FRAC SAND OVERPRODUCTION CRISIS
U.S. Silica cuts 10% of workforce as frac sand demand wanes

(Reuters) - U.S. Silica Holdings Inc said on Friday it had cut about 230 jobs, or 10% of its workforce, as demand for its frac sand comes under pressure from oil and gas producers reducing drilling in the backdrop of volatile prices.

The job cuts included employees impacted by idling of its two mines in Utica, Illinois and Tyler, Texas, the company said, adding that it expects to incur about $1.7 million in related severance costs in the fourth quarter of 2019.

Last month, U.S. Silica said it expects demand to slow down in the fourth quarter and reported a bigger-than-expected quarterly loss weighed down by lower prices.

Prices for the proppant used to crack the ground and extract oil have dropped in North America, as low oil prices and demands for higher investor returns stunted drilling activity.

The company had also forecast net sales and profits in its industrial business, which supplies sand to construction companies and glass manufacturers, to stay flat or rise marginally in 2020, hurt by trade tariffs and fears of a global slowdown.

“The difficult decisions announced today are an important element of our plan to protect margins and generate free cash flow in a.n increasingly competitive oil and gas completions market,” Chief Executive Officer Bryan Shinn said on Friday


Frac sand slump continues to sting industry
Sergio Chapa Nov. 22, 2019 

Frac sand suppliers have been hit by the slowdown in drilling activity.
Photo: Michael Ciaglo, Houston Chronicle / Staff photographer

Falling demand, abundant supplies, lower prices and and increased competition are hitting the frac sand industry as as it contends with a slowdown in the nation's shale oil and gas fields.

Katy sand products company U.S. Silica said Friday that it will idle two sand mines and cut 230 jobs, or about 10 percent of its workforce. With crude oil prices stubbornly stuck in the $50 to $60 per barrel range, many exploration and production companies are cutting back on their drilling and hydraulic fracturing operations.

Sand is a critical component of the horizontal drilling and hydraulic fracturing processes. It is mixed with water and chemicals and pumped into wells at high pressure to crack geological formations. The sand props open fissures that allow the oil and gas to flow into the well.

In a statement, U.S. Silica CEO Bryan Shinn said the job cuts and idled mines were difficult decisions. but necessary for the company’s survival.

"The actions taken realign our operational footprint and cost structure to more efficiently serve energy customers while simultaneously supporting the expected growth of our Industrials & Specialty Products segment,” Shinn said.

Shale Slump: Lower hydraulic fracturing activity stings frac sand business

In the early days of the shale revolution, most of the nation’s frac sand came from mines in Wisconsin and Minnesota, from where it was shipped by rail to regional depots, stored in silos and then hauled by 18-wheelers to drilling sites. Over the past three years, that business model has given way to lower mines near oil fields so sand could be hauled to drilling sites less than 100 miles away.

The crude oil price slump hit in Dec. 2018 just after several sand companies opened dozens of new mines in the Permian Basin of West Texas, the Eagle Ford Shale of South Texas and other shale plays across the United States.

Oil and gas companies have pulled more than 270 drilling rigs out of operation over the past year, pushing the U.S. rig count down by 25 percent, according to the Houston oil field services company Baker Hughes. Services companies, such as Halliburton of Houston, have cut the number of fracking crews and laid off workers.

Oil settled Friday at $57.77 in New York, down 81 cents.

During an Oct. 29 investors call, Shinn said the industry has a glut of 35 million tons of sand — driving down prices as companies compete for market share. He estimated that seven sand mines have closed and more will follow over the next several months.

As part of a plan to save $20 million a year, U.S. Silica is pairing its jobs cuts with plans to idle mines in Utica, Ill. and Tyler.. The company is reducing operations at other mines, including its Permian Basin mine in Crane County. The reductions are expected to take 7 million tons of frac sand off the market.

Following a $23 million loss on $362 million of revenue during the third quarter, the company is also looking to diversify by making a number of commercial and industrial products ranging from roofing materials to filters for blood and plasma.

Analysts say that market conditions for frac sand suppliers will get worse before they get better. James West, an analyst with the Houston investment research firm Evercore ISI, noted that U.S. Silica lowered its sand volumes guidance for the fourth quarterm expecting overall demand from the oil and natural gas industry to decline by 10 percent.

“The biggest questions everyone is trying to answer now are how much of a rebound will the industry experience when (oil and gas) budgets reset in the New Year and will it be a sharp pickup in activity or a slow grind until toward the end of the first quarter,” West wrore in a recent research note. “Slow grind is our view.”

Shares of U.S. Silica were down slightly, closing at $4.55 at the end of trading on Friday.

sergio.chapa@chron.com

Demand for Frac Sand and Concrete Drives Scarcity

By SHELLEY GOLDBERG June 25, 2019 INVESTOPEDIA

Despite appearances, we are running out of sand. While that might seem farfetched – sand is seemingly everywhere – there is not only a thriving international trade in the commodity, but it’s the second-most heavily exploited natural resource after water and, by volume, the most heavily extracted solid material in the world.

Like any commodity, sand requires uniformity. Uniform sand, or "aggregate," includes gravel, crushed stone and a number of recycled materials, such as crushed concrete, each of which has unique applications. Specialty sands also exist for industries such as golf, volleyball, sports fields, and playgrounds, as well as retail and technical services. Each has unique shape, size, hardness and color specifications.

From Playgrounds to Fracking Wells

Sand is formed by erosive processes over thousands of years and, according to a UN Environmental Program (UNEP) report, is being extracted far more quickly than it can be renewed. While the U.S. imports only about 1% of the total sand that it uses, according to the United States Geological Survey, developing countries like China and India have had to import significantly larger quantities to meet the demand created by recent construction booms. Sand's scarcity translates to price appreciation, which makes investing in sand compelling.The price of sand and gravel has increased dramatically over the last decade, from $7.06 per metric ton in 2007 to $8.80 in 2016. Specialty sands generate even higher prices: frac sand, which is used in the process of extracting oil through hydraulic fracturing, cost about $25 per tonne in 2017 but in times of short supply has climbed to $70 per tonne.

But investing in sand is challenging. Sand’s weight relative to its value makes it expensive and challenging to move and store. Investors are also unable to buy or sell futures contracts tied to sand, as they would with other commodities, such as soybeans or oil. As a result, investors interested in deepening their exposure to sand need to look to equity in companies associated with sand production.

Fueling Construction Growth

Conservative estimates place world sand consumption in excess of 40 billion tonnes a year, according to UNEP. That number is twice that of the annual amount of sediment carried by all of the rivers of the world, which means that mankind is the largest transforming agent in the world with respect to aggregates. Demand is asymmetric: Increasing demand is predominantly tied to urban growth in Asia, though it is worth noting that information on global sand consumption, particularly in emerging and frontier markets, is scarce.

Aggregate is the main constituent of both concrete and asphalt. It is also the primary foundation for building roads, parking lots and runways, homes, buildings and landscapes. According to the U.S. Geological Survey, for each metric tonne of cement used, the construction industry needs about six to seven times more tonnes of sand and gravel.

China produces over half the world’s cement, an estimated 2.41 billion metric tons (BMT) in 2017. Global cement production is expected to increase from 3.27 BMT in 2010 to 4.83 BMT in 2030.

Frac Sand Boom and Bust

Energy Exploration and Production (E&P) also consumes vast quantities of sand, mostly due to its use as a primary proppant in hydraulic fracturing. Proppants are mixed with a liquid to keep fracking wells open and facilitate the removal of oil and natural gas. For scale, individual fracking wells often use seven million pounds of sand, with some requiring up to three times as much. Wells have grown longer and wider since modern-day hydraulic fracking came about in the 1990s.

Frac sand suppliers are highly fragmented, with some 50 producers globally. In addition to energy producers themselves, frac sand suppliers were among the hardest hit by the shale oil bust beginning mid-2014, as drilling activity plummeted. Major oil and gas producers saw their market halve, but the carnage among sand suppliers was worse. With the steep decline in rig counts, sand suppliers like Emerge Energy Services (EMES) and Hi-Crush Partners (HCLP) saw their stock prices depreciate more than 90% from their 2014 highs.

But by 2016, the U.S. frac sand market heated up, even as oil prices remained depressed, due to the increasing size of wells. Producers also increased the number of fractured stages per well, which fueled a boom in the amount of sand used to drill. As U.S. crude continues to recover in price, coupled with high demand for U.S. natural gas, frac sand demand should continue to surge.

Among those producers that are publicly traded, is U.S. Silica Holdings (SLCA) the largest pure-play fracking sand provider. Fairmount Santrol Holdings (FMSA) also has a significant business line supplying for foundry, building products, water filtration, glass, and recreation markets. Hi-Crush Partners and Emerge Energy Services are structured as master limited partnerships. EOG Resources (EOG) is a large producer but uses all of the sand it mines in its own wells.

The barriers to entry for frac sand producers are high. Not only does it take time, expertise and capital to build a new mine, but it’s also difficult to time the market exactly. Furthermore, there can be supply limitations due to infrastructure or shipping constraints.

Environmental issues are also a concern. Sand extraction lowers water tables and decreases sediment supply, resulting in the destruction of ecosystems like fisheries. Sand extraction has also been linked to inland and coastal land loss, water contamination, and river embankment and coastal infrastructure damage.

Limits on Infrastructure Development 

Furthermore, the planned expansion of infrastructure in many parts of the world is more ambitious than had previously been estimated. India's current $120 billion building boom making has placed sand in such high demand that illegal mining has engendered a sand mafia. Saudi Arabia, which already made headlines for importing sand despite its desert locale, announced a plan to build Neom, a $500 billion mega-city spanning 10,230 square miles.

Sand mining and dredging have been largely ignored by policymakers. But as climate change's ramifications on coastal cities become more evident, this too will likely change. Today, in the U.S., the fastest-growing use of sand includes fortifying shorelines eroded from rising sea levels and increasingly powerful ocean storms, particularly after recent powerful hurricanes. Inland uses include temporary sand dams and sandbag installations to protect residents and property from surging lakes and rivers, as well as mudslides, like those that impacted California in 2018.

While sand substitutes exist, they are expensive. Increasingly, producers have begun to turn to recycled asphalt and cement, although comparative usage is quite small.

In addition to producers, investors looking to make a play on sand could look into dredging companies and dredging/blasting equipment manufacturers, given recent advancements in robotic crushing technologies. For investors concerned about the long-term effects of a sand shortage, glassmakers (windows, glassware and cell phone screens), water filtration, septic systems, swimming pools, solar panels, and wind turbine manufacturers all rely on the material. Sand is used in the railroad industry, as well as for molds in foundries that make everything from airplane and cruise missile parts to artificial hips.

Frac Sand Mining

Hydraulic fracturing uses high pressure water to break open underground geologic formations – most commonly shale. – containing oil and gas.

Once the shale is fractured, if the fractures are not propped open, they will close again.

So frackers use frack sand to prop open the fractures to allow the oil and gas to be extracted.

They use a lot of sand:, up to 10,000 tons of sand per well.

Frack “sand” is actually tiny pieces of quartz- silicon dioxide (SiO2) also known as silica sand. It is not garden variety sand found in your kids sandbox. Because it is special, it is found in only a few places. In the United States, that currently means in the Midwest near the Great Lakes. The Southeast corner of Minnesota and neighboring Wisconsin contain vast deposits of the most desirable highly spherical sand close to the surface.

Alternatives to sand include the use of manufactured ceramic beads and even hemp. Some drillers in western Colorado’s Piceance Basin have experimented with sandless fracking in more naturally brittle formations where the broken portions of shale can themselves act as a proppant.

Overburden Removal

Before mining for frack sand, operators must remove “overburden” – topsoil or subsoil overtop the sand that is mainly composed of clay, silt, loam, or combinations of the three.

Removing the overburden requires scrapers or tracked excavators. After removal, the operator stockpiles the material in man-made earth mounds called berms. These berms can serve as light and noise barriers between the mine and nearby communities.

Excavation

After peeling away and storing the overburden, the operator then must excavate the sand. Excavation may require blasting; depending upon how tightly cemented the target silicates reside within the geological formation.
Processing

In order for the frack sand to effectively hold open the formation fissures, it must have a fairly uniform hardness and shape. To achieve this uniformity, the silicates must undergo further processing at a plant:
Washing — which involves high pressure spraying of water and dangerous chemicals on to the sand that often leaches in to the ground;
Drying — depositing the sand in to large rotating drums fed by hot air, powered by either combustion or natural gas;
Screening and sorting — sorting allows the operator to capture the sands suitable for fracking and dispose or sell the sands better suited for other purposes.

For More Information
EARTHblog Frack Sand Mining Doesn't Just Suck, It Blows
EARTHblog Where do you think the fracking sand comes from?
EARTHblog Minnesotans Declare Independence from Frac Sand Land
MPR News Wisconsin Sen. Vinehout proposes legislation to control frac sand mining
Minnesota DNR Industrial Silica Sand
Allamakee County Protectors Grassroots Iowa Group
Sandpoint Times Grassroots Minnesota Group
WBEZ Behind the fracking boom, a sand mining rush
Journal Sentinel Wisconsin attorney general levies fine against sand mining company, Dec. 16, 2013
Wisconsin Center for Investigative Journalism Frac sand mines credited for rising, dropping property values March 30, 2014

SEE  https://plawiuk.blogspot.com/search?q=FRAC

SEE  https://plawiuk.blogspot.com/search?q=FRACKING

SEE  https://plawiuk.blogspot.com/search?q=SAND

SEE  https://plawiuk.blogspot.com/search?q=FRAC+SAND

What is frac sand?  

Frac sand is a type of sand with small, uniform particles. It is injected into the rock formation along with the water used to fracture the rock in the process known as hydraulic fracturing ("fracking"). The sand is used to prop open the fractures that are created. Because the particles are uniform, fluids like water, oil, and gas are able to flow through the spaces between the particles. Frac sand is currently mined in a range of states, with the Great Lakes Region, consisting of Illinois, Minnesota, Michigan, and Wisconsin, contributing approximately 70% of the silica sand used in America as a proppant in 2014.

Learn More 

Mining: Frac Sand (Webpage), Wisconsin Geological Survey
A short overview of frac sand, where it is found, and how it is mined, with links to other resources.
Frac Sand in the United States (Report), U.S. Geological Survey
A geological and industry overview of frac sand mining in the U.S.
DNR and Silica Sand (Webpage and Map), Minnesota Department of Natural Resources
Webpage on frac sand mining in Minnesota, with information on relevant legislation, answers to frequently asked questions about frac sand, and a map of sand mines in Minnesota.




Frac Sand Health and Environmental Impacts

Sand is critical to fracking. After workers drill down into rock, they create fractures by pumping in a mixture of water, chemicals and sand. The sand keeps the cracks propped open so that oil and gas are released.

Frac sand mining creates significant air pollution from the handling, mining, and processing of the sand. The important sources of air emissions come from the tiny dust particles – known as particulate matter – scattered during mining and processing.

These tiny dust particles, usually only a few microns in diameter, when inhaled in the lungs can lead to Silicosis – cancer of the lungs that poses a danger to miners and nearby communities.

Frac sand linked to lung disease in workers

The chronic silicosis caused by silica exposure poses unique dangers for employees working at frac sand mining sites. Because long-term exposure can be fatal, the Labor Department’s Occupational Safety and Health Administration (OSHA) issued draft regulations designed to reduce the health risk and previously issued a hazard alert.

Sand is basically silica — and breathing in silica is one of the oldest known workplace dangers. Inside the lungs, exposure to the tiny particles has been shown to sometimes lead to serious lung diseases like silicosis and lung cancer.

Workplace safety expert Eric Esswein and his team visited 11 fracking sites in five states: Arkansas, Colorado, North Dakota, Pennsylvania and Texas. At every site, the researchers found high levels of silica in the air. It turned out that 79 percent of the collected samples exceeded the recommended exposure limit set by the National Institute for Occupational Safety and Health.

There were some controls in place, says Esswein, who notes that “at every site that we went to, workers wore respirators.”

But about a third of the air samples they collected had such high levels of silica, that the type of respirators typically worn wouldn't offer enough protection.

Neighbors fear for their health

Wisconsinites and Minnesotans (the two states producing most of the frac sand) who live around frac sand mining, processing and transportation facilities are concerned about the long term impacts of their exposure to silica dust.

As a result, some local governments have enacted bans and moratoria.

Mining puts water at risk

Frac sand processing also poses dangers to water sources. Miners commonly use chemicals called flocculants to clean, wash, or remove unwanted minerals or other fine particles from the processed sand. These chemicals can infiltrate in to groundwater after washing.

Long term exposure to common flocculants like polyacrylamides and acrylamides in high concentrations of drinking water can lead to nervous system, blood problems or increased risk of cancer.

Neither the federal nor state governments have developed drinking water standards for flocculants.

For More Information

EARTHblog Frack sand mining doesn't just suck, it blows

EARTHblog In Frac Sand Land, Residents Have Little Protection Against Silica Dust Exposure

NPR Sand From Fracking Could Pose Lung Disease Risk To Workers

OSHA Worker Exposure to Silica during Hydraulic Fracturing

Price of Sand Film

CDC Silica

Civil Society Institute Communities At Risk: Frac Sand Mining in the Upper Midwest


What is Frac Sand?

Frac sand is a high-purity quartz sand with very round grains. It is very durable and provides a crush-resistant material used in the oil and gas industry for hydraulic fracturing (also called “fracking). Rock units composed of quartz grains that have gone through multiple cycles of weathering and erosion are potential sources of frac sand material. This evolution has removed most mineral grains other than quartz resulting in grains with very round shapes.

The demand for frac sand has risen dramatically in recent years as an increasing number of oil and natural gas wells use the hydraulic fracturing process. A single well using hydraulic fracturing can use a few thousand tons of frac sand. The surge of specialized drilling has created a billion dollar frac sand industry in just a few years.
How Frac Sand is Used

Some subsurface rock contains large amounts of oil, natural gas, or natural gas liquids that cannot flow freely to a well because the rock is impermeable to the degree that the fluids cannot flow through them. The fracking process presents a solution by creating fractures in the rock.

This is accomplished by drilling a well into the rock and sealing the portion of the well in the petroleum-bearing zone. Water treated with chemicals and thickeners to create a viscous gel is then pumped into that portion of the well using a high pressure process. The gel facilitates the water’s ability to carry grains of frac sand in a suspended state.

Large pumps at the surface increase water pressure in the sealed portion of the well until pressure is sufficient to fracture surrounding rocks. Water rushes rapidly through the fractures, making them larger and pushing them deeper into the rock. Because billions of sand grains are pushed deep into the fractures, it can take several thousand tons of frac sand to stimulate a single well.

Why Frac Sand Makes a Good Proppant

After the surface pumps are turned off, the fractures contract but do not close completely because they are propped open by billions of grains of frac sand. This occurs when there is sufficient sand remaining in the rock to resist the force of the closing fractures.

Frac sand is known as a “proppant” because it props the fractures open by forming a network of pore spaces that allow petroleum fluids to flow out of the rock and into the well. Although there are other types of proppants available, depending on the type of well, frac sand often delivers the highest performance.

Characteristics of High Quality Frac Sand

Proppants used in the petroleum industry must meet very demanding specifications. The typical characteristics of high quality frac sand include:

high-purity silica sand

a grain size that is perfectly matched to job requirements

a round shape that allows it to be carried in hydraulic fracturing fluid with little turbulence
durability to resist the crushing forces of closing fractures

Frac sand comes in various sizes. It can be as small as 0.1 millimeter in diameter to over 2 millimeters in diameter. Most frac sand used in the oil and gas industry is between 0.4 and 0.8 millimeters in size. 

Understand the frac sand mining process - YouTube

▶ 2:34
- Uploaded by WKBT TV Frac sand mining is the mining of sand that is used in the fracking process to get oil and natural gas out of the

SEE  https://plawiuk.blogspot.com/search?q=FRAC

SEE  https://plawiuk.blogspot.com/search?q=FRACKING

SEE  https://plawiuk.blogspot.com/search?q=SAND

SEE  https://plawiuk.blogspot.com/search?q=FRAC+SAND

How Fracking’s Appetite for Sand Is Devouring Rural Communities

PHOTO ESSAY / FIELD NOTES

How Fracking’s Appetite for Sand Is Devouring Rural Communities

Small towns in western Wisconsin are being divided by a little-known mining boom. An anthropologist who lives in the region set out to understand why.


THOMAS W. PEARSON / 4 MAY 2018

View Slideshow1 of 8 Photos

Thomas W. Pearson is a professor of cultural anthropology 

 at the University of Wisconsin, Stout.

“Do you want to see the mine?” asks Harlan*.

“Of course,” I reply.

He fetches his boots. We head outside with his wife Edith and follow a row of fledgling soybeans as we stroll across a few acres of farmland.

It’s June 2014, and I’m in Dovre, a rural community in western Wisconsin where farm fields hug tree-covered hills and cattle graze lazily in the afternoon sun. A wooden 19th-century Lutheran church sits at the center of town, along with a one-room town hall.

Harlan and Edith spent most of their lives as dairy farmers in this once tight-knit community, just the two of them and around 40 cows. As we walk, they reminisce proudly about a life rooted in hard work and strong communal ties. Their view of community includes neighbors, but also something more, a commitment to reciprocity that entails a give-and-take between people, animals, and the land.

“We took care of the cows,” says Harlan, “and the cows took care of us.”

They speak fondly about the lifetime of labor they invested in their farm, putting up the barn, the silos, the shed, the milk house. They talk about maintaining the soil and managing the woods. Each hill, each of the surrounding farms, has its own story.

But now sand mines are erasing those stories—“putting the land blank,” as Harlan says.

Nearing retirement in the early 2000s, Harlan and Edith sold much of their property to another farmer and then built a house on a hill nearby, where they could look out at the land they passed on to its next steward. For people like Harlan and Edith, you don’t actually own land. You just care for it until you move on, a cycle they assumed would continue. Several years into their retirement, however, the other farmer sold the land to an out-of-state mining company and then left town.

We reach the end of the field and push through some brush, emerging at the edge of the mine—a 20-foot drop into a flat moonscape that covers about 120 acres, half of it curving around a hill and out of view. Harlan looks grief-stricken as he stares intently into the massive pit containing a unique treasure: pure silica sand. An excavator scoops loads of it into a dump truck.

The land erased. A community frayed.

Much of Harlan and Edith’s former farm in Dovre, Wisconsin, has been ripped open by sand mining. Another mine cuts into a distant hillside. Thomas W. Pearson

“Well, let’s put it this way,” explains Harlan. “Everybody that I know around here that sold to the companies moved out, so that should tell you something. And right now, we’re surrounded, and it just makes you feel like they’re squeezing you too.”

The mining company has visited Harlan and Edith several times, but they prefer to hold out. “They keep coming over,” says Edith, “and we’d both like to see it farmland. But how long can we hang on?”

Phrases such as “being squeezed” and “hanging on” allow Harlan and Edith to express a type of loss, even trauma, that is both individual and collective. They watch mining transform the landscape and feel alienated from a place that had once anchored their sense of belonging. They are not alone.

Over the past decade, the push to expand fossil fuel production in the United States through techniques such as hydraulic fracturing (commonly known as “fracking”) has reverberated far beyond oil rigs, pipeline routes, and petrochemical complexes, pulsating unexpectedly through communities like Dovre.

Fracking involves drilling deep into underground rock formations to release natural gas or oil. And it uses sand. Lots of it. Sand props open tiny fissures in the bedrock that are created during the fracking process, but not just any sand will do the trick. Highly pure silica sand is especially strong and resists being crushed thousands of feet below the surface. Round sand grains of consistent size allow hydrocarbons to flow more efficiently through the well.

During fracking, just one well can require several thousand tons of sand. To put that into perspective, industry forecasters predict that more than 100,000 new wells will be drilled over the next several years in Texas’ Permian Basin alone. But fracking is not limited to Texas. The last decade has also seen drilling booms in Pennsylvania, North Dakota, Wyoming, and Alberta, Canada, among other places. Last year nearly 70 million tons of sand was mined in the United States for fracking.

Landsat images from a USGS/NASA time-lapse video show landscape changes over the past 32 years in Barron County, Wisconsin. Several frac sand operations are clustered in Dovre (on the right), with two in neighboring Sioux Creek to the west (left). Landsat/Google Earth Engine

It just so happens that Wisconsin is uniquely positioned to supply fracking rigs in North America with some of the best sand available. Deposits of silica sand that formed some 500 million years ago are concentrated in western Wisconsin. While sand mining also occurs in Texas, Arizona, and Oklahoma, among other states, Wisconsin’s sand is especially prized for its strength and purity. It’s also close to the surface, so digging it up is relatively easy. And profitable.

Since the mid-2000s, the growth of fracking has powered a booming frac sand mining industry in western Wisconsin, with hundreds of operations cropping up across the countryside. Some people clearly benefit. Lucky landowners may see a windfall in selling or leasing to a mining company, and others may find work at mining operations or by driving trucks. Down the line, consumers enjoy cheap fuel. But at what cost?

Frac sand mining disturbs once-quiet rural towns with blasting, truck traffic, and industrial activity. It generates new environmental health risks, and some residents worry they are being exposed to microscopic particles of airborne silica dust that cause silicosis, an often fatal lung disease. Mining also flattens hills and alters scenic bluffs, disrupting not only a picturesque rural landscape but places that are deeply meaningful to people. Perhaps most significantly, the mining boom in communities like Dovre has fomented division and distrust as residents grapple with a resource boom that brings both wealth and ruin.

As the geographer Gavin Bridge writes, “One person’s discovery is another’s dispossession.”

Dispossessing people of resources or land is one thing, but the disruption caused by mining is commonly expressed as a form of assault—a kind of violence not only against the land but also people’s relationship to it. Residents often struggle to convey their emotions, drawing on images of invasion, illness, and violence, describing the hills as “cut open,” “disfigured,” or “scarred” by mining.

“No one invited the pillaging hordes of Genghis Khan either,” stated one resident in a letter to a local newspaper as she compared out-of-state mining companies to an occupying army. “Let’s prevent the cancer,” wrote another man, relating mining development to the metastatic spread of a life-threatening disease. “When they mine this, they rape this land,” a man told me, his gaze as empty as the pit being dug across the street from his home. “I don’t know any other word to use but ‘rape.’”

It’s not just retired farmers like Harlan and Edith who grapple with this kind of dispossession. Joe and Nancy moved to rural Wisconsin after living their entire lives in a large Midwestern city. The countryside represented a sanctuary from the grind of city life. Several years after they resettled, however, a neighbor sold a parcel of his land to a mining company. When the mining started, says Joe, it was like getting “smacked in the head with a two-by-four.” In addition to noise and dust, the pain was psychological, he remembers.

“The first year they were here,” Joe explains, “I’d go out and walk the dog in the morning … then I’d go sit in the basement. I felt like I was in solitary confinement, in jail. I mean, I gained weight anyhow [after retirement], but I gained a hell of a lot more weight then. I didn’t want to go outside. I was sick. Your life is just turned upside down.”

Lisa’s life has similarly been upended. Several years ago, two frac sand mines opened within a mile of her home and the barn where she boards several horses. Trucks drive by all day long. A processing plant runs nonstop, loading railcars by the thousands. She constantly deals with noise, vibration, and interrupted sleep, and she worries about possible exposure to silica dust. 

Frac sand mining generates silica dust, which is hazardous when inhaled. One of the mines in Dovre has installed air monitors in an effort to measure the impacts of mining on air quality. Thomas W. Pearson

“I’m told I’m exaggerating when I talk about the sheer dust that’s in this house. In the middle of summer, I can start [dusting] on this end,” she says, pointing to one side of her kitchen, “and by the time I get to this end, there’s a layer of dust on that countertop.”

She has complained to local officials, but as she sees it, they support the mining industry and have downplayed her concerns. “I’m told that I’m lying, that I’m ridiculous, I’m exaggerating, I’m crazy.”

Uncertainty about the nature of the dust is a source of continual anxiety. She feels unsafe in her own home and abandoned by elected officials who she thought were supposed to watch out for her well-being.

To truly grasp her experience, it is important to recognize that people in the United States associate certain meanings with the idea of home: order, security, investment in the future. Mining may disrupt these expectations, leaving people feeling extremely vulnerable, if not hopeless.

It makes sense that some residents would prefer to live elsewhere. But leaving one’s home also brings with it complex feelings of loss.

Heidi says she felt “empty” when she sold her 19th-century farmhouse after multiple mining operations were permitted to operate nearby. The mining company bought her out so that they wouldn’t have to deal with a frustrated, outspoken resident living next door. She accepted the buyout, her one chance to “escape,” as she puts it. Others were “not so lucky,” she says, and she struggles with the guilt of leaving friends and neighbors behind.

While she elected to sell her home to a mining company, it was a choice constrained by circumstance. Her only other option, she says, would have been “to grow old and be some pissy old woman sitting in the middle of the driveway yelling at all the trucks going by. I would’ve lost everything.”

“It was very traumatizing,” explains Heidi, “to feel pushed out of our home.”

The sense of loss expressed by some people in Dovre extends beyond feelings of vulnerability or the trauma of relocation. Like Harlan and Edith, some lose connections to places that were once immensely meaningful—that were part of them.

Marleen has lived in Dovre for over 80 years. Historical photos of her farm, which her grandfather purchased in the 1890s, hang prominently in her living room. When hosting visitors, she likes to thumb through photo albums and tell stories about family and friends. Her husband was laid to rest in the cemetery next to the Lutheran church.

For Marleen, memories are etched into the rural landscape, a genealogy of kin ties linking past to present. These ties transcend her own property. Her grandfather, for instance, worked on a different farm up the road when he first arrived from Norway—one that is now being mined for sand. In fact, it is the same land that Harlan and Edith once owned.

“And I [had] always felt good about that,” Marleen says mournfully, “that I could go up there, and I was actually stepping on soil where my grandfather lived.”

Now the hills are gone, replaced by “pyramids of sand,” she scoffs. These are the stockpiles at a nearby processing plant being readied for shipment to the drilling rigs.

The land has been put blank.

“It’s sickening, just sickening,” says Marleen. “I wish it was like a dream, and you wake up and it was a dream and it didn’t happen.”

*Pseudonyms have been used to protect the identities of people interviewed in Dovre over the course of the author’s research.

**Editors’ note: People and places described in this essay are further discussed in the author’s book, When the Hills Are Gone: Frac Sand Mining and the Struggle for Community, and his article in the journal Human Organization.  

In west-central Wisconsin, frac sand mines struggle amid industry changes
Eric Lindquist Eau Claire Leader-Telegram
Jun 25, 2019

In this Thursday, Dec. 15, 2011 photo, frac sand destined for the oil and

 gas fields piles up at the EOG Resources Inc. processing plant in Chippewa Falls.

STEVE KARNOWSKI, Associated Press
A relatively new industry to west-central Wisconsin continues to give area residents a modern-day lesson in old-fashioned economics.

The regional frac sand industry, which burst onto the scene about a decade ago, already has gone through at least two boom-and-bust cycles and is in the midst of a bust that has idled several mines.

The source of the strife comes down to the basic economic principle of supply and demand.

While demand for frac sand remains strong, the supply has expanded dramatically in the last two years as energy companies have built a number of mines closer to oilfields in Texas and Oklahoma, said UW-Eau Claire geology professor Kent Syverson, who also serves as a consultant for the frac sand industry. The production expansion has pushed down prices and enabled oil drillers to get local sand for less than the cost of shipping it from Wisconsin.

“I think the boom years are over,” Syverson said, referring to the period from 2011 to 2014 when sand mines, processing plants and rail loading facilities were popping up like dandelions across west-central Wisconsin to take advantage of the region’s silica sand reserves.

“The capital has already been invested in Wisconsin,” he said, “so the real questions are how much of this sand will still be needed and how many of these higher-cost operations that are taken off line will never come back.”

Ryan Carbrey, senior vice president of shale research for Rystad Energy in Houston, said Upper Midwest mines with annual capacity of 18 million tons of frac sand already have been idled this year, and his company projects that total will rise to 30 million tons by the end of 2019.

The vast majority of the mines producing what is known in the industry as northern white sand are in Wisconsin, with the bulk of them located within 80 miles of Eau Claire.

The sand is used in hydraulic fracturing — the drilling technique commonly known as fracking that involves injecting a mixture of sand, water and chemicals deep into underground wells to force oil and natural gas to the surface. The sand is used to hold open fissures in the rock.

Northern white sand, prized by fracking companies for its coarseness, durability and the spherical shape of its grains, is still considered to be of higher quality than the sand produced in Texas, but producers have developed methods to make the lower-quality sand work well enough to satisfy their needs, Carbrey said.

Most importantly to producers, the Texas sand is cheaper because it doesn’t have to be shipped more than 1,000 miles by rail from Wisconsin to the oil and gas deposits in the Permian Basin in west Texas and southeast New Mexico.

“Wisconsin sand is still the Cadillac of all sands, but these companies in the Permian Basin are saying they can make more money driving a Chevy than a Cadillac,” Syverson said. “It’s all a cost-benefit analysis.”

As a result, demand has dramatically increased for the finer grain sand, which is much more plentiful than northern white sand, he said.

“The demand structure has flipped, and it appears right now that the industry has moved toward the finer sand and it’s hard to imagine that going back,” Syverson said. “It was just kind of mind-blowing to have this seismic shift from coarser to finer grain sand in just a couple years.”

All of this is important, Carbrey said, because the Permian Basin accounts for about half of the nation’s shale energy production. He added that the relatively new west Texas mines already have the capacity to produce more than 70 million tons of frac sand per year.

Region hit hard

The impact of the demand shift is evident across west-central Wisconsin, with once-booming sand mining and processing facilities sitting dormant.

Superior Silica Sands has idled three of its five frac sand mines in Chippewa and Barron counties, said Sharon Macek, the company’s manager of mine planning and industrial relations in Wisconsin. Superior Silica is still producing sand at a mine near Chetek and one in the Barron County town of Arland, and its dry plant near Barron is fully operational.

Emerge Energy Services, which owns Superior Silica, entered into a debt restructuring deal with its lenders in April, so company officials can’t comment further on operations at this time, Macek said.

Covia, created by a merger of Fairmount Santrol and Unimin, announced in a filing with the Securities and Exchange Commission that it was idling operations in Maiden Rock as well as several mines across the country.

A company spokesman also confirmed Covia has reduced production at its mine in Menomonie.

Hi-Crush idled its Whitehall frac sand production facility in September but then announced early this year it was resuming operations at the Whitehall mine and halting production at its facility in Augusta. The Houston-based company said its Augusta workforce would be moving to the Whitehall plant, which is about 30 miles away.

The decisions were based on increased demand from oil and gas industry customers, predominantly in the Northeast, that are more efficiently served by Hi-Crush’s Blair and Whitehall facilities located on the Canadian National Railway, CEO Robert Rasmus said in a news release. Hi-Crush was the first sand company to establish a mine in the Permian Basin.A company spokesman said Hi-Crush mines in Blair, Whitehall and Wyeville are fully operational and that the firm’s Wisconsin employment is down about 9 percent this year, with about about half of the decline resulting from attrition.

The Augusta facility remains dormant, Mayor Delton Thorson said Thursday.

“They’ve got a lot of investment here, so it’s hard to imagine this shutdown will be permanent, but if they have sand sources closer to the oil fields, you can understand why they would go there to get it,” Thorson said. “My guess is that sooner or later the wheel will spin back to here.”

Outlook unclear

Samir Nangia, director of energy consulting at analytics firm IHS Markit, told Wisconsin Public Radio last month that as much as 75 percent of Wisconsin sand mines might need to be closed temporarily or even permanently. Nangia couldn’t be reached last week for further comment.

Carbrey offered a glimmer of hope for Wisconsin frac sand producers by pointing out that other major shale energy deposits in North Dakota and Pennsylvania continue to rely on northern white sand.

“In those regions, there’s not really much good local sand,” he said.

Despite the major shift to using sand found closer to oil fields, the long-term outlook is unclear because the finer sand leads to wells in which production declines faster than those using northern white sand.

“It is cheaper, but it doesn’t produce as high quality of a well,” Carbrey said. “No one really know yet if in-basin sands provide positive economic value. We really don’t know how it will all shake out.”

Frac Sand Mining

SIERRA CLUB WISCONSIN

Hydraulic fracturing, or “fracking,” is the controversial practice of extracting fossil fuels from hard-to-reach shale deposits. In this process, fossil fuel corporations force these underground shale rock formations to crack and split open by blasting them with a mixture of highly pressurized water, high quality sands, and toxic substances, unleashing massive quantities of natural gas and oil. The sand helps to prop these fissures open so the fossil fuels can be released and captured. As a result, waste material often seeps into groundwater, or is collected and then injected back into the ground using waste disposal wells. While not a new development, the amount of fracking has dramatically accelerated in recent years.

This process pollutes our air and water and can even lead to induced earthquakes and flammable tap water (check out this video of a woman taking a match to her kitchen faucet). It also unleashes methane, a greenhouse gas that is 30 times as potent as carbon dioxide, into the atmosphere — contributing to climate change and reinforcing our dependence on fossil fuels, delaying the urgently necessary transition to renewable energy sources. Luckily, Wisconsin doesn’t have any known natural gas deposits, so we have been spared from the immediate harms of fracking. But our state does have an indirect — yet important — connection to this destructive industry…

What is frac sand mining?

Western Wisconsin has beautiful rolling hills and scenic bluffs that stretch from the banks of the Mississippi River into the central part of our state. Beyond their aesthetic appeal and intrinsic value, they facilitate hiking and other recreational activities as well as provide habitats for many species of native flora and fauna. But for the fracking industry, these bluffs are important for just one thing — high quality sand.

Fracking requires a steady supply of special silica sand with grains of ideal size, shape, strength, and purity — called frac sand. And fracking necessitates enormous quantities of it; in fact, each natural gas or oil well uses millions of pounds of this sand in its lifetime. Because so much sand is needed, frac sand mining — the process of extracting the sand from the earth — has developed to satisfy the surging demand.

In a lot of places, this sand is rare. Unfortunately for us, the majestic bluffs that have enhanced the beauty of our state’s western landscape for millennia contain the ideal type of sand needed for fracking. And the fossil fuel industry and mining corporations have figured it out.

The Sand Rush

The boom in natural gas and fracking has triggered a subsequent “sand rush” in western Wisconsin, causing mining corporations to scramble to supply natural gas wells with a necessary ingredient. Wisconsin now has 128 industrial sand facilities, including mines, processing plants, and rail load-outs.

To extract this sand, mining companies use open pit and hilltop removal mining, which destroys landscapes, poisons our environment, and harms quality of life. Enormous tracts of land are cleared of all greenery, and then the “overburden” — which is what miners call all of the soil and life that exists above whatever mineral they are extracting — is excavated using heavy machinery and explosives. And as the name suggests, hilltop removal mining involves literally destroying entire hills and bluffs.

Because the sand is actually in rock form, it must be pulverized and then washed, to remove any impurities. The waste materials are then collected in vast pools of sludge, while the purified frac sand is stored in large piles awaiting transportation to natural gas and oil wells.
Why is frac sand mining bad for Wisconsin?

1) It’s environmentally destructive. Frac sand mining requires clearing land of forests, grasslands, meadows, and wetlands, eliminating valuable ecosystems and habitats. But it also generates alarming levels of air and water pollution. The mining process, especially the excavation and pulverization steps, release silica dust — a known carcinogen that causes lung cancer — into the air. Long term low level exposure can also cause silicosis, which is debilitating, incurable, and often fatal, as well as other respiratory diseases, meaning miners and people living near the mines are at risk. In one study, 79 percent of air samples at frac sand sites revealed levels of silica dust over the exposure limit, and a third were so high that most respirators wouldn’t be capable of removing it

from the air. But it’s not just the air — water is affected too. These mines contaminate local waterways with toxic substances like heavy metals and polyacrylamide, and there have been several cases of waste liquid spills, including one that released 10 million gallons of waste into tributaries of the Trempealeau River — leading to dangerous levels of heavy metals in the water. Additionally, frac sand mining requires immense quantities of water, contributing to water overuse and waste. In fact, just one mine can demand up to 2 million gallons of water a day. Finally, these mines increase noise and light pollution; some residents in Trempealeau County said they can’t even open their windows due to “constant noise and light.”

2) It enables fracking. As previously discussed, fracking for natural gas and oil is incredibly detrimental to the environment and generates a litany of social ills — from poisoning our air and water with harmful pollutants and carcinogens to exacerbating climate change to even inducing earthquakes. Basically, there is no safe amount of fracking, and the practice needs to come to an immediate halt if we want to protect both local communities and the planet as a whole. Because frac sand mining provides the necessary ingredients that fuel this destructive process, these frac sands mines act as accomplices to the fossil fuel industry and help perpetuate this unjust and degrading system.

3) It leads to volatile boom-and-bust cycles that spell disaster for local economies. At first, frac sand mines might appear to be beneficial to the economy, as they hire workers and generate economic activity. But this activity is unsustainable and often disconnected with the rest of the local economy, meaning much of the money generated through the mining process does little to benefit Wisconsin’s communities and makes the economy less diversified and more vulnerable to the wild fluctuations of the sand market. And the uncertain and unstable jobs that are actually provided make up just a small fraction of the total employment in the region and can actually displace more sustainable and socially beneficial jobs. Plus, technological improvements mean less and

less workers are hired as the years go on, and more profits are hoarded by the executives and corporations that own the mines. And the boom years are often short-lived; already, Wisconsin frac sand mines are going idle or bankrupt and laying off workers as the market becomes oversaturated with too much sand. More profitable mines selling cheaper sand closer to oil and gas wells are also opening up in Texas and New Mexico, outcompeting these Wisconsin mines and causing their market share to plummet. Regardless of the competition, frac sands mining, because it relies on depleting the earth’s finite resources, is inevitably unsustainable and inescapably a short-term endeavor. And this isn’t the first downturn for the nascent industry — 2016 also saw mine closures and layoffs. What this means is that frac sand jobs are notoriously insecure and precarious: once the mine folds, the jobs disappear and all that remains is the environmental devastation, the harmful health consequences, the higher carbon emissions, and the deep scars on Wisconsin’s landscape.
What can we do to stop frac sand mining?

Local activists are turning people out to public hearings, questioning the mining companies and educating people in the area about the dangers that exist, and they’ve had some success in preventing some of the harms that these mines inflict on the state. Unfortunately, however, once one mine is stopped, the companies just pop up with a new mine in the next town over, evading laws and exploiting new localities inexperienced at dealing with these manipulative mining corporations.

The one action that has had some success in blocking new frac sand mines are moratoriums. Towns, cities, and counties have established short-term moratoriums in order to better study the impacts of mining proposals. As expected, though, sand mine companies have actively fought against these moratoriums. For example, High Country Sand sued Eau Claire County after the county established a moratorium on the company’s proposed mine. Worse, in the last days of the legislative session, the legislature passed 2011 Wisconsin Act 144. The law makes it far more difficult for cities, towns, and villages to establish development moratorium ordinances, effectively blocking local communities from creating moratoriums.

Therefore, we need to enact a statewide moratorium on new frac sand mines in Wisconsin, at least until the state conducts a comprehensive study of the impacts, and we need stronger regulations to protect public health, local communities, and sensitive habitats from the degradation that results from the rapid proliferation of these inherently unsustainable mines.

The mining companies claim they are bringing jobs into the area, and we do need jobs. But these are insecure and short-term jobs that only employ a small fraction of the population. There are better ways to create real, sustainable jobs.

If you’d like to help us in our fight against these frac sand mining companies and protect Wisconsin, please volunteer with us!



The Permian Rush Is Creating A Frac Sand Shortage 

By Julianne Geiger - Jul 18, 2018 OILPRICE

The ‘mega-frac’ is turning the typically annoying sand of West Texas into the new gold, and the oil and gas land rush on the Permian Basin has now extended into the dry, gritty sand that only a year ago few would have given a second thought.

While most are busy watching all land grabs by oil and gas producers in the Permian, much less attention has been paid to the secondary land rush for the sandy wasteland that could ease some of the bottlenecks for producers who need frac sand to make anything happen.

Now as some herald a new phase of deal-making and consolidation following the Permian oil and gas land rush, the same may end up happening for all those frac sand producers who have followed them there.

As many as 23 new frac sand mines are being developed in West Texas this year, according to reports cited by Bloomberg.

Why Texas, And How Much Frac Sand Do We Really Need?

The process of hydraulic fracturing involves injecting highly pressurized water into a well and then pouring sand into it in order to keep the tiny fractures created by the water blast open. After that, the holes are widened to allow the crude to ooze out of the shale rock. The more fractures created in a rock, the more oil and gas producers will get out of it. That notion of well completion intensity is driving increasing sand usage per well.

It’s all put the frack sand subsector very much on investor radar as a backdoor into the lucrative shale business. So much so, in fact, that some have even started referring to the frac sand situation as “proppant-geddon”.

So the answer to ‘why Texas’ is a simple one: Frac sand producers follow the oil producers, and they’re descending on the Permian. And until the run on Texas sand, producers were largely dependent on expensive ‘white sand’ mined in Wisconsin and Minnesota. The brown sand of Texas is cheaper. And when it’s right in your backyard, producers save a bundle.

It’s cheaper because it’s easier to mine. Wisconsin’s sand is locked up in sandstone, while Texas’ is just hanging out in big dunes. That’s where the lower price comes into play.Related: The Best And Worst Oil Price Predictions

Of course, it’s bad news for Wisconsin, which won’t like the competition that ends up driving frac sand prices down. The run on Texas is a big one:

“The costs are really low of producing this sand and of course they’re putting up too many mines, which basically means that they could sell that sand for as little as $30 a ton,” Wisconsin Public Radio quoted IHS oilfield services expert Samir Nangia as saying.

Producers love it because, according to Nangia, it costs up to $60 a ton just to ship Wisconsin frac sand to Texas by rail.

"These Permian mines are going to take market share away from the Midwest mines but what is also true is that they cannot take away 100 percent of the market share," said Nangia. "If I had to cap it, I would cap it at 50 percent."

It doesn’t necessarily mean that Wisconsin is out of this game, because all sands aren’t equal. The cheese state’s white sand is stronger and lets producers drill deeper and wells produce longer. But according to Nangia, some producers have already been cutting it with the cheaper Texas sand to make it go further.

This Is Frac Sand Boom 2.0

All in all, the ‘mega frac’ is a brilliant price driver for specialty frac sand, which cost about $25 per ton last year, but has been known to hit $70 per ton when supplies are short. And while this is a mouthwatering price for investors, it’s not traded like a commodity, so getting in on it means buying equity in producers themselves.

There aren’t that many public frac sand companies to choose from, either, and this is a pretty consolidated market, led for the most part by U.S. Silica, Fairmount Santrol, and Hi-Crush Partners LP, which together corner over 45 percent of market share.

And according to a new Market Study Report, the global frac sand market is expected to grow at a CAGR of around 14.7 percent over the next five years, reaching $6.7 billion in 2023, up from around $2.9 billion last year.Related: Record Oil Production Doesn’t Free U.S. From Global Market

For anyone betting on oil, frac sand shouldn’t be far behind—but it hasn’t always followed the same pattern. It went bust in a bad way in 2014 when oil did, and saw a revival in 2016—before oil prices responded upwards. That’s because producers started increasing the size of wells (bigger fracs), even if the number of wells wasn’t going anywhere. So, in 2016, the new frac sand boom preceded an oil rebound.

And look to Texas, because the frac sand mining set-up is about to get even easier. Kinder Morgan is planning a new gas pipeline to West Texas that will ease a major bottleneck for oil and gas producers. That heralds yet another uptick in frac sand demand once it’s up and running as slated in 2019. The $1.75-billion line will connect the Permian to eastern Texas and is scheduled to begin operations in October next year.

Right now, prices for natural gas that pipeline bottlenecks have trapped in the Permian are lower than pretty much any other major American hub. Output may be booming, but prices are down 30 percent from a year ago because it’s all trapped.

Once the bottlenecks are sorted out, we’ll see Frac Sand Boom 3.0, and it’s going to be all about Texas.

By Julianne Geiger for Oilprice.com

SEE https://plawiuk.blogspot.com/search?q=FRAC

SEE https://plawiuk.blogspot.com/search?q=FRACKING

SEE https://plawiuk.blogspot.com/search?q=SAND

SEE https://plawiuk.blogspot.com/search?q=FRAC+SAND

How one Utah community fought the fracking industry — and won

WRITTEN/PHOTO BY Tara Lohan / The Revelator January 23, 2020

The land around Red Knoll near Kanab, UT that

 could have been razed for a frac sand mine.

Kanab took an unconventional path to face down a frac sand mine that threatened the region’s aquifer.

A sign at the north end of Kanab, Utah, proclaims the town of 4,300 to be “The Greatest Earth on Show.”

It’s a rare case of truth in advertising.

Kanab sits just seven miles north of the Arizona state line, at the crossroads of some of the Southwest’s most beautiful places. In every direction a geologic wonderland awaits. To the north is Zion National Park with its breathtaking valley of 2,000-foot-tall rust and white sandstone cliffs. The sweeping expanse of Grand Staircase-Escalante National Monument stretches to the east of town, and just to the south you’ll find the Grand Canyon’s North Rim.

You don’t even need to leave Kanab, which is ringed by the famously red-hued Vermillion Cliffs, to get socked by jaw-dropping beauty.

It’s this landscape that drew Susan Hand to Kanab 25 years ago when she opened Willow Canyon Outdoor to sell gear, maps, books and coffee to local and visiting adventurers. And it’s this landscape and the community’s gateway-to-the-wonderland experience, the economic bedrock of this tourism-dependent town, that she worried would be destroyed by a new industrial project proposed for development 10 miles north of town last year. 

Kanab, Utah, is a popular tourist destination.

 (photo by Tara Lohan / The Revelator)

There, a company called Southern Red Sands LLC had announced plans to build a facility to mine and process massive amounts of sand for use by oil and gas companies conducting hydraulic fracturing. The sand is a lesser-known but substantial aspect of the fracking process. Round grains of silica sand serve as a “proppant” to keep underground fissures in the shale open as oil and gas are pumped out. Fracking a single well can require thousands of tons of sand.

“I really wanted to keep an open mind, but the more I learned about the project, the more concerned I got,” Hand told The Revelator when I visited Kanab in September.

She had reason to be worried. The first decade of the fracking boom relied heavily on so-called “frac sand” sourced mostly from Midwest states like Minnesota and Wisconsin, where mining reduced verdant green hills to piles of dust. 

Frac sand in Wisconsin. (photo by Tara Lohan / The Revelator)

But mining in the Midwest has its limits. Sand is expensive to ship across the country, so as fracking has taken off in Utah, Texas and New Mexico, companies have looked to find more local sources to trim costs.

That’s when the proposed mine in Kanab entered the story.

Southern Red Sands, a two-person start-up backed by Utah real-estate developer Kem Gardner, hoped to establish the region’s next frac sand mine in a scenic area of state-owned lands outside Kanab called Red Knoll.

City and county officials quickly gave their blessing — and a combined 1,200 acre-feet of water rights a year — after only cursory consideration.

But residents became concerned about impacts to scenic beauty, water resources and local businesses. They teamed up to fight back, forming a community group called Keep Kanab Unspoiled.

It was beginning to feel like a familiar story.

The struggle between extractive industries and environmental protection is not a new one in Utah. A fight is still raging nearby over the boundaries of Bears Ears National Monument and Grand Staircase-Escalante, both of which President Trump slashed in order to increase drilling and mining opportunities.

Despite public pushback and some legal challenges, though, the frac sand mine seemed to be cruising toward approval as recently as October. It still needed an environmental impact assessment from the Bureau of Land Management, and the two water transfers needed approval from the state engineer. The project definitely wasn’t a done deal, but in industry-friendly Utah, it had a good shot.

So it may have come as a surprise to a number of residents when Southern Red Sands announced at the beginning of January that it was abandoning the proposed project.

What happened? And are there any lessons that other communities fighting extraction threats can learn?

“Speak out, pull together like-minded neighbors, organize and don’t give up,” Hand told me after hearing the news. “But also, try to be nice.”

Surprisingly, it’s that last bit that may have made a big difference — along with a good hard look at the economics of the endeavor.
The threats

Von Del Chamberlain is a white-haired, soft-spoken Kanab resident. Born in 1934, he spent his youth exploring the red rock and his career studying the stars. The astronomer and former director of Salt Lake City’s Hansen (now Clark) Planetarium retired to his hometown 15 years ago and hoped to start a public observatory.

He realized that Kanab’s prized dark-night skies would be threatened by a 24-7 mining operation. But that wasn’t even his biggest concern with the project.

“The beauty here is the thing that will sustain this area economically for as far in the future as we can possibly see,” he said.

Opponents like Chamberlain usually cited two big concerns: environmental impacts, particularly the threat to water resources, and the local economy. But in Kanab it’s hard to separate the two.

“It doesn’t matter what kind of an economy you want to develop here,” said Hand. “Even if you have an industrial economy or an extractive economy — if you don’t have water, you’re out.”

The water supply, which draws on underground aquifers, currently supports the town’s tourist-driven economy, ranching, and the county’s biggest employer — Best Friends Animal Society, known worldwide through the Dogtown TV series on the National Geographic Channel. The nonprofit owns a 3,700-acre sanctuary, the country’s largest no-kill animal shelter, and would have been the mine’s closest neighbor.

Best Friends, which employs 400 locals and draws 35,000 out-of-town visitors a year to its sanctuary, came to see the proposed mine as an existential threat. Their property relies on wells, seeps and springs that come from the same aquifer the project’s two wells would tap. 

Groundwater seeps to the surface at the Best Friends animal sanctuary

 in Kanab, Utah. (photo by Tara Lohan / The Revelator)Last July Kanab’s city council approved a 50-year contract for 600 acre-feet a year of water rights for the project and Kane County Water Conservancy District, which oversees water servicing for the unincorporated areas of the county, agreed to provide an additional 600 acre-feet of water. That combined amount equals about 740 gallons per minute, although Southern Red Sands contended it would use only about a third of that.

Many local residents were shocked by the water-rights transfer. A 2016 water needs assessment found that Kane County Water Conservancy District’s reliable supply would be in deficit by 2035. And the district’s executive director, former state representative Mike Noel, has been a vocal advocate for a pricey proposed pipeline to send Lake Powell water to southern Utah communities, including near Kanab, under the premise that the region is already running short on water.

“We knew that it would damage our seeps and our springs, and we weren’t sure yet the full impact besides some drawdown to our groundwater, but we were really concerned,” Bart Battista, an environmental engineer responsible for facilities management at Best Friends’ Kanab sanctuary, told me. “It boggles my mind that the city wasn’t as concerned.”

But documents unearthed by local radio station KUER showed that officials at nearby Zion National Park already were concerned that the project could reduce flows into the East Fork of the Virgin River, which flows through the park, by reducing the amount of water from underground seeps and springs that feed the river.

Wanting to learn more about how the project could affect the region’s water, Best Friends commissioned a study from hydrogeologist Kenneth Kolm of Hydrologic Systems Analysis, a firm that’s completed water studies for other Utah towns.

Kolm found that the mine posed the potential for decline in productivity to wells owned by both Best Friends and the city’s water supply. The project could also decrease flows into nearby Kanab Creek and dry up perennial streams and springs, including one that feeds an area of habitat that’s home to the Kanab ambersnail — currently federally protected as endangered.

The amount of water being withdrawn wasn’t the only issue. The proposed project site and its sandy soil are also vitally important to local hydrology.

“The sand is the first ticket to collecting water,” said Hand. It captures rain and holds it in place long enough for it to sink into the water table and not run off. But the sand is exactly what would be removed from the site, further threatening the region’s water supply.

“I realized for the first time how small and vulnerable our watershed actually is,” she added.

Southern Red Sands hoped to start digging on 640 acres of land around Red Knoll, an aptly name rise of coral-colored rock and sand. The area is managed as part of Utah’s School and International Trust Lands Administration (SITLA), where state-owned property can be leased (often for resource extraction), with revenue being funneled to education.

The operation would have started by bulldozing all the trees, shrubs, grasses and forbs, then scraped up to 30 feet of the earth from the exposed surface. The sand would then be processed — washed with water and chemicals, then dried and sorted — in a facility with up to six 120-foot-tall silos. After that it would be loaded into trucks and hauled out.

A small fraction of the remaining sediment — mostly the fine silts and clays — would be put back on the land. But that change in geology could mean a big change for the aquifer. How big would depend on the scope of the project, though.

In addition to the SITLA land, Southern Red Sands had acquired placer claims — mineral exploration rights — for 12,000 surrounding acres managed by the BLM. And although the company said it planned to mine only 700,000 tons a year from the SITLA property, the facility would have had the capacity and water rights to accommodate much more.

“If they’re building a plant with a capacity of 3 million tons a year, that’s presumably because they expect to be able to produce that,” Dean Baker, a Kanab resident and opponent of the project told me in December. “They may never do that, but you don’t build extra capacity without the idea that you might use it.”
The resistance

Water issues are paramount in arid Utah, but the mine was likely to come with some other potential problems.

If Southern Red Sands did build out to end of their claims, they’d be within 10 miles of Zion National Park and workers at Best Friends would be looking over their fence line at the operation — not to mention potentially breathing its dust.

Mining, processing and trucking frac sand can release tiny particles of crystalline silica into the air. Inhaling those particles regularly can cause lung disease, including cancer and silicosis, a chronic disease that, like “black lung” for coal miners, can be deadly.

Dust in the air at a frac sand processing facility in Wisconsin. 

(photo by Tara Lohan / The Revelator)

The facility would likely run with lights and noise 24-7, which could be detrimental to wildlife. And adding more diesel-spewing, slow-stopping big rigs hauling 50,000 pounds of sand down the town’s one main road concerned residents, too.

With so much at risk, opponents employed a number of tactics to try to fight the mine.

Keep Kanab Unspoiled held community meetings. They invited Kolm, the geologist who did the independent study, to report his findings, and started an online petition to discourage the company from moving forward.

Best Friends — an established national nonprofit with considerably more financial resources — took the lead role in mounting legal challenges. The organization filed an appeal of a conditional use permit approved by the county and formally objected to the water transfers, which needed to be approved by the state engineer.

But during the fall, Best Friends decided to shift tactics. Lawsuits could just lead to years of legal battles, something beyond the organization’s longstanding mission.

“We might alienate our donors and members,” Battista explained. “The appeal of Best Friends crosses party boundaries — animal welfare is something everybody can support.” Apparently environmental action is not.

They decided the best approach was to sit down and talk with the company and its backers.

Battista couldn’t disclose details of the negotiations — which went on for months — but on Jan. 9 Best Friends and Southern Red Sands released a joint statement saying that the company “had decided not to pursue its business ventures in Kane County.”

The members of Keep Kanab Unspoiled were elated by the news.

“It’s so heartening how so many people from our community came together to amplify a voice that is seldom acknowledged by our elected representatives and institutions,” Hand tells me. “I’m relieved that an area I love won’t be sacrificed on the altar of fossil fuel consumption. I’m grateful that this threat to our travel and tourism economy is diminished.”

It would be comforting to think that the driving force behind the decision boiled down to preserving the scenic beauty or the region’s groundwater resources, but it’s more likely it had to do with money.

“Economics played some role,” Battista said. “The market for frac sand has changed and [Best Friends] had financial viability assessments of the project to show that the mine wouldn’t be a good idea. Economically it just didn’t make sense to any of us. I think that our studies corroborated that.”

This was a main talking point of Keep Kanab Unspoiled, bolstered by research done by Baker, who also happens to be an economist and cofounder of the Center for Economic and Policy Research.

The frac sand industry — and the larger fracking industry — is volatile. The number of rigs drilling for oil tends to fall when prices get low. Rigs plunged with falling prices from 2014 to 2016 and last year saw record declines in rig numbers. In addition, fracking costs more than traditional drilling — and the industry has also been overspending to keep the fracking boom from going bust.

A research organization in Norway found that the amount of money being spent to drill for oil by 40 U.S. shale oil companies outpaced the money being made by selling that oil. That deficit cost companies almost $5 billion in just the first quarter of 2019, DeSmog reported in August.

It’s a scenario that’s happened before.

With oil prices now around $60 a barrel, the industry is hanging on. If prices dip much lower, it could be trouble. A decade into the fracking frenzy, investors are worried that the best spots have been drilled and many debts won’t be paid.

There’s even more uncertainty when it comes to producing and selling the sand. Companies used to rely almost exclusively on Midwest sand, but now more areas are getting in on the game.

The consequences of failures in the fracking business model are real.

Falling oil prices and a shifting market for frac sand recently took down Emerge Energy Services — owner of eight frac sand facilities in Wisconsin — which filed for bankruptcy last summer and left behind unsafe levels of arsenic and heavy metal contamination for the community to clean up.

That’s a scenario that Baker worried could happen in Kanab. Southern Red Sands said their intended market was in Utah’s Uintah Basin 350 miles north, but a new frac sand mine just opened in the basin. “It’s almost inconceivable they’d be able to compete with them because the biggest cost with frac sand is the shipping,” said Baker. “There are some operations in the San Juan basin [in New Mexico and Colorado] but it’s not clear to me that they could beat those out either.”

Even though economics played a role in halting the project, he believes community efforts were important, too.

“The fact they faced serious legal obstacles at every step in their path had to be a factor,” he said. “It is a nice, and unfortunately rare, victory for the environment.”

Best Friends worked to ensure the hard-earned victory wasn’t short-lived, either. It also purchased Southern Red Sands’ 12,000 acres of mineral rights.

“We want to make sure that no one else comes in here in two years if the market’s better and tries to put in another sand mine, we just don’t think that it’s the right thing for this area,” says Battista. “We want to make sure that in perpetuity, there’s not a threat to the sanctuary.”

As for Hand, she’s now looking at the bigger picture. She saw the fight over frac sand in Kanab as a microcosm of the global fight over fossil fuels and climate change.

“While we can embrace a sense of triumph, it’s likely to be brief,” she says. “When it comes to protecting wild places and using our resources carefully, our work will never be done. The next development project is already bubbling. I do feel more hopeful for each success, but climate change marches on.”

This article was produced by The Revelator, an online news and ideas initiative of the Center for Biological Diversity. It is republished here with permission.

Digging Deeper: Eight Questions About Southern Red Sands

By DAVID FUCHS • SEP 23, 2019


The view from the base of the Red Knoll in Kane County, 

where start-up mining company Southern Red Sands

 seeks to create a "frac sand" mine.
DAVID FUCHS / KUER


KANAB — A proposed mine for sand used in oil and gas extraction has stirred tensions and spurred questions in this small town just north of the Arizona border since the City Council voted in July to provide water to the project.

The mine’s opponents say local officials did not fully evaluate the mine’s potential impact on the area’s water, air and traffic. They also argue that the mine, which would produce at least 700,000 tons of sand per year, could threaten the city's aquifer and Best Friends Animal Society, a neighboring animal sanctuary that is the city’s largest employer.

Meanwhile, speculation and distrust have surrounded the company behind the mine, Southern Red Sands. The company, which has described itself as a start-up, has the financial backing of Gardner Company, the Salt Lake City-based real estate developer. Its chief executive, Chad Staheli, says his company is complying with all regulations. With the protest period for the city’s water service agreement ending on October 2, KUER looks at the origins of the company.

What is Southern Red Sands? 

Southern Red Sands is a frac sand mining operation based in Kane County. The company has two full-time employees. The rest of the team consists of consultants and contractors, CEO Chad Staheli said in an interview with KUER.

The company began, however, in February 2018 with a different name, Integrated Logistics, according to business records filed with the state. The organizer of the company was J.T. Martin, a former Salt Lake City Council member and high-ranking executive of Integrated Energy Companies. Known as IEC, the energy company provides services to oil and gas companies in the Uintah Basin, among other functions. The company’s chairman is Kem C. Gardner.

Who are its backers? 

The principal investor in Southern Red Sands is Gardner Company. The company describes its real estate portfolio as one of the largest in the state. Staheli said the only other investor is Vere Capital — a small investment management company he helped start seven months before he joined Southern Red Sands.

The Gardner Company asked Vere Capital to evaluate the frac sand mining project, shortly after the Integrated Energy Companies purchased the mining claims in 2018, Staheli said.

Soon after, the three companies decided to spin off the mining operation as a standalone company, rather than as a subsidiary of Gardner Company or IEC. Staheli accepted a position as the company’s CEO.

Staheli calls the company a “start-up” because none of the parties have specific experience with frac sand mining.

“If I was really trying to spin something, I wouldn’t call this a ‘start-up,’” he said. “I’d call this a ‘Gardner Project’ because they have the operational history to give a community like Kanab the comfort to know they’re getting taken care of.”

Who else is involved?
The other Southern Red Sands employee is Andy Gant, who besides being its operations manager also serves as a Kane County commissioner. The dual role has raised questions among residents about potential conflicts of interest.

Kane County Clerk Karla Johnson confirmed that Gant filed to run for county commissioner in March 2018 — the same month he started his position with Southern Red Sands, according to his LinkedIn profile.

Johnson added that it was widely known during Gant’s candidacy that he was working with the mining company and described the commissioner as an “open book,” adding that she “has always known him as an honest man.”

Staheli also dismissed any suggestion of impropriety.

“If somehow it benefits us, Southern Red Sands, to have Andy Gant as a county commissioner, I haven’t seen it,” he said. “If it exists, it’s something that’s nebulous and out there and I haven’t seen the real effect of it.”

Through a recent marriage, Gant is also related to Mike Noel, a polarizing former state representative who currently serves as the executive director of the Kane County Water Conservancy District.

The two became in-laws in December 2017 when Mike Noel married the sister of Andy Gant’s wife, Rhonda Gant, who also serves as the county’s human resources director.

Southern Red Sands CEO Chad Staheli says that sand is a “logistics play.” His company is strategizing that their relative proximity to the Uintah Basin will give them an edge over competition from Wisconsin and Minnesota. But as other sand operations set up even closer to their target market, Staheli says Southern Utah’s superior sand and warmer weather will allow the company to turn out a higher quality product all year-round.

What’s in a name? 

Between May and July 2018, the mining company took on two new names.

The first change was from Integrated Logistics to Integrated Sands in May 2018. Around that time, Martin told conference attendees of the Governor’s Energy Summit, “We have some of the best frac sand in the country,” adding that “We are calling this ‘Utah pink Champagne.’ The Wisconsins have nothing on us,” according to the Salt Lake Tribune.

But that name didn’t last long. Less than two months later the company switched to its current name.

Staheli explains that the name changes reflect a marketing decision to differentiate their product from fracking sand mined in the Great Lakes region, which is often referred to as “Northern White” by industry insiders.

“The transition from business to business is nothing more than a change in business name — same involvement, same people,” he said, adding that the investors and ownership structure have remained consistent throughout the project.

What is “frac sand”? 
Hydraulic fracturing or “fracking” is a method of extracting oil and gas from low-permeability rock formations. It works by using pressurized fluids to create fractures through which oil and gas can flow. Fracking operations use what's called a “proppant” to hold those fractures open. Sand, or “frac sand,” is a naturally occuring proppant. The majority of the country’s frac sand comes from the Great Lakes region.

What does Southern Red Sands plan to do?
The company’s production facility is being designed to yield 700,000 tons of sand per year. The mine could be retrofitted, however, to include an additional production line if there is sufficient demand, Staheli told KUER.

As planned, the operation will feature four 120-foot storage silos. But a conditional use permit issued by the Kane County Planning and Zoning Commission allows the company to build up to six silos.

The commission’s decision rankled residents during its July 11 meeting, as pre-meeting documents provided by the county showed the mine would be limited to two silos. Southern Red Sands and Kane County both say the discrepancy resulted from a typo committed by the county while preparing the information packet.

Where will the company mine? 

Southern Red Sands holds the mining permits to 640 acres of land surrounding Red Knoll, which sits roughly 10 miles north of Kanab. Lease records indicate that Southern Red Sands’ precursor, Integrated Sands, purchased the permits from a New York-based mining company in May 2018.

The land is owned by the State of Utah School and Institutional Trust Land Administration, or SITLA, and functions as private land managed by the state to generate revenue for education. It is not subject to environmental regulations that exist for public land.

The company will restrict its mining to a 100-acre section of the SITLA parcel until the sand supply is exhausted, which Staheli expects to last between five and 10 years. The mine will then expand its operation onto adjacent Bureau of Land Management parcels if the demand for fracking sand still exists. Staheli has stated publicly that his company has purchased mining claims across 13,000 acres in the surrounding area. He says this a strategy to prevent potential competition from developing other sand mines.

How much water will it use? 

Southern Red Sands says that extracting and processing that much sand will require roughly 400 acre-feet per year of water. The company will have access to up to 1,200 acre-feet per year, pending approval by the state engineer of water service agreements it has signed with Kanab and Kane County Water Conservancy District.

Where will the sand be transported? 

The target market is the Uintah Basin, where oil and gas operations use between 1.1 million and 1.4 million tons of fracking sand each year, Staheli said.

Southern Red Sands is also considering shipping sand to the San Juan Basin in Northwestern New Mexico. However, Staheli says the option is not yet economically viable due to insufficient demand and road restrictions that would limit maximum truck weight.

Correction: 1:43 a.m. MDT 9/24/19. Oil and gas operations use between 1.1 million and 1.4 million tons of fracking sand each year. The Southern Red Sands production facility is being designed to produce 700,000 tons of sand annually.

David Fuchs is a Report for America corps member who reports from KUER's Southwest

RELATED CONTENT

Thousands Sign Petition Against Gardner Company's Support Of Southern Utah Frac Sand Mine

By DAVID FUCHS • AUG 26, 2019

UTAH GEOLOGICAL SURVEY
A petition calling on Gardner Company to cut off its support 

to a controversial frac sand mine outside Kanab has picked 

up over 2,600 signatures.

UPDATE: Controversial Southwest Utah Frac Sand Mine Moves Forward

DAVID FUCHS • JUL 11, 2019 Southern Utah News Bureaus


A hand-painted sign alerts Kanab residents to a City Council meeting at the local library. The council voted during a July 9 meeting to conditionally approve a controversial water service agreement for a proposed frac sand mine.
DAVID FUCHS / KUER

Updated 3:00 p.m. MDT 7/11/19

A controversial frac sand mine proposed in Southwest Utah is poised to move forward after local officials gave the go-ahead this week on the sale of water and a conditional use permit.

The Kane County Planning Commission voted Wednesday night to issue the permit to Southern Red Sands, LLC, which has plans to operate the mine just north of Kanab.

The permit listed 48 conditions the company must follow to minimize the impact of the proposed mine on the county. The process is a standard procedure for new works on county lands.

However, according to Kane County attorney Rob Van Dyke, the site is ultimately outside of county jurisdiction, as the operation would be located on land managed by School and Institutional Trust Land Administration, or SITLA.

The county’s conditions will be passed onto SITLA for further review.

Original Story:

The conditional approval passed Tuesday hinges on the Kanab city attorney’s review of potential liability if problems arise from the project, which would mine and process sand across a 55-acre area roughly 10 miles north of the city.

Frac sand is a naturally occurring “proppant” used to hold open fissures created by hydraulic fracturing operations in oil and gas extraction. The company says it plans to ship the sand for use in the Uinta basin.

Hundreds of residents attended the four-hour hearing and expressed concerns that city officials had not gathered sufficient information about how the project would affect the town’s water supply or alter the area’s landscapes.

Despite the pushback, city officials say the project is poised to move forward.

“Regardless of what we do here tonight, this project will go forth,” Kanab Mayor Robert Houston told the crowd before the vote. “The ultimate decision will be made by the State Engineer.”

The operation is being proposed by Southern Red Sands, LLC, a start-up mining company based in Salt Lake City. The company owns over 500 other mining claims across 12,000 acres near the proposed site, according to The Diggings, an online database of past and current mining claims.

Southern Red Sands officials estimate that the project would create as many as 40 jobs, though some will be shift work and technical positions. Trucking will be outsourced. The company has already leased the potential mine site — a 640-acre property south of Highway 89, which includes a feature known as “Red Knoll.” The land is currently managed by the School and Institutional Trust Land Administration, or SITLA, an independent agency that manages state trust lands to generate revenue for schools, universities and hospitals.

The first public discussion of a water service agreement between Kanab and Southern Red Sands, LLC took place at the Kanab City Council meeting on February 12, 2019.

Under the water agreement approved Tuesday night, Kanab City will sell the company 600 acre-feet of water per year, one-third more than the project’s estimated use of 400 acre-feet per year. The company has a separate agreement in place with the Kane County Water Conservancy District for an additional 600 acre-feet per year.

The City Council voted to amend the service agreement so that liability will be placed or shared with the company if problems arise from the operation. The company cannot be held liable as the current agreement stands.

Critics voiced concerns that the mine could deplete the aquifer, increase truck traffic, hurt tourism, damage the area’s aesthetic beauty and could eventually expand beyond is current scope based on the company’s nearby holdings.

Bart Battista, a retired Marine Corps officer who was previously the lead environmental planner for Camp Pendleton, one of the largest Marine Corps bases in the United States, said that the mine cannot move forward without two critical components: a well, which must be approved by the state engineer, and an access road, which requires approval from the Bureau of Land Management.

“For some reason the city is being blind to that and just thinks that they don’t have a choice and that they can’t influence this process,” he said. “And I believe the county thinks the same way.”

Battista currently manages the facilities at Best Friends Animal Society, a no-kill animal sanctuary which is the largest adjacent property owner to the proposed mining site.

City officials said they believe the city has sufficient water to make the sale and that selling its water is the best way to maintain a voice in the project moving forward.

David Fuchs is a Report for America corps member who reports from KUER's Southwest Bureau in St. George.