Thank you, Mr. Chairman.
Good morning, and thank you for the opportunity to provide information and perspective on your study on innovation in the energy sector. My name is Rob Dutton. I'm the vice-president, facilities, for Devon Canada Corp. Devon is an upstream oil and gas company with its Canadian headquarters in Calgary and nine field offices in Alberta and British Columbia. Our job is to responsibly explore for and produce oil and natural gas.
I and the 2,000 people who work for Devon in Canada are proud of the work we do. We believe it's possible to be a strong economic contributor to this country and be a leader on innovative land stewardship techniques. The team I lead, the facilities team, is responsible for building the infrastructure of our business. We build roads, install pipelines, and build the plants that process oil and natural gas. Ostensibly, we are in the construction business.
We are also a team of innovators. While in some cases it's about the use of new technology, for the most part it's about looking at old problems in new ways and coming up with collaborative solutions to improve our performance. As you can see, not all innovators are guys in lab coats. Like me, my guys are 20-, 30-, and 40-year veterans of the construction business, and they have a passion for finding better ways to do it.
The focus of my discussion today is an innovative solution we've come up with for the installation of small-bore pipelines. Just to add some context, you may be surprised to learn that there are hundreds of thousands of kilometres of pipelines just within the province of Alberta. On average, 13,000 kilometres a year, give or take, are added to that inventory. Of that, 85% are what we consider to be small-bore pipelines. Those are pipelines that are less than 16 inches.
Most of the pipeline network within that province is gathering oil and gas from wellheads. They aren't transmission lines. About 40% of that installation happens on agricultural land. Traditionally—and by traditionally, I mean in the very near and recent past—when a pipeline is built, the topsoil is segregated from the subsoil. It's stripped along a big stretch that goes down the length of that pipeline. When the pipeline is then lowered back into that ditch, of course the subsoil is put back, and so is that topsoil.
Without compaction, without a number of different elements, that ditch line will subside over time, which doesn't sound like a very big deal, but I know many of you represent areas with agricultural operations—I, myself, come from one—and know what this may mean to farmers. This method can reduce the quality of the topsoil and have a negative impact on crop growth and yield.
Sunken ditches aren't visible until a farmer drives over them, largely because the crop has grown over top. Why is that important? During a growing season, these depressions are passed over hundreds of times, forcing adjustments to speed, spray, and fertilizer rates, so to the individual farmer, there's a long-term impact.
We, of course, as industry, come back and do repairs to those lines, but we felt it was something we wanted to address more fully. For my company, for Devon, it meant some strained relationships and high repair costs to land and equipment, which were not acceptable to us. The innovative pipelining strategies challenge this 40-year-old standard practice I just walked you through. In partnership with Alberta's department of the environment, the landowners, our contractors, and people on my team, we turned that around.
Our focus was threefold. The first was conservation versus reclamation: if you minimize the impact initially, there will be less to reclaim later. Second was to reduce the industry impact of operations on the land. The third was to increase stakeholder participation in decision-making.
This isn't a very technical innovation. It really challenged a long-standing practice of how it was always done.
What we did was minimize the topsoil we moved, minimize the main pipeline trench to reduce the width of it, and reduce the amount of subsoil being moved, but the big one was that once the pipeline was lowered back into the trench, we came back and added the additional step of compacting that earth in and around the pipeline, and on top as well, to constrain that pipeline and to minimize the future impact that we would have going forward.
What did that get us? The stakeholders came together to solve a problem before it was regulated. Through that, a social trust was built between the agricultural community and our industry.
Depending on the project, we have seen very small to very large reduction in surface disturbance. To put that into perspective, Devon Canada will traditionally install between 150 and 200 kilometres of pipeline. In the three quarters of 2012, the amount of topsoil or deforestation that we avoided.... It's usually measured in hectares, and I obviously have to put it into something I can relate to, so it's football fields. Over 150 football fields of disturbance was avoided by using this technique.
We have not had to re-enter land to repair sunken ditches, and landowners expressed satisfaction with early engagement and results. Their farmland can, immediately after our work, return to workable condition.
It can also be done in frozen-ground conditions. Then we asked ourselves, if this could be done in agricultural land, why not forested land? We've done work in northeastern British Columbia and we've had great success in doing that, as well with our SAGD operations north of Cold Lake.
With this innovation, we decided to take it one step further. We've started to employ horizontal drilling techniques that have provided for the opportunity to have no trench at all. There are only intermittent bell holes where we can reach the extent of our drilling to connect to the next line that goes out.
In cooperation with the municipal government of Grande Prairie, which helped to build the centre of excellence in research at Evergreen Park, we have engaged the local community to make sure there's an area where we can test these techniques in real conditions.
It's taken us over five years to get here, and we still have a long way to go. We feel that the more exposure this technique can be given, the better the opportunity for others in the industry to have the opportunity to try it out.
A barrier to innovation is the fear of failure. Certainly that is something that has to be managed and mitigated. Although it sounds very simple and you ask yourself why this hasn't been done previously or in other constituencies, the answer is that there is a higher degree of technical expertise required to pull this off correctly.
On that note, I would extend the invitation to you or any of your colleagues to come and see this work in person. There's nothing like seeing it in person to gauge the true impact.
Thank you for the opportunity to tell our story. I would be pleased to answer any of your questions.