Sunday, August 26, 2018

Geologists Looking For Fracking Sand Source In North Dakota -- Fracking Sand Costs -- Transportation -- August 26, 2018

Cost of sand / transportation:
So, in round numbers, maybe:
  • $60 / ton for fracking sand (up from $20 / ton at the beginning of the Bakken boom)
  • $150 / ton for shipping by truck (?)
But here's the best analysis, perhaps, from a PDF that I cannot link, a PLG presentation at JPMorgan, January 11, 2018:



Notice the cost to get the sand the last mile!

Now the article sent to me be a reader, data points:
  • operators looking for "local" source of fracking sand to cut down on shipping costs
  • operators using an average of 2,500 to 5,000 tons / well
  • from the article:
Fred Anderson, geologist with the North Dakota Geological Survey, authored a study in 2011 that said North Dakota sand sources approach oil industry standards for use in fracking but are lower in overall quality than other U.S. sources.
There's a renewed interest in that research, however, as demand for sand increases and companies experiment with lower-cost options.
"They're accepting sands that we probably never would have accepted 10 to 15 years ago," said Monte Besler, owner of FRACN8R Consulting in Williston.

For CLR, twenty million lbs of sand = 10,000 tons
  • product at $60/ton = $600,000
  • transportation at $150/ton = $1.5 million
  • sand + transportation: upwards of $2 million 
At a more conservative 5,000 tons, the cost can come down to $1 million (sand + transportation).

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