Energy Services BC (ESBC) took advantage of the 2011 BC Oil and Gas Conference (September 7-9) in Fort Nelson to inform energy sector representatives, service sector companies, and community members about a new initiative they launched this June.
The BC Based Certificate Program has been created to encourage oil and gas companies to work with contractors based locally in B.C. by providing those contractors with a means of proving that they not only have offices and operations in the province, but even in specific regions of the province, such as Fort St. John or Fort Nelson.
“In the last few years, we’ve seen a lot of companies – producers – make commitments to hiring local companies,” said Brad Caldwell, President of Audit Tree, during the ESBC presentation at the
Caldwell was previously involved with ESBC, but now lives and works in Calgary, which has provided him with a view of both ends of the equation – the petroleum companies and the service sector companies. His company, an online corporate social responsibility audit platform, has partnered with ESBC on the BC Based Business Certificate project.
“What we need to create is a foundation to determine what a local business is,” he continued. “And there’s been a lot of different definitions from the B.C. government, from producers, and from different groups. One of the issues with the definition is it still doesn’t give you a list of those contractors that are actually local. And one of the things that some of the producers experience is, they did have a local list, a list of companies that had local addresses, but unfortunately they were finding that a lot of those companies weren’t actually local.
They might have had a local post office box … but they weren’t actually contributing to the community. And so even though producers had great local [procurement] programs in place, they weren’t really seeing the benefits, and neither was the community.
So, we really hope that the BC Based Business Certificate will help everyone with that process. We have more than a definition. We have qualification and a list of contractors.”
“A BC Based Business Certificate acknowledges people who have a location in B.C., employs B.C. residents, pays taxes in B.C., registers and insures their vehicles in B.C., they’re contributing to the province and the community,” explained Art Jarvis, Executive Director South for ESBC.
“BC Based doesn’t necessarily mean that that’s your head office. And it doesn’t mean that your family’s grown up here all their life and that’s what makes them BC Based. It means … they have a location here, they’re supporting the province and the community, and that’s what we’re trying to entice, is more companies to come in and build the infrastructure of smaller communities like Fort St. John, Fort Nelson, Chetwynd.”
The producers are already starting to take notice of the young program.
“Quicksilver is aware of the local communities' interest in employment and recognizes its importance,” said Doreen Rempel, Community and Regulatory Affairs Manager at Quicksilver Resources Canada. “We seek out opportunities to hire locally and create win-win scenarios.
“Regarding the BC Based Certificate Program,” she continued, “we believe it is a very good concept, which seems to have good potential to facilitate hiring of actual local companies and for tracking [that].”
During the Fort St. John Energy Expo (September 21-22) co-sponsored by ESBC and the Canadian Association of Petroleum Producers (CAPP), Jarvis presented a letter given to him by Shell Canada just prior to the event, expressing their recognition of the new program and their commitment to working with companies on the BC Based Certificate list.
“It basically is a letter that we can use for marketing,” said Jarvis. “And they will give [it] to all their contractors and ISNetworld. And they are stating that they are supporting Energy Services BC and they’re backing this BC Based Business Certificate program.”
“That’s a priority in their mind, is they want to hire local,” he added.
Jarvis also remarked that the letter is an important endorsement for the program and for ESBC generally.
“It will be huge,” he said. “It will enable us to increase our membership easier, because the more we can give our members, the more advantage we have of increasing that membership. Right now, the first question if you want to join any club or committee or anything, you want to know what will it do for me. This is something it’s going to do for them. It’s going to open the door for more employment. And as our membership grows, we’ll be able to lobby the government with real clout. We’ll have a big voice.”
About fifteen service sector companies had signed onto the program between its launch in June and the Fort St. John Energy Expo in September, but Jarvis believes Shell’s endorsement will encourage another wave of companies to get onboard. Caldwell also noted that earning the certificate is a simple process that only involves answering ten questions in about fifteen minutes.
“The main part is to show evidence that you have a physical address in the region [in which] you applied for the certificate,” he said, remarking that involvement in the community is also important.
“It’s a simple qualification,” he continued, “but, at the same time, it really ensures that the companies that are being recognized as local are actually local and committed to the communities they work in.”
“And if you are an existing member of Energy Services BC, then it’s a free service that we provide,” added Jarvis. “If you’re not a member, the cost of completing the survey goes directly toward your membership fee. So, you can become a member and it didn’t cost you anything more. And you will get that certificate to either post on your desk or your door.”
Essentially, Caldwell described the initiative as a two-way street where benefits flow both ways. Local service providers are given a greater opportunity to compete for contracts while oil and gas companies are more easily able to gain support for their projects by ensuring they are hiring local contractors and contributing to the local economy.
“The other thing is having a cost effective local service sector,” Caldwell said, citing reduced transportation costs as one of the benefits of local procurement for the energy sector.
“If you have a local company that’s an hour away from the project, it’s got to be a lot more cost effective than bringing in a service company that’s five or six hours away,” Caldwell continued. “And this is even more important with the shale plays. Heard a lot of people talk about the next forty years. That’s completely different than what we’ve experienced in the past with some of the conventional oil and gas activity. These are long term. I hear a lot of engineers in Calgary talking about this [being] more like a factory than oil and gas extraction in the past. So, I think it’s going to be even more important to have a strong local contractor base.”
Caldwell did note that the smaller B.C. communities are starting to get more attention in Calgary.
“We’re seeing a lot of meetings between Calgary and Fort St. John, Calgary and Fort Nelson, Calgary and Dawson Creek,” he said. “And that’s a big difference from when I first got involved in the oil and gas industry fifteen years ago. And it’s definitely positive on both sides.”
There has been strong political support for the initiative throughout northeast B.C., including the endorsement of Minister of Transportation and Infrastructure Blair Lekstrom and Peace River North MLA Pat Pimm, but Jarvis remarked that there is still a lot of work to be done to get the word out to the service sector in the region.
“Especially to the non-members,” he said.