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Shale Drives $1M Expansion at Bolt Construction
NORTH LIMA, Ohio -- It’s hard not to notice the physical impact of the shale industry as you drive along South Avenue in Beaver Township past Bolt Construction Inc.
While there are no visible well sites -- drilling for oil and gas isn’t as prevalent in this section of the Utica shale as elsewhere in the state -- the large steel structure taking shape next to the company’s offices shows how the industry is transforming many local businesses.
“Two years ago, we experienced record sales,” reports Bolt Construction’s president, Bruno Miletta. “Last year, we tripled that record. We’re at the point where we’ve outgrown the old shop.”
The company is building a new $1 million fabrication shop equipped with some of the latest ventilation, welding stations and lighting, says the company’s vice president, Todd Miller.
“It will have higher ceilings, greater floor capacity, so we can put in more welders and fitters,” Miller says. “It will allow us to double the number of welders we have.”
The 15,000-square-foot shop should be finished by late June, Miletta says. “We expect to hire about 20 more people” once the new shop is running at capacity.
Bolt Construction fabricates pipe and piping components used in the oil and gas industry, the petroleum industry and the jet-fuel industry. The company also installs compressor stations used to transport gas to markets throughout the country.
These days, it’s the new business derived from oil and gas exploration in eastern Ohio’s Utica shale that’s fueling the expansion at Bolt. “The new shop will allow more hook height for our cranes,” Miletta says, which is necessary since the company fabricates large skids that hold vessels 20 to 30 feet in height.
“We’re limited right now,” he says of the current shop. “We have to finish the installs outdoors,” which is difficult during the harsh winter months.
Plans to build the new fabrication shop were set in motion two years ago when the company realized its shop wasn’t adequate to handle new business generated from the shale plays. “We’ll have eight to 10 welding positions, whereas now we have five,” Miletta says.
Since shale gas exploration took hold several years ago across the country, the company has grown from 30 or so employees to more than 100, he continues.
Not only is Bolt expanding its manufacturing footprint, it’s also doubled the size of its offices over the last two years to 5,000 square feet.
“We’ve been turning work away because we just can’t handle it in our shop,” Miller says. “And, we still tripled business from two years ago.”
Workflow at the company is also likely to improve once the new fabrication plant is finished, Miller says.
“There’ll be a front and back entrance” that allows components and materials to arrive at one end, and a finished product shipped out the other. Also, the building will house three new cranes -- one 15-ton crane and two 5-ton gantries with provisions to add three more, he reports.
“There are also long-range plans to build a sandblasting structure and a paint shop,” Miletta says. “But, that’s down the road.”
Bolt was established in 1981 as a supplier to the gas industry. The company does business in 26 states and works on major projects such as large petroleum depots, shale gas processing centers, and jet-fuel systems at some of the country’s busiest airports.
“The airport side of the business is very important,” Miletta emphasizes. “They tend to be jobs of a longer duration.”
Bolt, Miletta notes, is busy with an $8 million project at the Memphis International Airport and another $10 million project at the Charlotte (N.C.) Airport.
The oil and gas industry is nothing new to Bolt Construction, but the shale industry in Ohio is. Early on in development of the play, Bolt secured business relationships with all of the major energy companies exploring the Utica. “This isn’t anything new to us,” Miletta relates. “What is new to us, however, is the volume and location of the work.”
Miletta says that his company is accustomed to working out-of-state, such as Missouri or the Upper Peninsula of Michigan, for example. “We’ve never worked this close to home.”
Much of the Utica’s development is an hour’s drive or more south of Mahoning County, in areas such as Carroll and Harrison counties. There, energy companies have tapped into what they consider the “core of the core” of the play, where wells have delivered strong returns of liquids-rich natural gas.
Bolt Construction, Miletta says, is in a perfect position to capture much of this business since the company is already well-known in the industry.
“All of our welds are subject to 100% radiographic inspection. We X-ray those welds the way a doctor would X-ray your arm for defects,” he says.
Miletta says his company’s repair rate is less than 1%; under 2% is considered good by industry standards. All of the components are pressure tested before they leave the shop.
“We provide the customer with documentation of each test. This allows them to go ahead and install the entire system, and that’s one less test they need to perform on the system before it’s put into production.”
With new business on the horizon, and a consensus that the Utica is still in the early phase of the play, the timing was right to invest in an expansion of the company, Miletta reports.
“We spent several hundred thousand dollars in upgrades of the old shop and you can improve something only so much,” he says. “So, we decided to go ahead and build, which in our minds, what will become the ideal fabrication shop.”
Editor's Note: This story first appeared in the May edition of The Business Journal.
Copyright 2014 The Business Journal, Youngstown, Ohio.
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