Posted By Lyndsey Kleven, Communications Coordinator,
Monday, November 02, 2015
The member spotlight series features legacy OOGA members who have been a member of the Association for at least 10 years. If you would like to recommend someone to be highlighted, please contact Lyndsey Kleven firstname.lastname@example.org
Jack Miller had an early start in the oilfield, as many families with multi-generations in the industry do. Today he runs Ken Miller Supply, Inc. the company his father Ken started in 1959, which has grown over the years. Jack recalled the story of how Ken Miller Supply, Inc. came very close to never taking off.
After working for another supplier for a period, Ken decided he’d like to have his own company so he bought four frac tanks and started a business in Wooster, Ohio. Early on in the beginnings of the venture, Ken moved in on a local well with a frac tank on the back of his truck, when unexpectedly the motor went out. Ken had a family with four kids at home, had just quit a reliable job, and his new start-up wasn’t going exactly as planned. He sat on the running board of his truck and cried, knowing he was under and the business wasn’t going to make it.
As luck would have it, a fuel deliveryman that Ken knew was driving down the street and stopped to see what happened. Ken explained how he was done because the motor on his truck went out. The guy chuckled and explained that he could put a new one in for $700, which is what Ken did and never looked back. The company’s first office was a red trailer that didn’t have any heat; Ken worked out of this space for over a year.
“When I was 12 in the 6th grade my dad was in the supply business and it was just him, so he’d get me out of school because he couldn’t measure a load of pipe by himself,” Jack recalled of his start in the business. “When I was 16 I drove a big truck moving frac tanks. We had the world’s largest 300-barrel frac tank rental company, having 500 of them, with 25 drivers. I was one of those drivers for about eight years part-time, I became full-time in 1974 when I graduated from college.”
Jack went to Ashland University and studied marketing, sales, and finance. He was the first person in the family to go to college, and it was very important to him and his family that he had a college education.
“I enjoyed driving trucks but you never knew when you could get home, and on top of that we would work all day Saturday. While driving my truck, I sold a man a million dollars worth of new pipe. My dad pointed out to me that we didn’t have new pipe. And I said, ‘we’re going to get some.’ So we drove down to the mill in 1978 with a million dollar order and we asked if they wanted the order, which they said yes, so then we had new pipe.
Jack’s business sense cultivated the company into new arenas and expanded the operations. In Ohio, being in the supply business since 1980, Jack has seen many suppliers coming in and out of the state.
“Our business isn’t sexy or exciting, we just sell a load, sell another load, and it all adds up.”
Miller Supply sells everything that it takes to hook up a well, from piping, culvert pipe, valves and fittings. As drilling has evolved over the years, the amount of products that are needed to drill a well has influxed.
“We never once in our industry said the word “recycle” but we have recycled pipe in wells eight times. And no other industry recycles one item every time. No industry recycles as much as the oil and gas industry, because we recycle everything.”
Jack’s resourcefulness is a trait he seemingly got from him father. Ken’s ingenuity was just as impressive and helped operations run more efficiently, this showed when he invented the straight truck. He took a tractor and trailer and cut it in half, stretched it 10 feet and welded in a 10 foot frame and drive line (this was before school buses in 1959).
“My dad called International Harvester and told them he stretched one of the trucks 10 feet to see what they thought. They said he was crazy, not to do it, and that it would never work, but it did. If only he had patented the idea it would have made us more money than any of the other business. He was the first one that thought of the long wheelbase.”
Other people moved tanks with a tractor and trailer and would get stuck. Miller Supply was resourceful and used straight trucks that ran like a four by four.
They also plugged wells and bought used casing from 100 wells a year. Being in the recycling business, this is how Miller Supply got its casing, Jack explained that 100 wells will yield about 300,000 feet of used four-and-a-half casing.
“We bought these wells to plug and then the Arab oil embargo came in 1974 and oil prices increased. A well that made three tanks a year became a good well, so things really changed, and then we became producers.”
Hence how the Miller’s drilling company Ken Oil got its start. Ken Oil is an Ohio drilling company that has wells in 14 counties, its early success came from drilling around the old wells they purchased. In 1988 Ken Oil started drilling Rose Run wells and had another good bite at successful drilling. They have a good relationship with the state and get along well the ODRN and inspectors and fellow producers.
“In the Rose Run we learned we had to share. You had to share leases with people and become friends with operators that you never had before, it was really a good thing for Ohio. So now we have more joint ventures then we had in the past because of the Rose Run activity.”
Today Ken Oil is in more of in a “hanging-on mode,” and Ken Miller Supply is the primary endeavor.
Various slow times in Ohio caused Miller Supply to expand. When times were slow in Ohio, they took on the mentality that they could either “go home” or go roughly four hours away—about how far a truck will take you in half a day—to start new locations. The company currently has 11 locations in five states.
“We don’t have partners so we grew really slow because we used our own money, which overall has really been good.”
The businesses employ 136 employees and they are very proud that 70% of those employees have been with the company 15-30 years. Jack says that he employs great people and is also thankful that they stay with him and they don’t have to train new people all of the time.
“Our people, like myself are, our salesmen, our managers, have all driven truck, threaded pipe, so we’re really hands on. This makes us unique as a supplier today and it gives us a great amount of knowledge for our customer’s problems.”
The employees are willing to take their knowledge of the business and share it to help others be successful.
“We have the knowledge to help people. We can learn something in Pennsylvania, then we can tell the guys in Ohio and save them the learning curve. Everywhere the drillers are regionally smart, and our company is regionally smart, but that doesn’t mean we can take what we do and go to Texas.”
Jack cited an example of a Texas company coming up to Ohio the first year shale drilling occurred and brought porta pots with stainless steel toilet seats. He recalled that there was a man screaming in the middle of winter because he was frozen to it. He ended the story by saying, “and that’s why you want to buy Ohio.”
Shale-development’s impact on business:
After expanding Miller Supply Company to 11 locations in 5 states put the company in a nice position for where all the shale development was taking place.
“When shale came around that put us right in the main fairway where all of the shale operators are. It’s interesting, in the year 2007 when the shale activity started we sold 25 pipe items, today we sell 79 pipe items. So everything I thought I knew in all my years of learning got thrown away, and now we’re in a completely different category of products.”
Jack described how shale drilling has made things more difficult for the producer, because they have become so efficient at drilling it has created a glut of gas and packed the pipelines. Also the current state of commodity prices has put everyone in an extremely difficult situation, saying that producers are netting half of what Rockefeller was getting in the 1900s—and he didn’t pay income tax. As a conventional producer Jack says it creates another set of problems. It is really tough to drill a well on the current leases and have it pay for itself.
Jack has been a member of the Ohio Oil and Gas Association (OOGA) since the early 1970s and has served on the board of trustees since the late 1970s. Getting an early start, Jack is one of the Association’s longest sitting trustees. Ken Miller was also a very active member and trustee, he enjoyed being involved for many years.
Today Jack also serves on the executive committee and is thankful for everyone who does because he knows that it is such a time commitment.
“We get way out in front of problems, years in front of when Bill and Betty Buckeye start to actually see them. And we have done so much to make it affordable to operate in Ohio—but we need to do more. It is really nice how each president has been so uniquely qualified to do a good job for the Association. And under the leadership of Tom Stewart as former executive vice president, and now Shawn Bennett serving as EVP, we have the right people in place to carry out the policies.”
Jack would say to those involved in any aspect of oil and gas, “get involved with the Association and stay involved. It’s a very inexpensive way to get your finger on the pulse of what’s going on. And it will affect you, so you might as well be part of the solution.”
In addition to Jack’s commitment to the OOGA over the years, the Miller family has done a great deal to give back to their local community in Wooster, donating resources and community building space. When Jack became involved with the family business, this opened up free time for Ken and he opened the Ken Miller Supply Oil & Gas Museum. The museum houses a vast collection of early gas pumps, drilling machines, tractors, trucks and cars. The museum is located at 7920 Shreve Road and is open to the public the second Saturday of each month from 12:00 pm to 3:00 pm.