OFS Energy Fund News

July 16, 2018

OFS Energy Fund Invests in Market Leading Frac-Sand and Logistics Business

Houston – July 16, 2018 – OFS Energy Fund (“OFS”) is pleased to announce that it recently closed on a preferred equity investment in Shale Support Master US Holdings, LLC (“Shale Support” or the “Company”), which, through its related entities, owns and operates frac-sand mines and related logistics operations. Shortly following OFS’s investment, Shale Support closed on the acquisition of two regional sand mines in Kinder, Louisiana and Greenwell Springs, Louisiana. The addition of these two mines adds 2.0 million tons of nameplate capacity to Shale Support’s existing operations, increasing total capacity to 5.0 million tons annually. Shale Support anticipates increasing the two Louisiana mines’ capacity to 3.0 million tons by the first quarter of 2019, which will give the organization 6.0 million tons of capacity annually.

Shale Support has been in operations since 2014 and is a provider of logistical services and frac-sand or "proppant" products to enhance the recovery rates of hydrocarbon products from natural gas and crude oil wells. The Company has more than 180 million tons of frac-sand reserves within its mining properties and is unit train capable from its processing facility located in Picayune, Mississippi. Shale Support also own a transloading facility, on the south side of San Antonio that is unit train capable with significant storage and transloading facilities serving both the Eagle Ford and Permian basins. 
Kevin Bowen, Co-Founder and CEO, noted with regards to the recent Kinder acquisition, "It has been difficult for Shale Support to find sand mine acquisition opportunities which maintain the clean, single digit turbidity product with targeted levels of crush strength that meet the quality requirements of API and our organization. These two Louisiana mines produce a clay-free, white sand that will maintain the stringent product standards of our brand, Delta Pearl. These mines are strategically located to meet existing demand in the Haynesville, as well as the significant demand increase that we see coming from expanding Austin Chalk activity."
Shale Support mines Delta Pearl from its properties in Picayune, Mississippi. Delta Pearl is the frac sand of choice among operators and third-party suppliers with operations in the Marcellus/Utica, Permian, Eagle Ford and Haynesville shale plays.
“OFS Energy Fund is excited to partner with Shale Support and its committed management team to provide the capital necessary to grow the organization with the two recently acquired regional sand mines,” said Bruce Ross, OFS Managing Partner. “Shale Support is a clear leader in the frac-sand and related logistics segment, and the expansion of nameplate capacity solidifies that position.”  
“OFS was attracted to this opportunity based on the Company’s strategy of cost-efficiently serving basins outside of the Permian. Shale Support’s base location on the Mississippi/Louisiana border provide it with a regional transportation cost advantage in which to serve the Eagle Ford and Haynesville Basins. In addition, the Picayune mine is dual Class I rail served with direct unit train access to the Northeast with no rail switching requirements providing a logistical cost and delivery time advantage to the Marcellus and Utica Basins. With the addition of the two Louisiana mines, Shale Support now adds to its portfolio an in-basin capability serving the Haynesville and developing Austin Chalk areas,”  said Robert Whilden, OFS Managing Director.
About OFS Energy Fund
Houston-based OFS Energy Fund is a private equity firm that specializes in acquiring and providing growth equity for lower middle-market energy service companies. OFS seeks to provide capital to business owners in the form of buyouts, recapitalizations, and growth equity investments. The Fund supports the development of management, appropriate governance, professionalization of reporting, and improving operational efficiencies to generate above average outcomes. OFS currently has in excess of $300.0 million of committed private equity capital under management across Fund II and Fund III. 

OFS Energy Fund
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