Service & Supply | Oilfield Services | Contract Awarded

Pioneer Inks Long-Term Sand Supply Deal with US Silica

Share Print Bookmark    |    Tuesday,September 11,2018

Pioneer Natural Resources and U.S. Silica Holdings have entered into a long-term sand supply agreement by which Pioneer will purchase an interest in U.S. Silica's sand reserves at its Lamesa, Texas, mine in West Texas.

This agreement secures a long-term supply of sand from the mine, with U.S. Silica processing and supplying sand to Pioneer for 15 years.

Timothy L. Dove, Pioneer President and CEO, stated, "We are pleased to announce our agreement with U.S. Silica that provides Pioneer with low-cost West Texas sand for the foreseeable future. Strategically located in close proximity to our Midland Basin acreage, delivered sand from the Lamesa mine will cost approximately half that of our current delivered sand, reducing well costs into 2019 and beyond. The long-term nature of this agreement will benefit both companies. U.S. Silica has been a trusted partner for many years, and this contract solidifies their position as one of our key suppliers of proppant."

Bryan Shinn, U.S. Silica President and CEO, stated, "We are pleased and excited to have the opportunity to expand and deepen our relationship with Pioneer, one of our largest and most dependable customers. This unique, very long-term contract at our new Lamesa site delivers significant value for both companies in the Permian and is clearly aligned with our stated goal of generating sustainable and predictable free cash flow yield from our oil and gas sand mining assets."