Monday, August 13, 2012

CN, Superior Silica Sands set pact

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CN said Monday the Class I railroad and Superior Silica Sands have reached a multi-year agreement to move frac sand from a new processing plant now under construction in northern Wisconsin.

Kosse, Tex.-based Superior Silica Sands is building an 85-acre sand processing plant and rail storage facility adjacent to CN's Barron Subdivision near Poskin, Wis., capable of producing up to 2.4 million tons per year of high-quality frac sand products, CN said. Superior Silica Sands broke ground on the processing plant and rail storage yard this month and expects to start production this November.

CN this spring launched a $35 million project to restore nearly 40 miles of track between Ladysmith and Barron, Wis. CN will upgrade rail and replace railroad ties, repair culverts and bridges, and restore rail service along the line. The Barron Subdivision will connect to CN's North American rail network at Ladysmith and will be in service later this year, the railroad said.

CN will provide rail service to the new plant, moving frac sand from northern Wisconsin to shale drilling areas across North America, including Western Canada.

Superior Silica Sands President Rick Shearer said, "We are excited to partner with CN on this project, which will open a new supply chain for our customers and allow us to reach new markets across North America. This major expansion allows Superior Silica Sands to realize its business model for dynamic growth."

Jean-Jacques Ruest, CN executive vice-president and chief marketing officer, said: "We look forward to working with Superior Silica Sands. We are investing $35 million to reopen the Barron Subdivision for rail service and to serve Superior Silica Sands and eventually other new frac sand plants on the same Barron Subdivision."

"Over the last three years, CN's frac sand market has grown nearly 70 percent, reaching 35,000 carloads and $100 million in revenue in 2011, and we hope that our end-to-end service focus will help us grow this market to become a $300 million business for CN in the next three-to-five year horizon," Ruest noted.