Hi-Crush Partners LP announced the successful completion of its previously announced acquisition of certain equity interests in Hi-Crush Augusta LLC, the entity that owns a raw frac sand processing facility located in Augusta, Wis., for cash consideration of $224.25 million.
At the closing of the acquisition, the partnership’s preferred equity interest in Augusta was converted into common equity interests in Augusta. It now owns 98 percent of Augusta's common equity interests.
“This is an exciting day for us,” said Robert E. Rasmus, co-chief executive officer of Hi-Crush. “By acquiring the Augusta facility we have doubled the partnership's production capacity to 3.2 million tons per year, and have established a baseline for future expansion. We remain focused and ready for the future, and for meeting the market's increasing need for Hi-Crush sand.”
Hi-Crush also announced the entry into an amendment to its three-year supply agreement with U.S. Well Services, LLC, or U.S. Well, a Texas-based oilfield services provider of well-stimulation services to the upstream oil and gas industry.
The amendment significantly increases the annual committed volumes under the agreement signed in March and extends the term by two years. The new five-year supply arrangement requires U.S. Well to pay a specified price for a specified minimum volume of frac sand each month.
"Hi-Crush is excited to further extend and strengthen our relationship with U.S. Well by entering into this amendment," said James M. Whipkey, co-chief executive officer of Hi-Crush. “U.S. Well’s increased commitment for volumes further underscores the demand for Hi-Crush sand and the appeal of our strategic logistics capabilities throughout the Northeast.”