Unimin-Fairmont Santrol Merger Indicative of Increasing Frac Sand Activity

Researched by Industrial Info Resources (Sugar Land, Texas)--This week's announcement of a merger by two frac sand miners shows how the material is big business in North America as U.S. drilling for oil and gas in shale formations increases. Unimin Corporation (New Canaan, Connecticut) and Fairmount Santrol (NYSE:FMSA) (Sugar Land, Texas) announced that they would merge into a New York Stock Exchange-listed company with expected annual revenue of $2 billion. While both companies have diverse interests in the Metals & Minerals sector, frac sand is a large part of the businesses and is expected to represent 55% of the new company's gross profits. Unimin is a wholly owned subsidiary of Belgium minerals company SCR-Sibelco (Antwerp, Belgium).

Frac sand is used to open shale formations to produce oil and gas from horizontal drilling. The use of frac sand in the U.S. remains steady, although it has declined a bit in recent years. For more information, see June 29, 2017, article - U.S. Sand and Gravel Mining Projects Persevere. An area of particular frac sand consumption is the Permian Basin of Texas and New Mexico, which has continued to show increases in drilling operations over the years, even as oil prices have fluctuated. Among the projects being tracked by Industrial Info is Fairmount Santrol's construction of an above-ground frac sand mine near Kermit, Texas. The open-pit sand mine will encompass 3,250 acres of leased land and will have on-site processing equipment. The mine will produce 3 million tons of frac sand per year for use in the Permian Basin. For more information, see Industrial Info's project report.

The Unimin-Fairmount Santrol merger comes in the wake of other frac sand mergers and projects. This summer, U.S. Silica Holdings Incorporated (NYSE:SLCA) (Frederick, Maryland) announced that it had acquired Mississippi Sand LLC, which included a 1.2 million-ton-per-year frac sand processing plant in Festus, Missouri. For more information, see Industrial Info's plant profile. Earlier this year, Emerge Energy Services (NYSE:EMES) (Southlake, Texas) announced that it had acquired sand producer Osburn Materials near San Antonio, with an eye to producing frac sand for drilling in the Eagle Ford Shale area.

Industrial Info is tracking more than $1.7 billion in U.S. frac sand projects, mostly in the Texas Permian Basin region. Among the top projects underway in the area is U.S. Silica Holdings' frac sand mine and processing plant near Monahans, Texas. The facility is being constructed on a 3,200-acre site to produce 4 million tons of frac sand per year over a 30-year mine life. Concrete Specialized Technical Services Incorporated (Hempstead, Texas) is performing construction management on the project, which is expected to be completed early next year. For more information, see Industrial Info's project report. U.S. Silica also is underway with a 2.6 million-ton-per-year frac sand mine and processing plant near Lamesa, Texas, in the Permian Basin. For more information, see Industrial Info's project report.

While West Texas is the most prominent location for frac sand development, Industrial Info is also tracking projects in Wisconsin and Illinois. Among these is Eagle Materials Incorporated's (Dallas, Texas) addition of a frac sand processing and drying plant in Utica, Illinois. The facility will be able to process approximately 1 million tons of frac sand per year. Construction began in the summer and is expected to be completed in the first half of next year. For more information, see Industrial Info's project report.

For more information on the frac sand market, see October 2, 2017, article - Frac Sand Market Roiled by New Capacity, Logistical Challenges.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.