TETRA Technologies supplies services and products to the oil and gas sectors.

Premier Business Partners:

HPD Hunt, Guillot & Associates LLC

By mid-2009, the chemical manufacturing group of TETRA Technologies Inc. will open a $100 million facility in southern Arkansas that can manufacture up to 400,000 tons of liquid calcium chloride and 120,000 tons of flake calcium chloride. “The new El Dorado, Ark., facility will enable the company to have enough supply to meet our customers’ demand,” Vice President and General Manager Jim Funke says.   

“The biggest change we have experienced over the past few years is that we’ve been short on raw materials to produce calcium chloride,” Funke says. “There is not enough supply to meet demand.”    

TETRA supplies services and products to the oil and gas sectors such as completion fluids, well abandonment and decommissioning, production testing and compression-based production enhancement. The company is headquartered in The Woodlands, Texas.   

Demand has grown in low single digits, but TETRA’s supply has shrunk due to changes in the availability of hydrochloric acid (HCl), he says. This unavailability began with the shutdown of the Lyondell isocyanides plant in 2005, which supplied HCl to TETRA’s Lake Charles calcium chloride manufacturing plant.

“We are supply-driven, meaning that we obtain the coproduct HCl from other chemical processes,” Funke explains. “Due to the economic downturn and other changes in the dynamics of the coproduct HCl market, there is less HCl available for TETRA to obtain in order to manufacture calcium chloride.”   

At this time, the company acquires its raw material, HCl, from other chemical companies, which produce it as a coproduct.   

“When the production of their main product is reduced, TETRA receives less HCl to produce calcium chloride,” he explains. “The new plant in Arkansas produces calcium chloride from brine supplied from another chemical process with ample volume so that our production will not be constrained.”     

In addition to calcium chloride, the Arkansas plant will produce sodium chloride and magnesium hydroxide, thus making the Arkansas facility the only plant of its kind, he says.    

The plant will primarily serve North America. TETRA has five other calcium chloride plants in North America and Europe. In addition, TETRA markets calcium chloride from a number of companies who produce it as a coproduct. TETRA also manufactures zinc bromide, calcium bromide and sodium bromine at a plant in West Memphis, Ark.   

The current supply shortage has brought many challenges to its calcium chloride business, Funke acknowledges. “Because we are under supply constraints, our focus is to secure volume so we can meet our existing customer demand,” he says. “And we’re doing this by buying product from many different sources.   

“For example, we import flake calcium chloride from China,” he explains. “By producing in Arkansas, we’re adding jobs in America. A lot of benefits come from producing in the United States, as opposed to importing from China. We have a better cost position, less lead time, and quality control advantages in products and packaging.”   

The plant in southern Arkansas will employ approximately 75 people at full capacity, he adds.

Serving Customers
“TETRA is one of two major manufacturers of calcium chloride in the United States,” Funke says. “Calcium chloride is a relatively low-cost product, and logistics is key to keeping costs low and servicing our customers. We have set up our supply network of terminals and warehouses so that we can adequately meet our customer’s needs and be close to where our customers are.   

“Serving its customers well is an integral part of the company philosophy,” he stresses, “and the company does this by focusing on providing quality products and service. We are basically supplying a common item and need to make sure that we do the little things right. We also have plant personnel visit customers’ locations, and our customers visit our plants. This interaction allows for a dialogue between our manufacturing group and our customers to better understand their requirements.       

“TETRA has recently added a reliability manager in the manufacturing group,” he adds. “The focus of this position is to manage the operational effectiveness and performance of our manufacturing processes by identifying specific risks to performance and working programs to mitigate the risk.”    

The most commonly identified activity of this job is the mechanical integrity and reliability of plant operations, he says. While integrity and reliability of operations is an important element of the job, it is statistically less than 25 percent of the reason that a manufacturing process fails to perform at expectations, he adds. The other critical elements are operational discipline, change management and equipment infant mortality –the design, installation and startup of new processes and equipment.   

Stressing health, safety and environmental (HSE) best practices is a core value for TETRA. “We believe that this emphasis on HSE has a direct correlation with the safety of our people and the quality of our products,” Funke says. “We make sure our employees understand that safety is critical and our obligation to them is that they return home each day in the same condition as they arrived.”

Company History
TETRA was founded in 1981 to supply services and clear brine fluids
(CBFs) used in well completion and workovers to the onshore oil and gas industry. Until 1985, the company focused on expanding its operations in California, Louisiana, Oklahoma and Texas, later shifting its focus to onshore drilling and completion activity to offshore operations in the Gulf of Mexico.    

In 1986, the company acquired Dravo Recovery Systems – a wastewater treatment and remediation company. “Without knowledge and experience from this acquisition, we wouldn’t have been confident enough to have initiated our program to convert chemical coproducts into calcium chloride,” President and CEO Geoff Hertel said in a statement. “We capitalized on this knowledge in 1987 and are still benefitting from it.”     

Over its history, TETRA has grown organically and through acquisition. In 2004, it purchased Kemira’s calcium chloride business, which is headquartered in Helsingborg, Sweden.     

For the next several years, TETRA’s plans are to continue to focus on its new manufacturing plant in Arkansas, it says.