Permian Basin Decisions Having Far-Reaching Effect. Take Frack Sand.

January 9, 2019

Sand mined in West Texas has “won the race” over out-of-state product for use in Texas fracking, according to one expert, exemplifying the far-reaching economic effects of decisions made in the Permian Basin.

While it was at one time thought that West Texas frack sand was inferior to the “Northern White” silica sand mined in Wisconsin, but economic factors have made the cheaper Texas sand more desirable, sending companies into cutbacks and bankruptcy.

It’s cheaper to buy locally than to pay $50 or more per ton in shipping costs of Wisconsin sand, and when combined with reduced fracking activity in the Permian Basin, 2019 was not a good year for “Northern White” miners, and 2020 doesn’t look much better, Rystad Energy Director of Shale Research Thomas Jacob told NPR recently.

Rystad says drilling activity is expected to decline by about 7% or 8% this year, flattening demand for frack sand overall.

And while some analysts thought the inferior quality of Texas sand would clog and damage fracking wells, Jacob said “we think adoption rates for in-basin sand in the Permian is around 85 percent and we expect it to stay that way,” summarizing that Texas sand “pretty much won the race.”

Jacob added that in 2020 it’s “possible that another 10 to 15 million tons of Wisconsin frack sand mining production will go offline…”