New business in the pipeline
The City of Prineville Railway will be adding a new business in the next few months that will specialize in manufacturing and shipping plastic pipe.
Railway General Manager Matt Wiederholt said that Krah USA will be setting up a manufacturing facility, starting with two production lines with plans to expand. They will be located in a shop in one of the railway's freight depot buildings. The company agreed to a five-year lease that takes effect July 1 with two options to renew.
"We are excited because we get a lease payment and the majority of, if not all of the pellets used to make the pipe come in from Canada or Texas," Wiederholt said. "That is where rail is a crucial part of this, for that inbound product. They need rail."
Krah USA is operated by CEO Midge Graybeal and her partner, Mark Theetge, who is the president and chief sales officer. They both share local connections in Central Oregon, with Theetge growing up in Bend and Graybeal coming from Terrebonne. Theetge proudly points out that he is part of Mountain View High School's first graduating class in 1979.
"Krah Pipes of Germany has developed technology over the last 40 years to manufacture large-diameter high pressure HDPE pipe, which until recently in the U.S., was only available in steel, concrete and sometimes fiberglass," Graybeal said. "Krah USA is currently working in tandem with the Krah Group, and Krah Advanced Technologies GmbH (Krah Germany), who are offering their individual areas of expertise to ensure that Krah USA has the resources it needs to be successful."
She said that after a two-year analysis and planning process, Krah USA LLC was formed in December 2019.
In addition to featuring rail, the partners selected Prineville because it fit a host of criteria.
"A year-long study was conducted on land availability according to the needs of the new plant," Graybeal explained. "After completing due diligence reviewing 10 Central Oregon local sites from Bend to Madras, the City of Prineville Railroad property was chosen as most compatible to our 22 listed requirements, including an existing and available large scale building, expansion capabilities, a loading rail dock and a separate office space among other amenities."
Krah USA will produce several products including the proprietary large-diameter, high pressure Krah HDPE pipe, a variety of sizes of Solid Wall HDPE pipe, manholes, fittings and fixtures.
"I've been trying to bring the Krah technology to America for 18 years," Theetge said. "I'm extremely proud to be able to take this effort to fruition and be part of the Krah family."
Facility planning, design and construction of the Prineville facility is already under way. Graybeal and Theetge hope to open in August and start producing pipe in September. They plan to employ 14 staff but expand to 20 in year two and 30 in year three.
"Krah USA's first expansion of production lines will most likely occur March of 2021," Graybeal said. "We anticipate adding a solar array within two years of operation."
Regarding the solar array, Graybeal stressed that the local facility will "be a model for environmental sustainability."
"The plant eventually will be partially powered by an estimated 2-megawatt solar array as a renewable net meter project, with any excess power sold back to Pacific Power," she said. "Water use will be minimal, and easily provided for by Prineville's municipal water supply."
She added that HDPE pipe is made from a byproduct of natural gas processing, "turning an energy production waste product into goods that benefit the environment."
Graybeal went on to praise community and railway leaders and expressed optimism for a lengthy presence in Crook County.
"We have a great partnership with the city of Prineville that ensures longevity of the headquarters plant for years to come," she said.
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