So You Want to Start a Trucking Company to Haul Water in the North Dakota Oilpatch

The Query

This morning, a gentleman who’s considering starting up his own trucking company to haul water in the North Dakota oil drilling boom asked a number of very logical questions. The answers added up to a complete post…and here it is, beginning with his wanting to know whether not I’d ever actually worked in North Dakota

My Industry Background

Back in the early eighties, I drove bulk cement tankers for Halliburton and later worked as a derrick hand for Western Oil Well Services on the workover rigs. Both operations were based out of Glendive, Montana, and a lot of our work was across the line into western North Dakota.

Also, my (late) grandparents lived on the Rez at Mandaree, ND, and I visited there as well, adding to an already clear understanding of the terrain and climate.

In total, over the years, energy industry work (involving drilling and production operations for both oil and natural gas) included assignments that took me to the following states: Montana, North Dakota, South Dakota, Wyoming, Colorado, and Utah.

The final years in the industry were as a water hauler for the gasfield drilling boom in western Colorado. Toward the end, I even started up my own trucking company (Tryad Transport, Inc.), for which the truck financing fell through at literally the last moment. The lender closed its doors forever on the day Obama was elected President.

I’m still steamed about that.

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Answering the Man’s Questions

Starting up a water hauling company can be a fine thing, though I have to cringe a little at the thought of a man doing that with zero upfront experience in the oilpatch. Not that it can’t be done; more than one of the smaller trucking outfits contracted to my former employer in Colorado did just that.

Pay is by the hour, so much per truck-and-driver, on contract between the trucking company and the oil company. I don’t know what would be competitive in North Dakota at the moment; you’d really need to go talk to some folks in the area to get a feel for that. A fairly typical rate in western Colorado a few years ago (2007-2009) was running around $100-$135 per hour for a tractor-trailer combo, give or take, but pricing is all free market competition.

Volume does count in the sense that oil companies, just like anybody else, want the best bang for the buck they can get. The baseline tanker size is 130 barrels for a semi trailer and 80 barrels for a bobtail (straight truck with chassis-mounted tank). If you run larger tanks than that, you’ll have an edge with some potential employers, but there are downsides, too:

1. Heavier loads mean OSOW (oversize overweight) permitting with the state.

2. Heavier loads can tip over more easily and/or get stuck deeper in the mud.

3. Bigger tanks are more expensive to purchase and harder on the running gears that carry them, so you’ve got a couple of cost factors there.

Best rigs to equip with:

This is to a large degree a matter of personal taste. For example, I’m partial to International trucks and would definitely run those exclusively if I had my druthers. But Peterbilt, Kenworth, and Mack all have their advocates in the oil patch.

Mack does present a unique problem in that their parts are proprietary; you can only get them from a Mack dealership.

As for tanks, I’m most familiar with the Troxell and Dragon brands, both of which are well made, but there could be others out there by now that work just as well (I’ve been out of the patch since April ’09.)

Vacuum pumps are most important items, but discussing those is a whole ‘nother story. I’d do some walking and talking to existing drivers in North Dakota before I picked a pump brand. Going the wrong route with one of those can mess up your entire operation. Some are a lot more rugged than others, some are noisy enough to deafen a driver over time, etc.

Whatever dealership or specialty shop sets up your trucks for the oil patch needs to know what he’s doing, and you’re going to want axles and suspension that are as heavy duty as possible. The patch is a rough neighborhood when it comes to equipment, and I’ve seen many a unit sidelined with a busted spring or a rear axle that snapped because the owner didn’t beef things up in time.

Heavy duty rear ends are essential.

Sound like a lot to take in? Oh, it is! Certainly more than a brief written page like this can cover adequately.

Who to contact: There’s only one sure way to find that out. Namely, take a week, spend some time in the area you’re targeting, and talk to people who are doing the work you want to do. Some of the company owners with whom you’ll be competing will brush you off, but there are always drivers at the nearest coffee shop who will give you the straight scoop.

Carry a notebook, maybe a voice recorder. Do the legwork.

Find out, also, what sort of Safety Program will be required to keep you in D.O.T. compliance. It might be startling to most liberals, but the oilpatch is an extremely safety-minded place, and there are hoops you’ll need to jump through to keep State Inspectors (and the company hands paying you to haul their water) happy.

Until or unless your new company grows large enough to allow you to have “old” drivers train new drivers, be careful who you hire to drive your trucks. It only takes one idiot who neither knows nor cares enough to cut down his air pressure to five psi or less when his tank is nearly empty…plus the receiving tank being nearly full…to result in a massive splash-over-the-top water spill.

If that happens to be fresh water, few company or state or federal authorities are likely to care too much. But if it happens to be nasty stuff from downhole, carrying all sorts of toxins and carcinogens and other horrible, smelly chemicals, it could put you out of business in a heartbeat.

Is it worth doing? Oh, you betcha! My former employer in Colorado grew their little three-truck startup to a sizeable operation fielding more than sixty power units in something under three years worth of hard-charging time and effort.

That is the American Dream in action.

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