A few weeks ago the draft agenda for the 9th Annual Frac Sand Supply & Logistics Conference was essentially done. However, the frac sand industry is going through a major adjustment right now and we have decided to adjust the agenda to match it. It seems to us that there are three clear areas on which we will focus at the conference (and the agenda will reflect these):
1 – Restructuring & Repositioning. Along with North American onshore, the frac sand industry is going through a major adjustment. Financial stability and good economics, combined with operational efficiency, will be the hallmarks of the companies who emerge as leaders from this adjustment. Contracts are being modified (or cancelled), bankruptcies are happening, and companies are figuring out what they do really well (and can do profitably). At the same time, they are looking for reliable partners, who they know will deliver operationally and are not at risk financially. It’s not a question of “who will get a seat when the music stops”, but rather “who is the right dance partner for when the music starts up again”. The agenda is going to address this issue.
2 – Mobile/Mini Frac Sand Plants. Operational efficiencies and economics seem to indicate that hyper-local mini sand plants have the potential to play a large role moving forward. Several solution providers have emerged and are jockeying to be the leader in this segment. Relationships will open doors initially, though performance will be the ultimate factor in determining market leaders. This was the primary focus of the initial draft of the agenda and it will continue to be a big part of the revamped agenda. That said, as long term economic feasibility will be a higher focus, if operators determine that the shift to in-basin local sand is detrimental (as claimed in a recent report), then there is a chance for a seismic shift back to Northern White. Stay tuned on that topic.
3 – Asset availability. There was already a fair amount of used equipment available, but with the market conditions we expect a flood of high quality, used equipment to be available at bargain prices. We’re working on adding an “asset swap meet” component to the conference, where those with assets available can showcase those assets to potential buyers. We are also trying to get some potential buyers from other industries to attend the swap meet component as many of the assets can be used elsewhere.
We think we’re on the right track with this approach, but we would welcome your input as well. There is still time for us to make adjustments to our agenda and approach. Please email Pete Cook ([email protected]) with any recommendations.
We expect to come out of this downturn as a smaller, more efficient, performance-focused industry. I think you end up with more, closer collaboration with proven, vetted partners.
I hope you join us for the conference. It could end up being the event the leads to one or more of those long-term partnerships for your company. You might not be able to afford to miss it.