Otherwise known as the Boston Globe Sunday Business section:
"Global Partners is now an industry powerhouse; Started with one truck in Dorchester, business now a Fortune 500 company" by Erin Ailworth | Globe Staff, June 09, 2013
ALBANY, N.Y. — Hundreds of rail cars stretch toward the horizon, black as the crude they carry from shale fields in North Dakota. From here, the oil will move by barge and truck to East Coast refineries, a stopover on the way to its ultimate destinations: family cars, home heating systems, and fleets of trucks.
The rail yard — in a larger complex of tracks, roads, pipes, and storage tanks — has become a key gateway in a virtual pipeline stretching across the country, helping transform a family-owned Waltham fuel distributor into a Fortune 500 company in less than a decade.
Related(?): Boston Globe Energizer
Tapping into the boom in North American oil production, Global Partners LP, since becoming a public company in 2005, has more than doubled the volume of fuels it sells to 6.1 billion gallons and quadrupled its revenues to $17.6 billion last year.
Today, the company, number 157 on the Fortune 500 list, operates a network of rail-loading facilities, storage and barge terminals, and gas stations in more than 20 states, distributing crude, gasoline, ethanol, and other fuels.
It employs 1,650 workers, including more than 600 in Massachusetts. And, industry analysts say, Global is pushing to expand further, with the major oil producing region along the Gulf of Mexico a likely spot.
“They’re going to continue to build out their rail capability, try to extend their footprint, try to target something on the Gulf Coast. And at that point, they’d have something on every coast,” said Paul Jacob, an energy analyst at Raymond James Financial Inc. “It’s going to be tough to compete with that.”
So how did Global become this powerhouse? By following a strategy of steady expansion and jumping at chances to acquire assets. Take the 63-acre tank farm here. In 2007, when Exxon Mobil wanted to sell the terminal, Global Partners snapped it up, looking to expand its storage capacity. But it soon began eyeing the property’s small rail loading facility with two tracks as an opportunity to transport ethanol from the Midwest.
By 2010, Global had added four more 1,200-foot-long train lines connecting the property to the upper Midwest branch of the Canadian Pacific Railway — just as the boom in oil production, aided by the controversial drilling technique known as fracking, was getting underway in North Dakota. As production outstripped pipeline capacity, and oil companies turned to rail as an alternative, Global was perfectly positioned.
“Given the expense . . . as well as public opposition to building a crude oil pipeline from the midsection of the country to either of the coasts,” said Gabe Moreen, an analyst with Bank of America Merrill Lynch, “rail has emerged as really the only economically viable alternative for getting crude to the coasts.”
Global Partners traces its beginnings to 1933, when Abraham Slifka opened Slifky’s Reliable Oil Burner Service in Dorchester, a one-truck heating oil business that served homes and businesses in the area. His wife, Sonya, did the books.
The company grew as people turned to heating oil from coal and other sources, and the next generation, Slifka’s sons Fred and Richard, renamed the company Atlas Oil in 1963. They later expanded into wholesale fuel distribution and trading, using a Small Business Administration loan to buy their first terminal in Revere to store heating oil from Venezuela. (Global now has 25 terminals in Massachusetts alone, including in Chelsea, New Bedford, and Braintree.)
The company continued to grow, partnering briefly in the late 1990s — when it became known as Global Partners — with the Spanish oil company Repsol and buying or leasing terminals in Maine and Rhode Island. The Slifka family bought out Repsol in 2003. Two years later, Abraham Slifka’s grandson, chief executive Eric Slifka, took Global Partners public, trading on the New York Stock Exchange.
“I’m lucky, I know that. The family company was able to make a transition,” said Eric Slifka, 48, during an interview at the company’s Waltham headquarters, where the lobby and conference rooms are decorated with vintage gas pumps, paintings, and artistically styled photographs of the company’s terminals and gas stations.
As with previous generations of Slifkas, Eric Slifka has shown a knack for finding and seizing opportunities. Expanding into rail transportation was one. Getting into the crude market, after decades of exclusively dealing with refined fuel and natural gas, was another....
It's all from shale, which means fracking, which means earthquakes and poisoned ground water. Can' drink a glass of oil.
So what’s next for Global?
Slifka has his eye on several new markets and new acquisitions, including natural gas. The company recently partnered with OsComp Systems Inc., an MIT energy spinoff with offices in Boston and Houston, to provide compressed natural gas to industrial and municipal customers in New England....
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Related(?): Sunday Globe Special: Portland's Pipeline
While we are at the Sunday pump:
"The job growth in May was at a steady pace that showed strength in the face of tax increases and government spending cuts. But the unemployment rate rose to 7.6 percent from 7.5 percent in April. That’s because more people began looking for work, a healthy sign, but analysts don’t expect that the jobs growth is strong enough to convince the Federal Reserve to pull back on the economic stimulus. Those measures have been intended to ease long-term borrowing costs, and have had the effect of supporting the price of oil....
In other words, printing all that money to buy Wall Street bonds is driving the price of oil up.
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