The early months of 2017 saw an increase in demand for hydraulic fracturing “frac” sand, according to recent news reports, which add that a steeper demand for the product may be on the way as oil production ramps up. For those researching Vista Sand Owner and the frac sand mining process, these recent developments within the industry are a welcome change from bottom-of-the- barrel retail gasoline prices of recent years.
Frac sand is typically pumped into the ground along with other substances to help break up subterranean natural gas deposits for mining purposes. According to a Feb. 17, 2017 Reuters news article, the increase in demand is due to an increase in shale oil mining. Per the report, this bump in activity is allowing for companies that mine the material to lock in long-term prices with oil production operations. The report states that the increased demand is driving up prices to positions where industry experts expect them to remain for at least the next 18 months.
The recent rush of good news comes after cheap oil prices rebounded to industry norms. When prices fell, oil producers cut back budgets for products like frac sand. Now, according to the Reuters article, there are nearly 600 U.S. oil rigs in operation across Texas and North Dakota.
Industry experts say the price of frac sand could even increase in the coming months, albeit a modest jump if at all. Reports say that frac sand producers will need to concern themselves with mining enough material to meet demand in 2017. Averaging about $25 per ton, according to a January 2017 article by an industry-oriented website, frac sand prices could surge to $40 per ton over the next year.
For more information on Vista Sand Owner or the frac sand industry, call 817-279-1660.