North American Construction Group: a premier provider of heavy construction and mining services
North American Construction Group, based in Edmonton, Alberta, has been a leading provider of heavy construction and mining services throughout Canada for more than 60 years. NACG offers an experienced, comprehensive, and integrated approach that fits their customer's requirements from consultation to completion.
NACG is primarily a heavy civil mining and construction company working predominately in oil sands, but also in the resource industry – coal, gold, diamond mines – as well as highway work, underground utilities, and piping. In addition, the Company does earthwork for hydro dam projects, front end construction activity, and civil and underground work around refineries in Edmonton and throughout Alberta. It also has one of the largest independently owned fleets of equipment in Canada.
The Company, founded in 1953 as a highway construction business, was purchased by a private equity firm and listed publicly in 2006. In the past two years NACG sold off its pipeline and piling divisions for improved financial stability and to reduce debt. Now their core focus is on being a heavy construction and mining company.
“The changes we made over the past year have really shown us how we can improve our costs and our performance and still maintain a strong safety and client service focus,” says Joe Lambert, COO of North American Construction Group. “We sold some assets because the marketplace was oversaturated and felt our timing was ahead of the curve on that. We made those decisions and got to a better place faster than a lot of our competitors and we think that puts us in a good position moving forward.”
Health and safety
NACG’s ultimate goal is to reduce or eliminate workplace injuries and incidents by using every means possible and through the aggressive promotion of healthy and safe work practices in the work environment. The Company strives to ensure the optimum success of this policy through compulsory participation by all employees, management, and subcontractors.
“In today's industry, health and safety is the price of admission,” Lambert says. “We're focused on safety as a company value because it's not only a moral obligation, it’s good business. We are proud of our safety record and have had significant improvements for six consecutive years.”
Safety starts with leadership and the NACG’s managers create and promote a safe workplace through active and visible direction in the field, by leading by example, and by promoting the Company’s core values. Management is also constantly communicating the importance of health and safety programs throughout the organization.
To help achieve the goal of minimizing incidents and creating a safe work environment, the Company’s employees also have a personal responsibility to work safely at all times and a commitment to adhere to NACG’s standards of practice for health, safety, and environment as a condition of employment.
The Company adheres to programs and training in risk management, disability management, risk tolerance, risk assessment, as well as field level work-safe operating procedures. They complete fitness-for-work screening, which includes drug and alcohol testing programs, vision testing, hearing testing, cardio vascular testing, and functional capacity testing to make sure that the people being hired can meet the physical demands of the job.
“In our business one of our key philosophies is prior to hiring individuals, let’s make sure we know as much about them and their fitness for the particular work that we're doing,” Lambert says.
In 2013 NACG was recognized as one of “Alberta’s Top 60 Employers,” which was the third consecutive year they were named on the list.
“That shows that we are doing the right things that are important to employees,” Lambert says. “When it comes to construction and mining, if you take care of your people and you take care of your equipment then you're well on your way to success.”
The Company has 1,600 experienced employees who are used to working in the extreme northern climate and conditions in the oil sands area in Canada. NACG offers a competitive wage to go with this challenging work and also puts a lot of time and energy into employee training programs.
In addition, the Company has extensive training programs for supervisors and managers – to ensure that they have good people to manage people well. They also offer equipment operating training, maintenance training, and even mentoring programs.
On the safety side, they have a “green hand” program for new employees. “We also use it to learn information from those new employees who have good ideas from past places they worked,” Lambert says. “New hires require training and coaching commitment, but they also bring different experiences and ideas and we have no issue stealing good ideas when we hear them.”
NACG uses state-of-the-art equipment provided from primary equipment vendors. The Company’s philosophy is all about having quality equipment and maintenance programs. As an equipment operator that's your office, that's your workplace, when there is quality equipment that's safe and running effectively then that creates a good office environment for the operators.
One of the major technological advantages NACG has is its immersive simulator, which creates an actual environment, much like a NASA simulator. The immersive simulator tracks the operator’s head movements and allows the Company to train operators not only on safety but on production. It can simulate emergency situations, like fires, and make sure people know how to respond. Workers may go throughout their career without having an emergency and this technology is able to train people so they know what to do when those situations occur.
There is also a lot of technology in the equipment with GPS and the real time reporting of machine health, where it can monitor equipment for faults on the equipment, which gets reported immediately.
“On the equipment side it's about identifying maintenance issues before there are failures,” Lambert says. “That's where you save your money and create the safety and efficiency in those systems. GPS on equipment makes you more effective.”
Scope of operations
NACG operates on almost every mine site in the oil sands and has also worked in British Columbia, Ontario, Saskatchewan, and Yukon for all the resource industries – gold, diamonds, copper, coal – as well as heavy civil and construction work. The bulk of their revenue comes out of working the oil sands, which is a huge marketplace.
The Company got started in the oil sands in the '70s and has been there ever since. “At most of the oil sands mine sites - we have been there since they opened,” Lambert says.
NACG has a central office based in Edmonton with good communication and project management training for employees on work sites. They pride themselves on going into the field knowing what the plan is and how to execute it safely and efficiently. The management team has a depth of experience in the execution of project. It's not unusual to find guys with 20-30 years of experience running NACG jobs.
“When they have been around with us that long then we know their skill sets well and can place them on the projects where their extensive skills and experience benefit us the most,” Lambert says.
The Company recently announced that it had secured a new five-year master services contract for the provision of civil mine support services in the oil sands. The scope of the new contract covers overburden removal, reclamation, mine services and civil support and maintenance. Activity levels at the site ramped up at the beginning of this year.
NACG is also involved in an Alberta highway construction job that started in February.
Trends and challenges
Over the last few years there has been a heightened competition in the market, even internally from NACG’s clients that have their own equipment and will in-source work, and that can affect the marketplace.
“We need to make sure we keep our focus on safety and we need to be able to run tight on our costs,” Lambert says. “If you have competitive pricing and strong safety performance you have a good chance of getting the work.”
Also important is NACG’s sturdy long term relationships with clients – many since the inception of their operations. Another way the Company is competitive is its diversification with roadwork, light industrial, piping, under-ground utilities, dam construction, and work in other resource areas.
“All industry areas have a cyclical nature and diversification helps normalize that cyclical impact,” Lambert says. “But the oil sands is a consistently strong market area and a place we expect to have a majority of our business for a long time.”