Pete Cook, Editor
Issue #323 | May 19, 2021
Over six years. 323 weeks. 2,267 days. That’s how long the Frac Sand News Digest had been going, without missing an issue…until last week! I blew it. Somehow, I just completely forgot to assemble and send out the Digest. I was in Dallas, helping run a large oilfield water conference (the Oilfield Water Markets 2021 Conference, which was awesome, by the way), and I went back to my hotel room on Tuesday night to work on the Digest. I got distracted by other issues and I never got to it. Not only that…I didn’t even realize I missed the issue for a few days! So, mea culpa. Hopefully, I won’t miss another issue for at least another six years!
Moving on. Everyone should be turning their attention to the 10th Annual Frac Sand Supply & Logistics Conference. I visited the venue on Friday and it looks great. We’re planning on adding some fun extracurricular outings to the conference this year, so please plan on joining us and, if possible, bring your spouse and family. The conference dates are September 15-17, 2021.
Because we missed last week, this week’s Digest is packed full of great articles. It is worthwhile to carve out a good hour to take your time to go through the Digest. As you’ll see, there is plenty of reason to be optimistic about the future of the industry.
And now, the news…
Canada-based miner Source Energy Services reported that frac sand demand was recovering slowly, although it remained below the levels seen before the Covid-19 pandemic.
For the past couple of years, the Permian sand market has seemed hopelessly oversupplied. The proliferation of local mines since 2017 in seemingly endless dunes flooded the market and then demand cooled with Covid. But the WTX sand market won’t be loose forever… already this year, we’ve seen a very tight 1Q21 where prices spiked.
Pattison Company, a leading provider of high-quality industrial sand, construction aggregate, armor stone and rail car storage, will use the proceeds to refinance existing term debt and equipment debt, new projects, and working capital.
In the mainstream trucking industry today, there are no shortage of shock and awe headlines on logistics market tightness. From Saia trying to add 500 drivers to completely insane compensation headlines, you don’t have to look far these days to find evidence of supply shortfalls and logistics inflation.
One Texas frac sand trucking company is willing to pay some of its experienced drivers a salary of as much as $14,000 per week as it seeks to combat the effects of a nationwide driver shortage.
The company doesn’t actually hire drivers as employees. It contracts with owner/operators who are running their own businesses.
Brent oil topped $70 a barrel with optimism building about the demand outlook in key regions such as the U.S., and on signs that a glut built up last year has been whittled away.
On ProPetro’s conference call this week, management said that price increases were inevitable in pressure pumping, saying customers are resigning themselves to that reality. The only question left in ProPetro’s mind is “how much and how fast” to raise prices.
New data show that North Dakota’s oil production grew in March after a lackluster start to the year, and the state’s top oil regulator anticipates it will keep ticking up throughout the summer.
In this update, Infill Thinking processed capex spending updates for 29 public shale E&Ps into their model, representing 79% of the public E&P universe they monitor.
Even before the coronavirus, E&Ps were promising to focus on living within their means, returning more cash to investors. Has the industry acted in that way? Will they continue to do so with oil prices so supportive?
A key takeaway is several operators testing their first simulfracs and… loving it! In particular, two new adopters (PXD and MTDR) quantified their cost savings from simulfrac at $250k/well.
Liberty Oilfield Services announced the introduction of FracSense™, a diagnostic service to help E&P customers acquire more accurate diagnostic well data to optimize hydraulic fracture completions and well spacing.
The dunes sagebrush lizard (DSL) finds it’s scaly, reptilian self at the center of a multi-year kerfuffle that might finally be coming to a head under the new Presidential administration.
With the DSL coming up more frequently in offline conversations with members, some of whom fear the worst on a listing event this year, Infill Thinking went digging in the risk disclosure section of 10ks for a) some carefully vetted background information and b) management takes on how this might impact completions and frac sand.
Kansas City Southern’s plan to accept a revised $30 billion merger offer from Canadian National Railway Co., which would junk a deal with Canadian Pacific Railway Ltd., throws a new wrench in the effort to create a track network that extends the length of North America.
In the third of a two-part series Richard and John discuss how challenges in implementing net-zero emission (NZE) plans could revise the (bearish) long-term outlook for oil and gas demand.
The world could be facing a shortage of an underappreciated yet crucial commodity in the years ahead: sand.
C&D Group is a supply chain logistics focused company actively sourcing raw materials for sale within China and also for provision to other C&D Group companies, including oil & gas uses.
Perhaps we should start tracking the methane emissions from the B.S. being emitted by these government agencies.
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