Highland Tank grows on demand for super-size fuel storage
Today's gas station isn't your grandfather's gas station. It's out on the highway, and it's big.
That means big storage tanks to hold all the gasoline needed to fill thousands of cars and trucks each day.
Likewise, natural-gas drilling in Pennsylvania's Marcellus Shale formations means companies need large steel tanks to hold all that gas before it's processed.
And we're talking big tanks, some as big as a fast-food restaurant and capable of holding 90,000 gallons of gas or liquid.
The demand for these super-size storage tanks is part of the reason that Highland Tank & Manufacturing Co. started expanding its facility in Lancaster County last year and will open the new production line by early July, said Charles A. Frey Jr., Highland vice president and general manager of the midstate operation.
"Everything just keeps getting bigger," Frey said. "There's just a need to store more gas."
The corner gas station might have a 5,000-gallon tank to serve customers, but a large fuel station like Sheetz might have a 30,000-gallon tank or larger.
Highland's exterior construction of the new 40,000-square-foot tank assembly areas in Rapho Township is finished, and the company is adding all the new technology and amenities on the interior, he said.
The township had to rezone some land from agricultural to industrial for Highland's expansion because the company is a nonconforming use in an ag zone, said Sara Gibson, township manager.
"It's an unusual area for an industrial property, but it's been there so long that everyone's used to it," she said.
The expansion is one of very few in the township during the past several years, Gibson said. Most development is taking place near Mount Joy along Route 283. The last industrial development in the township was in 2009, she said.
The new facility is necessary to build the really big tanks, like the 60,000-gallon models, Frey said. The company is hiring about 25 people for the expansion, and it moved its workforce from the Lebanon County facility as well.
Gasoline storage is just 20 percent of Highland's business today, he said. Other fields are growing rapidly, including work in automated grease trap storage tanks for restaurants, rainwater collection and storage tanks, oil-water separation tanks for runoff from parking structures, and natural-gas tanks.
"It's certainly growing," Frey said. "In the Marcellus (gas drilling), when the stuff comes out of the ground, you need someplace to store it."
Companies working on heavier fabrication are growing because of the shale gas boom in Pennsylvania and Ohio, said Bill Gaskin, president of the Ohio-based Precision Metalforming Association.
Companies making tanker trucks and tanks for train transport and storage are doing a lot of business in the area of natural gas, he said.
However, other sectors such as metal stamping that comprise most of PMA's membership are less affected by the energy sectors, Gaskin said. Natural gas hasn't generated a need for small, precise metal parts. Those parts are more likely to end up in electronics for the larger consumer economy, he said.
"Automotive and appliance sectors generate more work for PMA member companies," Gaskin said.
Machining and tooling manufacturers are doing more work with the natural-gas industry for equipment that's going into the drilling operations, but that work is mostly cyclical and has slowed with less drilling activity, said Dave Tilstone, president of the National Tooling & Machining Association in Cleveland.
"Now we're waiting for the next wave of activity from the areas where they're in the permitting process and will soon be drilling," he said.
Many of these companies make parts and products for various sectors of the energy industry, so they balance the boom-bust cycle in any one sector, he said.
Companies making products needed throughout the life cycle of energy exploration and production will have more consistent work, which is likely the reason tank manufacturers are seeing increased need, Tilstone said.
Natural-gas companies need tanks even after the holes are drilled and rigs go home, Frey said. The gas has to be transported somehow.
The only question is what happens when more pipelines are built to carry gas to market. It's expected that could cut into the natural-gas side of business, but that's why Highland has other products for other sectors, Frey said.
"We're diversified," he said.