SemGroup Affecting Smaller Towns

Oil may be cheaper now, but it's no easier to find.  As the financial fallout from SemGroup's collapse continues, the well is running dry for road projects across Green Country.  SemGroup is the principal supplier of many of the oils used for road construction.  The News On 6's Chris Wright reports smaller cities are having to deal with SemGroup's bankruptcy.

Summer is the season in which most road construction occurs.  But, without oil from SemGroup, some projects have already had to be scaled back or postponed.

Some Muskogee County residents contend that area roads have always left a little bit to be desired.

"They have never spent the money on the roads.  Muskogee, in this area, has the worst roads, especially county roads," said Mike Pruet of Muskogee County.

But, making improvements to those roads has suddenly become more difficult.  Much of the oil used for new asphalt, as well as chipping and sealing roads, came from SemGroup.  Now that the company is bankrupt, it has scaled back or altogether stopped providing that oil.

While the demise of SemGroup will likely cause some headaches in the City of Muskogee, the county, which relies almost exclusively on SemGroup for road supplies, says it will definitely cause some major headaches.

"Obviously, this is a very sad event for the entire construction effort in eastern Oklahoma. Sem are our primary suppliers," said Muskogee County Commissioner Gene Wallace.

Muskogee County Commissioner Gene Wallace says he has been allocated enough oil from SemGroup for the immediate future, but it will run out.  He says other towns and counties are also experiencing the pinch.

"It's extremely frustrating; I've got counterparts across the state that are cancelling projects. Our cities and small towns, they're cutting back entirely," said Muskogee County Commissioner Gene Wallace.

SemGroup is also convenient for counties like Muskogee.  It will now have to bring in oil from much farther away.  That will take longer, cost more, and could translate to fewer projects and more delays.

"Time is one thing we can't recapture, and once we get behind, you continue to stay behind," said Muskogee County Commissioner Gene Wallace.

Muskogee County says it is already looking to other states for its supplies.  Officials say they may have to bring in oil from as far away as St. Louis.