In Ontario's chemical valley – the petrochemical and refinery complex located in Sarnia-Lambton – , small and mid-sized manufacturers spent decades developing best-in-class products and services for oil and petrochemical giants. Their metal fabrication, engineering, environmental management and support services also translate well into biochemical production. But as the petrochemical industry began to evolve and change, businesses had to start thinking outside the valley. In 2011, some 35 visionary companies, ranging in size from five to 500 employees, formed the Sarnia-Lambton Industrial Alliance (SLIA). Their mission was to identify new business opportunities and devise innovative approaches to marketing their well-established supply chain.

According to SLIA chair Rick Perdeaux, owner of Toolrite Engineering, the wide-ranging expertise and experience of suppliers in the Alliance offer global industries a single source for an entire supply chain. “Alliances provide economies of scale, so we can offer our clients better service, quality and competitiveness matched to their needs to make them more attractive to industry,” he says. Various companies with similar or complementary products have also banded together to strengthen their offerings.

Selling Canadian oil equipment to the world

Perdeaux admits that in its half-century of operation during the boom times, Toolrite never needed to market its services. Today, he is promoting it and other SLIA members to burgeoning regions such as India, Asia, the Middle East and Latin America. "Many of these countries do not have the high-quality manufacturing infrastructure we do – they are looking outside their own areas for new suppliers." Being part of a credible alliance makes it easier for small firms to attract the attention of prospects.

Paul Healy, president of LamSar Inc., which has operating facilities in Sarnia and Corunna, Ontario and St. Clair, Michigan, has also benefitted from joining SLIA. He has participated in more than 20 trade shows in Canada and around the world, and joined trade missions to investigate business opportunities beyond provincial borders. "In addition to some trade-show funding, we have had great support from the Ontario Government in setting up trade missions, outreaches and introductions that companies like LamSar could not have organized on their own."

SLIA member companies can also leverage the advantages of the Sarnia-Lambton area when marketing. This includes Sarnia's position on the Great Lakes waterway, with access to the St. Lawrence Seaway and beyond. "Household brand names in the midstream oil and gas business demand best-in-class service from local contractors like LamSar and we can take that experience with us wherever we provide product – or have boots on the ground," he notes.

Healy reports that his company's exports have been increasing steadily, both in volume and geographical reach. Modernizing LamSar's manufacturing plants during the recession has positioned them to capture more of the market now that the economy is showing signs of rebounding. The company's first export to Kuwait is now underway.

Delivering Canadian equipment to refineries everywhere

SLIA continues to help members conduct research, promote their products and services, and attract new industry to the area. Recently established neighbours include BioAmber and Comet Biorefining that use local feedstocks to produce new bio-based chemicals and sugars.

A critical part of the supply chain is delivering products on time and at an acceptable price to the client. But moving some of the huge equipment required by the oil and chemical industries wreaks havoc on transportation corridors, the community and profits.

"Chemical plants and refineries need specialized equipment for breaking down crude oil, natural gas or bioproducts, and it's often too big to transport via rail," says David Moody, SLIA's secretary-treasurer. The solution is to build a permanent oversized-load corridor that would reduce suppliers' costs and minimize the impact on the community. "Manufacturers could pass those savings on to customers who would then be motivated to buy more product." adds Moody.

"The petrochemical businesses in our chemical valley have seen enormous cultural and economic changes over the past decade," says Moody. These include plant closures and cancelled projects due to the economic downturn. On the other hand, new feedstocks such as corn and ethane have driven plant upgrades and new technology – and attracted new manufacturers. He points out that SLIA has played a key role in helping members market themselves and generate new business, with some companies already doubling in size and upgrading to robotic and other leading-edge equipment.

"As an alliance, we share our successes and concerns to come up with strategies that will benefit not only companies, but also the entire Sarnia-Lambton economy," he concludes. And that's just good business.
An image depicting oversized chemical plant equipment that is often oversized and therefore hard to transport on regular roads. Ontario is working to create a ‘corridor’ to serve this need.
Chemical plants and refineries need specialized, often oversized equipment that is hard to transport. Ontario is working to create a ‘corridor’ to serve this need.

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