The manufacturing shop at Kilgore's Permian Tank operation is shutting down, with about 35 employees facing a lay-off – the sales department will remain on-site but manufacturing will shift to other PermianLide facilities.
The bulk of questions about the transitioning business are being directed to the company's corporate office in Dallas. PermianLide President Howard Seely was unavailable for comment this week, but a local employee offered a brief description of the changing operations in Kilgore.
“The manufacturing shop is closing down,” office manager Cheryl Rhyne confirmed Friday. “The operations we have here will be transferred to other facilities.
“The sales department will still be here. If anyone wants to buy a tank they can still call us – we'll sell them as many as they want.”
In a Thursday press release, Kilgore Economic Development Corporation Executive Director Amanda Nobles said she had no confirmation of changes at the business and expressed her dismay at the reported loss of local jobs.
KEDC appreciates Permian Tank both as a primary employer and as a partner in local economic development, Nobles said: the company is a participant on the advisory board of the KEDC Advanced Technology Center / Kilgore College Advanced Welding Academy.
“A loss of primary employer investment and primary jobs in Kilgore concerns KEDC,” Nobles said in the release. “The board and staff are not only concerned about the business climate, but also about the people who are losing jobs.”
Chevalier Tank developed the existing Permian Tank location in 1976, and Permian took over in 1984.
Kilgore EDC assisted the company through an economic development performance agreement in 2005 in which Permian agreed to invest $500,000, retain 60 jobs and add 10 posts. With the successful completion of the agreement, KEDC awarded the company $50,000.
At that time, Nobles confirmed, the company had 70 employees, but she allowed that number may have changed, especially in recent years during the oilfield downturn.
Rhyne said her details on the local changes are limited, but “It's probably going to effect around 35 (people) … Those employees will be without a job,” she confirmed. At least, however, “We were contacted by Kilgore College, and they are helping us out with a grant they received for employees that were laid off, to have them come down and do extra training and classes in other areas so they will be more qualified” for other employment.
The lay-offs will leave four employees, possibly, at the Kilgore operation, Rhyne said.
Nobles is appreciative of all Permian has contributed to Kilgore's economy over the years: employment, wages and taxes. She understands, though, a company's need to have a business case for its operations.
“The product manufactured by Permian depends upon (energy) production, and new production is now centered elsewhere in Texas and the US,” she allowed.
It's not the first company that has been impacted by the downturn, and the contraction at Permian Tank is symptomatic of ongoing challenges in the oilfield.
At KEDC, “The vision of the board is to provide diversification to increase the economy’s ability to sustain the inevitable cycles of the oil and gas industry,” Nobles said. “The number of active agreements with companies related to the energy sector continued to decline from 47 percent in 2012-2013 to 28 percent FYE 2016.
“The KEDC program of work includes a focus on the business climate for retention and expansion purposes. Activities include workforce development and other assistance ranging from the extension of data services and infrastructure improvements to collaborating with our partners as an advocate for our employers.”