Home A project of States Newsroom
Brief
Frac sand mining back on the rise in Wisconsin

Share

Frac sand mining back on the rise in Wisconsin

Nov 17, 2022 | 6:22 am ET
By Isiah Holmes
Share
Frac sand mining back on the rise in Wisconsin
Description
Pumpjacks, which are crucial to oil field and fracking operations

Prior to 2020, frac sand mining had been a declining industry in the Badger State. Wisconsin’s coveted northern white sand was proving too expensive to transport to sites across the country. Many companies migrated to Texas, closer to fracking operations that extract oil and gas. But one Texas-based company, Smart Sand Inc., is making a comeback in Wisconsin.

According to Wisconsin Public Radio, the company reported a 41% increase in sales of northern white sand during the third quarter of 2022. Recently, he company’s sales double year after year. A filing with the U.S. Securities and Exchange Commission offered a clarifying view into why frac sand mining in Wisconsin is on a momentary rebound.

Demand for oil and gas dipped during 2020 due to the COVID-19 pandemic. Subsequent years have seen a rebound in that demand, and then the invasion of Ukraine occurred. “The ongoing conflict in the Ukraine has contributed to dramatic swings in oil and natural gas prices and significant volatility in the oilfield service sector,” the filing states. “Additionally, current high inflation and other economic factors could lead to a global economic recession that could have a negative impact on global oil and natural gas demand, which may lead to continued volatility in the oil field service sector. We cannot predict if positive pricing trends will continue or if sand prices will increase, decrease, or stabilize.”

For now,  northern white sand has become more valuable. The Smart Sand Inc. filing states that the sand, which is primarily found in Wisconsin, has logistical advantages in regions from the Appalachian basin to Colorado to Wyoming and Canada. “We expect demand for our frac sand to continue to be supported by customers who are focused on long-term well performance and ultimate recovery for reserves from the oil and natural gas wells they are completing as well as those interested in the efficiency of their logistics supply chain and delivery of sand to the wellsite.”

Smart Sand Inc. has also been making other moves in Wisconsin. In March, the company bought a deactivated mine in Blair Wisconsin from Hi-Crush for $6.5 million. Six years earlier, the same mine was bought by Hi-Crush Partners LP for $75 million. Hi-Crush invested a lot of money to keep its mines running under former Gov. Scott Walker. One of the company’s co-founders, Robert Rasmus, contributed $25,000 to Walker’s campaigns between 2012 and 2017. Rasmus gave another $205,000 to the state’s Republican Party, along with over $10,000 from three of his  employees. The company came under investigation for dumping 10 million gallons of sludge into the Trempealeau River in the Driftless region of western Wisconsin. Smart Inc. maintains another mine in New Auburn, Wisconsin.