Canadian Pacific Railway Ltd. says it has a multiyear agreement with U.S. Silica to transport frac sand.
CP did not disclose the value of the contract, which will make it the exclusive rail service provider to the American company’s newest mining and processing facility in Sparta, Wis.
U.S. Silica is the second-largest U.S. producer of commercial silica, used in oil and gas shale production and various industrial and specialty products.
The company is building a new frac sand plant located on the CP’s rail line in Sparta that will produce high quality northern white sand for use in shale basins across the United States and Canada.
The plant will produce and ship three different grades of dry sand and is expected to be fully operational in the first quarter of 2013.
Jane O’Hagan, CP executive vice-president and chief marketing officer, says the agreement is an important component of the railway’s growing energy strategy, which focuses not only on outbound crude oil but also on the flow of input materials into shale and other energy developments.
“Our agreement with U.S. Silica leverages the strength of CP’s network through Wisconsin with service to key energy regions throughout North America” Ms. O’Hagan said.