Oil boom transforming small Manitoba town
While concerns are being raised over the delicate future of the world’s oil supply — and also by a resulting spike in gas prices at the pumps — there’s little appearance of that being felt in a small Manitoba community.
The farm village of Waskada, located 300 kilometres southwest of Winnipeg near the Saskatchewan border, is at the heart of a veritable home-grown oil boom.
Each passing day, oil companies spend roughly $800,000 on drilling equipment and manpower to tap into oil deposits located nearly a kilometre down from the Earth’s surface.
About 230 oil wells now dot the community’s landscape. And that number’s growing.
"We anticipate spending - and I'm saying over a 10 to 15 year period — between $1 -1.5 billion, in that neighborhood," said Murray Nunns, president of Calgary-based Penn West Energy
Investments made in Waskada by other companies like Halliburton and EOG Resources will only bolster that amount.
And even though the oil is expensive to get at, its rising market price has tapped into a willingness to consider and adopt oil-extraction efforts in unconventional locations, said a Penn West foreman.
"That's driving oil companies to look in places where they may have not have normally done so in the past," Tim Buchanan told CBC reporter Mychaylo Prystupa.
Others say it’s a sign the time of so-called peak oil is upon us.
Peak oil is the idea that world’s oil fields will inevitably pump out their maximum or ‘peak’ production of oil, and then start pumping less and less, due to ever-depleting finite oil energy reserves.
Nunns does not hold the view that peak oil is happening now — but he admits it was oil rising well above $80 a barrel in recent years that finally brought Penn West to the area.
"Fundamentally, one of the keys that always drives exploration is the price," said Nunns, "As the price moves up people are going to go look for more oil," Nunns said.
"We're starting to employ new technologies and it gives us a chance to look at areas we haven’t looked at in a long time."
The effect the mini oil boom has had on Waskada is apparent. Economic spinoffs have meant the village is sporting a new daycare and an addition to the local school. Where once, villagers opened the supermarket’s doors with their hands, they now swing open electronically.
"You could look down the street before and not see a soul, and now there's cars everywhere," said Vivianne McKinney of Waskada Community Foods.
"You wouldn't think that electronic doors are that big of a deal, but you know what? In this town, we've never had it," said Mayor Gary Williams, who beamed as he talked about what’s been happening in the village
"It changed my role — I think we were in a survival mode 2 years ago — now, we're going full bore. Going ahead as fast as we can."
- A prior version of this story said Enron was operating in Waskada. In fact, EOG Resources became an independent entity in 1999 after separating from Enron.Apr 03, 2011 3:00 PM ET