Eagle Oil -- keeps on-site contractors lubed and fueled

Tuesday, January 15, 2002

By Jim Obert

Business Today

JACKSON -- When Jim Rowland and his wife bought Eagle Oil from Les Eagle in 1982, they kept the name of the business and formed a corporation.

The business came with a tank wagon for delivery of fuels to farms, and a few small commercial accounts.

Lubricants ordered from Amoco Oil were sold in barrels, buckets and cases. Rolled roofing was a petroleum-based product that the Rowlands discontinued; however, the transport part of the business expanded.

Jim Rowland said there have been huge changes in the lubricants and fuels industry over the past 20 years. Formulations of gasoline have changed, as have specifications of lubricants. A new family of lubricants was developed to maintain better designed equipment.

Everything became computerized, environmental laws became increasingly stringent and taxes increased.

"There is a lot of government intervention in this business," said Rowland.

Soon after buying the business the Rowlands invested in new transport trucks to haul refined fuel products. They began providing fuels for area service stations and industry. At one point they sold drums of high octane (118) methanol used primarily in sprint cars.

Currently, Eagle Oil transports gasolines, diesel fuels, kerosenes, solvents and lubricants to local jobbers in about a 25-mile radius of Jackson.

"We've got a network of jobbers around here that we keep supplied," said Rowland. "Delivering to job sites is a huge help for contractors. It reduces their down time and they don't have to worry about the environmental issues."

In 1986, Rowland built a warehouse and became a lubricants distributor for Amoco Oil Co. Rowland said Eagle Oil was one of 70 companies nationwide to supply Amoco lubricants to all the reseller networks and also to commercial accounts.

"It was a big decision for us, because we had to spend a lot of money to get set up in about 60 days," he said.

Rowland said he discontinued his business relationship with Amoco after the company was sold to Chevron and Chevron raised its prices. He soon hooked up with Exxon and Mobil.

As a certified repackager for Exxon and Mobil, Eagle Oil buys lubricants by the tanker load. Transport trucks are often sent out of state for lubricants, which are pumped into 3,000- and 4,000-gallon holding tanks in the warehouse in Jackson. The product can then be pumped into 5-gallon cans, barrels or sent out in bulk.

Lubricants include hydraulic oils, engine oils, gear lubs, greases and cutting oils.

Rowland said his company distributes lubricants to commercial customers in Arkansas, Kentucky, Tennessee and Southern Illinois. About four years ago Eagle Oil opened an office in Harrisburg, Ill., bought a warehouse and currently distributes lubricants as far east as the Mt. Vernon area in Southern Illinois.

In the Southeast Missouri area, Eagle Oil distributes lubricants commercially as far north as Ste. Genevieve and west to Doniphan.

"We have the ability to sell railcar loads of lubricants, although we haven't done that yet," said Rowland, adding that a railcar holds 27,500 gallons of product. "Most of that business is handled by the oil companies themselves, but we could do it if the opportunity was there."

Rowland said the current recession has had an effect on his business -- some customers are a little slower to pay their bills. Still, dealings with his gas and diesel clientele has remained fairly steady.

"The things that affect us most in fuel sales is when someone says there's a shortage and people panic buy, or when cold weather is predicted. We can get a price change from the major oil companies almost instantaneously," said Rowland, adding that people at the local level often blame local distributors for jumps in fuel prices.

A major concern of staying in business is having to abide by the environmental regulations that dictates investing in major upgrades concerning control and storage of lubricants and fuels.

"It's a dumb operator that doesn't inspect himself," said Rowland. "All our employees watch how and what we do. It can get expensive if you have to pay fines."

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