Hallador and Hourglass announce Colorado’s first frack sand operation

By North American Shale magazine staff | May 15, 2018

From its coal mining experience in Indiana to its previous work in the exploration and production sector, Hallador Energy Co. believes it has everything needed to enter the frack sand mining business. Based in Denver, Hallador has announced plans to open a frack sand mining operation in Colorado. Once operational, the mine will be the first-of-its-kind in the state.

Hallador believes operators in the DJ Basin are looking for in-basin sand much like their peers in the Permian are doing. Through a $4 million investment into Hourglass Sands LLC, frack sand from a state-permitted mine near Colorado Springs could give operators an in-basin option.

“We feel that frack sand mining is well within our core competency,” said Brent Bilsland, president and CEO of Hallador. “We also believe Hourglass can meaningfully contribute to Hallador in future years.”

The initial plan for the mine is to produce 800,000 to 1 million tons of sand. Hourglass will bring in a third-party to process the sand. This summer, an operator will test the sand from the mine to determine its quality and mesh size.

“To us, the trend we are seeing in the industry,” Bilsland said, “is that it seems most of the shale plays are using greater volumes of sand and are willing to use lower quality. Part of what we are trying gauge is how much of our product the market will accept.”