Research_Report

2014 ACCESS MAT RESEARCH
PERSPECTIVES ABOUT THE INDUSTRY AND ASSET TRACKING CONCEPT
FEBRUARY 2015
Golden Environmental Mat Services Ltd.

GEM SERVICES - 2014 ACCESS MAT RESEARCH
1.0 INTRODUCTION
2.0 DEFINITIONS
3.0 STUDY METHODOLOGY
Figure 1.1 - Industry Sectors Interviewed
4.0 RESULTS
4.1 Market Size
4.2 Market Growth
4.3 Factors Impacting Industry Growth
4.4 Mat Ownership
4.5 Who Is Buying Mats?
4.6 Operator Needs & Frustrations With Providers
4.7 Respondent Perspective Toward Asset Tracking
4.8 Views Toward Asset Tracking Technology
4.9 Views On How Asset Tracking Technology May Address Pains
4.10 Desired Data & Functionality
5.0 CONCLUSIONS
ABOUT GOLDEN ENVIRONMENTAL MAT SERVICES
ABOUT ALBERTA INNOVATES TECHNOLOGY FUTURES
ABOUT TEAMTHINK
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TABLE OF CONTENTS

03GEM SERVICES - 2014 ACCESS MAT RESEARCH
1.0 INTRODUCTION
Golden Environmental Mat Services (GEMS) with support from Alberta Innovates Technology Fund under-
took a research project to gain perspective about the access matting industry and the concept of asset track-
ing. We spoke to operators of energy, utilities and pipeline companies, EPC firms (engineering, procurement
and construction), mat manufacturers and distributors, construction companies and other providers of mat
rental services. Ultimately, we wanted to learn about industry trends, market characteristics and most impor-
tantly the users of mats and their needs.
We hired an independent market research firm, TeamThink Inc., to implement the study on our behalf. We
sought an unbiased, third party point of view on the industry and assessment of the asset tracking tech-
nology concept. We also felt research participants would provide more candid responses during interviews
conducted by a third party.
While GEM Services (GEMS) has a vested interest in conducting this research we also feel the findings are
beneficial to our industry peers and colleagues.
We hope this information is valuable to you. Feel free to distribute it to your colleagues. Should you have any
questions or feedback about the content of this findings report, please feel free to contact me.
STEVE FISHER, CEO
Golden Environmental Mat Services Inc.
403.862.4367
steve@enviromat.ca
www.enviromat.ca

2.0 DEFINITIONS
OPERATOR
For this research operators are oil and gas producers, energy transmission/distribution companies and pipe-
line operators who are the end user of the matting or matting services.
PROVIDER
Companies that own a fleet of mats they rent to operators; providers are either installers or construction
companies.
INSTALLER
Companies that solely rent, install and remove mats for operators (e.g., GEM Services); they primarily own
their mats but may bolster their fleet by renting mats from others that are in turn rented to their customers.
CONSTRUCTION FIRM
Companies that construct assets on behalf of operators; some construction companies own the mats they
rent to their customers; others procure mats from installers to be used on their jobs and pass these costs
through to their customer
DISTRIBUTER
Mat brokers who procure directly from manufacturers or buy mats from others and resell them.
MANUFACTURER
Produce mats. There are both pure play manufacturers but others that have integrated vertically to provide
mat rentals and installation services.
MATTING / ACCESS MATS / RIG MATS
A portable platform that supports equipment used in construction and other resource-based activities,
including drilling rigs, camps, tanks, and helipad. Often used as temporary roadways to provide passage over
unstable or environmentally sensitive ground, pipelines and more. Commonly the top and bottom layer are
made up of 11 pieces and the middle layer, placed cross wise, is made from 21 pieces. In the USA, the majority
of access mats are made from mixed hardwoods, although they are often referred to as Oak. It is also usual
to find hardwood mats in Canada, however the availability of durable coniferous species such as various firs,
pines, and spruces make their use a more economical prospect. Common dimensions are 8’x14’. Thicknesses
vary between suppliers from 4.5 inches to a full 6 inches. Rig mats are either 8’X20’or 8’X40’and have a steel
frame with wood infill.

3.0 STUDY METHODOLOGY
TeamThink conducted one-on-one phone interviews between July 14th and November 14th of 2014 with 28
industry contacts. Five of the participants were businesses who have worked with GEMS in the past year and
remaining participants were industry contacts of GEMS or contacts made by TeamThink and included:
›› Three global oil and gas companies
›› Four large utility companies
›› Six mat manufacturers representing the majority of the mat production industry in North America.
Figure 1.1 Industry Sectors Interviewed
Key Interview Topics:
›› Mat use and market size
›› General views on the matting industry
›› Relationships between operators, construction firms and mat providers/ installers
›› Perspective of RFID/ GPS asset tracking for mat inventory
Although 28 interviews do not provide statistically valid conclusions, interviews were structured to probe
responses and clarify comments to uncover rationale of responses to generate key insights and themes to
form conclusions.

4.0 RESULTS
4.1 MARKET SIZE
Respondent Estimates:
›› Total access mat demand in Canada = 450,000 – 750,000 per annum
›› Annual access mat production in North America = 300,000 – 600,000
›› Rig Mats produced in US = 2000 – 2500 in Canada = 20,000 – 25,000
›› Minimum 500,000 produced – unsure of ceiling
›› Note: Private companies do not provide full disclosure of hard data
›› Note: US also has crane mats and other products that were not accounted for
GEM Services numbers generated through Canadian Association of Petroleum Producers 2013 data on explo-
ration and development drilling expenditures in the Major Conventional Oil and Gas Fields projected 1.4
million mats in use. The 1.4 million mats does not account for unconventional activities (oil sands), Pipelines
maintenance and development or Utility transmission and development.
Verified data:
›› Major US Mat Manufacturer: 250,000 produced annually
›› Major CDN Mat Provider: 300,000 mats in the field
4.2 MARKET GROWTH
›› 10 years ago“no one was using mats”, meaning the industry was very small
›› Market has grown approximately 200% in past 5 years (manufacturer)
›› Projected Growth:
Major Mat Manufacturer: Flat 2015: 10-25%; in 2016: 10-15% annual growth probable for the
foreseeable future
Global Company Providing Total Service Spectrum (Utilities, Manufacturing, Rentals, Instal-
lations and EPC): They see market growing given # of utility projects planned and underway. Feel
it is a strong market not as concerned about growth rates, they like directional data/ trends of the
growth they are seeing.
Major Mat Manufacturer: Feels over supply of mats in short term and expects consolidation to
shake out smaller players
›› Potential Growth Area: composite mats emerging due to durability and lighter weights will reduce
costs of transportation

4.3 FACTORS IMPACTING INDUSTRY GROWTH
Oil and Gas
Demand is linear as new projects come on, look for leading indicators such as capital investment. Use of
rig and access mats is becoming standard. Given sudden drop of oil prices many capital projects are being
delayed or cancelled which will impact demand in this sector.
Utilities and Pipelines
Many projects expected to come online. Less subject to volatility compared to oil and gas. Workforce avail-
ability could limit growth.
Other Factors
›› More competitive pricing is creating margin pressure.
›› Mat quality is improving so mat lifespan is extending.
›› Legislation requiring mat use does not exist but private and public groups are requiring mats when
projects cross their land. For example, there are matting requirements for crossing over buried pipe-
line infrastructure and within project job specifications for a utilities company.
4.4 MAT OWNERSHIP & USAGE EXAMPLES
COMPANY CIRCULATION / OWNERSHIP
Major Oil and Gas Operator Bought $15-20 Million many years ago and never again
Major Oil and Gas Operator Rent 10,000
Major Utility Operator (transmission) Rent 5000 - 10,000 on transmission line construction project
Utility Operator (Distribution) Own 600
Construction Supplier Oil and Gas Own 10,000
Construction Supplier Oil and Gas Own 400, but rent more for projects
Utility Operator (Distribution) Rent 500 annual use
Major Utility Operator (Distribution) Rent 2000
Major Utility Operator (Distribution) Rent and own 70,000 (unsure of split)
Small Provider Own 12,000
Major Oil and Gas Operator* Own <1000
* Outsourced management and installations

4.5 WHO IS BUYING MATS? OVERALL ESTIMATE WAS <70% TO PROVIDERS
PERSPECTIVE INTERVIEWEE % OF SALES TO PROVIDERS VS OPERATORS
Large Volume
Manufacturers
Manufacturer #1 80%
Manufacturer #2 60%
Small Volume
Manufacturers
Manufacturer #3
Sells only to major distributors and expected majority were
sold to providers
Manufacturer #4 20%
Manufacturer #5 75 - 80%
Manufacturer #6 Almost all operators
Distributer Distribution Company Vast majority to providers
4.6 OPERATOR NEEDS & FRUSTRATIONS WITH PROVIDERS
OPERATOR NEEDS OPERATOR FRUSTRATIONS
Mat quality (safety concerns) Delays
Availability and timely deployment Lack of availability
Site service (responsiveness, reliability, worker efficiency) Cost management
Expertise in install and removal Billing for damages
Convenience Mats lack durability
Low cost and lowering cost Transparent invoicing
Tracking (for operators with large projects) Price gauging in boom times
4.7 RESPONDENT PERSPECTIVE TOWARD ASSET TRACKING
Pipeline and Utility Operators
›› Reliability of access to mat assets is critical.
›› Heavy regulatory requirements for reporting to independent auditors from governing bodies such as
the Alberta Utilities Commission to justify their construction plans and associated costs. These indus-
tries need an accurate and auditable information trail.
›› Job Complexity
-- Dealing with multiple land jurisdictions and public/private land issues with stringent environ-
mental regulations

-- Projects cover vast distances and require the use of large numbers of mats spread out over large
geographical areas
›› Environmental scrutiny and need to be environmentally diligent; More obligation and commitment
to“doing the right thing”
-- Greater danger of fines/problems due to mat abandonment and not addressing environmental
concerns
-- More regulations around environment compared to other industries
-- Big public perception challenge – need to harness good image to get their jobs pushed through
-- Minimization of footprint is key to positive public perception
›› Different corporate philosophy, which stems from who pays the bill (rate payer)
›› Not as cost driven on the expense side in Canada
Oil and Gas Operators
›› Minimizing project slowdowns as this leads to big cost savings, but daily opportunity cost of not
being online is massive
›› Internal scrutiny is a key challenge as there is a large information gap between downtown office based
decision makers and field staff.
-- Different groups with different mentalities and understanding of realities
-- C-Suite trying to focus on what is happening in the field and must rely on word of mouth
-- Need tools to help provide real accurate data on field level issues
›› Rental mats viewed as “dumb” equipment that lack information that can result in several stumbling
blocks throughout operation
›› High priced equipment is easier to manage with less automated fashion because there is less of it
›› All assets would benefit from the use of tracking technology
Providers and Installers
›› Managing inventory is time consuming and costly (for fleets of 10,000+ mats), also not completely
accurate
›› Constantly moving mats – need a view of exactly where the mats are
›› Have mats on jobs with multiple companies at times – they get mixed up – need to get the right mats
back
›› Need to respond rapidly to clients – knowing where inventory is to be responsive is essential
4.8 VIEWS TOWARD ASSET TRACKING TECHNOLOGY
›› Potentially a game changer
›› Manufacturers most bullish on concept – some have clients asking for the technology
›› Concerns over technology functioning properly (case studies and proven field trial essential)
-- Will GPS truly work or do you need to“wave a wand near mats”?

-- Will RFID function in water, mud, undercover?
-- Component durability in the field?
-- Will it slow down installations?
›› Greatest benefit would be seen by:
-- Mat owners (operators or providers) with a large inventory
-- Providers and installers as they move mats
-- Project managers on jobs with large quantities of mats
-- Companies that deal with regulations or governing bodies
›› Perspectives leading to technology having limited appeal:
-- Some uncertainty around“how big the problem is – does it warrant a technological solution”?
-- Regarding pain points/ frustrations – availability, responsiveness, mat quality trump desire for
tracking.
-- Is there ROI?
4.9 VIEWS ON HOW ASSET TRACKING TECHNOLOGY MAY ADDRESS PAINS
Financial
›› Reduce replacement costs of mats (capital risks)
›› Increase financing options and reduce financing rates for capital expenditure on the mats
›› Optimize timing of orders with manufacturers to reduce mat purchase costs
›› Reduce internal staff headcount for managing/ tracking mats in the field, office personnel (“Counters”)
›› Differentiator (helps providers/ installers earn new business)
Fleet Management
›› Reduce transportation costs
›› Ensure mats are retrieved/retained on job sites where mats are owned by multiple providers or
operators
›› Data insights to help improve fleet management (new orders required, mat lifespan, mats cleaned)
Operational
›› Reduce risk of project delays (idle rig crews for oil and gas operators cost $30,000-$50,000/ day)
›› Improve on-site project management (accurate counts of mats, accurate information on location)
›› Improve the ability for providers/operators to collaborate on managing mats on large jobs
Compliance
›› Comply with auditable tracking requirements on jobs if specified in contracts or by regulators
›› Address soil contamination through enabling tracking of mats that are sources of soil contamination
and verify mats have undergone remediation before returning to the field
›› Reduce risk of asset abandonment

4.10 DESIRED DATA & FUNCTIONALITY
INVENTORY MANAGEMENT
PHYSICAL
CHARACTERISTICS
ALERT / INSIGHT
Location of Mats Weight Transportation optimization
Mat utilization (generating revenue) Quantity Inventory optimization
Invoicing Transparency Quantity and Duration Auditable expenses
Rental period Grade of mat – A, B, C, D Inventories and Amortization
Rental stoppage or holds Not in use Cost controls
Inter-division mat requests if mats are
shared inside a company
Mat Locations Accurate expense allocation
In/Out of yards Inventories Cost management
Connected to serial # Quality ROI is tracked
Maintenance (clean or repair) Status Secure mat quality
Available inventory and location Quantity Speeds planning (estimating costs)
Automated systems Reliability Data Accuracy– Information export to Excel

5.0 CONCLUSIONS
It is apparent that mat use has become more mainstream and the benefit of unobstructed access has become
recognized by project operators. Conservative estimates for the number of mats in use and produced annu-
ally in North America are:
›› Rig mats produced: 20,000 - 25,000 (alternative products not accounted for)
›› Annual mat production in North America: 500,000
›› Annual mat demand in North America: 1,500,000
Across all sectors (Oil and Gas, Utility Transmission and Distribution, Pipelines, EPC and Construction Firms)
frustrations such as; delays, availability, cost management, mat durability, and transparent invoicing were
consistent themes. The matting industry is relatively young and there were several troubling examples that
were identified where improvements can be made:
1. Large mat inventories disappear following a major project ($20 million dollars in mats).
2. Providers don’t care about lost mats because the client pays for losses and damages.
3. Charges buried in stand-by fees, machine time, layering added costs to make-up for under-bidding
“to win the job”.
The factors impacting industry growth such as the price of oil can be considered an opportunity for a tech-
nological advance to hit the market at a time when Oil and Gas producers are desperate to find solutions that
will cut costs. A transparent and accurate form of cost reporting may become more favourable in the current
economic conditions. The common sentiment where “the oil and gas industry is predicated to the honour
system” and the fact that this honour system is not quantifiable and lacks accountability will probably be
re-visited in favour of more concrete reporting on costs.
Long-term success in the matting industry for providers and installers will require effective, timely and quality
service that is delivered with transparent invoicing and demonstrable cost savings. A technological advance
such as asset tracking for mats would help address many challenges and pains faced by both owners and
users of mats.

ABOUT GOLDEN ENVIRONMENTAL MAT SERVICES
GEM Services was incorporated in 2011 and provides access matting services to the WCSB energy industry.
Their main focus is on understanding and exceeding customer needs.
The matting industry is young and growing and GEM Services are excited to be the industry leader in its
evolution. There is an opportunity in several key factors that will help to; reduce client costs, improve supply
chain efficiencies and decrease the environmental footprint of energy projects.
GEM Services are looking forward to working with all participants of the survey to build a resilient industry.
ABOUT ALBERTA INNOVATES TECHNOLOGY FUTURES
Part of the Alberta government’s research and innovation system, Alberta Innovates-Technology Futures
(AITF) provides: technical research and development support and advisory services; business innovation and
talent development programs; and regionally accessible commercialization support.
Outcomes being achieved by AITF include the commercialization of technologies, development of new
knowledge-based industry clusters, and establishment of an entrepreneurial culture in Alberta. These out-
comes enhance economic diversification by increasing the productivity and competitiveness of existing busi-
nesses, and the establishment and growth of sustainable new businesses. Aligned to provincial priorities,
AITF’s suite of programs and services are designed to meet the needs of entrepreneurs, companies, research-
ers, post-secondary institutions and investors, in order to build globally competitive commerce in Alberta.
ABOUT TEAMTHINK
TeamThink was established in 2002 by principal, Sandor Kiss, to provide marketing and sales consulting ser-
vices to small and mid-sized businesses located in Calgary Alberta.
Since then TeamThink has become a trusted advisory firm to take care of their sales & marketing needs for
its clients. TeamThink positions clients for revenue growth by conducting research to understand customer
needs and creating plans and strategies to reach target markets. The company also influence sales growth by
providing sales and marketing coaching or directly generating revenue as an outsourced business develop-
ment resource.

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