Nitrogen producer could hire 80 after opening at Jenkins

A Canadian company which produces materials used in “fracking” natural gas wells has agreed to locate a $30 million nitrogen production plant at the Gateway Industrial Park in Jenkins. The plant is expected to create as many as 80 high paying jobs with benefits.

Ferus Inc. will use the large facility to produce nitrogen, which is delivered to well sites as a refrigerated liquid, by using air as its “feed stock.”

The company’s decision to locate in Letcher County was announced Monday by Letcher County Judge/ Executive Jim Ward at the May meeting of the Jenkins City Council. Ward was accompanied by Letcher County Economic Development Director Joe DePriest and Magistrates Wayne Fleming and Archie Banks.

Ward said it had been a long struggle to get the plant located in Jenkins and it had been equally difficult to keep from sharing the earlier bits of good news during this time of a downturn in the economy, but it was important to keep the information secret until everything was in place, including a $2 million incentive program from the State of Kentucky. He said Governor Steve Beshear plans to be in Jenkins for the groundbreaking ceremony, which should be in June or July.

“We were in competition with other counties and states,” said Ward. “But we kept onto it and stayed with it. It came down to two counties in Kentucky and two in Virginia and we were able to persuade them to come to Letcher County.”

Ward credited a team approach to the final success in obtaining the plant and praised the cooperation and hard work put in by Jenkins Mayor Charles Dixon as well as Magistrates Fleming and Banks and other court members. He said the positive team-oriented approach had paid off big with the representatives of Ferus, who were pleased with the efforts made by the Letcher County group to meet their needs. Ward also praised the efforts and cooperation of Jenkins Councilman Todd DePriest and the Industrial Board.

“When the company came to visit the site, all the people were there every time,” said Ward. “The team approach made a big diff erence. The people in Frankfort said our teamwork and positive approach were very important.”

Mayor Dixon expressed his appreciation for the efforts of the fiscal court and said that by working together with the court and the City of Whitesburg, it had helped to create this and other opportunities. Dixon said the most important thing about the announcement was that it might give young people in the area some hope that they won’t have to leave their home region to find good opportunities.

Ward said it would take between 18 and 24 months to get the plant operational and the county may have a job fair to interview candidates, or that the Kentucky Employment Services Department in Whitesburg might handle the interview process. He also said a new fueling station will built by Childers Oil in the Gateway Industrial Park to service large trucks and will be self-serve and operated by using fleet cards. Ward added that Kentucky Power has agreed to upgrade the power supply for the plant and that Jenkins will now have the luxury of having two power sources in case one fails.

“They will be installing a big generator with 8,000 horsepower to pull the nitrogen out of the air,” said Ward. “Ferus is connected with the natural gas industry and will supply the region. I imagine a lot of truck drivers will be hired.”

Magistrate Fleming told the council that the Gateway Industrial Park has proven to be successful much quicker than many industrial parks in the region and said the park has a bright future.

“Our site is a young site,” said Fleming. “There are a lot of other sites much older than ours that still have nothing sitting on them.”

Mayor Dixon thanked the court members and DePriest and promised a large groundbreaking ceremony. Dixon said Raven Rock Golf Course had been an attractive and positive factor as well. Magistrate Banks said that Dixon had been an important factor, too.

“Charlie was in on this, too,” said Banks. “He was with us all the way.”

Ward said the jobs will start off around $15 per hour with higher wages for skilled workers. He said the initial training will be done at Ferus’s Canadian facility although it also has operations in Colorado.

Ferus’s website describes it as specializing in providing integrated solutions to the energy industry for well stimulation, well completions and enhanced oil recovery. It provides a dedicated supply of cryogenic fluids, as well as the related logistical services to deliver those products where needed, when needed. Its primary product and service lines include liquid carbon dioxide (CO 2) , liqui d nitroge n ( N2 ), transportation, storage and on-site services.

Ferus currently owns and operates six cryogenic plants, which are strategically positioned across Alberta, Canada in close proximity to energy industry demand. A fleet of more than 150 transportation and storage assets is specifically designed for oilfield operations, providing Ferus customers with premium on-lease capability and efficiency, according to the company’s website.

Judge Ward also announced construction of a recreational vehicle campsite at Fishpond Lake, with water and electricity provided. The park will be located near a new trailhead for all-terrain vehicles that will connect to a series of trails throughout the county. Councilman DePriest told the council it needs to form a policy for creating good relationships between ATV riders and the Jenkins Police Department and said that several cities including Evarts in Harlan County have agreed to send their ATV ordinances to Jenkins to help the city draft a policy.

Ward said the ATV trailhead and RV site will enhance tourism and provide opportunities for businesses to serve the needs of campers and trail riders. He added that Pine Mountain Trail and the Linear State Park, which runs along the ridge of Pine Mountain, also present opportunities for tourism-related businesses to serve the needs of hikers.

In other business, the council will revisit a 1990 zoning ordinance (Ordinance 139) that was passed but never enacted. Mayor Dixon said the time for zoning has arrived in Jenkins and cited the destructive effects and reduction in property value for residents who have neighbors with dilapidated houses, garbage in their yards, or inappropriate structures that lower the desirability of the neighborhood. In his Mayor’s report, Dixon said it was beyond him how people would oppose any measures taken by the city that would enhance the value of their property and keep their neighborhoods clean and desirable. Councilman Todd DePriest agreed, and said people should realize that zoning is done to protect the value of their property.

The council discussed the issue briefly but DePriest, Rebecca Terrill Amburgey and others said they would like to have a chance to see the ordinance and the maps that accompany it. The creation of a Zoning Commission and other measures to fully enact the ordinance will be discussed at the June meeting.

The council also heard a “good news/ bad news” water loss report from Water Superintendent Bo Hopkins. Hopkins said that while unaccounted for losses of treated water are down to a low figure of 6 percent (811,000 gallons), city workers found and repaired a number of leaks that accounted for an estimated total loss of 5,860,000 gallons, 2,000 gallons more than the city sold in April. The city produced a total of 14,612,000 gallons and sold 5,858,000.

Hopkins said the real good news was that the city lost about 10 percent less water in April than in previous months, but added that the unaccounted for figure will level out in coming months because they had the good fortune to locate and repair an unusually high number of large line breaks. He said that one three-inch line with heavy leaks in Burdine has been isolated and will be turned off as soon as service lines are run to the two houses it serves. Hopkins also said the city’s revenue has about doubled in Burdine after new meters to provide accurate readings were installed for Mountain Breeze Apartments.

Paul Nesbitt of Nesbitt Engineering, which works with the city on water and sewer projects, told the council that when the revamp of the Jenkins Wastewater Treatment Plant is complete, the city will be able to use “gray water” to perform many of the cleaning and flushing jobs for which it now has to use treated water and said it will save a good deal of money on treated water.

Nesbitt said a number of water and sewer projects are either underway or ready to begin. The Number Two Bottom Sewer Project is ready to go with all easements cleared and the Camden Water Project has lines laid and awaits the installation of new meters. Nesbitt said that Camden will essentially have a new system. He also said that Phase I of the citywide Waterline Replacement Project is ready to go to bid.

Nesbitt said the city should go ahead and take bids for Phase I by the end of May, and that doing so will protect its funding. He said a few easements remain but that the easement process is taking a bit longer because the easements are being done correctly and to the letter of the law so they will be preserved for the future. Mayor Dixon promised a big groundbreaking celebration for Phase I when it is ready to go.

In other business brought before the council:

• The council voted to authorize the Jenkins Volunteer Fire Department to place bids for a new fire truck, providing the sale of the old “Silver Fox” truck the department now has can provide enough so it doesn’t go over budget. David Stofel of M3 Fire Apparatus visited the meeting and told the council M3 has a 2010 Silver Fox and that he intends to submit a bid.

• Councilman Chuck Anderson reported that the Jenkins Homecoming Days Festival Committee has about $8,800 in the treasury and added that two successful hot-dog sales fundraisers have added to the coff ers. He said the entertainment lineup is now set with eastern Kentucky country musician Tim Michaels on Thursday night, the Tams on Friday, and Grand Ole Opry star Earl Thomas Conley on Friday. The Tams are a popular “shag” (beach music) band who have two gold records, “Hey Girl Don’t Bother Me,” and “What Kind of Fool,” and a platinum single, “Be Young, Be Foolish, Be Happy.” Original Tams members Charles Pope and Little Redd are featured. Conley had a long string of number 1 country hits in the1980s and 1990s, including “Holding Her and Loving You,” and his hit album “Don’t Make it Easy for Me.”

• The Kids Day celebration for Jenkins is set for June 5 at the Jenkins City Park.

• Mayor Dixon presented his budget for 2010–2011 for the first reading. The budget calls for $3,340,868 in revenue and $3,318,145 in expenditures. Dixon said he left a reserve because the city has not received updates in health insurance costs for city employees from the carriers this year.

• Videographer Rick Hall was presented an “Unsung Hero” award by the mayor. Dixon said Hall has done videos on hundreds of events and does freelance work with Intermountain Cable, TVS Cable, and Heritage TV. He also hosts the weekly news and current events interview show, “Meet the People” which is recorded in Hindman. Hall has interviewed a number of celebrities including Governor Steve Beshear and bluegrass musician Ralph Stanley.

• Magistrate Fleming asked the city to do what it could to aid two homeowners in Mudtown who have water standing under their homes that is ruining their floors. Fleming said the water was the result of heavy rains and runoff , but added that it is an ongoing problem which is also caused by drainage pipes running into to Elkhorn Creek below the water level which brings water back into the neighborhood. He said the fiscal court will do what it can and that he has spoken to representatives of AML about the situation.