Apr 17 2015
Select Sands Corp. (the "Company") is pleased to announce the Company has submitted a Quarry Mining Permit Application to the Arkansas Department of Environmental Quality (ADEQ) for its Sandtown project in Northeast Arkansas, USA.
The quarry mining permit includes Reclamation Bond Instrument, five-year mine plan, and a public notice in an Arkansas daily newspaper.
Industrial Silica Sand and Frac Sand Market:
Select Sands Corp. Sandtown project near Cave City, Arkansas is 99% pure silica (SiO2) and "high crush resistance" of 30/50 mesh 7K, 40/70 mesh 9K and 100 mesh of 10K (suitable to be used in the extraction of oil and gas as 'Ottawa White' Tier-1 frac sand). The high purity (99% SiO2) silica is also suitable for industrial use including float/flat glass (automotive windshield and architectural glass), solar glass, computer/cell phone screens, fiberglass, construction, and building products.
Prices and volumes for Industrial Silica sand were higher in 2014 in the flat glass and fiberglass industry, where it is used in raw form to make glass. Overall demand growth is expected to continue in the flat glass, fiberglass, construction, and building products industries in the US aided by low regional energy (natural gas) costs. Growth is anticipated to remain the strongest in the U.S., including a further strengthening of the initial growth that started in 2014 in the non-residential construction, automotive, and photovoltaics (solar glass) sectors.
Frac sand (used in the extraction of oil and gas) demand decline in 2014 due to low rig-counts in the US is partially offset by the sand use increase per well. The number of drilled but uncompleted wells (DUC) is still increasing in the US. Bringing these DUC wells onstream alone will require about 9MM tons - 18MM tons (and growing) Tier-1 frac sand.
Preliminary Economic Assessment by Tetra Tech Inc.:
The Company is currently working with Tetra Tech Inc. to complete a mineral resource estimate and preliminary economic assessment (PEA) prepared in accordance with NI 43-101 and based on the recently completed drill program (See March 10, 2015 Press Release). The PEA will provide an initial resource estimate and conceptual economic analysis, including projected Net Present Value ("NPV") and Internal Rate of Return ("IRR"). The study will take into account current pricing and marketing options related to the silica sand industrial and specialty products markets (glass, construction, and sports/recreation) as well as the frac sand market for use in oil and gas extraction. The Company expects the report to be completed and released in the month of May 2015. The Company has completed a drill program on 200 acres of its 520-acre property. The St. Peter Sandstone formation intersected in the drilling to date remains open to the north and south. Tetra Tech Inc. is an industry leader in the evaluation of mineral deposits and has recently completed similar studies on industrial sand projects located in northern B.C. and Nevada, USA.
"We are encouraged by the demand increase in the industrial silica sand market, offsetting decline in the frac sand market," commented the Company president, Rasool Mohammad. "However, as per the recent IHS, Eagle Ford, Texas, DUC inventory of April 9, 2015, nearly 40 percent of the 1,400 DUCs (in Eagle Ford) are considered to have attractive economics (break-even costs below $30 per barrel); the demand for frac sand is expected to improve short-medium term."
Cameron Bartsch, M.Sc., P.Geo., of Tetra Tech, a Qualified Person as defined by National Instrument 43-101, has reviewed the scientific and technical information disclosed in this News Release.
Source: http://www.selectsandscorp.com/