Fort Worth’s Emerge Energy Services said it is buying a small sand facility south of San Antonio to transform it into a much larger mine to serve the hydraulic fracturing needs of the oil sector.
The San Antonio-based Osburn Materials facility currently produces sand to for building materials, golf courses and baseball fields. Emerge is buying it for $20 million with plans to spend much more to rapidly expand it into a sand mine for the oil and gas sector.
The energy sector is increasingly relying much more on sand for fracking, and in some cases using up to 1,000 truck loads of sand for a single well.
Emerge Energy said the mine, which is located south of San Antonio off of Pleasanton Road, has 80 million tons of sand reserves that can serve Texas oil needs.
“Osburn’s (sand) reserves, located near the heart of the Eagle Ford basin, will be highly desirable for frac sand purposes, as the sand is high quality and logistically-advantaged,” said Emerge Chairman Ted Beneski.
The mine is close to South Texas’ Eagle Ford shale, and offers nearby rail access to ship sand to West Texas’ Permian Basin.
Emerge CEO Rick Shearer said the plant can produce 300,000 tons of dry sand a year. By the end of the year, Shearer said the goal is to double the production levels. An even larger expansion will build it out to 3 million tons of dry sand production annually by as soon as mid-2018, he said.
However, the project could draw the ire of residents and environmentalists. Just a little south of the Osburn Materials site, in Atascosa County, residents are fighting a 300-acre sand mine proposed by Preferred Sands of Radnor, Pa., citing health risks, potential well water contamination, truck traffic and potential damage to the site of the 1813 Battle of Medina, a bloody fight in the early years of Mexico’s long war for independence.
Although a sand mine has very few carbon emissions, there are concerns the mines despoil pristine land and create health hazards by kicking up silica dust, which has been linked to lung cancer, tuberculosis and other lung diseases when inhaled.
Emerge Energy and other frac sand companies primarily own sand mines in Wisconsin and Minnesota where there’s the more desired Northern White sand. However, the Permian Basin oil boom is leading to new and expanded Texas mines. Emerge already owns another Texas sand mine near Kosse.