees?  Well, he didn't say.

Fast forward to 2013.  Nothing substantive had been accomplished in terms of improving student performance, something I touched base on early last year.  Hancock was history and Jeff Johnson was running the show.  Johnson loves his legislation apparently.  When I contacted him regarding why he had chosen to vote against allowing GSA's in Alberta schools, his response was that the proposal that would have allowed this was unnecessary because there is legislation (read more paperwork) in place to help deal with that.  For someone who seems to abhor critical thought, I found his love for reading and paperwork a bit odd, but I digress.

Fast forward to the end of last year.  Johnson is mercifully gone, having been shuffled into the seniors portfolio which seems appropriate given his geriatric thinking.  Now, we have Gordon Dirks.  To be fair,  I'm not too familiar with Dirks but I know he's been hot water in some quarters given a certain cosiness with right-wing religious groups.  Perhaps his solution will be to pray the problem away.

A couple years ago, the government quietly released a report stating that Northland needs to be rebuilt. So the government has now essentially wasted 5 years and who knows how much tax money to wind up with yet another report that changes need to be made.  And Albertans are cheering of course because we never could have figured out the obvious on our own without the sage council of politicians.  I know I've become rather cynical of politicians in recent years so forgive me if this looks more like an extended exercise in giving the APPEARANCE of taking action without actually DOING anything.  In the months to come I expect yet more wrangling over how to rebuild the boards, what recommendations of the report to put in to place, what ones not to put in place, how to set everything up, how to monitor it and so forth.  In other words, another ponderous make work project.  While I knew back then this would take time, I never would have guessed then that this all would have lasted through 3 different education ministers.  In the meantime, students at Northland School Division continue to fall behind.

It's all enough to make me want to open up the hamster cage and retrieve the furry creature.  It's obvious to all but politicians that it ossified long ago.