Thomas Edison once said: “Most people miss opportunity because it is dressed in overalls and looks like work.” While overalls might be an outdated requirement, work – – in its many forms – – is indeed at the core of opportunity. Once must earn one’s success, and it rarely comes easy.
Mike George, President president & and CEO of Steelhaus Technologies Inc., understands this reality. He founded his company in 2008 in response to the seismic change in the oil and gas industry: the U.S. shale gas revolution. Almost overnight, vertical drilling was replaced by horizontal wells using multi-stage stimulation (hydraulic fracturing), unlocking the shale gas that, until then, was inaccessible. Almost overnight, the U.S. significantly increased its production of oil and natural gas.
George, who at that time worked in the natural gas industry in Calgary, saw the writing on the wall and started to build a business plan for a completions technology company.
“I wanted to create a rapid engineering innovation resource company that could develop technologies for big service companies faster than they could do themselves,” he recalls. “We would get economies of scale (global sales and operational infrastructure) from the big companiescompanies, and they would get nimbleness from us. We’d maximize this exponentially growing opportunity.”
And what an opportunity it’s been. Steelhaus began with one employee and 80 square feet.; sSixteen years later, it is the world’s fastest growing upstream completions provider to the oil and gas industry, with 500 employees and 400,000 square feet.
“We’ve been able to grow each part of our business very organically and very slowly,” George reports. “We bootstrapped the whole thing.”
Originally a design and engineering firm, George followed his business plan and partnered with multi-national companies. “We found that they were great at commercializing a proven technology, and we could play a role in incubating that technology,” he says. “Then we realized that if we were going to make moneymoney, we would have to get more skin in the game. So we started manufacturing our product through third parties. Then we made the decision to truly vertically integrate and learned how to manufacture ourselves.”
Eventually Steelhaus expanded into sales and operations. “We never raised money, but rather grew slowly with the Canadian banking system,” George says. “We went from stage to stage very slowly, very intentionally.”
Today, Steelhaus manufactures upstream completion products used in well construction to access in situ reserves. “We are exceptional at developing technology quickly and responding to market competition,” he explains. “We’re not a new lightbulb company, we’re a better lightbulb company. We find more efficient ways to produce products for markets that exist. Since our development cycle is so short, we’re able to respond to competitive pressures to capture a lot of market share.”
It has four main product lines: multistage stimulation (plugs, shiftable sleeves, ball drop and unlimited stage technology), sand and flow control (its PremiumPort and flow control are at the heart of Steelhaus), conventional completions technologies, and thermal (sleeves and steam injection technologies).
It manufactures these products at eight production facilities in Calgary. “We are one of the largest manufacturers in Calgary,” George points out. “Which is unique given that Edmonton is typically the manufacturing capital of the province.” Steelhaus also has six field locations in Calgary, Edmonton, Grande Prairie, Red Deer, Bonnyville and Estevan.
Steelhaus obtains raw materials from all over the world, much from the Ffar East: “We’ve spent 10 years setting up supply lines that have been very beneficial to us. We made strategic decisions during the pandemic to stock up on materials, which kept the company very healthy during that time.”
Indeed, the company made it through the pandemic and successive oil recessions with both its staff and resources relatively in tactintact, thanks in part to its diversified portfolio of global markets. “So while it might be slower somewhere in the world, during the last three oil recessions we’ve been able to defy the down cycles and sail through those pretty easily because we were so diversified globally,” George notes.
Steelhaus works with every producer in Canada and in the U.S. Internationally it works exclusively with SchulmbergerSchlumberger via a successful global partnership. “This partnership has lasted upwards of 15 years and will probably last another 15 yearsdecades into the future,” George says. “We’ll be working with them for a long time.”
Top international markets are Argentina, Kazakhstan and most countries in the Middle East.
“Our success is tied very closely to being an efficient supplier,” George explains. “The global currency of the oil field is the U.S. dollar, anddollar and being in Canada we have a distinct advantage of producing in a market that has efficiencies. We can get material inputs fairly cheaply, and if we’re efficient through modernization and automation, we can be competitive in any market in the world.”
George lauds the resourceful and very skilled labour force in Canada which lends to the ability to build anything here.
“Our people certainly are our greatest asset,” George says proudly. “We’re anomalous in that. We’ve hired individuals from school who have been with us for more than 10 years, many have spent their entire career with us. We believe that you give someone more responsibility than they’re ready for and then coach them along the way. Then you have a rising tide of innovative and high energy individuals, and company productivity and outcomes.”
He notes that the average age of the Steelhaus executive team is in the mid– to late late–thirties30s.
“We have a joke we say when you’re hired: ‘Here’s a rocket, attach it to your behind because your career’s going to soar’,” George smiles. “The greatest joy of working here for me is to see careers take off, to see what people accomplish, and how it transforms their lives. It’s an incredible accomplishment for not only the individuals but for the company.”
A key to Steelhaus’ engineering success, and a core tenet of its culture, is its iterative design process. “More success happens on the cutting room floor than on the computer screen,” George says. “We encourage our engineers to go to the floor, test the product, have failures, learn and improve from those. We have a very tight feedback loop that includes our production and field personnel too.”
This process means that Steelhaus can get a product out in two months, rather than the typical two years it takes most other companies.
Integral in the process is a commitment to health, safety, the environment and the larger community. Steelhaus started Alpaca Systems, a software and technology company that developed proprietary software that helps manage the company end to end, including its safety information system: “It’s the backbone and completely manages the safety, training and management so that every employee is able to do their job safely from start to finish.”
On the environmental front, Steelhaus is focused on diversifying a larger portion of the business away from energy. “We have software development, investments in geothermal technologies for alternative energy production and wellbore abandonments,” he says. “We’re spending money to steer the company towards things that will make the world a better place.”
When it comes to community, the company is a strong supporter of STARS Air Ambulance and Kids Cancer Care.
“The future is bright,” George reflects optimistically. “We’ve achieved exceptional growth, and though a productivity gap exists in Canada relative to our U.S. peers, we believe the solution lies in modernization and automation. Our Special Projects team, which is responsible for preparing all our facilities and new business, is imbued with people with automation experience from the automotive industry. They have the knowhow of working with robots and process automation.”
“There’s outlook that this could be a multi-billion dollarbillion-dollar company, for sure,” George concludes. “We just have to make sure we can service that opportunity by being efficient and the best we can be with automation.”
MIKE GEORGE, PRESIDENT & CEO OF STEELHAUS TECHNOLOGIES INC.
