The trains will keep a rollin’ in McKean County, thanks to state-awarded funding to two industrial railroad projects.
Gov. Tom Wolf announced Tuesday that American Refining Group Inc. and Glenn O. Hawbaker Inc. will receive monetary support for railroad projects in McKean County.
They were two of 27 rail freight improvements projects receiving funding that Wolf’s administration said will create and sustain and estimated 255 jobs in the commonwealth.
According to Wolf, ARG will receive $2 million to construct additional track and purchase unloading equipment, while Glenn O. Hawbaker will receive $158,865 to rehabilitate about 0.75 miles of track, with updates to include installing new track, surfacing track and constructing a 60-foot retaining wall.
Using the funding, ARG will “construct additional rail sidings on the property, as well as installation of necessary loading and unloading equipment including racks, canopies, pumps, piping and related equipment,” said Sara Furlong, ARG executive communications coordinator. “The new sidings’ proposed location is near the refinery’s tank farm off Bolivar Drive.”
ARG President and Chief Operating Officer Jon Giberson said, “We are very grateful for the support from the state to help us fund this critical infrastructure upgrade in Bradford.”
It is the importance of infrastructure to industry that is the motivation behind the funding, according to Wolf.
“Keeping goods and services moving across Pennsylvania’s more than 5,000 miles of freight track is vital to the state’s economy,” the governor said in a press release. “These investments in our rail infrastructure will continue to support business development.”
According to Giberson, a number of challenges for local crude oil producers has meant ARG is bringing in crude from further away. This has prompted the developments in the company’s own rail systems.
Furlong described what the company does: “The ARG refinery receives crude oil and additives used for blending finished lubricants and ships other products such as solvents, distillates, base oils, resins and waxes to its customers by rail.”
To maintain the same production, ARG has had to make changes.
Giberson explained, “It’s been well documented in the last several years that our small, local, Pennsylvania-grade crude producers — what we call our legacy producers — have been challenged on a number of fronts including volatile crude pricing, water handling and treatment, costs and ongoing regulatory pressures.
“Legacy crude always has been and always will be our most preferred feedstock; our refinery was built specifically to process this unique crude produced by the Bradford field,” he said.
But keeping production at a certain level at ARG means more efficient processing.
Giberson explained that ARG’s operations are optimized when processing 10,000 barrels per day. The decline in legacy production has required ARG to source alternative feedstocks in order to bridge any shortfall, according to Furlong.
ARG’s Supply Chain team must source crude oil that is compatible with the refinery’s equipment in order to deliver the high-quality products its customers expect, but have had to venture greater distances from home to find it.
The additional track will help the company meet its goal of optimizing production.
“The ability to transport crude via rail from locations across the country is critical to our long-term strategy for growth and development,” Giberson said. “Consistently running at optimum rates will help us protect jobs and sustain a stable market outlet for local producers.
“It also ensures we are positioned to stand with and lobby on behalf of industry groups and associations such as Pennsylvania Independent Petroleum Producers (PIPP), Pennsylvania Independent Oil and Gas Association (PIOGA) Pennsylvania Grade Crude Oil Coalition (PGCC) and the Pennsylvania Grade Crude Development Advisory Council,” he continued. “We are deeply invested in working with the state, environmental agencies, economic development efforts and industry to allow the PA conventional oil industry to thrive once again.”
At Glenn O. Hawbaker Inc., Mike Hawbaker, vice president, said the project is simply maintenance for a facility that is more than two decades old. The project is located at the company’s Turtlepoint facility on Champlin Hill Road.
“We’re just keeping up on proper and safe maintenance of the facility,” Hawbaker explained. Hawbaker noted the work is happening at a facility that has been in place for 25 years and said it’s “a credit to the initial construction” that it’s lasted.
He the company is “now moving on with good maintenance practices to continue operations in Turtlepoint, Port Allegany and the entire Northern Tier.
“We bring high-quality construction aggregates that are used throughout the Northern Tier of Pennsylvania,” Hawbaker said, noting that municipalities and the Pennsylvania Department of Transportation are among Glenn O. Hawbaker’s largest customers.
With the track rehabilitation, it “puts us in a position to continue to provide high-quality products and services,” he said.
He explained that Glenn O. Hawbaker is a “third generation family company” that provides heavy construction services and products such as limestone and gravels. About 25 years ago, the company decided to build a location in the northern tier, choosing Turtlepoint as its location.
Since the region lacks limestone as a natural resource, the best way to bring it in to the site is by rail. The funding will be a “great help” in allowing Glenn O. Hawbaker to continue to help customers.
“We’re looking for work to start within the next 30 to 60 days on that maintenance and rehabilitation,” Hawbaker said, adding they plan for the project to be complete before the end of summer.
He expressed his gratitude to Wolf for Pennsylvania’s support.
“We appreciate Pennsylvania’s continued support of railroad infrastructure and understanding of the benefits to the Pennsylvania economy,” he said.
For more information about ARG, visit www.amref.com or follow the refinery on Facebook and LinkedIn. Glenn O. Hawbaker can be found online at www.goh-inc.com.
