Frack Sands Rebound Predicted Under Trump Administration

Source: The Energy Report   01/19/2017

View Original Article:

Fracking is poised to increase under the Trump administration, and with it will come the need for larger quantities of fracking sand.

Frack Sand

President-elect Donald Trump is widely expected implement pro-energy exploration policies. His "America First Energy Plan" calls for making "American energy dominance a strategic economic and foreign policy goal of the United States," and the unleashing of "America's $50 trillion in untapped shale, oil, and natural gas reserves. . ." Pro-energy policies coupled with rising energy prices point to an increase in fracking. And with the growth of fracking comes the need for fracking sands.

Sand is essential to fracking. Bloomberg reports that sand "is a much greater tool in hydraulic fracking than drillers had understood it to be. Time and again, they've found that the more grit they pour into horizontal wells—seemingly regardless of how extreme the amounts have become—the more oil comes seeping out." Bloomberg cites IHS figures that show that drillers are using twice as much sand per well as they did in 2011: "The per-well increases have analysts and investors betting that the sand industry will boom again as soon as fracking activity starts to pick up even a little bit."

Torchlight Energy Resources Inc. (TRCH:NASDAQ) is one exploration company that is using larger amounts of sand. On Jan. 10, the company announced that on its Flying B Ranch #2 well in the Midland Basin in Texas, it will be performing a "significantly larger multiple-stage frac than previously employed, [utilizing] 600,000 lbs. of sand pumped at a fluid rate of 75-100 barrels per minute." Torchlight CEO John Brda said, "We have engineered a much larger frac for this second well and expect that it will maximize any production results that we encounter."

Investors are swarming to sand fracking companies. One company that has seen a huge rise in valuation is Vancouver-based Select Sands Corp. (SNS:TSX.V). Its shares have risen from CA$0.20 last winter to CA$1.62, before falling back to about CA$1.53. Its operation in Arkansas gives it a geographical advantage to supplying sand to frackers in Texas and Louisiana; most fracking sand comes from Wisconsin and Minnesota. Brien Lundin, in the Dec/Jan issue of Gold Newsletter, noted that Select Sands "has raised the funds it needs to complete its option to buy a dry plant near its flagship Sandtown silica project in Arkansas. . .the large cash infusion gives Select Sands the resources to pursue its development plans at Sandtown. The project has great merit, both as a source of industrial silica and as a potential fracking sand provider, should that market revive."

Another frack sand company garnering attention is Smart Sand Inc. (SND:NASDAQ GS). The Texas-based company has operations in Wisconsin. The company went public on Nov. 4, 2016, at $11/share; the stock is now trading around $17.

Emerge Energy Services LP (EMES:NYSE) has also seen its share of action. The Texas-based company operates plants in Texas and Wisconsin. In the last year, its shares have risen from $1.97 to $15.75, before falling back to $13.50.

Want to read more Energy Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent articles with industry analysts and commentators, visit our Streetwise Articles page.

1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She owns, or members of her immediate household or family own, shares of the following companies mentioned in this article: None. She is, or members of her immediate household or family are, paid by the following companies mentioned in this article: None.
2) Torchlight Energy Resources Inc. is a billboard sponsor of Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview or article until after it publishes.
Additional Disclosures for this Content

Disclosure from Gold Newsletter, December 2016, January 2017 issue.
The publisher and its affiliates, officers, directors and owner actively trade in investments discussed in this newsletter. They may have positions in the securities recommended and may increase o decrease such positions without notice. The publisher is not a registered investment advisor.

Connect with us on Facebook and Twitter!

Popular posts from this blog

The Second Largest Oil and Gas Merger - Cabot and Cimarex

Is a Strong Oil Demand Expected This Year?

Pennsylvania Operator To Acquire Three Natural Gas Producers