The global recession and oil field services

Craig Beal watched as roughly 40 per cent of his business slipped away along with plummeting global demand for oil this fall.

The president and owner of Dieppe-based Number One Machining Ltd. said for 2009, he doesn't have a single contract lined up to manufacture bearings for the down hole drills working Alberta's oil sands, though his plant was churning out 1,000 a month, half a year ago.

"Everything's pretty quiet," Beal said, adding that his clients in Alberta are likely waiting to see just how deep the global recession will cut and how long it will keep the price of oil below profitability.

"A barrel of oil is the lowest it's been," he said - at about US$39 when he checked at the start of the week.

That Beal does not yet have any contracts in 2009 for a core component of his business is not uncommon, said David Plante, the vice-president for New Brunswick's chapter of the Canadian Manufacturers and Exporters.

"What I'm hearing is that the order books have shortened up," Plante said.

"In talking to companies across the province, the anticipation is that the first quarter of 2009 is going to be pretty bad," he said.

The experts concur.

Bowes hopes that as oil sands production slows, business will open up in bitumen mining in the same region.

But still, northern New Brunswick will feel the cuts companies will surely have to make to keep an eye on the bottom line during the downturn, Bowes said.

"It will have an impact on jobs, for sure."