Jennifer Hiller | San Antonio Express-News
SAN ANTONIO — A new pipe mill south of San Antonio plans to hire more than 200 workers and build a $62.5 million facility — the latest ripple-effect project of the Eagle Ford Shale drilling boom.
Houston-based Alamo Tube Co. announced that its pipe mill and finishing facility will go into Alamo Junction Rail Park, a new 400-acre development in Elmendorf.
The company did not announce a timeline for the project, and a company representative did not return a call for comment.
The San Antonio area has seen a wave of Eagle Ford business and some of the world’s largest oil-field service companies have opened campuses, including Baker Hughes, Halliburton and Schlumberger.
San Antonio Economic Development Foundation President Mario Hernandez said that now smaller suppliers are betting on the Eagle Ford, too.
“It’s not a huge rush, but companies are convinced it’s a longer play and that the efficiency of being closer to the drillers makes it important to be in the San Antonio area,” Hernandez said. “The supply chain companies are moving methodically. They have to see that they have the customer base in the Eagle Ford formation.”
Companies that move things such as pipe or sand need to locate along rail lines, which has prompted a wave of rail-related construction. But oil-field businesses of all sorts have gobbled up industrial and warehouse space across South Texas.
“The labor pool makes San Antonio and Bexar County the premier destination for some of these suppliers, but industrial buildings are in demand all over South Texas,” said Omar Garcia, president of the industry group South Texas Energy & Economic Roundtable. “You’re seeing people build space that would not be built other than for the Eagle Ford Shale.”
The Eagle Ford swoops across 26 counties, from the Mexican border near Laredo to the College Station area at the eastern edge of the field. Drilling started slowly in late 2008, but it has become one of the most rapidly developing energy projects in the world. So far, the state has issued more than 15,000 drilling permits in the region.
Hernandez said the San Antonio area has benefitted by proximity and luck.
“Sometimes it’s better to be lucky,” Hernandez said. “We don’t have a well in 50 miles of us, but we’re getting a lot of benefit of the supply chain and we’re the center of employment.”
Alamo Tube Co. said in its announcement that Abbey Fives Bronx will supply the high-speed pipe-rolling mill with U.S.-produced tube. The mill will produce as much as 250,000 tons of oil-field pipe yearly.
Alamo Junction Rail Park is located off Old Corpus Christi Road in Elmendorf and is served by both the Union Pacific and Burlington Northern Santa Fe railroads. The rail site was designed for warehousing operations, manufacturing and oil-field services such as crude oil storage and shipment, or the storage and shipment of sand used in hydraulic fracturing operations.
The rail park is being developed by National Property Holdings and Rail Logix and is one of the latest rail sites in South Texas to expand — or appear from scratch in a swath cleared of brush and mesquite. Train cars are moving everything from sand for hydraulic fracturing to crude oil to gravel for well pads and roads.
Among the South Texas rail yards adding track to accommodate shale business are Hondo Railway LLC, Port San Antonio’s East Kelly Railport, Gardendale Railroad Inc. in La Salle County and the Texas, Gonzales & Northern Railway Co. near Harwood in northern Gonzales County.
Another new rail site in southern Bexar County, the 300-acre Southton Rail Yard near Interstate 37 and Loop 410, opened in January. Its anchor tenant is Santrol, part of the Ohio-based Fairmount Minerals.
Express-News archives contributed to this report.