In-basin sand strategies create new mines, more tech

FROM ISSUE 2
By North American Shale magazine staff | April 10, 2018

To better serve its clients in south Texas, Pennsylvania-based Preferred Sands recently opened the Atascosa County sand mine. The new facility designed to serve the Eagle Ford, Michael O’Neil said, represents a significant event for the company’s new location strategy. Once a sand provider with northern white plants in Minnesota and Wisconsin, Preferred chose to match the in-basin needs of its clients like other sand providers had before. In Monahans, Texas, the company will open a second in-basin plant. The Minnesota and Wisconsin plants once owned and operated by Preferred have been sold.

Hexion Inc., another sand-linked entity, has also entered the in-basin sand game happening in Texas. The company recently unveiled a mobile resin-coated proppant manufacturing facility for clients that want to alter their proppant without paying for shipping and handling costs. The mobile units come complete with a lab and silo storage and can be placed anywhere along the logistics line. Jerry Kurinksy, senior vice president and general manager of Hexion’s Oil Technology Group, said the mobile manufacturing system matches the new need of Permian clients while giving them more economical access to higher-quality proppants.

“The potential savings of in-basin sand are huge—as long as operators are satisfied that it meets their technical requirements, they could save up to 50 percent on frack sand hauled from Wisconsin,” said Todd Bush, founder of Energent, an oil and gas research and consultancy firm that released a study on in-basin sand.

“Assuming a 50 percent adoption rate of locally mined sand, incumbent suppliers will see a material decline in non-contracted volumes by the third quarter. It will also focus attention on logistics within the basin itself—the truck fleet, retaining drivers and transport technology—which will also drive well economics,” he said. 

Benefits of Resin-Coated Proppant Created In-Basin
“The primary benefit of resin-coated proppant is to prevent flowback,” Kurinsky said. “When proppant is coated, the grains bond together and form a pack that doesn’t flow back into the well. When fractures start to close in, the pressure shears off untreated-sand more easily, which reduces the permeability and the ability of oil to flow properly.