Businesses in Estevan, Sask., reeling from oil price collapse

Estevan, the city at the centre of Saskatchewan's oil boom, is now grappling with a bust.

Retailers, welding shops, hotels feeling the pinch

Hours have been cut back at Bert Baxter Transport, says Darryl Shirley. (Bonnie Allen/CBC)

Estevan, the city at the centre of Saskatchewan's oil boom, is now grappling with a bust.

Early March is usually a busy period for drilling in southeastern Saskatchewan — right before the spring thaw.

That's because once the ground begins to soften, road bans force most oil companies to stop working for about six weeks.

But with the ground still frozen more than half of the drilling rigs in the province have already been shut down.

A welder at Brent Gedak Welding in Estevan still had his job in March 2015, although jobs related to the oil patch were already drying up. (Bonnie Allen/CBC)

The slowdown, caused by low oil prices, is already sending ripples throughout the economy, affecting everything from retail sales to the housing market.

Days Inn manager Jeff Pierson says his hotel is usually 80 per cent full, but these days is half empty.

Like every other business operator in the city, he's keeping a close eye on the oil business.

"The road ban will just be another slowdown to the oil industry that will make things more challenging. I don't expect it to get better in the next three months," Pierson said. "Realistically, it's probably going to get worse but you just have to look ahead to better times."

Small businesses feeling the crunch

Small businesses that service oil companies in the area are reporting a 30 to 50 per cent drop in business.

Among those feeling the pinch are workers at one Estevan welding shop, who are finishing up their last orders from oil companies and wondering what's next.

Like most businesses in Estevan, Brent Gedak Welding is just trying to stay afloat. He used to receive 90 per cent of his business from the oil patch.

Gedak had 27 employees, but he has laid off two and is trying to find work for the others.

"I don't want to scare people with layoffs. I mean, we're doing our best that we can," Gedek said. 

"We've had a couple small ones, so far. We're going to continue on cutting maybe some hours, maybe do job sharing. We're saving money with trucks, parking them, trying to save fuel bills."

Gedak was planning to expand his shop and hire more employees but now, he has no idea when the industry may rebound.

Trucking companies are also hurting in Estevan. 

Darryl Shirley, who's part owner of Bert Baxter Transport, says the trucking business has cut 40 jobs since Christmas.

"Last year, the year before,  at this period of time, they'd be putting in 80 or 100 hours a week.  The trucks were always gone. Right now, I got more trucks in the barn than I got on the road."

Another company, Dayman Trucking, has closed its doors and put 12 trucks up for auction.

It had been in business in Estevan for nearly 60 years.

Brent Gedak's welding shop gets most of its work from the oil patch, so the drop in crude prices has hit his business hard. (Bonnie Allen/CBC)

With files from Bonnie Allen


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