Pioneer Natural Resources Company, the largest natural gas operator in the Texas Panhandle has entered into a long-term sand supply agreement with U.S. Silica Holdings, Inc.
Under the deal, Pioneer will purchase an interest in U.S. Silica’s sand reserves at its Lamesa, Texas mine in West Texas. The agreement secures a long-term supply of sand from the mine with U.S. Silica processing and supplying sand to Pioneer for 15 years.
The sand reserves and sand supply will be from U.S. Silica’s previously announced mine that is located about 60 miles north of Midland, near Lamesa, Texas. The mine is expected to produce approximately six million tons annually of predominately fine grade 100 mesh and 40/70 mesh sand, with initial production expected in the fourth quarter of 2018.
Pioneer expects to receive its initial sand volumes during the first quarter of 2019, with its supply increasing from approximately 1.4 million tons in 2019 to 2 million tons per year in 2020 and future years.
Pioneer is a large independent oil and gas exploration and production company, headquartered in Dallas, Texas, with operations in the United States. For more information concerning Pioneer, visit www.pxd.com.
U.S. Silica is a leading producer of commercial silica used in the oil and gas industry, and in a wide range of industrial applications, headquartered in Katy, Texas, and with offices located in Chicago, Illinois, and Frederick, Maryland.