Fortress Environmental Holdings Texas SuperCenter Projects
Fortress Environmental Holdings, LLC was established in December, 2013 with the general purpose of finding and selecting the best opportunities to service the oil and gas industry and provide the best returns to our investors. Our first project was established in Gonzales County, Texas at the growing edge of the Eagle Ford shale development. We are particularly proud of this first project as it has quickly become recognized as one of the best examples of how to design and build a full-service facility.
Texas SuperCenter Project #1: Gonzales County
Located right off the I-10, and Highway 97 interchange (Refer to blue marker in the map to the right), our Gonzales County facility couldn’t be in a better location to service the growing opportunities in this North-Eastern portion of the Eagle Ford. Trucks visiting our facility only need travel <1/4 mile on fully paved roads to reach us from the I-10 interstate. Over five trucking companies are within 7 miles of us up and down Hwy-97. Once a truck pulls into our facility, they find one of the few (if not only) 1-stop locations that can:
- Help them offload their disposed or flow-back water in less than 17 minutes – at a facility that that they can just drive through one of 4 bays with no backing up.
- Once empty, they can then opt to have their tank completely washed out to get rid of any sediment and/or gunk before refilling with fresh water.
- They can also opt to get their entire truck washed so they don’t risk any citations while traveling state highways.
- They can also get their tanks filled up with fresh water to take back to their oil drilling clients.
- Soon, we will also have a mud farm facility that will receive and process mud used in drilling new wells.
Texas SuperCenter Project #2: Dimmit County
FEH, through its operational branch, Fortress Environmental Services (FES), is developing its second oil field/environmental disposal services Supercenter Project on a leased a 12.8 acre property located in Asherton, Dimmit County, Texas. The new Project is 116 miles south of San Antonio and 190 miles southwest of the initial FES project in Gonzales County, Texas which opened July, 2014.
The project will provide vital services to producing oil and gas wells and to wells being drilled and completed. The property is located on one of the main transportation routes in Dimmit County – FM Road 190, just off Route 83, a major highway in the middle of significant oil and gas activity providing easy access to any trucks wanting to use the FES services (See map).
Asherton is in the Eagle Ford Shale (EFS), possibly the largest single economic development in the history of the state of Texas and the largest oil & gas development in the world based on capital invested. The play trends across South Texas from the Mexican border into East Texas, roughly 50 miles wide and 400 miles long with an average thickness of 250 feet resting between the Austin Chalk and the Buda Lime at a depth of 4,000 to 12,000 feet. While 17,000 wells have been drilled so far by over 200 active operators in the 30 county EFS area, the University of Texas recently estimated that it expects 100,000 wells in the EFS that could recover 10 billion barrels of oil and 20.8 trillion cubic feet of natural gas. Additionally, 1,261 wells in the EFS were drilled but not fracked during the downturn, according to the EIA.
The Project’s operations are composed of the following business units.
- A Solids Treatment Facility (“STF” or commonly known as a “Mud Farm”). This facility processes solid cuttings as well as water & oil based drilling mud that are associated with the drilling and fracking of wells. The STF derives revenue from tipping fees and from recovery of skim oil which is sold at WTI less $8.00. FES expects to obtain a permit from the Texas Railroad Commission which has changed its regulatory policy and is more aggressively regulating mud disposal while actively discouraging land farming. The advanced equipment and sophisticated operating process to be utilized at our STF will comply with state of the art procedures and will produce NO polluting materials. Most competitive facilities will not be able to comply with the new regulations.
- A Truck Tank and Frac Tank Wash-out The trucks delivering mud, cuttings, and salt water to the site for disposal require frequent washout as do the trucks delivering the same material to other disposal facilities. Frac tanks must be cleaned out upon the completion of each well by drilling rig. Trucks and frac tanks pay a fixed fee for the first two hours of service and then an hourly rate.
- Salt Water Disposal. Frac water and production water will be accepted and separated from skim oil utilizing a 16,000 barrel settling pond. The salt water will then be environmentally disposed.
Dimmit County was on the front-edge of the Eagle Ford explosion and is now getting ready for the “second wave” (i.e. a Stage 2 field). The first wave of wells were drilled on 640 acre spacings. In the second wave, the density increased to about one well per 120 acres for the most productive fields. Sanchez Energy (NYSE:SN) recently announced a $2.3 Billion acquisition of rights immediately adjacent to the Project site with an aggressive program to drill and complete thousands of wells on its property starting in 2017.
The Supercenter Project is expected to open in August of 2017. There are approximately 26 rigs currently operating within market proximity to the Asherton site and the number of rigs is expected to increase as the price of oil recovers. Fortress expects to obtain ten drilling rigs as clients within 180 days of opening. Each rig completes a well in approximately 20 days before moving to the next nearby site. The map below shows why we are so interested in this project location. Not only are we located off the main travel roads in Dimmit County but, as you can see below, there is a substantial amount of drilling activity going on in the area that will feed our business (The purple circle is where our site will be located).