Integrated environmental services set Tervita apart

The windows in John Gibson’s nineteenth-floor office at Tervita Corporation serve multiple functions, of which letting in light is the least interesting. Providing a view of the prolific high-rise construction activity in Calgary’s trendy commercial/residential southeast Beltline is slightly more intriguing. But the writing on the glass wall is what catches most people’s attention.

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“Justice vs. Mercy”

These are remnants of Tervita’s president and chief executive officer’s musings on core values. They might have served as talking points for meetings or mini-lectures and are a testament to Gibson’s original vocational aspiration—to become a university professor.

But reality has a way of scuttling even best-laid plans when family falls ill. In Gibson’s case, his daughter’s medical bills in the United States forced him to take a job as a geophysicist after finishing his bachelor’s degree. Persistent evening study then earned him a master’s degree in geology alongside a career that increasingly specialized in rebranding.

This work involved helping companies like Halliburton integrate its various acquisitions and divisions when it purchased Dresser Industries in 1998 into one unified whole rather than a portfolio of collected businesses.

In 2010, Gibson came to work for CCS Corporation, a sprawling $5-billion enterprise of related environmental and energy service companies founded in 1984 by David Werklund. Werklund’s vision was to integrate the dozen or so divisions into an integrated solution for his customers around their environmental needs.

“This is like the United States trying to get the U.S. Army, Navy, Marines and the Air Force all to change their uniforms and become one military. They all have their own songs and their own uniforms,” Gibson drawls in a Deep South accent. (He spent most of his career in Texas but jokes that Texans would disown him for his Alabama accent.) “Same thing in a company. The traditions are there. Cultures are there. They’re very proud of those cultures, but you can’t keep all those names. It’s just not functional.”

To engender a sense of employee ownership and belonging, and to provide a fresh rallying point for its 4,000-plus employees, CCS rebranded to Tervita this March. The new name suggests earth and life, and the company’s commitment to both the energy resource industry and the environment.

Integrated solutions

“The market for environmental services is changing,” Gibson says. “Our customers want more complex and more complete environmental solutions. They want to be able to say to us, as an example, ‘Can you give me a certificate of abandonment from ERCB [Energy Resources Conservation Board] so I don’t have any liability for that well.”

Given its range of environmental services, a focus on complete solutions provides Tervita a lot of opportunities. In the past, a well abandonment would be pieced together from a variety of perspectives within CCS Corporation—HMI Scrap Metal Processing for the steel, HAZCO Environmental Services for remediation and soil reclaiming, Concord Well Servicing for cementing zones and removing the wellhead, and a contaminated soils landfilling group. Now these divisions work in concert to bid on contracts.

“We can go out to their wellhead without having to coordinate seven or eight different vendors,” Gibson says. “We show up and take care of the complete abandonment and we can bid on multiple wells to optimize logistical elements and deploy the right people with the right expertise to give you a better product at a lower cost in meeting governmental standards.”

Sitting down

Gibson is a big man whose American accent adds to his largess. Shaking his hand is more like grabbing hold of a bear. But he’s less bone crusher than a prototypical friendly American businessman who enjoys a good laugh and tells a good story. He’s even got a bit of a humble bent to him.

An example comes at introductions. Werklund says, “Hi, I’m Dave.”

Gibson follows with, “And I’m baby Dave.”

Shrugging off the laughter, he adds, “I figure it’s better than saying something like, ‘I’m Dave’s spiritual apprentice.’”

There’s a lot of mutual respect in this relationship between chief executive officer and chairman. The two men have distinctly different personal styles, but their skills are complementary. Werklund is soft-spoken, an entrepreneur and tactician with vision and resolve. Gibson is the articulate frontman who executes on that vision and pulls people together.

“I’m just a servant,” Gibson likes to say. “I’ve served people like Dave all my career and I’ve had a great career.”

Gibson started at Gulf Oil LP in Texas. Then he worked for Chevron Corporation managing subsurface research at its La Habra, Cali., research facility.

“Nothing is more challenging than to work in a group of 150 people where 149 of them are smarter than you are and better educated,” he says. “You get up every day thinking no matter how much I know, I’ll never know more than these people. But it doesn’t discourage me at all. It’s exhilarating and I love it.”

Self-deprecating humour aside, the way Gibson sees it, building great companies involves getting everybody to sit down in a room and clearly looking at the problem they’re trying to solve.

“We’ve now got a management team that I think is one of the best in Canada,” he says. “We sit and talk about the current problems and new problems that are being created. Then we come up with great solutions.”

The heart of this process is collaboration. Integrate the people and the work will get integrated, Gibson says. Leave people to problem solve separately and each will only consider solutions according to their specialty. One will see it as needing bulldozers and heavy equipment, another as a chemical experiment, and so on, rather than potentially coming up with a more creative, more effective solution.

For Gibson, collaboration is also a characteristically Canadian capability. Collaboration entails compromise. And collaboration is a Canadian strength it should be careful not to lose.

“I find Canada fascinating because it’s a completely different place than the U.S.,” he says. “It’s in the public’s best interests to not have contamination from hydrocarbon production, but if they’re going to produce it economically, there’s going to be some contamination. So our company’s in the middle, trying to minimize that contamination.

“The thing about Canada is that the communities in which we work get together with our customers and fight like crazy until they find some centre ground. They try to resolve it by accommodating the needs of the different stakeholders. You fight, but you do it politely. You preserve all the relationships. Each person compromises and you reach a reasonable conclusion for the benefit of all stakeholders.”

By contrast, Gibson sees the United States so polarized now, with the public in one corner and the industry in the other, that it’s becoming difficult to get things done. Think TransCanada Corporation’s Keystone XL pipeline deadlock.

“But you’re beginning to see that with the Gateway pipeline,” he says. “I think that’s foreshadowing a problem in Canada if you allow any one stakeholder to have so much power.”

Opportunities…and challenges

Tervita is one of North America’s largest environmental service companies for the energy industry, but it’s eager to continue growing. Werklund would like to see Tervita become global.

“To continue to grow, we have to aggressively build new solutions and continue to expand our operations into markets that have a need for environmental solutions,” Gibson says.

Innovation plays a key role in offering better environmental solutions. Over the years, CCS brought a number of industry firsts to the market. Engineered landfills dedicated to the disposal of drill cuttings and other oilfield-contaminated soils is one. Unparalleled high standards are another.

“If you were to visit one of our service centres,” Werklund says, “you’d see that nothing touches the ground. The trucks back in on concrete pads that have liners underneath them. Everything is clean and nothing actually touches the ground. Where a pump truck unloads, we put a pan under each pump to catch the drips. The sites are kept immaculate.”

Mechanical equipment at these facilities is sealed so no gases escape to the atmosphere. A high-temperature flare burns off the vapours.

Tervita’s landfills are often tended like parks. It goes to the trouble of planting grass and putting in picnic tables in some locations. If an acquisition doesn’t meet its standards, it will spend the money to bring it up to snuff.

“These are many of the little things that set our company out as a leader in the industry,” Werklund says. “We want to set the standard for how industry operates and how sustainable it can be.”

South of the border, in North Dakota, Ohio, New Mexico and other states moving to new drilling standards that are doing away with open pits for drilling fluids, Tervita offers closed-loop systems for the fluid flows.

“We manage the solids in those tanks and never take the chance that those contaminants from the well at the rig site will get into the ground,” Gibson says. “So you basically move to a zero-discharge approach.”

This is the kind of expertise and innovation Tervita expects to export to other parts of the world in the coming years. The best prospects for its geographic expansion are jurisdictions that have high environmental standards.

“They have to have a commitment to environmental stewardship,” Gibson explains. “If you don’t have a government and a population that values environmental stewardship, our company is not very appropriate for you. If you have a country that takes drill cuttings and just piles them up on the ground, chances are we’re not going to have a very successful entry into that country.”

Conversely, one market entry Gibson is particularly excited about is China’s interest in energy resources. Acquisitions in the oilsands and, more recently, the Chinese bid for Nexen Inc., are exactly what Canada needs, Gibson says.

“I hope the federal government approves China’s acquisition of interests here,” Gibson says. “You see some people opposing that, too. I don’t think that’s right. It’s a great free market and compromise is the right way to go.”

Chinese investment could also have a timely effect on current industry activity levels in western Canada, which are below projections. Tervita had been staffing up, based on those higher projections, but in September it was forced to cut 400 positions through attrition and layoffs, focusing primarily on overlapping corporate shared services and reducing overhead costs in order to remain competitive.

The energy industry drives our business and the energy sector is volatile at this time,” the company said in a prepared statement. “The market has changed. It is more uncertain now than it has been in years.”

One of the benefits of having become one company, the statement continued, was that Tervita is able to achieve cost synergies. It’s taking advantage of those synergies now.

“Competitive companies must make adjustments to be responsive to their customers and to market conditions – and we are doing the same,” the statement concluded.

The move caught many employees by surprise, especially since Tervita is continuing to expand its network of facilities, services and geographic footprint. Consequently, while it made difficult cuts in one area, it has also added 300 people to its payroll this year, in other regions where its customers need them.

Future

What is Tervita’s competitive advantage?

Werklund: “We’re more innovative. We apply our services more effectively and we have a truly integrated model of providing 
these services.”

Gibson: “With any great company, it’s your culture that attracts people and it’s your culture that your customers want to work with. And our culture is around integrity.”

An environmental company is nothing if its safety and integrity are suspect. Werklund made integrity and safety cornerstone values in the early years of CCS. He protected them through CCS’s stint as a public company from 2002 to 2007. And they continue to serve it now as an integrated private company delivering environmental solutions to the highest standards.

“You want to be transparent. You want everything to be out in the open. You want to share exactly what you’re doing with the companies you work for, with the government and with the communities,” Gibson says.

Lifelong learning

Werklund is one of Canada’s most celebrated businessmen. An oilfield-industry leader and dedicated philanthropist, his can-do attitude and commitment to leadership principles and lifelong learning has earned him various recognitions, such as several Entrepreneur of the Year Awards and two honorary degrees, the most recent a doctorate of laws degree from the University of Calgary.

Working for a man of his social stature can be humbling, but Gibson says it’s also an opportunity for him to learn from one of the brightest business stars. Less an advocate for education than for curiosity, Gibson’s natural curiosity drives him to continual learning. It’s a quality he shares with Werklund.

“Education is really the result of a curious mind,” Gibson says.

That thirst for understanding and know-ledge seems to underpin Gibson’s infectious optimism, enthusiasm and vigour, the kind of qualities you would want in a leader of one of the most important service industries in the oilpatch.