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FEDERALSBURG - Keith McMahan pauses to consider a complicated question: Why has Tri Gas & Oil been such a steady presence in Caroline County for more than three generations? Because, he says, the business was raised to see people first.
“I like the people we serve, and I like the people I work with,” says McMahan, chairman of the Federalsburg-based family of companies. “Every day, I’m fortunate to work with folks I trust.”
That insistence on connection runs from a farm lane on American Corner Road to a multi-location energy business stretching from Cape Charles to Maryland’s western shore. It explains why this chairman, with more than 50 years of service to the company, still lights up behind the wheel of a bobtail truck. It also explains why the company, founded in 1963, is defined as much by what it gives as by what it sells.
A legacy shaped in a church kitchen
The company’s story doesn’t begin in a boardroom. It starts with Audrey and Lee McMahan, who began with very little and somehow always gave. Audrey’s happy place, McMahan recalls, was the Union Church kitchen in Federalsburg, where she cooked for parishioners, Rotary and Ruritan functions, and community suppers.
Lee, a truck man at heart, built Tri Gas & Oil by solving problems for neighbors. He farmed and hauled poultry for Caroline Poultry. When his chicken houses needed heat, he arranged to buy oil, load it on a truck, and deliver it. Neighbors saw, then asked if he could provide for them, too.
What began as McMahan Poultry evolved into Tri-County Oil, and eventually into Tri Gas & Oil. Propane arrived in the early 1960s, cementing commitments to both transportation and neighborly service.
A hardware bell rings its last
McMahan’s first “gotcha” leadership lesson came when the growing company needed more office space. The Federalsburg property’s front housed a hardware store that his father loved.
Farmers came to talk and buy parts, and Lee checked the ledger daily. Converting it into a customer service center later in the company’s history made business sense at the time, but meant closing a community hub.
“My local community was not happy,” McMahan says.
The experience stuck with him: decisions on paper need to consider the deep personal connections the company has developed with its neighbors and consumers.
The PepUp decision
The company’s largest acquisition occurred on July 1, 2022, when Tri Gas and Oil finalized a deal with Pep-Up, Inc., a Delaware-based brand with deep roots in Sussex County. The timing coincided with political headwinds. Policymakers debated fossil-fuel restrictions, and the name “Tri Gas & Oil” suddenly felt like a target for misunderstanding.
The solution: corporately, they retain Tri Gas & Oil. In the market, the brand is PepUp, with the reminder that it’s “a Tri Gas family company.” The approach preserves legacy while preparing for an energy future that will be blended for decades.
McMahan says nearly all newer vehicles now carry PepUp graphics with Tri Gas attribution, and that Federalsburg’s signage will be among the last to change in the near future.
The joy of the front line
For all the strategy, McMahan’s joy is in service. Ask around and you’ll hear about the chairman who drove nurses to Shore Regional Health in storms, or who overfilled a tank on Hoopers Island, then insisted the bill be corrected.
“I grew up in a company where transportation was critical,” he says. “I’ve always enjoyed driving delivery trucks.” Now at an age when most have long retired, he laughs that some wish he’d do less of it, but the smile shows he won’t.
Working with people, not only managing them, fuels him.
A wider circle of service
The company’s community service is both formal and informal. It employs more than 270 people at peak, including seasonal workers who return annually. Districts often host open houses to thank customers. The team organizes blood drives in Federalsburg and partners with the Salvation Army for the Angel Tree program. Antique trucks appear in Christmas parades.
As the company expanded, holiday traditions also shifted. A single big party in Federalsburg no longer worked for families spread from Virginia to Glen Burnie, for example. Now each district hosts its own catered gathering, scaling Audrey’s church suppers to a larger table.
Tri Gas & Oil has also grown through adjacent services. Comfort Plus Services, its HVAC arm, employs more than 30 technicians. Breeding Roll Off Service and M&L Truck Service continue to provide essential transportation services while maintaining year-round employment for drivers and mechanics. And Mid-Atlantic Rail Services is the wholesale propane arm of the company, serving customers throughout the region.
The logic traces back to Lee’s instincts: if you run trucks, you need fuel and mechanics. If you deliver fuel, the customer likely needs their equipment serviced as well. Service becomes an ecosystem.
What giving back looks like
McMahan resists the idea that Tri Gas & Oil is the community’s primary benefactor. “We live in a business community that is committed to giving back, and people here do it quietly,” he says.
When asked how readers might build their own habits of giving, he suggests starting close.
“Look for the thousands of small things, not one grand gesture,” he suggests. “Feed volunteers at a hall. Sponsor a blood drive. Ask an agency like the Salvation Army what program needs the most help, then support it.”
He says if you have time, show up for someone. Then create a habit by doing the next right thing and repeat it over and over again.
Inside a company, he says, you build the same muscle. McMahan doesn’t plan to be the bottleneck.
“At 74, you’d better have good people around you,” he says. He meets with a senior leadership team whose vision mirrors his own. Son Nash serves as president, and his daughter, Julie, manages complementary businesses. Son David also grew up as part of the family business and has since moved with his family to Florida.
The goal for Keith is to “set the stage so the next generation can do the same.” Succession planning, for him, means keeping the community lens.
Energy futures
Ask McMahan about the future of energy, and he answers without bluster. The path ahead isn’t either-or. It’s both-and.
Fossil fuels will remain necessary, but they must be handled cleanly and responsibly, he says. Nuclear energy belongs in the mix, as do solar and wind energy. The grid will require time, vetting, and investment.
Tri Gas & Oil plans to stay focused on fuel services while exploring alternative opportunities that fit the business's skills and scale. The stance mirrors the PepUp branding: be clear about what you are today, and flexible enough to meet tomorrow’s needs.
The measure that matters
Talk long enough with McMahan and the story circles back to gratitude. He tells you he is “very, very fortunate,” then repeats it to make sure you heard.
For moments of joy outside of business, he says he and his wife, Darlene, travel by RV to their favorite spots, from Williamsburg to Lancaster and south to Florida, where they visit their son, David, and his family.
He enjoyed flying small planes up until recently, and now holds memorabilia in his office as a reminder of his piloting days.
It’s clear McMahan is quietly proud of what his parents built and what his team stewards. He is prouder still that the company’s reputation reflects how Audrey lived and how Lee worked. If his grandchildren read this someday, he hopes they’ll see the family recognized its blessings, shared them, and built a business where people felt valued.
That’s how a hardware bell gives way to a call center without losing its soul. That’s how a fleet changes logos without breaking promises. That’s how a Caroline County company becomes a regional one while staying true to its local roots.
“Everybody becomes a product of the environment they grow up in,” McMahan says. In Federalsburg, that environment still resembles a neighbor in a church kitchen, a driver in the snow, and a business that finds practical ways to say thank you.
