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Starting a construction project in the feed and grain industries
6 Plays8 months ago
Welcome to the latest episode of the Feed & Grain Podcast, hosted by Steven Kilger. In this exciting two-part series, Alex Kerrigan, vice president of Project Development at Todd & Sargent discusses the intricacies of initiating construction projects in the feed manufacturing and grain handling sectors.
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Transcript
Introduction and Sponsorship
00:00:00
Speaker
Hi, everyone. My name is Stephen Kilgore. I'm the managing editor of Feeding Grain magazine and the host of the Feeding Grain podcast. Thank you so much for joining me today as we dive deep into the issues affecting the feed manufacturing, grain handling, and allied industries. Today's episode is brought to you by the Binwip and Numad systems. The powerful dual impact Binwip removes the toughest buildup and blockages in industrial storage silos without hazardous silo entry. Learn more today at binwip.com.
Guest Introduction and Background
00:00:30
Speaker
Today's episode is the first of a two-parter with Todd and Sergeant's Vice President of Project Development, Alex Kerrigan. We're talking about what it's like to start a construction project in the feed manufacturing, grain handling, and processing industries. We discuss what it's like to start a project like this, when to get a contractor, and what information they need to help you build your best project.
00:00:53
Speaker
I hope you enjoy the interview. If you want to help out the podcast and are listening to this in a podcasting app, please rate us and subscribe. Helps out the podcast a lot. If you're listening online, sign up for the Feeding Grain newsletter industry watch to see the latest podcasts and stay up to date on all of the latest news from around the industry. Now onto the show. Hi, Alex. Thanks for joining us today. I really appreciate you being here. Yeah, great to be here, Steven. Thank you very much for the invite. Looking forward to.
00:01:20
Speaker
Chatting a little bit through the construction or pre-construction items that customers should think about when building the facility.
00:01:27
Speaker
Yeah, it's a really good topic. I realized actually when we were, full disclosure to everyone listening, we just, Alex and I just met in IPPE and talked a little bit and I realized like, I've known Alex for 10 years now. We just got crazy to think about. But you're one of our favorite experts on any of this kind of topic. So we really appreciate you sitting down with us. But for anyone who hasn't known you for the past 10 years, can you tell me a little bit more about yourself and what you do at Todd and Sargent?
Journey into Construction
00:01:57
Speaker
Yeah, I've been at Todd and Sargent. I interned here back in 1998, just in both the field a little bit and estimating and touch of design over a short time period during the summer. It's funny, I graduated college with more of a finance or with a finance background and wanted to learn more about the inner workings of a private company, the financial side of a private company. And then the more I got around the design piece and the project management piece, I gravitated towards that instead.
00:02:26
Speaker
I've got an agricultural background. I've been around these smaller facilities for years since I was, oh, I don't know, probably sixth, seventh grade, helping my dad out on the farm and also around our grain elevator and feed mills locally. From Southern Iowa, a little town called Afton. I still farm down there with our family. We've got a, again, a small grain elevator slash driver system down there. It's kind of nice to just beat around and
00:02:53
Speaker
and understand concepts and equipment in general. And then, of course, I probably get into my own little, I don't want to say, owner or project management on small projects down there as well. So, but at any rate, yeah, I've been at Todd and Sargent since 98 intern and back in the swing of thanks and 02 full-time. And I've gone anywhere from working on grain elevators and feed mills to more involved processing on say, soy crush facilities,
00:03:20
Speaker
Expeller plants, pet food facilities, quite a bit in the biodiesel industry managing jobs on biodiesel and a little bit of ethanol work.
00:03:31
Speaker
You're, gosh, 15, 18 years ago. Quite a bit in the flour milling industry. Really enjoy the flour and feed side both. I enjoy these complex facilities that take a lot of interaction or a lot of coordination between owners, the process technologists, and in the construction side, be it engineering or construction alike. So I guess my biggest desire in growing up and what I do today is just organizing facilities to be more efficient. And, you know, my love for agriculture is just making things better.
00:04:01
Speaker
whether it's in how we go about constructing or how we go about processing the grain and logistically how to get it there and how to get finished product out. So it's a little bit about me.
Hobby Farming and Work Inspiration
00:04:13
Speaker
Yeah, you've been involved in some huge projects over the years. Some of the biggest stories we've ever covered at Feeding Grain have been taught in sergeant stories. And it's also really nice to hear that you're still on that hobby farm.
00:04:30
Speaker
or you still, you still do that. Uh, cause I always remember talking about you around harvest season and it's, you know, it's gotta be pretty relaxing, right? To be able to go from the, to regular, just, you know, go down to the farm and get out there on the combine and harvest some grain to be a nice respite. Yeah. Most people know they're sitting around on the tractor. It gives you, it gives you time to introspect or sit in the combine, but it also
00:04:57
Speaker
It helps me just kick back and relax a little. And if concepts here at Todd and Sargent or design concepts happen to pop into my mind as I'm
00:05:06
Speaker
tooling around out in the middle of the field, that's a nice time for me just to try and envision certain ideas that come from a customer or how to implement best practices from a vendor or a good subcontractor that we team up with on a job. And yeah, I enjoy working at Todd and Sargent and all of our teams and especially with the owners that we get to interact with. But I also like having that little bit of free time to think about or like I said, just envision what we might construct for a customer as well.
00:05:36
Speaker
Oh yeah, definitely. I only understand that from writing where the best way to get rid of writer's block is like to go for a long drive and just kind of think to yourself there in the seat. So I imagine it's similar.
Pre-Construction Planning Essentials
00:05:49
Speaker
So, we have you on kind of to talk about the beginning process of a facility who might want to upgrade or might be thinking of upgrading, renovating, or building a new site and kind of what information they should start to gather before they talk to someone and when to talk to someone and what to talk to someone like you about.
00:06:12
Speaker
Starting with, so before engaging with a construction company, what kind of essential information should companies really gather to ensure that it's going to be a successful project and that they have everything ready for you to give your input? I guess the few different hats that I wear at Todd and Sargent, you know, we're thinking about conceptual design and how to interact with a customer, whether it's just the process design or specifications.
00:06:39
Speaker
just negotiating the final sales package and everything, but some of the things that an owner wants to be thinking about are what's, as you said, what's the essential information that companies could gather ahead of time. A lot of owners, this goes without saying they already have this in the back of their mind, but there are some owners that don't consider these items of what's the distance or how far away are you logistically speaking? What's your access to raw materials?
00:07:05
Speaker
to the backside of it, what's your distance or access to the end user or customer. And what I mean by that is if you're building a feed mill in a particular locale, is it a feed mill that's in close proximity to corn being grown or do you need to bring in everything by rail? And then the second part of it is, or that back end part of it is, is your facility close by where you're capable of just throwing something on a truck in bulk or maybe bulk bags or just
00:07:34
Speaker
smaller 50 pound bags and send it over to an end user or do you need to be thinking about a much more involved logistical setup of loading out rail cars or I mean, it still could be a pretty complex thing to be translating from, I don't know, say it's a
00:07:54
Speaker
into a van trailer versus dumping it into a hopper bottom semi. That's a big thing is understanding the distance, understanding the costs involved. Like I said, I think a lot of customers, they have that in mind from the get-go when they're siting a facility. The other thing though, and these are some of the things that you hope you can just force through if you're an owner maybe,
00:08:20
Speaker
Um, or, or at least you hope for the best is, uh, do the neighbors, do they want you there? Uh, you know, there's, there have been, uh, discussions, you know, complexes in Kansas that, uh, have been, Hey, no, we don't, we don't watch there. You know, there's that, I think of that export facility down Louisiana. Uh, you know, maybe the neighbors don't watch you there. Uh, it sounds crazy, but you know, uh, being a good neighbor means a lot, uh, interacting with the,
00:08:48
Speaker
with the local Chamber of Commerce or I'm sorry, economic development means a lot. And you have to just think through that and what state you're thinking about building it or what location you're thinking about building it. Will the permitting be an uphill battle that outweigh or actually outweighs the site's benefits or will everything fall into place and
00:09:14
Speaker
make your entire process of construction and eventually operation of the facility profitable and I'll say synergistic with the locals. Yeah, people really underestimate how important it is to have the community on your side. Interesting little side story that I might cut from this, but I
Community Relations in Construction
00:09:37
Speaker
think is really interesting is I got a call from an NPR reporter covering
00:09:41
Speaker
that facility down in Louisiana that there were all those protests for and they're trying not to get built as a little background person which I was very excited about because I was like I've never been a background consultant for anybody before this is fun and he's asking me all these questions and he's like well like are there concerns about dust and stuff you know justified or smell and noise I'm like I mean
00:10:05
Speaker
No, because you can build facilities. I mean, we have equipment to get rid of dust. We have dust collectors and they're a lot cleaner than they've ever been. Same with noise and same with air pollution and smell and stuff like that. And then of course he used none of that in the article and just kind of was like, yeah, it's going to smell. I'm like, that's not what I said at all.
00:10:28
Speaker
Yeah, and you're right. I mean, most everything with a facility in a particular locale can be mitigated. It is a matter of cost though. I mean, obviously, the cost of a dust system versus no dust system is, yeah, there's additional cash that needs to be, or a cash outlay for that.
00:10:48
Speaker
or that particular
Railroad Service Challenges
00:10:49
Speaker
system. And it happens with noise pollution, light pollution, et cetera. All those things are certainly things that can be taken care of with additional costs. But there's other things besides just keeping the locals happy too. Does the railroad, like say if you've got a railroad that you're working with, do they want to service your site? The biggest thing that we find on at least any project that involves railroad service
00:11:16
Speaker
is the customer starts talking to them maybe three months in advance of wanting to break ground. And that's good that they're talking to them, but you'll find, and I think everybody that's maybe listening is aware that the railroad has, they've got a lot of approvals they need to get through. They have a lot of safety checks they want to confirm. They want to make sure the engineering of your facility or
00:11:40
Speaker
or what their locomotive might be driving across is well-constructed or well-engineered and well thought through. You want to make sure that the railroad's able to service your site and that they've given you an idea of what the timeline will be of when you'll actually be able to get service. That's a big one. Obviously, most everybody listening is aware that the facilities that
00:12:08
Speaker
they were being constructed, be it a feed mill or grain elevator, an annex storage, fire mill, whatever it may be. These are tall facilities. Grain is stored upright for the need of utilizing minimal space. With these being tall facilities, you need to be in conversation with the local airport or the FAA to make sure that there are no objections to
00:12:35
Speaker
your plant location or the height of your facility or that feed manufacturing plant or whatever you're thinking about building.
00:12:46
Speaker
Yeah, yeah, definitely. See, these all things, especially when you're caught up in
Timing for Engaging Construction Companies
00:12:51
Speaker
the moment, you might kind of just forget about until you're way more into the thick of things. So at what point should a company really start a dialogue with a company like yours, an engineering design construction company?
00:13:09
Speaker
Yeah, so we always say in the feasibility study, it doesn't mean it doesn't matter if you're talking to Todd and Sargent or any other contractor out there, you know, the the earlier we can get an idea of what you're thinking about building and some of the
00:13:27
Speaker
the nuances of the job or the site itself, the smoother things will go. Yeah, if you wanted just a package answer of when you should start, I mean, hell, I've worked on facilities where it's been 10 years in the making and then we finally broke ground. I've worked on facilities where the owners had a lot of these
00:13:51
Speaker
ducks in a row, so to speak already, within four to six months we're breaking ground and working away. The owner needs to be talking to utilities about whether it's the railroad that I just mentioned, if it's electrical, if it's water, sewer, gas, what's the water quality that's needed for the boiler?
00:14:18
Speaker
the delivery volume for either domestic use or the boiler use, or hell, maybe even a fire pump or expression system. Those are things that they want to be getting done as soon as they possibly can. That could certainly be something that's a year in the making, a year in advance.
Preparation for Construction
00:14:37
Speaker
You need to be thinking through, hey, is my site, is it culturally or environmentally sensitive? Do I need to get an environmental firm on retainer to start thinking about the air permitting? There are a lot of states and provinces out there that it could be anywhere from six to 12, I'll say six to 12 months with the air permitting and certainly other
00:15:07
Speaker
environmentally sensitive areas like if you have a wetland that needs to be mitigated, it could take some time to get those permits in hand or if it's on a culturally sensitive site and you need to get a cultural resource management company involved to do a survey or talk mitigation, that's something that should be thought about a year or two in advance. I guess I threw this out. What I find happens a lot is
00:15:37
Speaker
An owner sees this pristine parcel of land or they're given this pristine parcel of land by, oh, I don't know, say an industrial park group or whatever. And it looks great up on top, but there's a lot of things that can happen from a civil design of how much dirt needs to be moved or worse yet, how much needs to be imported from offsite
00:16:04
Speaker
to build up this nice piece of ground. Then, hey, what's going on underground? The geotechnical needs, it is ideal to get a soils report and a few soil drawings done as soon as you're able, just so you know what you're getting into with this particular parcel. You might think you're buying it for
00:16:25
Speaker
3,000 bucks an acre and it's, hey man, that seems pretty cheap versus 10,000 and then you realize, oh my gosh, this soil underneath is nothing but mucky silt or fat clays and it's going to force me into a million, million and a half dollars worth of piling or something. Those are things that you usually say to a construction company, hey, I just want to get a price on this facility, but you don't,
00:16:53
Speaker
You don't always think through what might be underground and how you have to support these massive structures. Yeah, and I'm sure, especially with people who haven't done a new project in a long time, all those regulations and all those things have, I assume, gotten more strict and also probably take a lot longer than people think they're going to, which is bureaucracy of governments on all levels.
Additional Planning Considerations
00:17:24
Speaker
Yeah, and like you said, Steve, that's on the more of the authorities having jurisdiction or servicing folks, but you also have a lot of interaction, not just with a Todd and Sargent type group or construction group. You got a lot of interaction with your industry partners like a technology provider. If it's a brand new greenfield site, Flowermill,
00:17:52
Speaker
there's probably a lot to be discussed with a process technologist of what your outputs are and how you're going to fit it around and that's going to determine what the footprint is of your actual structure to house all this equipment. If you get a feed mill that's a little 30 by 40 footprint for an ingredient bin tower and
00:18:15
Speaker
A little 30 by 40 footprint or 20 by 40 footprint maybe for the loadout lanes. That's one thing if you're looking at a
00:18:23
Speaker
a big old feed mill with three pelleting lines and more like a 50 by 60 ingredient tower and two or three loadout lanes and save a couple million bushels of grain storage. That's a lot. That's just the footprints. You still have to determine what's needed for the traffic flow around that facility and what you need for roadways.
00:18:46
Speaker
in how you interact with the civil engineer to determine not just how much dirt needs to be moved, but how you actually move water across the site, what drainage is necessary to have a long-lasting site that you're happy with for 100 years to come. Hello again. It's me, Stephen, just hopping back in at this point to let you know the second part of this interview will be coming next week.
00:19:16
Speaker
But until then, thank you for listening and stay safe out there.