What Is Fracking
Hydraulic fracturing in some form or other has been around since 1949. Modern-day fracking gained a foothold in the 1990s when advances in horizontal drilling technology opened vast shale reserves thousands of feet beneath the surface of the earth.
Shale is a type of sedimentary rock, made from what is basically pressurized mud, with many tiny pores. Locked within these pores are oil, natural gas, and natural gas liquids. Since its first use in North Texas’s Barnett Shale in conjunction with horizontal drilling, the process of fracking has evolved as a highly effective solution to unlocking these hydrocarbons.
The drilling and completion process is as follows:
Using a drill bit, a rig digs several thousand feet straight down, before turning 90 degrees and digging outward through a horizontal layer of shale. This channel is called the wellbore. Along the horizontal section of the wellbore, small perforations are made, which open the wellbore to receive hydrocarbons.
A pressurized mixture of water, frac sand, and chemicals are then forced into the well, fracturing the perforations in the shale layer and releasing petroleum liquids, which then flow up through the wellbore for collection.
What Is the Role of Frac Sand?
Frac sand plays an important role in the process of fracturing the shale to release natural gas, oil, and natural gas liquids from pores in the rock. When the high-pressure water stream forces the small perforations to become larger fractures, frac sand holds these fractures open to continue releasing fossil fuels. Frac sand (or any other type of natural or synthetic substance), when used to prop open these fractures, is called a “proppant.”
When the water pumps are turned off, the fractures need to be held open so that they don’t deflate and close the pores from which the natural gas and oil are derived.
That’s why it’s so important that a proppant is as durable and crush-resistant as possible. The longer the proppant holds up against the enormous pressure of the fractures, the more petroleum can be extracted, maximizing the efficiency of the well.
The Growing Demand for Frac Sand
With recent higher oil prices, activity in shale basins across the United States is increasing. To keep up with the production pace, frac sand demand is expected to climb accordingly, increasing to 115 million tons in 2019, up from 82 million tons in 2017.
The demand for locally-sourced frac sand is also growing. When oil prices plummeted in mid-2014, production companies across the U.S. set their sights on uncovering new methods of extracting oil, cheaper and more efficiently. The adoption of in-basin sand is a product of this drive for innovation, delivering cost savings by significantly reducing shipping expenses which can account for 65 percent of frac sand costs. Current estimates indicate using in-basin sand will reduce the total cost of drilling and completing a well upwards of 5 to 10 percent.
Permian Basin producers are leading the charge for in-basin sand––mainly driven by the economic benefits that follow simplified logistics. All told, in-basin frac sand has the potential to save Permian producers $500,000 per well. Basin-wide this equals an estimated $3.5 billion in savings per year.
In 2017, an estimated 50 billion pounds of frac sand was used in the basin – double 2016’s total and four times what was used in 2014. Demand is expected to climb, reaching 119 billion pounds by 2022. By then, the Permian alone is expected to account for a full 40 percent of the total projected sand use in all U.S. shale plays.