Rainmaker, Arkansas Silica Strike Deal

Rainmaker Resources (RMR) concluded a deal by way of a binding Letter Agreement with Arkansas Silica LLC (ASL) to option the 304-acre Bray frac sand property in Northeast Arkansas. ASL currently has a purchase option on the property from the landowners. RMG has tested and assessed the initial potential and plans to deliver an NI 43-101 resource estimate in 90-120 days, according to a report in the Financial Times.

The company has engaged BRS Inc. of Denver, led by mining industry veteran Doug Beahm P.E., P.G., to complete an NI 43-101 compliant technical report, with a resource estimate.

RMG believes that it can be shipping sand in less than two years, which is significantly less than the nearby property, which took more than three years to get through the permit process.

Rick Patmore, RMG president and CEO, stated: “The Bray Frac Sand property is ideally situated to service the Eagle Ford, Fayetteville and New Albany shale plays. The Ottawa sands are of a top pedigree of frac sand in this industry. Mexico lifted its moratoriums opening another potential and significant revenue stream. This property could quickly turn Rainmaker into a major contender in this market for many years to come.”

While the quality of the sand is extremely high, the key to this deal is the location. The property is 20 miles from rail, which is already set up to load sand. Being close to transportation infrastructure means RMG can not only service Canadian clients, but more importantly any customer from Pennsylvania to the massive oil and gas fields of the southern U.S. and into Mexico.

Prior to securing the property, Rainmaker drilled three initial holes and found sand thicknesses of 80, 90 and 120 ft. The quality of the initial tests showed that approximately 80 percent was top quality sieve cuts of 40/70 (58 percent) and 70/140 (33 percent).

Alan Young, director and CFO of RMG, stated: “The particle size distribution will result in good revenue streams and value for application for fracture stimulations in Canada, the U.S. and Mexico. Compared in particular to proppant from Canada, this product is stronger and has a better particle distribution, making it applicable to more stimulation applications.”

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