A Proven Path to Lower Industrial Gas Costs and More Reliable Production Operations
A partnership between South-Tek Systems and Morey, an electronics design and manufacturing company, demonstrated the opportunity manufacturing plants have to unlock significant savings and secure production independence through smarter nitrogen management. Morey achieved significant cost savings – a \$20,000 monthly margin – after transitioning from delivered gas to on-premises nitrogen generation.
An on-premises nitrogen solution now delivers the ultra-high-purity (99.999%), reliable nitrogen supply Morey depends on for SMT soldering and component storage in its manufacturing operations.
South-Tek Systems provides complete air and gas solutions, including nitrogen gas generators, air compressors, filters and dryers. Morey provides design, manufacturing and integration services for the commercial vehicle space, with operations heavily dependent on a stable, high-purity nitrogen supply. Nitrogen is critical for soldering and pre-test storage of manufactured components.
Before partnering, the customer relied on bulk nitrogen delivery. This arrangement came with high costs, a risk of supply cutoffs and inflexible contracts. Leadership was concerned about potential production interruptions and legal or contractual constraints that could significantly affect its ability to fulfill customer promises.
“Our biggest concern wasn’t just cost, it was continuity. Nitrogen is a critical utility for our manufacturing process, and we needed a solution that reduced supply risk and gave us long-term reliability,” said Ryan Thomas, Chief Operations Officer, Morey.
Morey builds connected hardware, enabling customers to receive reliable data from field assets.
Nitrogen Use in Electronic Component Manufacturing
Morey uses ultra-high-purity, 99.999% nitrogen in its surface-mount manufacturing process to produce circuit boards and other electronic components. The customer also uses nitrogen to prevent oxidation within storage cabinets holding finished components. Upon review of its existing bulk nitrogen supply and delivery process, the customer realized it faced a critical challenge: Its production depended heavily on nitrogen, yet the supply was controlled by a third-party delivery provider. The company was locked into a long-term contract with escalating costs and inflexible termination terms, limiting its ability to negotiate competitive pricing. Reliability and continuity of supply also remained ongoing concerns.
The mandate to the company’s operations team was clear: Implement a complete, end-to-end nitrogen generation system within five to six weeks, fast enough to ensure a seamless transition away from the existing liquid nitrogen contract, providing ample notice while avoiding operational disruptions, legal complications or additional costs for either the customer or its supplier.
“As we evaluated our nitrogen use, it became clear the delivered-gas model wasn’t sustainable. We were paying a premium and carrying avoidable risk tied to deliveries and aging infrastructure,” said Thomas.
The customer realized it faced a critical situation combining financial strain, legal pressure and operational risk.
Designing a Nitrogen Solution on an Aggressive Deadline
South-Tek mobilized a multi-disciplinary team to design and install a complete nitrogen gas generation solution tailored to Morey’s exact needs. The project included two nitrogen generators delivering 99.999% N2, supported by an integrated system of an air compressor, a refrigerated compressed air dryer, filtration, storage tanks and control and performance monitoring tools.
The project included two nitrogen generators supported by an integrated system of an air compressor, a refrigerated compressed air dryer, filtration, storage tanks and control and performance monitoring tools.
To meet an aggressive five to six week timeline, the company provided turnkey engineering and vendor coordination, ensuring every stage – from design to commissioning – was completed seamlessly. The company’s engineering team began with a detailed assessment of the existing bulk nitrogen system, followed by an in-depth analysis of both peak and average nitrogen demand to ensure accurate system sizing. The audit included multiple facility visits followed by scheduled cross-functional customer calls with the company’s engineering, field sales, service and operations team members, alongside key Morey personnel, to ensure alignment at every stage of the project.
Using these insights, the company configured an optimized set of components designed to reliably meet its customer’s required N2 output and ensure a continuous, uninterrupted supply of mission-critical N2. In addition, the company implemented ongoing monitoring and service support to sustain optimal performance and long-term reliability.
Working closely with Thomas and the customer’s engineering team, the company translated operational objectives into clearly defined technical specifications while ensuring compliance with regulatory standards. Detailed engineering reviews validated system sizing, process integration and compatibility with existing infrastructure, with particular attention to flow requirements, pressure stability and scalability. The system incorporated two nitrogen generators strategically selected to balance peak N2 demand while maintaining continuous operation during maintenance or unexpected downtime. Together, the units deliver more than 5,000 scfh of ultra-pure nitrogen gas, providing both the capacity and operational resilience Morey needed.
This collaborative engineering process enabled early identification of design constraints and iterative refinements prior to fabrication and installation. To meet the accelerated schedule, the company coordinated multi-vendor procurement of critical components, managing technical submittals, quality verification, installation resources and delivery sequencing to maintain project momentum and ensure seamless integration throughout the system installation, commissioning and long-term operation.
“South-Tek managed the project’s end-to-end design, equipment, installation and commissioning, which allowed our team to stay focused on production,” said Thomas.
South-Tek Systems configured an optimized set of components designed to reliably meet its customer’s required N2 output.
Solution Results in \$270,000 in Annual Savings
The transition from delivered liquid nitrogen to on-premise nitrogen gas generation provided immediate benefits for the customer. What began as an effort to transition away from cumbersome tank maintenance and an increasing cost contract led to a complete redefinition of how the customer sourced and managed mission-critical nitrogen.
With its nitrogen generation system in place, the customer was able to eliminate all risk of supply interruption and ongoing price increases, securing full control over its nitrogen supply and achieving production independence in six weeks, a timeline nearly unheard of for a project of this scale and complexity. The cost impact was substantial: The customer’s nitrogen expenses dropped from roughly \$350 per 8-hour shift to about \$100, resulting in about a 70% cost savings per shift. On an annual basis, this translated into an estimated reduction from over \$360,000 to about \$90,000, saving the company over \$270,000 annually.
The customer stabilized production in the long term and eliminated downtime caused by nitrogen supply. It also reduced its operational footprint by eliminating tanker truck deliveries to its location and by cutting waste at the valve during tank refills or measurements. Measurement of nitrogen supply and usage is enhanced going forward, and growth is enabled through capacity planning in the system design.
Last, but not least, the company’s facilities staff is warmer this winter, as it isn’t checking or tightening tank valves in the snow and ice or checking if gates are closed after a delivery. Moreover, Morey’s customers, employees, vendors and neighbors now have a clear view of mature spruce trees near the company’s loading dock doors. The liquid nitrogen tank, elevations and fencing are gone.
“This decision wasn’t just about reducing cost; it was about strengthening our operational resilience. Bringing nitrogen generation in-house gives us greater control, long-term cost visibility and a more reliable production environment,” said Ryne DeBoer, CEO and President, Morey.
For the customer, switching to on-premises nitrogen generation wasn’t about cost savings; it was about having control over and confidence in its nitrogen delivery.
Fine-Tuning to Maximize System Efficiency
South-Tek’s role didn’t end when the nitrogen system was switched on. The company continues to work with the customer to monitor nitrogen use in real time, ensuring supply consistently aligns with production demand. Regular 90-day facility visits by the company’s field service engineers ensure the system delivers nitrogen meeting or exceeding Morey’s specifications. The field service engineers perform scheduled preventative maintenance, identify any system performance issues and communicate overall system status and efficiency to the customer. They also fine-tune system operations to maximize efficiency, reducing both energy consumption and operating costs.
The company is helping the customer plan for future scalability and redundancy, ensuring the nitrogen systems can expand as production grows. In addition, the company provides hands-on training, equipping customers with the knowledge to manage and maintain their systems independently.
“South-Tek’s field service, customer service and engineering teams are excellent. Its continued commitment to ensuring our nitrogen-generating system delivers the nitrogen we need at the purity we require allows us to focus on our manufacturing operation with confidence,” said Mike Elliott, Director of Facilities, Morey.
“There’s a difference between buying equipment and working with a partner,” said Thomas. “South-Tek delivered a system meeting our requirements, and it’s continued to support that system with strong service and follow-through.”
Reducing CO2 Dependency with NitrogenNitrogen is increasingly used in breweries and beverage plants both alongside CO2 and, in certain tasks, as a replacement for CO2. The two gases behave differently in liquid: CO2 is quite soluble and is the main tool for carbonating beer, while nitrogen gas is far less soluble and is primarily valued as an inert pressurizing and blanketing gas. That solubility difference is the foundation for why nitrogen can save CO2, improve dispense performance and help protect flavor. In combination with CO2, nitrogen lets beverage plants supply total pressure without unintentionally changing carbonation. Brite tanks, brite-to-packaging transfers, filtration skids and long-draw draft systems all require stable pressure. If plants provide all pressure with CO2, additional CO2 can dissolve into the beer, pushing carbonation above the target and increasing foaming risk at the filler or faucet. With mixed gas, plants set the CO2 composition (its partial pressure) to match the desired carbonation equilibrium and use nitrogen to make up the remaining pressure needed for the process. The result is steadier carbonation, more predictable foam and less CO2 use for non-carbonation work. The best-known mixed-gas application is draft dispensing with beer gas, typically a blend of 70/30 or 75/25 N2/CO2. These blends are especially useful for nitro-style beers (stouts, porters, cream ales) served through a restrictor faucet. Because nitrogen does not readily dissolve, the beer can be pushed at higher pressures to overcome line resistance and drive the restrictor plate, creating the signature tight, cascading foam and creamy mouthfeel. The CO2 fraction maintains modest carbonation and prevents the beer from tasting flat, while also limiting the carbonic bite higher-CO2 beers can have. Nitrogen also works alongside CO2 in oxygen control. Many breweries use N2 to purge tanks, hoses, kegs and filler bowls, and to blanket headspace during holding or transfers. Displacing air with an inert gas reduces oxygen pickup, helping protect hop aroma, color stability and shelf life. In packaging, nitrogen dosing is another hybrid use: Nitrogen is added just before seaming, creating internal can pressure for improved rigidity and a positive internal package pressure. As a CO2 replacement, nitrogen is best used where carbonation is not required. N2 can replace CO2 for purging, inerting and blanketing, and it can push product during transfers or packaging, as long as plants maintain adequate CO2 partial pressure when carbonation must be preserved (otherwise the beer can slowly off-gas until it re-equilibrates). Operationally, shifting these tasks to nitrogen can reduce CO2 consumption, lessen exposure to CO2 supply volatility and reduce the labor associated with frequent cylinder swaps or bulk deliveries. Many facilities pair this approach with on-premises nitrogen generation, which can provide a continuous supply of clean, dry nitrogen for day-to-day operations. |
Nitrogen Generation Takeaways for Industrial Leaders
Having a reliable nitrogen supply is as essential as electricity in maintaining uninterrupted operations, and on-premises nitrogen generation delivers both cost savings and long-term dependability. By reducing reliance on third-party vendors, companies can minimize legal and operational risks while gaining greater control over their processes.
Most importantly, partnering with a trusted expert accelerates implementation, ensures a seamless transition and sets the stage for lasting operational resilience.
About the Author
Michael Dolan, Director of Sales and Marketing, leads South-Tek System’s customer acquisition, growth and retention strategies while overseeing the industrial manufacturing sales team. Mike has been with the company since December 2021.
About South-Tek Systems
South-Tek Systems provides mission-critical air and gas solutions, trusted by organizations across commercial, industrial and military sectors. For more than two decades, the company has focused on delivering reliable, high-performance systems, improving efficiency, reducing costs and giving customers greater control over their operations. Its portfolio includes nitrogen generators, air compressors, filtration systems and compressed air dryers. For more information, visit https://www.southteksystems.com.
About Morey
The Morey Corporation is an electronics design and manufacturing company that develops and builds rugged technical hardware and connected systems for industrial and commercial applications. They partner with companies to design, engineer, and manufacture electronic components, including telematics devices, sensors, and embedded systems for vehicles, equipment, and IoT solutions. Rather than selling consumer products, Morey works behind the scenes as a technology partner for OEMs and manufacturers. Their focus is on reliable, high-performance electronics built for demanding environments. For more information, visit https://www.moreycorp.com.
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