27-3 Dream Homes Issue
This time of year, the oven is certainly not our friend. When we see the words “pre-heat,” we flip the page in the cookbook, right?
Written by Tracie Grimes
With each piece of equipment they design, manufacture, and ship, Don Nelson, Mike Houghton, Eric Berger, Frank Lawrence, and Danny Henderson have a lot at stake.
These are the leaders of Ramsgate Engineering, Inc., who decided to pool their collective years of experience together in 2005 to bring high-tech engineering and high-quality fabrication for heavy oil production to the global market.
Their approach is unique to the heavy oil production industry. To meet the unique, multifaceted needs of the industry, they draw on expertise from their two business entities: Ramsgate Engineering and ProGauge Technologies.
Ramsgate Engineering (a group of engineers, geologists, project managers, designers, and support staff) fills specialized niches within the heavy oil production industry such as steam generation and distribution systems; data systems implementation and management; electric power systems analysis, optimization, and design; and well design and drilling planning, just to name a few.
To complement Ramsgate services, ProGauge Technologies, Inc., a business started in 1998, is an equipment manufacturer specializing in state-of-the-art devices such as steam generators, well testers, steam splitters, and fluids conditioning heat exchangers. ProGauge equipment production is done in Bakersfield and in Oman.
“Although we do quite a bit of work here in California for Aera Energy, a lot of what we do is in the Middle East and South America,” explained Nelson, President of Ramsgate and ProGauge. He added that ProGauge has recently begun manufacturing in Oman as well as Bakersfield to help cut down on logistics and shipping challenges. “We consider ourselves to be a ‘boutique’ company because we can do everything within our own company. We can design, procure, manage, and operate all phases of thermal and related oilfield projects and we can manufacture the equipment. Our specialties are in heavy oil development and enhanced thermal technologies, and have seen enormous growth in countries such as Oman, Kuwait, Venezuela, and Bahrain.”
And, as you can imagine, traveling to these countries these days can bring a whole different set of risks to the table. “I was in Bahrain when the protests broke out,” Nelson recalled of his most recent trip to Egypt. “I remember looking outside the window of my hotel room and seeing hundreds and hundreds of people just walking by. I didn’t really know what was going on at the time and I didn’t feel threatened, but I knew I wasn’t going to go outside anytime soon.”
While certainly a memorable experience, Nelson was quick to add that this was the first time he’s seen any kind of Middle Eastern turmoil first-hand.
“We usually get to take part in some of the coolest stuff,” added Berger, recalling the trip he and Nelson took with their families and were invited to an excavation site at the Great Pyramids. “They had closed down the Pyramids to tourists and set up these tents for a birthday party for President Mubarak’s son-in-law. And here we were, rubbing elbows with all these important Egyptian officials, just two regular guys from Bakersfield...unbelievable!”
“It seems like our whole time in business has just been one long adventure,” agreed Houghton, who’s most memorable experience took place when he was working on a project in Madagascar. “I remember I was talking with another American couple and I was just transfixed by all the stars I could see and was thinking about how far I, this guy from Taft, had come. Then I started chatting with the couple, asking ‘Where are you from?’ ‘Oh, this little town in California nobody’s ever heard of—Taft.’ It’s just strange the journeys life takes you on sometimes.”
Though there are plenty of days their journeys seem a bit surreal, most days these five friends and business partners are taking a sentimental journey.
“We founded the business because we enjoyed worked together,” Berger said. “We had all worked together at Getty, and then everybody but me left, so I ‘retired.’ ”
“After I left Getty Oil in 1991, I started another consulting company, DCCK Engineering and was bought out by a construction company in 2004,” Nelson explained. “I ‘retired’ at the age of 45, but playing golf every day got old. I got together with Eric, Mike, Frank, and Danny, because we had worked so well together in the past and we were all good friends, and we started Ramsgate.”
Since he was working with the guys he knew best and they all knew the business inside and out, Nelson admitted he didn’t really feel any risk when Ramsgate first began operations. But now the challenges seem to roll in every day.
“I felt pretty good that people were calling me and asking me to start another company,” Nelson smiled, “so I guess at first I just didn’t see that there was much risk involved. But now it’s a different story. Our biggest challenge is trying to keep up with the logistics of growth.”
With more than 80 employees (“the most employees I had when I ran DCCK was 65 and that was after being in business for 10 years,” Nelson noted), and more and more calls coming in requesting bids, Ramsgate and ProGauge have quickly filled up the 20,000 square feet of space they moved into not that long ago. And even with our economy being the way it is, Nelson doesn’t see the companies’ growth slowing down anytime soon.
“The downturn in the U.S. economy hasn’t affected us because 80 percent of our business is international. About the biggest risk our company faces is the Middle East going up in flames.”
The partners are always at risk financially, Nelson added, because Ramsgate and ProGauge have to issue a bank guarantee for every project. “If we don’t deliver, they can call in that guarantee, which is for millions of dollars and is personally guaranteed by all five partners.
“Another challenge that’s come up in recent years is the change that’s taking place in oil extraction from Middle Eastern fields. Until recently the Middle Eastern fields have been producing ‘light’ oil. Now they are starting to bring up ‘heavy’ [thicker, more viscous] oil. Meeting this challenge isn’t a problem for us because that’s what we’re geared to do. The challenge for us is that we are being asked to do bigger projects in the Middle East,” Nelson noted, adding that a “small” job in the Middle East would be considered huge here in the States. Large Middle Eastern projects would be in fields that produce billions of barrels.
Confident that Ramsgate and ProGauge can meet the challenges of a changing Middle Eastern oil production industry, the partners rely heavily on their top-notch employees to come up with solutions.
“Our employees are some of the smartest in their fields, some of the most respected internationally as well as in Kern County, and definitely the best and brightest I’ve ever worked with,” Nelson said with the pride of a father bragging about a child. “And to keep up with our growth, we are fortunate to be able to add new talent to the team almost every month. Our team works like a well-oiled machine and can pull together to do what needs to be done not only to complete the project, but to make sure it’s up to our high standards.”
Validation for this extraordinary teamwork came when Ramsgate and ProGauge were awarded a gold award from Oman’s Minister of Oil and Gas.
“That was quite a difficult project because we had to design and install equipment for a steam pilot project in Oman in under a year. There was a lot of pressure that went along with that project, a lot of air freighting of parts and equipment, and a couple of times we felt the crunch, but everyone just pulled together and we did it. This is the kind of teamwork that allows us to keep up with growth and stay successful.”
The success of Ramsgate and ProGauge has almost caught Nelson and his partners off guard, he said laughing. “I really don’t mean to come off sounding too sure of myself or arrogant in any way, but when I think back at what we’ve done, it’s almost like living a dream. Who would have thought that we’d put two businesses together, form contracts with foreign countries to design, build, and implement some pretty complex equipment, and get wined and dined by bank presidents and ambassadors?”
“The work is tough and very challenging,” Houghton added, noting that stepping out onto a desert in the Middle East is like stepping out onto the Moon. “But the most memorable thing about our projects is the adventure.”
“We really do ‘push the envelope’ and have always been known for our ability to ‘think outside of the box.’ We’re pretty adept at creating a whole new set of systems on how to get a project done while meeting EPA standards and being compliant with local laws and standards,” Berger elaborated. “What we do on a daily basis definitely isn’t the ‘norm’ in the industry. What we do is much cooler!”
While coolness is certainly a factor that keeps these five buddies out of retirement, it’s living the adventure they’d never dreamed possible that keeps them plugging away at the ol’ grindstone. After all, as Nelson noted, you can only play so much golf.
Article appeared in our 28-2 Issue - June 2011