Living off the fat of the frac sand

By Emma Hughes
Published: Monday, 03 June 2013

Frac sand, a specific type of silica sand, is a durable, round grain, crush-resistant material produced for use in the hydraulic fracturing process (more widely known as fracking).

Frac sand, a specific type of silica sand, is a durable, round grain, crush-resistant material produced for use in the hydraulic fracturing process (more widely known as fracking). It is this process that has put frac sand on the proverbial map, as governments around the world begin to roll out new energy schemes including fracking, which are in turn boosting the call for this industrial mineral.

“Increased demand for hydraulic fracturing sand in support of production of natural gas from shale gas deposits has led to production capacity upgrades and ongoing permitting and opening of numerous new mines,” the US Geological Survey (USGS) industrial sand and gravel report for 2012 outlined.

Fracking is used to gather natural energy sources, such as oil, natural gas and natural gas liquids, from underground rock units that lack adequate pore space for these fluids to flow into a well.

Hydraulic fracturing generates fractures in shale rock by drilling a well, sealing the portion of the well in the energy source-bearing zone, and pumping through a mixture of frac sand and fracking fluid under high pressure into that portion of the well.

Fracking fluid is made up of water (98%), mixed with proppants (1.9693%) and small amounts of agents, including acid, biocide, corrosion inhibitor, iron control, friction reducer and scale inhibitor. As well as frac sand, fracking fluid contains other industrial minerals including bentonite, calcium chloride, sodium chloride, calcium carbonate and magnesium chloride.

The fracking fluid creates a viscous gel which facilitates the water’s ability to carry grains of frac sand in suspension. Billions of frac sand grains are carried into the fractures made by the pumping action. The frac sand is used to prop open fractures; this is why frac
sand is referred to as a proppant material.

API recommendations

While all frac sand is silica sand, not all silica sand is suitable as frac sand. This is because not all silica sand is able to withstand the high pressure durability required for propping open the fractures created in shale rock.

In order to help fracking companies to choose sand which is fit for purpose, the American Petroleum Institute (API) has published a set of frac sand specifications, which can be used as a guide as to which sand deposits are suitable for fracking and which are not.

These specifications mean that suitable silica sand deposits are limited. The specifications are expressed in mesh size, roundness/sphericity, crush resistance, quartz content (SiO2), bulk density, specific gravity, solubility in acid and turgidity.

A brief summary of the main API recommendations can be seen in Table 1 below.



Frac sand locations

The world’s largest producer of frac sand is the US, where a fracking boom is driving demand for this mineral.

Luckily for the US, high purity quartz sands are common on its shores, and many of these deposits are currently being exploited. However, not all of this sand is easily extractable, meaning some deposits have been abandoned while others are so remotely located that logistics costs render them commercially unviable (see pp28-29).

That said, there are still many deposits that are commercially viable.

The most notable deposits of API-grade frac sand can be found in sandstone formations such as the St. Peter (or Ottawa) sandstone (primarily mined in Illinois, Wisconsin, Minnesota, and Missouri), the Jordan sandstone (Minnesota and Wisconsin), and the Hickory sandstone (Brady, Texas).

Within the US, Wisconsin is leading the fore in the production of frac sand. Wisconsin has become the US’ “top frac sand hub of activity” (see IM October 2012), showing a 100% increase in frac sand activity between 2011 and 2012, growing from just a handful of facilities to more than 100 frac sand sites.

Data from the USGS highlights that Wisconsin ranked third in total US industrial silica sand production in 2010 at 3.39m tonnes, accounting for 11.3%, after Illinois (4.37m tonnes, 15%) and Texas (3.61m tonnes, 12.5%). In terms of frac sand production, the state is in pole position.



Wisconsin potential

The amount of activity within Wisconsin has increased dramatically since 2011, when the Wisconsin Center for Investigative Journalism (WCIJ) identified 41 facilities operating or proposed in the state. As of July 2012, figures had increased to 87 permitted sites (51 operational, 36 in development) and 20 sites at the proposed stage.

Now, under a year later, things have progressed even further, highlighting that growth within the Wisconsin frac sand industry is not showing any signs of slowing down.

The most recent data from the WCIJ’s investigations, which dates 1 May 2013, now shows a total of 92 permitted sites (72 operational, 20 in development) and a further 36 at the proposed stage (see Table 2).

One of the state’s initiatives to increase frac sand mining activity was announced in January 2013, when the state governor, Scott Walker, announced that Wisconsin’s Department of Natural Resources could soon have a specialist that would focus on helping potential frac sand miners navigate the rules and state processes.

“The [new DNR] staff position will speed up the process for frac sand oversight and regulation of frac sand mining,” Walker explained.



Facility locations

The state’s largest frac sand mining and processing facility, located in Trempealeau County, was approved in April after a nine-hour public hearing and meeting.

The Trempealeau County Environment and Land Use Committee approved Michigan-based Sand Products Wisconsin’s plans to open a 716-acre (2.9km2) mining, processing and railroad loading facility (see Table 2).

Another company operating in the state is Northern Frac Proppants LLC (NFP), which recently acquired an area of land containing frac sand reserves and a processing site in Wisconsin as part of a newly-announced supply agreement with Goose Landing Sand Co., LLC.

As part of the acquisition, NFP will gain access to premium Northern White frac sand reserves, which have an estimated life of more than 25 years. NFP has already begun to mine, process and sell the sand under previously-signed supply agreements.

The land, situated on 1,600 acres (6.5km2) near Black River Falls, is located on Class 1 rail which will help the company overcome the often costly logistics problem associated with the delivery of frac sand to the oil and gas basins where it is required.

Jeff Alston, president of NFP, said that the acquisition of the Goose Landing property and frac sand reserves “is in keeping with NFP’s plans to increase our reserve base and build processing facilities in key geographic locations to better serve our customers with low-cost, high-quality Northern White frac sand proppant.”

“We are pleased to enter into this agreement with Northern Frac Proppants, an emerging player in the supply of high quality frac sand proppant to the oil and gas industry,” added James Hoffman, president of Goose Landing Sand.

Preferred Sands LLC, which has two frac sand mines and one processing facility in Wisconsin, has recently launched a new bulk proppant distribution service, aimed at reducing the costly logistics problem.

“Preferred Pipeline was born from a growing need for a consolidated industry distribution network,” Michael O’Neill, CEO of Preferred Sands, said.

“As the energy market has grown and matured, the supply chain has remained fractured, with proppant companies controlling their own distribution networks. This has caused a growing number of inefficiencies and skyrocketing fees,” he added.

The cost of transporting frac sand, which is a high bulk, low cost mineral, has been an expensive problem for suppliers working in the oilfields industry for a number of years.

In a bid to further ease the logistics costs for frac sand companies, a portion of the Wisconsin state budget will include additional money to upgrade the state’s rail system.

“If you have good roads and bridges with maintenance that will make it easier when it comes to not only frac sand but also manufacturing sites and dairy farms and anyone else that depends on a reliable transportation industry,” Walker added.

The budget for the improvements will come from government cuts made over the past few years, which have made around $342m available.

Further frac sand potential

While Wisconsin is leading in frac sand developments at present, this is largely down to the fact that other areas of the US, such as Illinois and Minnesota, are struggling to get facilities off the ground due to government moratoria.

These two states have significant potential in terms of API-grade frac sand reserves, yet opposition to mine development is holding developers back.

Among the reasons behind these objections are concerns over noise and air pollution; water contamination; heavy site traffic and danger to the natural environment.

Minnesota’s state senate committee approved a one-year moratorium on new silica sand mines - most of which areÊaimed atÊsourcing frac sand - in March. The Senate Energy and Environment Committee passed the bill despite industry objections, launching a state-wide study on the potential health and environmental impacts associated with frac sand mining.

The study could also authorise local governments to tax companies that mine, transport or process frac sand.

In Wabasha, Minnesota, the City Council has also voted in favour of two frac sand mining moratoria. The move came following recommendations by the town’s planning commission after concerns were raised about heavy truck traffic.

Two already-established Wabasha frac sand operations transport sand through the community’s west side to a rail loading facility.

The first moratorium halts new frac sand operations and the second limits the existing operations to 30 heavy truck trips a day.

Illinois, which also contains significant frac sand resources, has been plagued with the same objections.

The city of St Charles saw opposition to frac sand mining in January as a group of concerned residents gathered in the public offices to ask the city board to immediately ban all frac sand mining, processing and transportation within the town.

The residents hope to block plans from Minnesota Proppants LLC for a 3m tpa frac sand processing and transportation facility in the city, as well as any other silica sand projects.

The council voted to take no action until information from the city’s planning and zoning board has been received. Officials will then review all regulations regarding mining operations in St Charles, it said.

Illinois has also faced local opposition to a frac sand mine under development by Mississippi Sand LLC.

Three environmental groups have launched a legal case against the state in response to the project, which has already been approved by state agencies to receive three permits to move forward with the mine.

Two of those permits have already been issued, but the third, from the state’s Environmental Protection Agency, has been approved but has not yet been issued.

A fracking future

Frac sand concerns do not stop at extraction, as a growing amount of opposition to the fracking process is also mounting - not only in the US, but across other areas of the world too.

However, due to the global requirement for new and less carbon intensive energy sources, governments around the world are expected to continue to promote the need for frac sand resources in order to supply the growing oilfield industry - as they are beginning to do in states such as Wisconsin.

It is expected that as environmental reports - like those being undertaken in Illinois and Minnesota - are published, further frac sand developments will go ahead, only adding to the growing list already present in Wisconsin.