December 26, 2009 Rough Road Warrior

Volume 12 | Issue 4

Nile Chapman Construction is doing its part to place the U.S. economy on the road to recovery. Particularly, the Utah-based subsidiary of Da

In 1953, French film director Henri-Georges Clouzot contemplated “The Wages of Fear” in an unforgettable cinematic masterpiece. His riveting narrative vividly depicts the shared odyssey of four truck drivers that transport nitroglycerine across treacherous South American terrain, their volatile payload intended to extinguish an out-of-control oil field fire. Forced to drive dilapidated vehicles across the most rudimentary roads and rickety bridges, the men face instant annihilation with every axle revolution. By the emotionally exhausting movie’s end (warning: spoiler alert!) all four have perished, with three deaths attributable to vehicular accidents.

If Dalbo Holdings Inc. (DHI) had existed back then, and if it operated in South America instead of North America, the circumstances and outcome would have certainly been different. Of course, the movie only represents an existential fable, and in the real world no company would assign anyone such a lunatic mission. But Dalbo’s theoretical involvement in the imaginative scenario would have ensured the four drivers’ survival.

Headquartered in Roosevelt, Utah, DHI is a leader in fluid transportation, heavy equipment hauling, fluid storage tank rental and fluid disposal. Operating in the Rocky Mountains region market, the corporation’s subsidiaries include RN Industries and Nile Chapman Construction, both based in Roosevelt, Utah. RN Industries offers a well-maintained fleet of trucks, tractors and tank trailers that effectively function on rough, mountainous terrain to service oil and natural gas fields. Concurrently, Nile Chapman Construction builds the roads and bridges that provide safe transport to these locations. While the vehicle equipment and well-constructed roadways these related companies offer could never translate into a relaxing Sunday drive in the country (considering the targeted region) the combined capabilities offer a safe and effective means to an end.

BRIDGING AMBITION AND GOAL
And to this end, Chapman contributes nearly a half-century’s experience that includes numerous and logistically complex road and bridge construction projects. Much of its activity has resided in the Uinta Basin, an area nearly as remote and rugged as Clouzot’s South American setting. But this northeastern Utah region proved quite attractive to investors, as it affords substantial natural resources (i.e., available oil and natural gas reserves). By providing safe access to such exploration sites, Chapman makes sure the attraction isn’t fatal.

But it doesn’t stop there. Once Chapman creates necessary pathways to these fuel-abundant locations, the company’s customers may encounter further accessibility problems. “When companies construct an oil or gas well in the rugged natural setting, and need to set up equipment for drilling purposes, we’ll create the necessary large, on-site paths,” confirms Russ Cowan, a company corporate manager.

Further, Chapman’s on-site construction activities extend beyond the necessary transportation easements. “In many cases, we also construct the actual hole that serves the drilling purposes,” Cowan adds.

EXTENSIVE EXPERIENCE
In 1960, long before being acquired by DHI, the family owned enterprise was established in Roosevelt by Nile Chapman, father of current president Roger Chapman. The company’s birth year indicates one of its main differentiating characteristics: Its experience. “We have worked this region ever since the discovery of its profitable oil and natural gas resources,” relates Cowan.

Experience also includes establishing important business relationships. Today, Chapman serves the leading “E&P” entities; that is, corporations involved in oil and natural gas exploration and production. “We work a multi-state region that extends beyond Utah’s Uinta Basin and includes Wyoming, Colorado and New Mexico,” says Cowan. “Our primary focus involves assisting the largest oil and gas companies that extract natural resources to help fuel the nation’s energy needs.”

The client list includes major players such as EOG, Halliburton, Noble Energy, Shell, ConocoPhillips, Chevron and Exxon. Chapman’s value to these high-profile companies is considerable. “As a service company, Niles Chapman Construction is often called upon to perform a variety of tasks,” says Manager of Administrative Services Chris Chapman. “For instance, we perform ground reclamation services at a drilling site, as well as a lot of explosives works, which opens up areas into this very rough terrain in the first place.”

JOURNEY TO THE BOWELS OF THE EARTH
Moreover, the company engages in construction of water treatment and sewer treatment facilities, as well as water disposal construction and operation. Water disposal is especially crucial. Explains Cowan: “When oil and gas companies engage in exploration, they literally drill into the bowels of the earth, which is filled with water. They need to rid their resource gain of this water.”

But that’s a very cumbersome and expensive proposition. Responding to this need, Chapman developed its water disposal construction and operation services. “We build and maintain our own water disposal systems and facilities, which help our customers separate the natural, profitable product from the wastewater,” says Cowan.

Such facilities are commonly referred to as evaporative ponds, he continues. “On an 80- to 100-acre spot, we can set up eight to 12 of such water disposal sites,” says Cowan. “Essentially, we help our customers rid themselves of an extractable component that has absolutely no market value. As our customers need to focus on getting their usable product to the marketplace, we’ll focus on the water disposal.”

Basically, at a site, water is disposed in environmentally friendly fashion, as applied technology harnesses the natural evaporative processes. Specifically, here’s how it works: The wastewater (also referred to as production water) is offloaded into a catch basin. Oily residue is skimmed and then disposed. Water then flows into a polymer-lined collection pit typically 10-to 12-feet deep. Natural evaporation (abetted by sprinklers) reduces that water that the pit collects.

“Currently, we have a capacity of 21 million barrels in our water disposal facilities,” reports Chris Chapman. And this is where RN Industries comes back into the picture: The sister company’s drivers can haul away many loads a day in a year-round operation.

THE ROAD AHEAD
As the company moves forward, it keeps one eye cocked to the past. “Not much has changed about our industry in the past 50 years,” says Cowan. “We’ve always used heavy pieces of construction equipment, commonly called ‘yellow iron,’ that includes large Caterpillars, backhoes, front-end loaders and necessary trucks – essentially, the large tools that move earth, rock and heavy debris. However, these tools are becoming more sophisticated, as we now equip them with modern technology, such as global positioning systems and other advanced electronics designed to increase operational efficiency at least 10-fold.”

By keeping itself up to date, Chapman continues addressing its customers’ ongoing needs, an approach that determines long-range direction. “As the oil-and-gas investment community finds circumstances conducive to further exploration, we’re poised to gear up, because we’ve already intuited the changes that will occur at least a year ahead,” reports Cowan. “For instance, in our water disposal activities, our business model is designed to accommodate an increased capacity of about 20 to 30 percent year. It’s all about being able to forecast the needs of our targeted markets and customers.”

So, there will be no unexpected boulders in the company’s path, nor will its future hinge on a rickety bridge that someone else built. Unlike Clouzot’s fatalistic drivers, Nile Chapman Construction won’t resign itself to apparent circumstance. Rather, the company chooses to master its own destiny. By the way, if someone should happen to ask it to transport a cargo of nitro, don’t be surprised if the company’s rapid response is “no sweat.” After all, Nile Chapman, with DHI support, has put in place the appropriate groundwork.

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