Target Logistics boosts workforce housing and starts to fulfill growing demand in North Dakota’s Bakken Formation
Brian Lash grimaces when people call his temporary housing units “man camps.” The Target Logistics CEO prefers the term “lodges.” It’s a better description, he says, for the services that staff provides to men and women working in the Bakken Formation oil fields in northwest North Dakota.
With workers pouring in from all corners of the U.S., finding places to live is one of the biggest challenges for oil companies and the companies that serve them. While small town entrepreneurs between Williston and Minot scramble to remodel and add more housing, often the only option is to park a camper next to other campers on crowded city lots or in RV parks being developed in rolling fields amid grazing cattle and pump jacks.
Companies such as Halliburton, Hess Corporation, Key Energy Services and Oneok Field Services have turned to businesses such as Target Logistics to bring in housing for their employees. Demand continues to grow.
By late June 2011, Target Logistics provided rooms for 750 workers on four sites. The number more than tripled to 3,000 by the end of the 2011 construction season. A new facility in Manning, N.D., scheduled to open in January 2012, will accommodate 600 people and expand to 1,200 people by summer, and plans are in the works to expand a Stanley, ND, hotel purchased by Target Logistics from 40 rooms to 400.
FROM LEISURE TO OIL
As implied by the Logistics part of its name, Target Logistics provides more than just a place to sleep. It provides catering and complete life support services to clients.
The company knows how to treat its residents well; it started as a group of travel and leisure companies in 1978. In 1995, Harley-Davidson asked Target Logistics to set up temporary housing for its 95th anniversary celebration. Target Logistics rented 200 acres and took care of everything from lodging to a medical facility to security for 4,000 weeklong residents.
“It was for me an epiphany,” Lash says. “I realized I could combine 20 years of hospitality experience with travel and air charter companies and handling complex logistics. Our tour company became experts in handling huge amounts of people.”
Target Logistics’ resume includes housing for 12 Olympic events, and many government agency operations including housing federal agents in Salt Lake City before, during and after the 2002 Winter Olympics. They built their first camp for 2,200 soldiers in Basra, Iraq, and set up temporary housing and provided a cruise ship to house government and private workers after Hurricane Katrina.
“The Bakken is where our growth has been beyond even my wildest dreams,” Lash says.
The first units were moved from the Winter Olympics in Whistler, British Columbia, to Williston’s Muddy River site for Halliburton’s flagship camp for 158 people. That was in April 2010, following the games.
It was just the beginning.
Travis Kelley helped set up and tear down the Whistler housing, and as the territory manager for North Dakota he oversaw the installation of the Muddy River Camp for Halliburton – and more.
“We had three of our campuses, Tioga, Williston and Muddy River, open within three weeks of each other,” Kelley says, in late November 2010, just before winter hit.
MEETING CLIENTS’ NEEDS
If he had to make a comparison, Kelley says he thinks Target Logistics camps are similar to university dorms, except they also provide weekly housekeeping services to clean rooms and change bedding. Residents have private rooms with Wi-Fi, televisions, cable and DVD players, and either a private bath or one shared with another person. There are communal spaces: desks with computers, recreation rooms with televisions, pool tables and workout equipment. There’s a place to do laundry and borrow DVDs.
Then there’s the dining room – with snacks and beverages available 24/7 in addition to three meals a day.
“It’s all about the food,” Kelley emphasizes.
Duck, lamb and sea bass are all on the menu as well as more typical American food. Monday is steak night, and Smokin’ Saturdays are all about grilling, everything from steaks to ribs. Heaping pans of meat and other sandwich fixings are available at breakfast and lunch for workers to make bag lunches. Much of the supplies come from national food service company Sysco Corp., which has a distribution center in Montana. Lash says Target Logistics is Sysco’s biggest customer in North Dakota or Montana.
“We know that the two most important things are the food and good rest,” Lash says, noting Target Logistics guests have quality mattresses, soft sheets, lofty comforters and oversize towels.
Three camps – Williston, Muddy River and Tioga – offer all the above services. In the nearby little town of Stanley, client Key Energy prefers cabins that have a bedroom on each side with kitchen and bathroom facilities in between for workers to take care of their own meals and housekeeping. Target Logistics set up 48 brand-new two-bedroom units to accommodate 96 workers.
The cabins are custom-made for Target Logistics by U.S. modular housing manufacturers, a major provider being Guerdon Enterprises LLC, of Boise, Idaho.
“We use the manufacturer closest to the job that meets the specs for the deployment,” Lash says. The cabins have tongue-and-groove pine wall interiors and dome-roof exteriors. Last spring, Kelley coordinated with contractors to do site preparation to bring in 62 two-bedroom cabins to the Williston site for supervisors to live in. All were immediately leased.
Units at the Muddy River site are former shipping containers remodeled into rooms, stacked three stories high. Target Logistics continually looks for temporary housing and matches units to clients’ needs and budgets. With a three-year contract, prices start at $95/person/day for three meals a day and all the amenities.
The biggest expansion this year was at the Tioga site, which grew from 249 beds to 1,000 beds under one roof, and also the addition of 100 RV park sites, Kelley says.
In addition to housing, Bakken Formation communities are scrambling to deal with other infrastructure issues such as septic system capacity.
Target Logistics is taking some of the stress off by investing in a $3.1 million portable water treatment plant at Tioga. The plant is a modular system, designed and built by Double-Tree Inc., out of Bozeman, Mont. It is housed in a steel building next to a 1.2-million-gallon holding pond. Wastewater from Williston and Tioga will be treated at a rate up to 180,000 gpd. That’s enough to handle the wastewater from both camps as well as some from local communities.
A couple of companies are interested in buying the water to use for the fracking process. “They have pretty high standards, and the water will be tested in their labs,” Kelley says. “We’ll treat 180,000 gallons a day, and we hope to recycle all of it. If not, we have the pond to hold the treated water.” The pond water will be run through the plant one more time before trucks haul it away.
The wastewater plant will help reduce use of freshwater taken from local communities and taxing area municipal wastewater plants.
“We do our best to be a good neighbor in the community. One thing we don’t want to do is overload them,” Kelley says.
The camp holding tanks are pumped every day. Though there is capacity for three days, Kelley was concerned a few times last winter that trucks wouldn’t be able to haul when road conditions were bad.
Despite the extreme cold, strong winds and snowfall last winter, the units did very well with only a couple minor freeze-up problems early on. The camps are completely heated with electricity.
One of the biggest chores for maintenance staff during winter was keeping the walkways between the units plowed and shoveled. Wet weather in spring and early summer created new issues when subcontractors started site preparation for more units.
But Mother Nature isn’t the only issue.
“One of the biggest challenges we actually face is getting guys to come out here to do the work,” Kelley notes. “And once you get them here, where do you put your workers to live while they are here?”
The company first tries to hire locally, then reaches out to a larger geographic area for contractors to excavate the sites, run power and waterlines, put plumbing in the units and do a variety of other construction tasks. Ironically, workers who travel a distance often live in their campers as they build housing for oil field workers.
EQUIPMENT AND STAFF
Target Logistics is in the business of housing, not construction, so the company’s fleet at the Bakken is for staff to get around and equipment to move snow and level paths and roads.
Kelley says staff at the Bakken sites drive eight Ford F-250 pickups (2008-2011) and a Freightliner Sprinter van. Outdoor maintenance workers use two 2008 S-185 Bobcat skid-steers for snow removal and other jobs at the sites. Two Caterpillar 950 wheel loaders are on order to help with snow removal this winter.
As Target Logistics continually adds housing, new and used units come from a variety of sources.
The growth is good news for people looking for jobs. By the end of 2011, the company had 200 people on its payroll to provide services to the 3,000 people living in the four camps in the Bakken fields. Staff includes maintenance, chefs and kitchen staff, laundry personnel, security staff and office workers. They come from all over the U.S. because of the lack of workers in the area. (Last August, Williston had a 1 percent unemployment rate, for example.)
PLENTY OF WORK
Lash notes that housing is crucial to the growth of the Bakken.
“Most workers are separated from their families, so we try to make them as comfortable as possible. We work with our team and the client so that we keep prices affordable,” he says.
Their client companies pay for all or at least a good portion of the housing cost for employees. Many clients sign three-year contracts for discounts that add up to more than $1 million over three years. Others have signed five-year contracts.
“The reason we love the Bakken is we don’t think we’ll be moving units out anytime soon,” Lash says. “We see only growth.” Target Logistics is in negotiations to add more camps near Dickinson and Minot.
Though Target Logistics has set up other mining and oil operations throughout the world, the Bakken has provided the opportunity to deal with all major oil companies, which opens doors for contracts in more oil fields, such as the Eagle Ford Formation in Texas.
Right now the Bakken keeps the company plenty busy.
“Our goal is to house 1 percent of North Dakota’s population – 6,000 people by 2012,” Lash says.