Several Story Lines Coming Out Of Minnesota, Wisconsin Regarding Fracking Sand

A huge "thank you" to a reader for sending me this story. Two story lines:

• frack sand supply and demand in balance
• when demand comes back, Wisconsin will be source; Minnesota dithered and lost out

The story is at The StarTribune:

WINONA, Minn. — Short-term demand for frac sand in western Wisconsin and eastern Minnesota has fallen because there's more available than the industry currently needs.
Demand had exploded several years ago, spurring companies to open mines and processing facilities and ship across the country for fracking operations, according to the Winona Daily News.
But that demand has cooled significantly this year, according to industry representatives and reports from government agencies. Some of the region's newly permitted sand mines are idle, as are loading and hauling facilities, and some operations are stockpiling sand.

And then this story line of what happens when a state dithers (though the environmentalists are happy):

Paul van Eijl, who purchases land for Superior Sand Systems in the region, said until there is an increase in demand, the company's new facility in Wabasha, Minn. — permitted in December 2012 — will likely remain idle.

"We just don't have any contracts," he said.

Superior Sands' rail loading facility is an example of one of many area operations that have stalled because they weren't permitted before the demand leveled off.

But happy days for Wisconsin:

By comparison, U.S. Silica, a 113-year-old company, just opened a new mine and processing facility in Sparta, Wis., and expects to have no problem selling the close to 4.5 million tons of sand it plans to mine yearly from its 15 mines and processing plants scattered across the country.

"We are confident in our ability to sell the increased capacity," said Lawson, adding that the company expects to see 10 to 15 percent growth this year.

When the demand rises again, a combination of looser regulations, geology and easier access to shipping channels all point to Wisconsin being in the better position to handle it.

For activist environmentalists, don't pop the champagne yet:

"There may be a temporary stabilization, but it's only temporary," said Winona County, Minn., planning and environmental services director Jason Gilman.

But the edge will go to Wisconsin.

Oh, by the way, there's another story line: when supply meets demand, prices tend to go down. It should be somewhat less expensive to frack a Bakken well, all things being equal, now that supply of fracking sand is meeting demand.

I would assume the same for ceramics. The bad news for sand enthusiasts: there is some data analysis that suggests all-ceramic fracking is the most economical way to go. The jury is still out on this.