High Roller Keeps Rolling… Meet The New Old Permian Dune Sand Miner
January 25, 2019 Infill Thoughts Leave a comment
High Roller Sand, the 2017 local Permian frac sand startup with oilfield roots, has re-emerged after the 2018 sale of their original PE-backed Permian Basin frac sand plant.
Construction is in the advanced stages on two new High Roller Sand plants, news that broke here first back in September.
This week, we caught up with Dave Frattaroli at the company hear more about their two greenfield plants. The company’s new, re-branded website is going live next week and it will reveal their new dual-plant Permian operations, which we shine a spotlight on below.
Keep Rollin’ Rollin’ Rollin’ Rollin’…
High Roller Sand’s two newbuild plants are designed to bring a combined nameplate capacity of 5mmtpa to the market, and both sites are expected to be commissioned by the end of 1Q19.
Management is applying lessons learned from their first Permian build-out project to these next two plants, especially dewatering the difficult Permian sand grains.
And their formal “re-introduction” to the market will take place in the first week of February with a booth at the HFTC conference in the Woodlands.
As one of the last new entrants to select locations in the Permian, High Roller chose north and south site locations just outside most crowded corridors in the Permian mining scene.
High Roller Chose Locations On The Edge Of The Core Permian Dune Sand Mining Zone
Importantly, this new construction round is privately funded by the High Roller team and family ownership with no outside financial sponsor.
Leveraging long-tenured sales relationships, management tells us they have 75% of their new plant volumes spoken for, feeding their customers’ growth and demand for logistical efficiencies. Looking at the locations, we’d expect a Midland-heavy destination mix vs. the more Delaware-oriented original plant, although 115 has good Delaware access as well.
Management is selectively hiring key staff from the mines closing in Brady, Missouri, and Wisconsin – in some cases importing full teams that have a history of working together. And opening the two plants close together in time gives them some flexibility to move key staff between the locations.
Below you’ll find details on each of their two newbuild plants, which by the way are the two of the final three Permian in-basin mines which we track as actively under construction.
115 Plant Details
- Plant Size:4mmtpa nameplate (3 rotary dryer configuration)
- Timeline:Commissioning mid-March 2019
- Build Details:IAC is building the plant
- Gradation: 60:40 mix of 100 mesh and 40/70
- Specs:10k 100 mesh and 7k 40/70
- Load-out:6 silos with load-out flexibility
- Expansion Plans:Management says they have no plans to expand at this point, but we found evidence of an NSR permit in the works and they could add a 4th dryer and 2 more silos
- Environment:Plenty of water, stitched out a deposit that doesn’t have high-probability DSL habitat
- Fun Fact:Sand on the east side of this dune is a bit finer than that to the west and also has a little better quality (crush, roundness, sphericity) per tests Lonquist ran for High Roller Sand both to the west for their original pant and to the east for this one
Penwell Plant Details
- Plant Size:2mmtpa nameplate (1 dryer)
- Timeline:Commissioning late-January 2019 (producing dry sand this week, shipping next week)
- Build Details:Simple purpose-built plant employing used equipment trucked to Texas from Wisconsin after purchase at the auction of a closing NWS plant
- Gradation: Single grade 100 mesh (50 / 140)
- Specs:Similar crush to other Permian 100 mesh not making the split (will be in neighborhood of 8k)
- Load-out:2 silos
- Expansion Plans: No plans to expand at this time but could add a 2nd dryer and 2 more silos
- Environment:No DSL risk here, but water is a challenge in this part of the Permian as it is dry here. High Roller will rely on wells on the property plus piped third-party water. Also the sand deposit is extremely dry, which may give the company some efficiencies in production.
- Fun Fact:This plant will have a strategic alliance with TSS, who is building a new yard and silo storage facility in Penwell. This mine will be the closest to their yard, and TSS is contracting out a portion of this mine’s capacity to serve their “mid-mile” / “delivered pricing” customers.
Parting Thoughts
We finished our conversation with Dave as we always do… “what’s next?”
While we wouldn’t count out additional expansion from High Roller in the frac sand vertical, we believe they will likely focus on execution at these two mines for most of 2019 at a minimum. The company has looked at local sand everywhere, but does have some reservations about quality specs beyond the Permian. They’d likely need a customer to request they build a dedicated facility for that customer before moving outside the Permian, at least in current market conditions.
As Dave said: “Permian dune sand is unique in that it is exactly where it needs to be and exactly what it needs to be in terms of quality.” We suppose that’s why High Roller is building the Permian Basin’s 20th and 21st new mines in 2.5 years.
