To make money mining sand, the first step is securing a proper site.
Wisconsin has several sandstone formations that produce grains of sand that are spherical and strong, the keys to successful use in fracking. Even though any mine located in those formations should produce marketable sand, some sites are more expensive to mine than others, said Mark Zdunczyk, an independent consulting geologist from East Greenbush, N.Y.
Even when all the sand is marketable, different sized sand grains sell for different prices. More coarse sand, called “20-40” sand, is sold for oil drilling. Finer sand, called “40-70” sand, is sold for natural gas drilling.
The second factor that affects the profit margin of a sand mine is how much unmarketable material, called overburden, is sitting on top of the sand. The cost of moving and storing this excess soil can add up quickly, so smaller amounts of overburden mean higher profits.
“Look at Unimin. They have a staff of geologists who picked the perfect site,” Zdunczyk said, referring to the facility under construction in Tunnel City near Tomah. “On two rail lines, low overburden, good 20-40 sand, low environmental impacts.”
After good grain sizes and low overburden, many industry experts agree that the last key to a successful mine site is proximity to rail lines. Hauling sand by trucks is expensive, and every mile adds up. Facilities located on rail lines can make more profit on their sand because they eliminate trucking costs.
“Let’s say it costs $2 a ton to get it to the rail, but if the price drops $3 a ton, then it’s not worthwhile,” said Tom Hubbard, an engineer with Cedar Falls Building Systems Inc. in Menomonie who has worked with several mining companies. “But if you are on the rail, it’s still profitable.”
— Kate Prengaman
Republish our articles for free, online or in print, under a Creative Commons license.
Republish this article
This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License.
- Credit should be given, in this format: “By Dee J. Hall, Wisconsin Watch”
- If published online, you must include the links and link to wisconsinwatch.org
- If you share the story on social media, please mention @wisconsinwatch (Twitter, Facebook and Instagram)
- Don’t sell the story — it may not be marketed as an individual product.
- Don’t sell ads against the story. But you can publish it with pre-sold ads.
- Your website must include a prominent way to contact you.
- Additional elements that are packaged with our story must be labeled.
- Users can republish our photos, illustrations, graphics and multimedia elements ONLY with stories with which they originally appeared. You may not separate multimedia elements for standalone use.
- If we send you a request to change or remove Wisconsin Watch content from your site, you must agree to do so immediately.
For questions regarding republishing rules please contact Andy Hall, executive director, at ahall@wisconsinwatch.org
