Emerge Energy buys frac sand provider Osburn Materials for $20M

|About: Emerge Energy Services LP (EMES)|By:, SA News Editor

Emerge Energy Services (EMES +1.5%) is higher after disclosing that it acquired south Texas sand provider Osburn Materials for ~$20M.

Osburn digs out and sells sports sands and building products but has not sold frac sand to oil and natural producers prior to the EMES deal; the company owns more than 80M tons of sand reserves, largely consisting of 40/70 and 100 mesh sand.

Osburn has capacity to produce ~600K tons/year of wet sand and 300K tons/year of finished dry sand, although EMES says it is planning for an upgrade of the acquired operations and expects to double dry sand production this year with a relatively small capital outlay.