History of Canam Pipe & Supply
Canam - Established Since 1989
Canam Pipe & Supply was built on a tenacious drive to service Eastern Europe and Former Soviet Union better than anyone else. Combating the tumultuous world market and political environment, Canam followed its mandate to be a leader in the global sourcing of oil and gas equipment and products.
Changing Conditions in Eastern Europe
In 1990, the Soviet Union itself began to unravel. Its own constituent republics began to issue declarations of independence. Large scale strikes shattered the Communist Party's traditional claim to be the representative of workers' rights. Demonstrations against the government and the party intensified. The economy worsened, food shortages became a problem, and the crime rate began to skyrocket. Gorbachev, caught between popular demands for more radical reform and party demands for the re-imposition of strict control, failed to satisfy either side. The following summer, the radical reform movements became strong enough to openly defy the government. Yeltsin, on the other hand, was the overwhelming victor in June elections for the Russian presidency. On August 18, party conservatives made a desperate bid for power. A group led by Defense Minister Dmitry Yazov and Vice President Gennady Yanayev detained Gorbachev at his country retreat in the Crimea. After he refused to support the imposition of military law, the head of state was placed under house arrest. The next morning the coup leaders issued the announcement that Gorbachev had resigned and that a state of emergency had been declared. Military units were dispatched to enforce the authority of the new government, but they were met with overwhelming popular protest led by Yeltsin and the other presidents of the republics. After three days the attempted coup had collapsed. Gorbachev was reinstated, only to realize that his position had become completely obsolete. By the end of the year, the Soviet Union had been voted out of existence, to be replaced by a Commonwealth of Independent States (CIS). On December 25, 1991 Gorbachev resigned, and on midnight of December 31, the Soviet flag atop the Kremlin was replaced by the Russian tricolor.
First Joint Venture in Russia
Since 1989 when Canam Pipe & Supply established our first office in Moscow, we have faced world changing events, cultural recall and adversity. It was also important for us to respect the country’s history and culture while surviving the ever-changing business atmosphere in the Former Soviet Union.
In 1991, Canam made history by being a part of the first Western Joint Venture in Russia called White Nights - a fishing tool company based out of Raduzhnyy.
Following the White Nights project, Canam, in 1993, moved its fishing tool operations to Kogolym, for the project called Calgary Overseas, where it was involved in fishing over 250 wells. It was at this time that Canam got involved in the oilfield equipment trading business and successfully secured our first major contract for one million meters of tubing for Calgary Overseas.
In 1995 Canam established the head office in Calgary, Canada, with the concept of providing Western-style equipment and services to the FSU market.
Shift in Global Economics Prompts Uncertainty
Boris Yeltsin’s weak position as President in 1996 created a time of uncertainty again. All Western investment into Russia stopped for six months due to the speculation of the Communist Party’s re-election and the eventual re-election of Boris Yeltsin.
In 1998 Russia sank into a deep economic depression that forced yet another withdraw of Western investment. In response, Canam chose to focus attention on the riches of the Caspian Sea and, in particular, Kazakhstan because of it’s seemingly openness and relatively stable economy. Still, all projects in Kazakhstan were facing obstacles with the importation of equipment, customs controls, and ever-changing government laws and regulations.
Canam Establishes Contracts
In 1999, Canam established its first drilling tools rental contract with Shell Temir, which convinced the shareholders that the opportunities in the Caspian Region were worthy of further investment. This initiated the creation of Caspian Downhole Services (CDS) a downhole tool rental, repair and service center, which is still today the only API service center in Kazakhstan or Russia. CDS was established with no contracts from the operators in the region, just the will to succeed. Canam was instrumental in consolidating all the equipment from around the world, as well as shipping, documentation and custom clearance to establish CDS. The facility was operational within eight months, which was remarkable for the time and conditions. Upon completion, the facility was inspected and approved by Tengizchevroil (TCO) and OKIOC (Agip KCO), and long-term drilling tool rental contracts were established.
In an attempt to promote more local business, the Kazakhstan government implemented a monthly report system to record all operators’ purchases from locally registered Kazakhstan companies. Recognizing the opportunity, Canam registered an office in the Atyrau Oblast and established Canam Pipe & Supply LLP (Kazakhstan) in 2000. This local presence allowed Canam to offer customers Incoterm DDP service, eliminating some of the issues related to logistics and customs.
Foreign Investment Deterred Once Again
On September 11, 2001, another unforeseen world event changed the mental state of investors around the world. This resulted in deterred foreign investment and spending, as it added a further element of uncertainty in the region. This had a devastating effect on the activities in Russia and the Republics that lasted for a couple of years.
Canam’s Resurgence
In 2004, the ownership and shareholders of Canam changed, adding a new and regenerated focus on growth and development of the company. To gain better access to some of the main supply bases, Canam opened offices in Wuxi, China and Zaporizyia, Ukraine. Canam also expanded its network for logistics coverage, with the intent to reduce time and costs, and becoming more competitive than ever.
Solid Plans for Future Growth
Canam’s focus for 2006 and forward is to establish a larger sales network of people and agents, to better service and expand our customer base. We will introduce our version of e-business, to further broaden our service to our customers. In doing so, we will provide them with more product information, specials and feature products to better assist in refining their operations and reduce associated costs. Canam will form key alliances with suppliers and manufacturers, as well as broaden our source of supply from key regions of the world.