Houston-based Gen6 Proppants is developing an in-basin fracture sand mine to serve Haynesville Shale producers in northern Louisiana.
The Momentum Midstream unit said it has acquired 1,000 acres in Red River Parish to build the mine, with permitting and procurement underway. Construction is set to start before the end of the year.
Once fully commissioned, the mine is expected to produce up to 1.5 million tons/year of sand, with first commercial production anticipated by mid-2019.
“The growing need for a more local fracture (frack) sand source has become paramount to our customers as drilling in the Haynesville continues to increase,” said Gen6 President Brant Baird, who also is COO of Momentum. “The new Gen6 mine will be the closest frack sand mine to the 10 top producers in the Haynesville.
“With over 1,200 truckloads of sand going to the average two-well Haynesville pad, our location allows us to significantly reduce transportation and logistics costs. Our goal is to provide the most cost-effective, timely and dependable service so that our customers can maximize their production values.”
The mine, which would be sited in the core of the Haynesville, has estimated sand reserves of more than 75 million tons and could be capable of delivering 40/70 and 100 mesh sand to area producers.
Natural gas output in June from the Haynesville, which extends across parts of East Texas into northern and southwestern Louisiana, averaged 6.4 Bcf/d, or about 8.5% of total U.S. dry gas production and the highest since September 2012, the U.S. Energy Information Administration reported earlier this month.
Monthly gas production in the Haynesville peaked at 7.4 Bcf/d in January 2012 but fell to less than half that only about one year later. Last year, the Haynesville remained the third largest producer of unconventional gas, which is led by Appalachia and the Permian Basin.
In-basin sand mines and long-term contracts have increased as operators work to reduce costs and improve efficiencies. Some of the country’s largest frack sand suppliers reported higher revenue for 2Q2018 and indicated they were moving to improve last-mile logistics provided by in-basin proppant services.
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