1999 Annual Report
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135 Members

PTAC Member Organizations
As of March 20, 2000

Producers

Alberta Energy Company Ltd.

Anderson Exploration Ltd.

Barrington Petroleum Ltd.

BP Amoco Petroleum

Burlington Resources Canada Energy Ltd.

Canadian Hunter Exploration Ltd.

Crestar Energy

Encal Energy Ltd.

Fletcher Challenge Energy Canada Inc

Gulf Canada Resources Limited

Husky Oil Operations Ltd

Imperial Oil Limited

Maxx Petroleum Ltd.

Murphy Oil Company Ltd.

Northstar Energy Corporation

Numac Energy Inc.

Ocelot Energy Inc.

PanCanadian Petroleum Limited

Penn West Petroleum Ltd.

Petro-Canada Resources

PrimeWest Energy Inc.

Ranger Oil Limited

Renaissance Energy Ltd.

Shell Canada Resources Ltd.

Suncor Inc. - Resources Group

Talisman Energy Inc.

Union Pacific Resources Inc. (UPRI)

Wascana Energy Inc.

Westpoint Energy Inc.

Service & Supply Companies

Adams Pearson Associates Inc.

Advanced Geotechnology Inc.

Air Liquide Canada Inc.

Alpine Environmental Ltd.

Aqueolic Canada

Barlon Engineering Group Inc.

Benhope Energy Inc.

Brine-Add Fluids Ltd.

Business Development Bank of Canada

Canwell Enviro-Industries Ltd.

Centre for Passive Sampling Technology

CHEM-PET Process Technology Ltd.

Clearstone Engineering Ltd.

Colt Engineering, Core Project Group

Computalog Ltd.

Computer Modelling Group Ltd.

D.E. Towson and Associates Inc.

Duke Engineering Services

EBA Engineering Consultants Ltd.

e-Energy Inc.

Enerplus Energy Services Ltd.

EnviroTest Laboratories

Epic Consulting Services Limited

ESG International Ltd.

Foothills Diamond Coring

Gris Gun Manufacturing Inc.

HCI StanchemTravis Chemicals

Hycal Energy Research Laboratories Ltd.

InStream Group

John Zink Canada

KBL Land Use Consulting Ltd.

Kootenay Powder Coating Ltd.

KPMG High Technology Practice Group

Kudu Industries

Lloyd Energy Inc.

Mactronic Ltd.

Malibu Engineering

Matrix Solutions Inc.

Membrane Technology and Research

Mercury Electric Corporation

Millennium EMS Solutions Ltd.

MJ Blair Corporation

NetworkOil Canada Inc.

NEWALTA Corporation

New Paradigm Engineering Ltd.

Noetic Engineering Inc.

Nordic Engineering

Norwest Labs

Nowsco-Fracmaster Ltd.

Ogilvie and Company

Oil Technology (0verseas) Inc.

Omnicon Consultants Inc.

OnX.com

Opsco’92

PCP International Inc.

Petro-Studies Consultants Inc.

Proalta Machine and Manufacturing Ltd.

Process Optimization

Promore

Prudential Steel Ltd.

Quest an Alliance Corporation

Questor Technology Inc.

Radian Canada

Ryan Energy Technologies Inc.

SAIC Canada

Schlumberger of Canada

TankSafe Inc.

Tornado Flare Systems

Trican Well Service Ltd.

Vaela Technologies Ltd.

Variperm Canada Ltd.

Vik International Inc.

WellBid Inc.

Winterhawk Technologies Ltd.

Individuals

Adler, Dr. George

Ayasse, Conrad

Bolt, Richard

Burnside, Wayne

Carleton, Mike

Gaudet, Denis

Logan, Al

Luhning, Richard

Mathew, Roy

McCann, Tom

Neulander, John

Porteous, Bob

Putt, Ken

Robertson, Duncan

Stephens, Mark

Todd, Murray

Tzanco, Elena

Willson, Diana

Wilson, Kenneth

Research Providers

Alberta Research Council

Alberta Sulphur Research Ltd.

C-FER Technologies Inc.

GRI

Natural Resources Canada (CANMET)

Petroleum Recovery Institute

Petroleum Technology
Research Centre

Saskatchewan Research Council

TIPM Laboratory (Perm Inc.)

Learning Institutions

University of Alberta

University of Calgary

University of Regina,
Faculty of Engineering

Government

AOSTRA

Founding Supporter

Canadian Business Networks Coalition (CBNC)


1999 Achievements
PTAC growth and R&D project results

1999 Key Accomplishments

  • Record Number of R&D Projects Launched
  • R&D Project Results Realized
  • Increased Membership
  • Hosted Successful Workshops, Forums and Technology Information Sessions
  • Formalized Environmental R&D Framework and Process
  • Played Key Role in Founding COURSE
    (Coordination of University Research for Synergy and Effectiveness)

Message from the Board of Directors

PTAC continued to grow in 1999 and realized several significant milestones. We added 33 new members, hosted a record 31 Technology Information Sessions, sponsored 6 workshops and forums, issued 10 Requests for Proposals (RFPs), and facilitated the launch of an unprecedented number of R&D projects – 26 projects valued at $4.5 million. PTAC has facilitated the launch of 51 R&D projects valued at $10.6 million since inception in 1996. The results of 18 of these projects, including our first project on Water Content and Physical Properties of Acid Gases, have been provided to funders and whenever possible to other interested parties.

A significant milestone was the formalization of an Environmental R&D Framework and Process Model for the upstream oil and gas industry with CAPP (Canadian Association of Petroleum Producers). PTAC will provide overall facilitation and coordination for an improved approach, which is expected to provide a multitude of benefits to stakeholders.

PTAC played a key role in the founding of COURSE (Coordination of University Research for Synergy and Effectiveness), a new mechanism for funding fundamental energy related research in Alberta, which resulted in the launch of 15 new university research projects in 1999.

For the first time PTAC facilitated initiatives in e-commerce, which led to the publication of a business case document and the creation of an
e-procurement standards working group in 1999.

Our successful track record for launching R&D initiatives has become more widely known. As a result, new oil and gas related initiatives are increasingly finding their way to PTAC’s doorstep for facilitation.

On behalf of the Board, we would like to thank PTAC staff and volunteers on committees, workshops and projects for their dedication and efforts. Our vision of applying leading-edge technology developed through collaboration is becoming a reality.

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Eric Lloyd
President of PTAC
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Alan Archibald
Chairman of PTAC

Projects Completed
R&D Project Results Realized

A total of 18 PTAC facilitated projects have been completed to date and the results reported to funders and whenever possible, to other interested parties. Most project results have been made available through PTAC Technology Information Sessions. However some project results are proprietary and only available to funders. Results have been made available for the following 13 projects, as well as five others launched in 1999.

Conventional Heavy Oil

  • Development of Full Project Engineering and Economics for the VAPEX Process
  • Assessment of Heavy Oil Fluid Gathering System Alternatives
  • Cyclic Waterflood Simulation Study
  • Reducing the Cost of Tank Cleaning in Heavy Oil Operations
  • Evaluation of Markets for Produced Sand

Drilling

  • Research and Software Development Project to Reduce Drilling and Completion Costs Associated with Borehole Instability

Natural Gas Production

  • Water Content and Physical Properties of Acid Gases
  • Onsite Electrical Generation from Flare Gas

Oil Production

  • Predicting Internal Pitting Corrosion of Multiphase Pipelines

Reservoir Recovery / Geoscience

  • Field Pilot for Water Abatement in Gas Reservoirs
  • Economically Beneficial Waste Gas Injection for Medium/Heavy Oil Depletion

Well Completion

  • Field Pilot for Near Well Treatment to Reduce Gas Coning/Channelling
  • Low Cost, High Performance Diverting and Blocking

Launched
R&D Projects Launched in 1999

PTAC facilitated the launch of 26 projects valued at $4.5 million during 1999. Further information on these projects, which are listed below, can be obtained by reading our 1999 newsletters or visiting our project index on our website (www.ptac.org). We expect to launch 25 additional projects during 2000 in the areas of: flaring; greenhouse gas (GHG) and fugitive emissions; human, ecological and animal health; heavy oil artificial lift; enhanced oil recovery; fundamental drilling research; and downhole technologies.

Conventional Heavy Oil

  • Thermal Solvent Process – Field Scale Engineering and Economics
  • In Situ and Refinery Upgrading of VAPEX Heavy Oil Production (VAPEX Phase II)**
  • Casing Deformation Study
  • VAPEX Refinery Upgrading Project
  • Bio-upgrading for Heavy Crude Quality Improvement*

Environmental

  • Assessment of Phytoremediation as an In Situ Technique for Cleaning Oil Contaminated Sites**
  • Hydrophobic Soils
  • Fugitive Emissions**
  • Evaluation of Past Revegetation Mitigation Efforts
  • Flaring Mitigation Centre Market Assessment**
  • Gas Plant Remediation*
  • Emissions from Individual Oil and Gas Reservoirs*

Natural Gas Production

  • Mitigation of Harmonic Distortions in Oilfield Electrical Systems*

Oil Sands

  • Novel Hardfacing Material System for the Oil Sands Industry*
  • Investigation of Mass-Transfer Mechanisms in the VAPEX Process*
  • Online Air-content Determination and Analysis (OSADA) Technology for Oil Sands Slurry Pipelines*
  • Solids Distribution in Hydrotransport Process*
  • Separation of Water and Fine Solids Through Asphaltenes Precipitation*
  • Oil Sand Lump Size Estimation by 3-D Sensing*
  • Particle Flow Modelling of Oil Sands Excavation*
  • Production of Rutile Concentrate from Oil Sands Tailings*
  • Role of Microbial Process on Sulfate-Enriched Tailings Deposits*

Reservoir Recovery / Geoscience

  • Seismic Investigation of the Steen River Reservoir*
  • Control of Water Coning in Gas/Oil Reservoirs*

Well Completion

  • Field Pilot to Remove Pyrobitumen Blockage from Oil and Gas Reservoirs with the PRIstine Process**

* Launched in conjunction with COURSE

** Results completed and reported to funders in 1999


VAPEX
Twin Horizontal Well Pair Pilot Expected

This anticipated pilot is the direct result of the two VAPEX projects launched through PTAC in 1998/99. These projects had 26 funding participants in total and 14 R&D suppliers, an excellent example of collaboration for others to consider following. The successful piloting of this technology would likely provide an economical and GHG friendly opportunity to significantly increase bitumen and heavy oil production and reserves for the industry. PTAC hopes that pilot decision makers will continue their past approach of allowing participation from all organizations that are prepared to pay their fair share of the project cost.

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Physical Model of VAPEX Recovery at PRI


Outlook
Outlook for 2000

PTAC will continue to focus on R&D priorities that are brought to our attention by PTAC members and the industry. In 2000, we anticipate that we will focus on the following technical areas: Environmental; Heavy Oil; Drilling; Well Completion, Stimulation and Workover; Reservoir Recovery; and Natural Gas Production, Processing and Transportation.

We expect to see new initiatives in the areas of: flaring; greenhouse gas (GHG) and fugitive emissions; human, ecological and animal health; heavy oil artificial lift; enhanced oil recovery; fundamental drilling research; and downhole technologies.

A significant technology pilot (VAPEX), from the perspective of both bitumen/heavy oil recovery and environmental GHG emission reduction, is expected to launch in 2000. Plans are currently under consideration for the world’s first VAPEX twin horizontal well pair experimental field pilot. This pilot is a direct outcome of the VAPEX projects (Phases 1&2) launched through PTAC in 1998 and 1999.

PTAC will be formulating an R&D Priorities and Strategy document for the Western Canadian oil and gas industry based on input from our members. The first two technical areas to be addressed will be Environmental and Drilling.

We have set a goal of launching a minimum of 25 projects with a value of $5.0 million in 2000. We are predicting a modest increase in our annual budget to $370,000 based on our growing membership. PTAC will continue to encourage member participation in workshop and forum planning to ensure collaborative R&D is focused on relevant issues.

PTAC and GRI (formerly known as the Gas Research Institute) recently initiated negotiations on a Technology Transfer function, to be hosted at PTAC and funded by GRI. The focus would be on commercialization in Canada of natural gas technologies that have been developed in recent years. This agreement would assist PTAC in planning and sponsoring events that focus on needs in natural gas related technical areas that could be addressed with new technology from GRI or others.On behalf of the Board, we would like to thank PTAC staff and all volunteers on committees, workshops and projects for their dedication and efforts. Our vision of applying leading-edge technology developed through collaboration is becoming a reality.


Board
PTAC Board of Directors

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Standing –
Don Towson, Bruce Peachey, Pat McLellan, Frank McIntyre, Kevin Hertz and Neil McCrank

Seated –
Bob Hill, Ken Putt, Larry Bell (Past Chairman), Eric Lloyd (President), Alan Archibald (Chairman), Murray Todd and Bruce Stewart

Missing –
Roger Bailey, Robert Child, Denis Gaudet, Patrick Jamieson, Rich Kerr and Bill Svrcek


PTAC Board Members
As of December 31, 1999

Alan Archibald, Chairman, PTAC
President, Westpoint Energy Inc.

Larry Bell, Past Chairman, PTAC
Vice President Operations Services, Crestar Energy Inc.

Eric Lloyd, President, PTAC
Petroleum Technology Alliance Canada

Roger Bailey
Executive Director,
Alberta Oil Sands Technology and Research Authority (AOSTRA),
Ministry of Alberta Innovation and Science

Robert Child
General Manager Gas Resources, BP Amoco

Denis Gaudet
Vice President, Aqueolic Canada Ltd.;
Engineering Manager, Winterhawk Technologies Ltd.

Kevin Hertz
Vice President Operations, Burlington Resources Canada Energy Ltd.

Bob Hill
Vice President, Technology and Operations,
Canadian Energy Pipeline Association (CEPA)

Patrick Jamieson
President and CEO, C-FER Technologies Inc.;
Vice President, Energy Technologies, Alberta Research Council (ARC)

Rich Kerr
Chief Engineer, Wascana Energy Inc.

Neil McCrank
Chairman, Alberta Energy and Utilities Board

Pat McLellan
President, Advanced Geotechnology Inc.

Frank McIntrye
Reservoir Engineering Manger, Rainbow Lake, Husky Oil Operations Ltd.

Bruce Peachey
President, New Paradigm Engineering Ltd.

Ken Putt
President, K.W. Putt Consulting Inc.

Bruce Stewart
Director, Western Research Centre,
Natural Resources Canada (CANMET)

Bill Svrcek
Professor, Department of Chemical and Petroleum Engineering,
University of Calgary

Murray Todd
President, Todd Resources

Don Towson
Industrial Technology Advisor, National Research Council’s Industrial Research Assistance Program (IRAP) –
Hosted at Petroleum Services Association of Canada (PSAC)


Membership by Category

The number of PTAC members increased to 124 by year-end 1999.

Our current members produce approximately 60% of Canadian Conventional Oil and Gas. PTAC signed up our 135th member in March 2000, continuing our pattern of steady membership growth.

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Project Expenditure by Technical Area

PTAC has facilitated the launch of 51 projects valued at $10.6M since inception in 1996.

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Technical Areas
Technical Subcommittees

PTAC now has 11 Technical Subcommittees (TS) and over 2800 contacts in the following areas:

  • Conventional Heavy Oil
  • Drilling
  • E-Commerce
  • Environmental
  • Fundamental Research
  • Inactive Well Management
  • Natural Gas Production
  • Occupational Health and Safety
  • Oil Production
  • Reservoir Recovery / Geoscience
  • Well Completion

The approach used by the Conventional Heavy Oil and Environmental TS has proven very effective in moving forward needed R&D. PTAC needs interested senior technical people to assist in identifying important issues that require R&D. If you are interested in participating, or seeing particular issues addressed, we encourage you to contact PTAC for additional information.


Sessions
Sessions Technology Information Sessions

PTAC hosted 31 Technology Information Sessions attended by a total of nearly 1000 participants in 1999. These sessions provide our members with the opportunity to obtain funding and technical input for proposed R&D, learn about new R&D initiatives and emerging technology, report on project and field test results, and transfer and market new technology in the conventional oil and gas industry.

PTAC held the first all day session focused on water shut-off technology in early 2000, with a variety of presentations that were well received by attendees. PTAC plans to use this approach in other technical focus areas in the future with a Cost-Effective Abandonment Solutions TIS planned for May 2000. If you have a particular technical focus area that needs to be addressed, please contact PTAC with your ideas.


Workshops and Forums
Workshops and Forums

PTAC sponsors workshops to provide opportunities for people to clearly define R&D issues and identify the direction which will yield the most promising solutions. Potential suppliers of R&D have the opportunity to hear first hand about such issues and to contribute their expertise and ideas for solutions. PTAC funds the workshops and provides the necessary facilitation, administrative support and coordination to launch projects. We widely distribute Request for Proposals (RFPs) with Expressions of Interest for each priority issue from workshops. Once we have identified those who will consider supporting the R&D, proposals are then solicited from potential suppliers. PTAC brings together the interested organizations in a structured way that leads to new R&D, while protecting proprietary interests.

PTAC also sponsored highly successful Environmental Forums in early 1999 and 2000. These forums were attended by over 300 participants who were provided with the opportunity to learn about the latest environmental oil and gas related research results and plans. For more information on our Environmental R&D Framework and Process, visit our website at www.ptac.org/tech_enviro.html.

In 1999, PTAC sponsored workshops in Environmental, Conventional Heavy Oil and e-Commerce. As a result, 10 RFPs were formally issued and two e-Commerce working groups were created. Workshop attendance totalled over 300 participants.

The continued involvement of industry personnel is needed by PTAC in 2000 to plan workshops or forums in areas such as Environmental, Drilling, Heavy Oil, Completion, and Reservoir Recovery. Mini-workshops that focus on one particular issue are an effective way to initiate collaborative R&D projects. We encourage you to contact PTAC if you have ideas for such workshops.


Collaboration
Association and Regulator Working Relationships

PTAC believes that working with industry associations and regulators to jointly sponsor events and distribute information is an important component of the overall approach to collaborative R&D.

The successful formalization of the Environmental R&D Framework and Process Model resulted from the cooperation and support of the Canadian Association of Petroleum Producers (CAPP), Environment Canada, Alberta Environment (AEnv) and other interested organizations. PTAC strives to build new relationships where there is mutual interest and continues to strengthen existing relationships.


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Skid for Improved Liquid/Vapour Separation Project


Financials
Auditor’s Report

We have audited the financial statements of PTAC Petroleum Technology Alliance Canada for the year ended December 31, 1999 and have reported thereon without reservation under date of March 2, 2000. The accompanying summarized balance sheet and summarized statements of revenues, expenses and surplus have been prepared from the audited financial statements.

In our opinion, the accompanying summarized balance sheet and statements of revenues, expenses and surplus fairly summarize the information as to the financial position of PTAC Petroleum Technology Alliance Canada and the results of its operations contained in the audited financial statements.

KPMG, Chartered Accountants
Calgary, Canada,
March 2, 2000


Summarized Balance Sheet
As at December 31, 1999, with comparative figures for 1998

Assets

1999

1998

Cash

$ 20,843

$ 29,938

Marketable securities

43,896

62,237

Accounts receivable

46,049

75,040

    Subtotal

110,788

167,215

Capital assets

28,661

27,147

    Total

$139,449

$194,362

Liabilities and Surplus
Accounts payable, accrued liabilities

$  16,391

$  6,240

Deferred revenue

121,035

168,692

    Subtotal

137,426

174,932

Surplus

2,023

19,430

    Total

$139,449

$194,362


Summarized Statements of Revenues
Expenses and Surplus for the year ended December 31, 1999, with comparative figures for 1998.

Revenues

1999

1998

Membership

$336,992

$297,088

Other

14,586

38,238

    Total

$351,578

$335,326

Expenses
Operating

$368,985

$335,491

Excess (short) of revenues over expenses

(17,407)

(165)

Surplus, beginning of period

19,430

19,595

Surplus, end of period

$ 2,023

$ 19,430

The complete audited financial statements of PTAC for the year ended December 31, 1999 are available from PTAC offices upon request.



For further information or printed copies of PTAC's Annual Reports please contact: PTAC
Petroleum Technology Alliance Canada

25th Flr., One Palliser Square
125 - 9th Ave. S.E.
Calgary, Alberta T2G 0P8
website: http://www.ptac.org
fax: (403) 920-0054
e-mail:

Eric Lloyd, President
phone: (403) 218-7701
e-mail:

Arlene Merling
Director, Operations
phone: (403) 218-7702
e-mail:

Tannis Such
Project Coordinator
phone: (403) 218-7703
e-mail:

Kerri Markle
Project Coordinator
phone: (403) 218-7711
e-mail:

Lorie Frei
Administrative Assistant
phone: (403) 218-7700
e-mail:


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