Black Jack Energy Services

WEST TEXAS EARTHWORK FIRM’S VERSATILITY, EXPERIENCE SPUR GROWTH BEYOND OIL AND GAS PROJECTS

June 12, 2018

“The Komatsus don’t break down’”

Gateway Pipeline

An operator with Black Jack Energy Services feeds a mobile crusher on a windmill site in West Texas with a Komatsu PC360LC excavator. “We started putting Komatsu equipment in our fleet approximately three years ago because Kirby-Smith had availability, and it was competitively priced,” said Equipment Manager T.C. Stipe. “It proved durable, reliable and productive, so we kept adding more.”

Gateway Pipeline

A Komatsu intelligent Machine Control D155AXi-8 dozer is put to work constructing reserve pits and roads on well and wind sites. “The D155AXi pushes a large amount of material over a long run very effectively,” said Black Jack Energy Services Equipment Manager T.C. Stipe. “The fact that the D155AXi does it accurately and without masts or cables that take time to install and remove or get damaged, makes it a terrific value.”

When Owners Cliff Price and Lonny Hergert started Black Jack Energy Services, LLC in 2012, they focused the business directly on building well sites for oilfield companies in West Texas. The company’s services included everything from clearing and grubbing to putting pads to grade to constructing access roads and reserve pits.

“Even though our name says energy services, in essence, we’re an earthwork company,” explained Price, who is President. “Both of us had a background in the industry and were looking to open a business of our own. I had been with a highway contractor for 18 years and helped start its energy division. Lonny joined that same business in 2005 as CFO. When the opportunity came for the two of us to go out on our own, we took it.”

The relationships Price and Hergert built with energy companies throughout the years proved fruitful. They contacted several to let them know they were in business for themselves.

“We had a customer base right away,” recalled Hergert, who is the Managing Partner. “That gave us a good start, and when customers saw that Black Jack could be trusted to get jobs done on time and on budget, they spurred our growth by offering us additional locations and contracts.”

Growing diversity

As the list of projects grew, so did Black Jack’s customer base. Instead of putting all of their eggs into one basket, the owners began to look for and make their own additional opportunities. They found a big one in the burgeoning West Texas wind-energy market.

“Wind sites are fairly similar to oilfield locations,” shared Price. “We still build roads and level the site. We’re even digging a hole, like to the oilfields’ reserve pits. The difference is that for the wind side, it’s used for the concrete base of the mill instead of the holding pen for mud or water on the oil sites. The holes also get backfilled on the wind locations.”

In most cases, Black Jack Energy Services supplies the backfill as well as rock for the pads and roads on all types of energy projects, either reusing on-site crushed rock or hauled-in materials. The company runs mobile-crushing spreads to make base and backfill from excavated caliche. In addition, the business operates several leased limestone pits and produces three to four products at each, including ballast, pea gravel and two-inch-minus base.

Black Jack does the same for its logistics customers. Nearly a year ago, the firm ramped up its number of projects for railroad businesses looking to expand their facilities in order to bring in more of the “frac sand” that is used in fracking oil and gas wells.

“We are constructing the base underneath the tracks,” Hergert pointed out. “The concept is similar to building a road to a well or wind site. The largest one we have done was a mile of circular base, and that was finished within the first few months we were in business. It involved 75,000 yards of cut and fill as well as approximately 42,000 tons of base material.”

In addition to its energy-related offerings, Black Jack Energy Services provides traditional road construction for heavy highways and residential subdivisions. Crews complete the dirt work and put down base material for subgrade preparation.

“We stick with what we know, so that’s the extent of that type of work,” Price explained. “Others put in the pipe and lay the asphalt or concrete. We operate as either a sub or a general contractor on state DOT, municipal and county projects. The biggest job we have done involved roughly 22 miles of new road around Seminole as a general contractor. We balanced the dirt, put down close to 150,000 tons of base material and subbed out the seal coating.”

Gateway Pipeline

(L-R) Black Jack Energy Services Owner/President Cliff Price, Owner/ Managing Partner Lonny Hergert and Equipment Manager T.C. Stipe meet with Kirby-Smith Machinery Territory Manager J.P. Cotton. “Kirby-Smith and J.P. have been terrific to work with,” said Stipe. “They have equipment available when we need it and back it with great service.”

Gateway Pipeline

A Black Jack Energy Services operator moves crushed caliche with a Komatsu WA380 wheel loader.

High production, reliability with Komatsu equipment

During the past few years, Black Jack Energy Services has turned to GPS technology to ensure greater efficiency and productivity. It started by outfitting all of its motor graders with aftermarket systems.

“It allows us to get jobs done faster and with greater accuracy because there is less staking, surveying and resurveying,” noted Hergert. “That maximizes our time and ensures that when we build a road or a pond, it’s dead-on accurate.”

Black Jack took that to the next level with the recent purchase of a Komatsu D155AXi-8, which features a factory-integrated system that requires no masts or cables. At 354 net horsepower and an operating weight of 90,610-pounds, it’s the largest in Komatsu’s line of intelligent Machine Control dozers.

“The D155AXi fills two big requirements. One, it pushes a large amount of material over a long run very effectively,” said Equipment Manager T.C. Stipe, noting it has a 12.3-yard blade. “Secondly, we have a lot of rock in West Texas, so you need a machine that will handle it with a blade or a ripper. The dozer does that with no problems. The fact that the D155AXi checks those boxes, plus does it accurately and without masts or cables that take time to install and remove or get damaged, makes it a terrific value.”

Black Jack Energy Services worked with Kirby-Smith Machinery and Territory Manager J.P. Cotton to purchase the D155AXi-8. Black Jack also uses Komatsu PC290LC and PC360LC excavators to excavate and feed crushers, and relies on WA380 wheel loaders to stockpile materials and load trucks.

“We started putting Komatsu equipment in our fleet approximately three years ago because Kirby-Smith had availability, and it was competitively priced,” stated Stipe. “It proved durable, reliable and productive, so we kept adding more. One thing that really impresses us is that our Komatsu machines have no DEF (diesel exhaust fluid) issues. We had four dozers from a competitive brand, and it seemed like one of them was down every other week due to a DEF problem. That took a serious bite out of our productivity.”

The majority of Black Jack’s Komatsu equipment is Tier 4, so scheduled services are complimentary for the first 2,000 hours or three years through Komatsu CARE. Kirby-Smith Machinery’s Odessa branch tracks the hours through KOMTRAX and contacts Stipe when a machine is due for service.

“They take care of it at a convenient time and location, minimizing our downtime,” noted Stipe. “I like that they handle it because as busy as we are, it ensures those service intervals are done right and on time by one of Kirby-Smith’s certified technicians. Komatsu CARE is a tremendous added-value.

“Kirby-Smith and J.P. have been terrific to work with,” he added. “They have equipment available when we need it and back it with great service. Other than routine maintenance, Kirby hasn’t done much on our machines. The Komatsus don’t break down.”

Something to consider

Price and Hergert have paving experience from earlier in their careers, and that may be the next step in Black Jack Energy Services’ evolution. The firm already produces rock that can be used for asphalt materials in its quarry operations.

“First, we would probably take on sealcoating, then go into hot mix,” predicted Hergert. “That would make us even more of a full-service contractor on the highway side. It’s something we are considering as Black Jack continues to grow.”

“Another possibility lies in expanding our trucking division,” added Price. “We quote thousands of tons of material, and it all has to get from one point to another. We subcontract a lot of trucks, and it may be more feasible and economical to acquire additional trucks of our own. Again, it’s a consideration.”