ST Pipeline

Source: Energy Digital

Date :11/04/2008 04:04:26

With an excellent record and reputation in the industry, it’s easy to see why ST Pipeline is a popular choice

Written by Ian Armitage and Produced by Richard Gentile

Established in 1984, ST Pipeline Inc. is, according to its corporate website, dedicated to supplying “expert construction services to the oil and production, transmission, storage and distribution companies for all facility projects, large or small.” This dedication, combined with an excellent safety record, versatility and experience, allows ST Pipeline to offer some of the most professional and capable services in the industry.

A minority contractor with a home office located in Clendenin, WV, it is able to serve West Virginia, Virginia, Kentucky, Ohio, Tennesseee, North and South Carolina, Georgia, Pennsylvania, Maryland and New York, and many other states.

An interesting start

ST Pipeline has a distinguished history and is proud of its roots. It offers competitive price and on-time completion to easy and every customer.

It was founded by Sue and Jim Shafer – a man with a distinguished reputation in the pipe contractors business. Indeed, Jim has an interesting history, which is summarized perfectly on ST’s corporate website: “The mainliners laid their pipe and reached the Shafer farm just in time to put Jimmy and his cousins to work. Carrying water from their stream to satisfy the thirst of the men and their contraptions didn’t pay much, but the hard work would pay off soon enough.” This was, says ST Pipeline, the starting point of Jim Shafer’s 63 year career.

As one of the most successful pipe contractors in the business, and an expert at navigating the improbable, Jim has today worked on projects from the steep topography of Appalachia to the frigid Alaska Pipeline. “Maybe when your family farms the side of a hill, running pipe up and down a mountain is a logical next step,” jokes ST Pipeline.

At 16, Jim worked for a pipe outfit out of Red Oak, Iowa, laying 100 miles of 36 inch pipe across the Hawkeye State. After finishing school, he became a welder for Pipeliners Local 798 and spent a decade or so perfecting his craft before going out on his own with his company, ST Pipeline, Inc. Since then, he has been the “go to guy for any natural gas company facing an uphill or downhill battle.”

Broad portfolio

Although it was formed in 1984, ST Pipeline converted to its current structure in 1990.

It today has a number of project capabilities including production facility construction, boring/drilling/HDD, coating rehabilitation, fabrication and excavation. It also offers a number of other services, designed to meet customer’s specific construction needs.

That being said, the company is primarily engaged in servicing the oil and gas industry through the installation and repairs of pipelines. It has an excellent record and reputation in the business community. It is easy to see why ST Pipelines is a popular choice.

Big Sandy Project

ST Pipeline Inc. is currently installing the Big Sandy Pipeline, acting as the contractor for Equitrans, L.P. - the company building the $154-million pipeline. The 20-inch natural gas pipeline is designed to relieve summer capacity constraints that restrict gas production in the eastern Kentucky basin.

The Big Sandy Pipeline is being installed in mostly a white sandstone geology that has frequently required blasting of rock. The construction right-of-way is only 100 feet wide with steep drop-offs on either side. This is a challenging project, but one ST Pipeline has proven it is capable of performing.

Buy-Out?

On Monday, 28 January 2008, Energy Services Acquisition entered into an agreement and plan of merger to acquire ST Pipeline.

Pursuant to the agreement, shareholders of ST Pipeline have a right to receive up to $15,200 per share in cash, or $19 million in the aggregate, subject to a reduction to reflect the book value of certain assets and a further reduction of $3 million that will be paid to ST Pipeline shareholders on a deferred basis.

In addition, Energy Services has agreed to enter into a three-year employment agreement with James Shafer and a non-compete agreement with Sue Shafer. Mr and Mrs Shafer have both agreed to vote their shares in favor of the ST Pipeline acquisition.

Jim Shafer said that he “was looking forward to the opportunity to align his company with Energy Services.” He feels this will give ST Pipeline a strong capital position that would enable it to continue to grow and expand to meet the needs of its customers.