Newpark Environmental Water Solutions shuts down
Facility south of Pinedale included in abrupt closure of company
September 6, 2006
Newpark Resources has shut down the operations of their Newpark Environmental Water Solutions (NEWS) division, including their facility operating in the Sand Draw Industrial Park near the Pinedale Anticline and Jonah natural gas field.
NEWS provides integrated site, environmental and drilling fluids services to the oil and gas exploration and production industry.
Parent company Newpark Resources Inc, based out of Louisiana, announced on Wednesday, August 30th, that they planned to shut down operations of their Newpark Environmental Water Solutions LLC water treatment because the technology they were using was not “commercially viable”.
Newpark Environmental Water Solutions was formed in early 2005 to commercialize in the United States and Canada a proprietary and patented water treatment technology owned by a Mexican company. This new technology uses principles of sonochemistry to remove dissolved solids from wastewater.
Paul Howes, President and Chief Executive Officer of Newpark, commented in a news release on the company's website on August 30th, "Based on our ongoing assessment of our portfolio of assets, we have determined that the technology behind NEWS is not currently commercially viable. As a result, we are not willing to commit further resources to this venture. Based on the losses incurred by NEWS to date and the prospect that the business will continue to incur substantial losses combined with the fact that NEWS is not part of our strategic direction going forward, we have decided to exit this business."
The Newpark news release stated, "By shutting down the operations of NEWS at this time, Newpark believes that it will avoid substantial continuing losses and negative operating cash flows related to this business, once all exit costs are incurred."
"Excluding depreciation, the operating loss for NEWS during the first six months of 2006 was approximately $2.0 million and for the month of July 2006 was approximately $450,000. Newpark expects to begin facilities shut down mid-September and start the site closure process as soon as all existing projects have been completed. In addition, Newpark is beginning the process of exploring possible sale of existing equipment and facilities," Newpark reported in their press statement.
Apparently the shut down came as unexpected news to the employees of the NEWS division operating in the Sand Draw Industrial Park facility south of Pinedale. Surprised employees were reportedly told on August 30th that they were being terminated immediately and given severance checks. The termination affected more than 15 employees, some of whom are scrambling to write their resumes and applying for new jobs in the area.
In a Letter to the Editor given to Pinedale Online and local newspapers, employees wrote, "Corporate representatives flew to Pinedale from Louisiana and Canada to inform employees they were terminated immediately. Those affected were asked to gather personal belongings and leave the property. All the employees who lost their jobs were U.S. citizens of the Boulder and surrounding area. Left in charge of Newpark Sand Draw site were Canadian employees working on the U.S. under temporary work Visas."
Employees also eluded to problems over air emissions from the Sand Draw NEWS facility, "Air emissions from the Sand Draw facility have been of concern recently to other occupants of the Industrial Park as well as Newpark employees. The site is locked and no one answers the phones," stated their letter. The employees said they believed another plant operated by Newpark in northern Wyoming was also closed under similar circumstances.
The parent company of NEWS is Newpark Resources, Inc, of Louisiana, which heads a family of integrated operations focused on serving the energy sector. Newpark provides advance drilling fluids systems, environmentally sound disposal and recycling techniques, site access systems for harsh or sensitive terrain and specialized construction services.
The company said they will "dispose of or redeploy all of the assets used in connection with its operations of the Newpark Environmental Water Solutions division."
Related Links:
Newpark Resources to Shut Down the Operations of Newpark Environmental Water Solutions (8/30/06)
Newpark Resources Inc www.newpark.com
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