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3 Reasons Your New Sand Plant is Falling Short

Reason #1: You're rushed getting out the door.


There we were in the summer of 2017 and the first West Texas frac sand mine was the start

of the “in-basin” rush. Almost overnight, air permits and land purchase agreements were

exchanging hands as sand producers hoped to scoop up the best sand deposits in the

region. Other nearby regions in South Texas, Oklahoma, and Louisiana experienced the

same rush for new sand plants. Now 24 months after the first West Texas sand mine

opened, there exist approximately 40 “in-basin” frac sand mining operations and processing

facilities, and the second half of 2019 still expects a few more.


Why the rush?


First, there is an immediate cost benefit to shortening the transportation cost of a 1,200-mile

train shipment of that fine, white frac sand from the deposits in Minnesota to the oil fields of

Texas.


Second, we are watching the birth of a brand new “regional” market, and with pricing at a

peak in its cycle, companies could get aggressive trying to gain market share through

production. As a result, billions of dollars were invested by both new and existing sand

companies.


What happens when supply skyrockets? The local price of sand in the Permian Basin has

dropped by more than 60% in the last 12 months. Unfortunately, your ability to lean out

efficiency and drive down costs today are severely hampered because the plant was

designed and built a year ago during what pilots call a “rolling runup”.


Reason #2: You brought the wrong equipment.


Long before any new sand plant is constructed, engineers look at lab-analyzed samples of

raw material from the prospective deposit. These samples are critical for the sand producer

to understand what equipment is needed to meet both quality and volume requirements.

Unfortunately, this sampling process is sometimes flawed in representing all the materials to

be found in entire sand deposit.


Where does the sampling process go wrong?


Even when multiple samples are taken at varying depths, it is common for some minerals to

get missed. Layers of caliche and clay can be found in random areas at random

depths all over the dunes of West Texas and small organic material such as sagebrush and

shin oak roots are common as well. Minerals that are missed during sampling can wreak

havoc on a new wash plant system if it wasn’t designed to handle them.


What if we just use the same equipment design from another plant?


Many producers who have existing operations in other regions may have a preferred design

or equipment selection that has proven successful for them. In the rush to take West Texas,

many operators just used the same plant design that worked for them elsewhere. All deposits are not equal. What works in one region may not necessarily work in others and

that is a costly mistake. If there’s more clay or silt content in the deposit than originally

expected, then the system needs to be modified to handle that change and likewise for

organic material.


Reason #3: Your people aren’t used to this work.


Here are what human resources departments are dealing with in West Texas: high turnover,

fierce hiring competition, and expensive benefits to attract talent. From my firsthand

experience in the Permian Basin for last 24 months, one of the hottest talking points when

talking to sand producers is how to succeed at navigating the oilfield labor market.


What is a common profile of the oilfield worker?


The classic oilfield worker is chasing the hot wages, even if they are on temporary projects.

Their expertise exists in drilling rigs and frac jobs which are short-term jobs. These workers

set-up, do the job, and take-down the site. This workforce has little to no experience in a

long-term manufacturing environment. Now, to be honest, what I’ve described are going to

be your mining industry professionals. There exists a large part of the workforce in West

Texas who is new to the frac sand and industrial sand industry entirely.


What do you mean by manufacturing environment?


These sand plants are operating 24/7/365. You come here every day, all the time, and make

sure the plant is operating at peak efficiency with optimal uptime. There are operational

practices in a continually-operating permanent manufacturing plant that most truck drivers