Former East Texas oil town getting new refinery

NEW LONDON, Texas — New London students had everything they needed and more.

Athletes used a whirlpool, a handball court was in the gym, everyone got a letter jacket, and each band instrument was furnished. Ball players enjoyed chicken fried steak after away games.

The community was coming off the big oil boom of the 1930s and 1940s, when the school district was known as one of the richest in the state.

It was a completely different picture than last year, when elementary students quickly shuffled out cafeteria doors after they ate, passing by columns with missing tiles. Half of the facility was vacant, but it would only be minutes before more children poured in to take over any empty chairs.

The remaining students finished eating, some on paper plates because the one working drain in the kitchen couldn’t handle a lot of dishwashing. At one point, at least one student covered his ears to block out the noise.

Now, community and school officials anticipate that West Rusk County Consolidated ISD will get a push toward revitalization when a refinery project comes online.

The refinery will be on a site off Texas Highway 323, 1.25 miles southeast of New London. Current processing equipment in Longview will be relocated to Rusk County, upgraded and restarted.

Plans for the project, which has been in the works for about 18 months, are to produce 30,000 barrels per day of light sweet crude and produce gasoline and diesel fuel.

“The basic concept of that project is to take crude oil that is relatively local and available and produce gasoline and diesel as a result,” said Kelley Holcomb, general manager for the Angelina and Neches River Authority, the conduit bond issuer for the project.

An estimated 300 to 400 jobs will come to the area during the approximately two-year construction period, and up to 85 high-paying, full-time jobs are expected at the site when the refinery is operational. During the next decade, the economic impact of the project is estimated at $8 billion, according to a presentation made earlier this year. The immediate economic impact, including construction and sales tax on local materials, is estimated at $384 million.

“I think it’s going to be great for the community, the county and the surrounding areas,” New London Mayor Dale McNeel said by phone.

An area that started out agricultural.

Farmers grew cotton, corn, watermelons, peaches and tomatoes, which they shipped on the Henderson and Overton Branch Railroad, according to the Texas State Historical Association. The association’s website states that the first well in the East Texas oilfield was drilled in 1930 a few miles from the London community, making it a boomtown.

When the oil field came in, there was a total influx of people, who lived in tents and houses made out of green lumber and other homes, said Miles Toler, director of the London Museum. A modern school and churches also came to the area.

In 1931, Humble Oil and Refining Co. moved 100 families to New London, according to the historical association’s website. Refineries eventually were built, the website reads, and oil companies provided jobs, housing and electricity, along with free gas and water.

However, the community was rocked on March 18, 1937, when the school exploded, in what is said to be the worst school disaster in United States history. Facilities quickly were rebuilt, and New London boomed until World War II, according to the historical association website.

“Basically London was an oil field service community,” Toler said. “It was kind of the area around here. You had the oil companies who were furnishing homes for their employees.”

When he attended school in the 1950s, he said the common question was, “What oil company does your daddy work for?”

“Basically, that was it. Everybody’s dad worked for an oil company,” he said.

But the East Texas oilfield began to decline, he said, and oil companies got rid of housing camps and utilities.

According to the historical association website, some people moved away while others stayed, and New London became incorporated in 1963. The population didn’t shift much, the website reads, with 899 in 1970 and 942 in 1980. The population in 2000 was 987 with more than 20 businesses.

Community and school district leaders are optimistic about what the refinery might bring to West Rusk County Consolidated ISD as well as New London.

Toler said that the new refinery will put into the area money that is desperately needed, and the West Rusk district will fall into the category of places like Tatum ISD, where the tax base really becomes strong.

“The thing that I see in this area is influx of money,” he said. “The ability to provide for kids should bring some to the area, but you see very few housing developments here. People who are there have been here. It’s not a turnover type situation.”

He added, “I just see the school becoming a diamond in the rough out here. If it was the subsidiary industry, that would service the refinery and they would be bringing people in, but I don’t see that right off the bat.”

Toler said being that diamond means West Rusk County Consolidated ISD will be able to get the top teachers, the top administrators and be able to offer a curriculum they’re not able to offer currently. Plus, he said it will be able to provide the exterior facilities needed to accommodate that.

“We’re just hoping with the refinery, our story we’re keeping alive here (at the museum) will continue,” he said.

Superintendent Tommy Alexander has known the refinery project was a possibility since December 2011 when he got a call from Ken Williams, president and owner of Gregg County Refining.

“It took a good five minutes to realize someone wasn’t playing a joke,” Alexander said. “The thing he was throwing out was overwhelming.”

Williams said Gregg County Refining looked at various locations for the project and found an extremely supportive community that has “opened their arms” to the effort.

He also noted that the future refinery site sits right in the middle of the East Texas oil field, where there it a lot of available crude oil and natural gas.

Within an hour drive of the site there is a very qualified, skilled labor force that would bring in people from Tyler down to Lufkin and even Shreveport, La., Williams said.

Most workers will live in their hometown and drive back and forth to the project site, he said, while others will rent residences in the local community or bring recreational vehicles or motor homes.

“These are real people. These guys work for a living and they want to do a good job,” he said, adding that he has experience upgrading a refinery and moving refinery equipment.

“What we’re producing is only a small percentage of the market in that area. There is just not a problem disposing of those products. We (also) had the equipment, and we have the know-how to do that.”

Construction activities are expected to start later this year and be completed within 24 months.

In the meantime, West Rusk County Consolidated ISD continues to move forward with a bond issue that voters approved in November.

The district’s bond, which will not exceed $15 million, will fund renovations to the existing cafeteria, a new multipurpose events center, a new football/track stadium and a new cafeteria.

Alexander said the district, which has more than 900 students enrolled, is within three weeks of being completely finished with the stadium.

The only thing that won’t be ready at the stadium this fall is a concession stand, he said. However, concessions are slated to be sold under the bleachers during the district’s four home games.

Stadium construction will be followed by construction of the new cafeteria, then converting the current cafeteria into six kindergarten classrooms, along with bathrooms and hallways.

By August 2013, the plan is to move into the new multipurpose building, which features a gym and a separate wing for sixth grade, the new cafeteria and the renovated cafeteria.

Alexander said the idea for West Rusk County Consolidated ISD is to have small bond elections every two to three years. The district also has made a list of things that will likely become part of a long-term or strategic plan, such as additional buildings and benefits for employees.