The Sand Rush in the Permian Basin Continues to Pulverize Frack-Sand Producers
Frack-sand producers Fairmount Santrol Holdings (NYSE: FMSA), Hi-Crush Partners (NYSE: HCLP), and U.S. Silica Holdings (NYSE: SLCA) are all getting crushed on Monday and were down double digits by the mid-afternoon. Fueling today's sell-off was Fairmount Santrol Holdings' decision to join its rivals and open a new sand mine in the Permian Basin of Texas.
Fairmount Santrol Holdings announced today that it had signed a 40-year lease to develop a frack-sand mine in the Permian Basin. The company expects to complete construction of the facility in the second quarter of next year, which should produce about 3 million tons per year and cost $100 million to $110 million. Further, the company said that it plans to reopen its Shakopee sand mine in Minnesota due to increasing customer demand.
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Source: Fool.com
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