July 2015, Vol. 242, No. 7
Features
Price Gregory President Discusses Accomplishments, Semi-Retirement
Price Gregory President Michael Langston recently announced his retirement after a 35-year career in the pipeline construction sector.
Langston joined H.C. Price in 1981. Following a merger between H.C. Price and Gregory & Cook Construction, Price Gregory was formed. Price Gregory was later purchased by Quanta Services and Langston was named president of the company.
In this interview, Langston recalls going through the merger and acquisition during his tenure and dealing with regulatory, safety and technological changes that have dramatically affected the pipeline construction sector. The veteran pipeliner also shared some thoughts on his career and professional and personal accomplishments with Pipeline & Gas Journal.
P&GJ: Where did you grow up and how did you become involved in the pipeline construction industry?
Langston: I grew up in the northwest suburbs of Chicago and attended college (Rose Hulman) in Terre Haute, IN. Various companies recruited on campus during my senior year, and I accepted an offer with Texas Gas (now a part of Boardwalk) in their design/construction department. I spent the first three years of my career on various pipeline and compressor station projects with them, mostly in south Louisiana. I’ve been in this industry ever since.
P&GJ: Can you give us a little background on Price Gregory and tell us when you joined the company?
Langston: Price Gregory was formed from the merger of H.C. Price Co. and Gregory & Cook Construction in early 2008. Prior to that, both companies had been competitors in the pipeline construction industry. Price Gregory was acquired by Quanta Services, Inc. on Oct. 1, 2009 and continues today as one of Quanta’s larger operating units. I joined H.C. Price Co. in June 1981 as project manager on a pipeline construction project for ARCO at Prudhoe Bay in Alaska. I remained with them through the merger with Gregory & Cook and the acquisition by Quanta.
P&GJ: How many employees does the company have and who are your main clients?
Langston: Price Gregory has operations in Alaska and Canada (through a subsidiary) as well as the Lower 48. Employee count cycles with workload and ranges from 2,500 to 6,500, depending on how many spreads are busy at any given time. Our clients include all of the major oil/gas operators in North America and many of the midstream operators, particularly in the Marcellus/Utica shales.
P&GJ: What do you feel has made Price Gregory unique in the pipeline sector?
Langston: There are several areas that differentiate Price Gregory. First of all would be our size in terms of spread capacity and balance sheet strength since being acquired by Quanta Services. Second would be our geographic footprint with permanent operations in the Lower 48, Alaska and Canada. Third would be our breadth of services. While we are seen predominately as a mainline contractor, we do a substantial amount of facility construction including pump/compressor stations, metering/regulator facilities and tank/terminal modifications. Our Alaska operation also constructs power plants (coal/gas-fired and hydroelectric).
P&GJ: What technological change, or changes, have you seen that have vastly improved safety in the industry?
Langston: Technologically, it would have to be construction equipment improvements. Vacuum attachments for loading/unloading/stringing pipe, hydraulics replacing friction control and the addition of ROPS on sidebooms come to mind. We are beginning to see excavators factory-equipped with cameras and in-cab monitors allowing the operator views of previous blind spots. This technology is common in today’s new cars/trucks and should be adaptable to most pipeline construction equipment.
P&GJ: What, if anything, is needed to improve safety?
Langston: The industry has improved safety performance dramatically over the past five or so years. We have a long way to go toward a goal of zero but I believe the owner companies, contractors and their respective trade organizations are aligned regarding the need for further improvement. Caterpillar Safety is leading a group of 10 companies (including owners and contractors) who are funding development of a safety-training curriculum specific to the pipeline construction industry. Training videos will be filmed on actual pipeline projects and modules will cover topics such as hazard recognition, risk tolerance, leadership, communication, etc. This is a training tool that our industry has lacked, and I look forward to its completion and roll-out near year-end.
P&GJ: What can you tell us about technological changes you’ve seen over the years that have dramatically affected the pipeline construction sector?
Langston: Not necessarily in any particular order of importance, some of the biggest changes I have seen during my career are:
• Development of ever-increasing yield strengths for line pipe
• Use of mechanized welding and AUT inspection required for high-yield strength pipe
• Introduction of pipe production from steel coil (spiral-weld pipe)
• Development of the horizontal directional drilling industry;
• Use of caliper tools for identifying and locating dimensional anomalies after backfill;
• Personal computer/satellite/Internet/cell phone revolution (I used a slide rule in college because pocket calculators weren’t available);
• The shale revolution
P&GJ: Over the course of your tenure, there has been much consolidation in the industry. Do you think this has worked to improve the industry as a whole?
Langston: Generally, most consolidation to date has resulted from acquisition by either private equity investment firms or publicly traded entities. In most cases, this provides access to greater levels of working capital, larger CAPEX budgets and healthier balance sheets. So yes, I see that as an improvement for the industry as a whole.
P&GJ: Price Gregory became an operating unit of Quanta Services Inc. in 2009. How much of a transition was that for you?
Langston: Not nearly as much as I feared. I was very concerned about losing the family atmosphere common to contractors in our industry and suffering through changes in operational processes required by the new parent. Operationally, we still handle business development, estimating, proposal preparation and contract execution in the same manner as we did prior to the acquisition.
The big changes have come in accounting, finance, IT and capital expenditure processes due to SEC oversight and Sarbanes-Oxley requirements. Quanta’s legal department is also heavily involved in reviewing the terms and conditions of our customers’ contracts. Trying to merge the two company cultures of H.C. Price Co. and Gregory & Cook Construction when Price Gregory was formed in 2008 was a much more difficult transition for me than being acquired by Quanta in 2009.
P&GJ: Do you see more consolidation on the horizon? If so, why?
Langston: I do. First of all, we are looking at a very robust pipeline construction market over the next three to five years in the U.S. and Canada, maybe record levels. Ownership of smaller privately held contractors will be motivated to cash in on the equity they have built up and their companies will be very marketable during this period.
Earlier consolidation has generally proved to be very successful, and I think there is less fear about the traditionally cyclical nature of pipeline construction going forward. Shale and oil-sand production have stabilized pipeline construction at relatively high annual levels, and I expect that to continue for a number of years.
P&GJ: There have been several regulatory issues enacted during your career as well. Can you cite any that stand out and whether there were positive (or negative) changes as a result?
Langston: Environmental regulations and requirements associated with pipeline construction have had a big impact on the processes required to get pipe in the ground. FERC guidelines, corridor routing, limited footprint (narrow ROW width and inadequate temporary workspace), extensive use of HDDs, stream and bird nesting windows, threatened/endangered species, archaeological discoveries, topsoil conservation, special treatment of water body and wetland crossings, extensive use of timber mats, the list is endless. While all of these regulations and requirements may be well-intentioned, the result has been a steady erosion of construction productivity and increasing cost.
From a safety standpoint, construction equipment and personnel have been squeezed into such congestion due to lack of adequate workspace that it is the most often-heard suggestion from our field supervision about what we can do to enhance safety: “Get us more room to do our work.”
P&GJ: Looking back, is there a particular project that stands out for you?
Langston: For me, it would have to be the Guardian Pipeline Project in 2002. It was 142 miles of 36-inch gas pipeline from Joliet, IL to Ixonia, WI. It was one of the last projects I estimated myself and then acted as project manager. It was intended to be constructed with two spreads but we offered an alternative proposal to do it with one spread and still meet the scheduled completion date. Manpower peaked at over 800 and we ran two pipe gangs and five road-bore crews, but we finished on time in seven months. It was the first contract I was involved with that exceeded $100 million in value.
P&GJ: What particular professional and personal accomplishments are you the most proud of?
Langston: Professionally that’s easy. Lasting 31 years with the same outfit and finally getting the opportunity to become president is very satisfying. As far as a personal accomplishment, it took taking some summer courses to do it, but I graduated with a BS in mechanical engineering in four years at a pretty tough school. I wasn’t a very good student but I was determined to make it and I did, barely.
P&GJ: Now that you’ve decided to retire, what are your plans?
Langston: The first order of business will be to move out of a Houston apartment and back to my home in New Braunfels. I expect to stay involved in the industry as long as I remain healthy and Quanta is offering me that opportunity working from home. So it’s really like semi-retirement and allows me time for family, fishing, Harley riding, pickleball and ham radio.
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