Select Sands Corp. on April 28 announced operational and financial results for the fourth quarter and full year 2019. The company sold 10,017 tons of frac and industrial sand during the fourth quarter of 2019, compared to 39,669 tons in the third quarter of 2019. For the full year 2019, the company sold 119,736 tons of frac and industrial sand. For the full year 2019, the company reported a net loss of $9.3 million.
Zig Vitols, president and chief executive officer, commented, “Given the challenging operating environment we and other U.S.-based frac sand producers expected and saw during the fourth quarter, Select Sands took a number of strategic actions to improve our financial position through the termination of the option to purchase the land in Arkansas and the divestment of certain assets we deemed as no longer core to our business. These targeted initiatives resulted in more than a 30% decrease in total debt and a year-end cash position that was substantially flat with the end of the third quarter.
“The most significant highlight for the fourth quarter was our establishment in December of transloading operations in the Eagle Ford Basin and a related long-term agreement to supply our premium 100-mesh Northern White Sand to a large-cap exploration and production company operating in the basin,” he continued. “We began delivering under the contract in January and continued to supply significant volumes of product until the operator curtailed frac operations and halted receipt of sand shipments, as announced in the company’s press release on April 13, 2020, due to declining oil prices as a result of the COVID-19 global pandemic.
“We are working closely with the customer and look forward to resuming sand shipments as conditions improve,” Vitols concluded. “The company’s contract with its customer is a ‘take or pay’ contract which will likely generate some level of revenues for the company in the coming months, depending on a number of contractual factors. The precise details contained in that contract however are confidential.”