Transloading operations at a railyard in Medicine Hat, Alberta, where Victory Nickel is converting common sand into frac sand at its new processing plant. (Photo courtesy Victory Nickel)
Victory Nickel and its wholly owned subsidiary Victory Silica have commissioned the 500,000-mt/y Seven Persons frac sand plant near Medicine Hat, Alberta, and expect to ramp up production and sales through the remainder of 2014.
Victory Nickel has four early-stage nickel sulphide projects in Canada: Minago, Mel, and Lynn Lake (currently under option to Prophecy Platinum Corp.) in Manitoba and Lac Rocher in northwestern Québec. Its new frac sand business provides it with its first source of cash flow.
The Seven Persons frac sand plant is processing concentrated sand imported from Wisconsin and selling various grades of high-quality frac sand. The plant is located near potential customers and within a few hours trucking distance of major oil and gas well sites. It represents the first phase of Victory Nickel's three-phase plan for its frac sand business.
Phase 2 includes construction of a frac sand wet plant in Wisconsin, which is expected to reduce costs and assure security of sand supply through ownership of a frac sand mine in the state. In phase 3, the company intends to construct a larger frac sand plant in Manitoba to process and distribute both imported and domestic sand, which may potentially, but not necessarily, include sand mined as a co-product of nickel at Minago. The company has identified a site in Winnipeg, Manitoba, for this plant.
Victory Silica CEO Ken Murdock said, "Going from a standing start to first frac sand production and sales in less than two years is quite an achievement. We now have 70% of the Medicine Hat-based oil field service companies as customers. This is just the beginning, however, and we have begun the push to implement phase 2 of our business plan."