Oil & Gas News

Sand – Holder of History, Shaper of Futures


Have you ever thought much about sand?  


Maybe you played in it as a kid.  Or maybe left your footprints in it as you stroll along a beach.  Or perhaps you’ve come home from a beach or lake vacation and found it in literally every item you unpack from your suitcase or car.  If you have thought about sand, you’ve likely considered it as overly abundant and innumerable and here for our pleasure or disdain, depending on how you experience it.  The bottom line is, you’ve probably never thought of sand as a necessity for any industrial production. But, some folks do, chief among them being oil and gas producers who rely on industrial grades of sand to stimulate production in newly drilled wells.  This year’s extraordinarily high production rates, made possible by ever-increasing amounts of sand used in the fracing process, have strained the ability of sand mines to meet rising demand.

Recently, many oil and gas companies are thinking very seriously about sand as shortages have begun putting pressure on oil and gas operations in Oklahoma as well as other producing states.  Some operators are dealing with this situation by purchasing sand mines to guarantee uninterrupted supplies; others are experimenting with untested varieties of locally produced sands. And, now this month, sand mining companies have announced the construction of three sand mines and associated distribution networks in our state to help meet the increased demand for sand.

In this month’s article, I invite you to look at sand differently and maybe, just maybe, come to appreciate it.  My goal is to introduce you to the power, physical strength, utility, and value of sand for oil and gas production.  I think you’ll be surprised when you consider how this seemingly simple material wields vast influence on the success or failure of oil and gas production.  First, some background.



Strength – Basic Information on frac sand

Simply put, the American “Shale Revolution” could never have happened were it not for sand. Horizontal drilling into layers of rock and shale alone won’t coax hydrocarbons up to the surface.  Newly drilled wells must undergo a fracing process to stimulate them to produce. High-pressured water and various other fluids are injected into the wellbore where they chemically fracture formation rock/shale.   The sand, which has been transported in the liquid acts as a “proppant” by holding the fractures open allowing the flow of hydrocarbons upward through the wellbore. Grains of sand holding rock open.

Sand - Hydraulic Fracturing Schematic

According to the USGS, the upper Midwest of the United States has been a primary source of the sand used in hydraulic fracturing.  The sands, referred to as “Northern White” or “Ottawa” are mined primarily in Wisconsin and Minnesota and consist of high-quality, pure silica sand occurring naturally in these regions.  A few other U.S. regions also mine frac sand including Texas which produces brown quartz sand and Oklahoma where a type of sandstone is mined for fracing.

The premium frac sand of the upper Midwest is nearly 100% quartz or silica and has a fairly homogeneous grain size, but other key physical properties drive the choice of sand used by producers:

  • Shape – the degree to which a sand grain is round or spherical in shape will determine how the sand will react to fracing fluids or produced oil/gas.
  • Crush resistance – the sand grain’s ability to withstand extremely the stress of high bottom-hole pressures found in most of the U.S. shale plays.
  • Solubility – the inability for the sand grains to dissolve within a substance.
  • Turbidity – the absence of impurities such as clay, silt, etc. within the sand grain.
  • Bulk density and specific gravity measurements similar to quartz in the case of sands other than quartz.


Source  – Fairmount Santrol, 2014


Power – Industry usage of frac sand

In recent years many U.S. producers have managed to reduce drilling costs while improving well productivity and profitability in a sub $50/bl environment. Unfortunately, their improved economics may be threatened due to rising completion costs, namely sand and produced water expenses. While often productive in the result, the trend of up-sized completions calls for vast amounts of water, which is often sourced locally, but the increased amounts of sand required for fracing is another story.

In a perfect world, frac sand resources would be near the locations where it will be needed. Alas, Minnesota and Wisconsin are nearly a thousand miles or more from our most active producing regions such the Permian Basin, STACK/SCOOP, and Eagle Ford. And, herein lies a problem. As production in the U.S. has dramatically increased, so has the demand for premium frac sand pressuring mine operators to keep up and creating massive transportation and logistics issues for all involved. The resulting shortages, delays, as well as rail and truck transportation costs erode the bottom lines of Shale oil and gas producers.

When sourced from distant mines, frac sand must be transported by long trains (of 100 cars or more) and then often trucked to the well site. According to logistics management experts, the longer the supply chain, the more complicated it becomes, requiring greater volumes to deliver, and at a greater speed. Will there be enough sustained demand will be there to feed this beast?



And, as hydrocarbon production in our country continues to increase, the demand for sand as well as the costs of supplying it are on the rise. For example, back in 2016, leading frac sand supplier, High Crush began its spring quarter selling high-quality sands for an average of $64 per ton, which was up 7% from Q1. By the end of Q2, the price had increased $19 (42%) to $83 per ton and was expected to continue rising. With the average frac job now requiring around 5,000 tons and current prices north of $100 per ton coupled with increases in transportation costs, well economics are certainly impacted.

The question is, will the production gains from high-intensity completions be enough to offset the rising completion costs? The answer is perhaps. Higher oil prices will help, but there may be additional relief in sight. More on that later. In the meantime, ponder this interesting fact….Sand can constrain and stimulate oil and gas production. Powerful.

So, how much sand is used for fracing wells? Turns out, a lot. Rockproducts.com and IHS Markit estimate frac sand consumption increased from 10 billion pounds in 2007 to over 120 billion pounds in 2017. This year, frac sand consumption is expected to exceed 135 billion pounds. Operations in the Permian Basin will consume 50 billion pounds of this amount.


Sand_regional demand forcast

Source: IHS Markit


It appears the future trend for sand consumption is expected to continue rising for the foreseeable future. The Freedonia Group, an industry research firm estimated in a recent study that the demand for proppants in North America is expected to grow by 4.2% per year through 2021, reaching 103 billion pounds. Nearly 90% of that demand will be from the U.S. Shale Basins, especially in Texas and Oklahoma.


The move to in-basin supplies

As I mentioned previously, there may be relief on the way to help meet the increasing needs for frac sand coming in the form of in-basin supplies. Permian producers were the first to latch on to the notion of developing sand resources closer to home to tame costs and supply chain logistics. Now, this idea appears to be taking root and becoming a trend in Texas as well as in Oklahoma’s STACK/SCOOP plays. Some experts estimate a 40%-50% cost savings by opting for local sand resources. Quality of the sand is still paramount. After all, not just any sand will be suitable for fracing, and it must meet the standards I listed near the topic of this article to be used as a proppant. While sands from the midwestern mines are still largely in-demand, especially for deeper well bores, there are signs of a market shift in progress.

This past March was a stellar month for Oklahoma as a record 16.8 million barrels of oil were produced. The U.S. Energy Information Agency indicated the previous high on record was 16.4 million barrels set in January of this year.

Sand - OK oil prod chart


What does this portend for sand mining in OK? It appears the answer is plenty.  Earlier this quarter, three sand mining companies announced new construction projects and facilities in our state.

Preferred Sands, a leading manufacturer, and provider of high-quality sand and proppants announced that construction was underway on their in-basin frac sand mine and facility in Oakwood, Oklahoma.  The company was an early entrant into the Anadarko Basin sand mining market and has positioned itself to supply well sites within the area’s most active areas. According to the company’s President and CEO, T.J. Doyle, the Oakwood mine will produce an estimated 3 million tons of finished sand annually supporting some 400 wells each year.  Doyle further estimates the mine’s lifespan at 25 years.

Sand - Preferred Sands

Source – Preferred Sands.


Alpine Silica announced its plans earlier this month for construction of a new facility near Fay, Oklahoma, where it has secured 51 million tons of frac sand reserves.  Groundbreaking for the new project will be mid-summer and is expected to produce 3 million tons of frac sand annually.

Lastly, Jason Holton, CEO of Omega Sands, announced his intention to break ground this summer on a mining facility capable of producing 2 million metric tons (MMT) of frac sand a year.  Bolton confirmed that permits had been filed for a 700-acre Dewey county location northwest of Fay, Oklahoma. The proposed mine’s reserves are estimated at 30 MMT.

Operators in the STACK/SCOOP have benefitted from white sand supplied by established mines in southern Oklahoma (see map above), but are showing a willingness to incorporate locally produced brown sands to reduce completion costs.

In a future article, I plan to explore the utility of frac sand by focusing on engineered proppants designed to boost the effectiveness of sand or even replace it entirely.  Stay tuned. You can always find me at jparker@tellusgeospatial.com.

Julie Parker has a decade of experience serving the Energy industry where she became an expert in the integration and application of geospatial technologies to exploration and production projects and workflows. Ms. Parker entered the industry in 2006 when she became the first GIS Director for Chesapeake Energy, a large independent producer of natural gas headquartered in Oklahoma City, Oklahoma with operations throughout the U.S. During her tenure at Chesapeake, Ms. Parker built and lead a robust, cross-functional GIS department that gained a reputation for developing and deploying leading edge solutions for nearly all areas of the company.


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