PHOTO BY LISA CARNLEY Oil States employee Brenda Slaton works a new state-of-the-art press that produces ball sealers for gas oil rigs. Company officials look for the business to rebound as the economy stabilizes headed into a new year. Oil States will observe 30 years in the Lampasas community with an open house Friday. With the economic downturn and the constantly changing price of oil, three decades in business is an accomplishment many petroleum based enterprises are finding hard to match.

But Oil States Industries in Lampasas not only has withstood some tough times, it has surpassed them by keeping the rubber manufacturing plant growing with new state-of-the-art equipment and additional square footage.

The Lampasas plant will celebrate 30 years in business with an open house on Friday from 2-4 p.m. that will offer tours and refreshments to visitors.

When the local plant opened its doors in 1979, the 125,000- square-foot facility was built at a cost of $300,000 on five acres of land along U.S. Highway 190.

PHOTO BY LISA CARNLEY Even with its state-of-the-art equipment, the human touch is still necessary at Oil States where employees hand-trim numerous sizes and shapes of molded rubber products, as demonstrated by Lupe Munoz. It began with 20 employees and added an additional 10 workers each month for the next several months. With 60 employees, manufacturing took place on three shifts, 24 hours a day, five days per week.

By March 1980, business was booming, and expansion plans were being discussed. By the middle of that year, 10,000 square feet was added to the present site with a new building.

At its peak in 1981, Oil States had 117 employees -- almost twice the number it started with.

In February 1983, LTV Corp. of Dallas purchased the company, whose headquarters are in Arling- ton.

In early 1986, an ailing petroleum industry forced Oil States to lay off more than 40 percent of its work force.

A dramatic decline in demand for oilfield services and supplies -- the lifeblood of Oil States -- led to an industry downturn.

In 1988, things began to rebound, and the local plant was able to increase employees and production. An additional 10,000-squarefoot building was constructed.

Sluggishness in the petroleum industry hit hard in late 1991, and Oil States again had to let employees go.

In 1995, the company was acquired by SCF Partners, and in 2001, Oil States became part of Oil States International.

In recent years, Oil States has leased the former Winn-Dixie grocery store at Santa Fe Square, and the building is at full capacity.

With a purchase of land adjacent to the local plant, Tim Zielinski, plant manager, said he had hoped a warehouse could be built on the property that would be more convenient and alleviate the need to use the former grocery store.

"But until we see some improvement in the economy, the warehouse has been put on hold," Zielinski said.

In 2008, a 7,500-square-foot extension to the building was added for product flow, testing and research and development, a testament to the company's continued growth amid the fluctuating demand for oilfield rubber products.

Last year, the employee count climbed as high as 138.

"But 2008 was a record year, and we recorded our highest sales and highest profit for the division," said Zielinski.

Robert Reed, former longtime plant manager and current sales representative, said the rubber plant lives and dies by orders of expendable products. "Or use and throwaways," he said. Parts are ordered mainly for drilling rigs and workover rigs of oil and gas wells.

The rig count in 2008 reached a high of 2,031 and averaged 1,879, but this year it fell to 879.

"Our business parallels the rig count," Zielinski said. "It has stabilized, and now there are about 1,100 active rigs. We hope to see a continued increase in 2010."

The rig count fluctuates with the price of oil. "When oil prices are higher, rig counts increase because there is more incentive to drill," said Reed. Consequently, when oil prices drop, the rig count drops, and that affects the rubber plant's business in a major way.

When the orders begin to fall, the plant must cut expenses -- and part of that is head count and keeping down overhead costs.

Diversification is not the answer, Reed said, because the plant's capacity is limited. And in good times when core manufacturing is at its peak, there is little room for other types of fabrication.

Today, the plant continues to operate successfully and plays a major part in the Lampasas economy.

Zielinski sees 2010 as a year of stabilization at a somewhat lower level than 2009, with the addition of five rubber-molding presses and plans to add a storage facility on its own land. He and Reed feel positive about the company's future in Lampasas.

Zielinski also hopes that with the continued upturn in the economy, outdated equipment can be replaced and more employees added.

"We are very optimistic, and we expect things to get better," said the plant manager. "We don't see doom and gloom," Reed added.

Currently, two shifts run 10- hour days four days per week. Both officials hope to see the plant running at full capacity in the near future, which means increased employment opportunities for residents and more money infused into the local economy.

"We anticipate getting to three shifts, 24 hours a day, five days per week," said Zielinski. "It wasn't unusual in 2008 to run the plant six or seven days a week, before the bubble burst and we had to begin cutting back.

"But we are expecting good things for our Lampasas plant in the future," he said. "Hopefully, there will be a celebration in another 30 years with Oil States as it continues to prosper in the Lampasas community."