Mammoth’s Puerto Rico contract expanded
The job of restoring power on Puerto Rico after Hurricane Maria is mammoth in size.
And a contract held by a subsidiary of Oklahoma City-based Mammoth Energy Services involved in doing the work is getting big, too.
Officials announced this week the agreement between Mammoth’s Cobra Acquisitions and the Puerto Rico Electric Power Authority has more than doubled in size — for a second time.
Initially, Cobra entered into a $200 million contract in October to work with the authority and with federal officials to help restore power to the island’s 3.4 million residents after the hurricane devastated its electrical grid.
The company sent 434 employees to work there, to start.
On Jan. 29, that contract was expanded to $500 million to cover a year’s worth of work by Cobra.
By then, the firm had about 880 employees working on the island.
This week, Mammoth Energy Services said the contract was amended again, this time expanding its total value to about $945 million. Cobra Acquisitions now has about 922 workers on the island, including contractors working with the firm.
“It really speaks to the severity of the storm and how bad it was,” said Arty Straehla, Mammoth’s chief executive, on Friday.
He noted about 14 percent of power generation capacity on the island still hasn’t been restored and that about 22 percent of its residents still don’t have power.
Struggling with circumstances
Additionally, the island grid continues to struggle keeping its power supply constant to places where electricity has been restored.
Unusual circumstances continue to impact efforts to complete the job, Straehla said.
“First, it is about 1,000 miles southeast of Miami, and that creates some logistics challenges,” he said. “In addition to that, most of the power generation is on the south side of the island, and most of the usage is in its northeast quadrant, where San Juan is located.
“In order to get there, you have to go across mountains, rain forests and hills,” he said. “It isn’t the traditional type of situation” most U.S. residents are accustomed to seeing, where power lines are mounted on poles — typically located in public rights of way along major roads.
“A lot of our work requires helicopters and heavy lifting.”
Another factor making the job difficult is that the island’s electrical grid system had been ignored for a number of years because the power authority there hadn’t had the money to keep its system up to date, or, to keep an adequate stock of replacement materials on hand.
Straehla said another issue hampering the recovery is that Maria was the third major hurricane impacting the U.S. in 2017. Because of power restoration efforts in Florida and Texas related to the earlier hurricanes, there was a general shortage of materials to begin with.
“Our teams are extremely professional,” he said. “In some cases, they’ve salvaged what they need from other materials that previously had been
scrapped to make what they needed.”
Straehla also noted the contract change will allow the subsidiary’s employees to acquire materials they need for their ongoing work without having to rely on third-party contractors that the authority and U.S. Army Corps of Engineers have hired to supply them.
However, he also said he expects Cobra Acquisitions will continue to rely on those suppliers, as its efforts to get what it has needed in a timely manner have improved.
Straehla said Friday that officials already are beginning to think about what they will need to do to upgrade and improve Puerto Rico’s power system during coming years.
“Our crews have been very efficient,” he said. “But I don’t want to lose sight of the reason why we are there, and that’s to try to get the lights on for the people of Puerto Rico. I have been impressed with their attitude.
“At the end of the day, this has gone on for a long, long time,” he said. “It just goes down to how tough this hurricane was.”