Oxane to locate in Van Buren; possibly add 300 jobs (Updated with video)

2010 is off to a good start and it’s not even 2010 yet.

Houston-based Oxane Materials announced Monday (Dec. 28) it will locate in Van Buren its first manufacturing plant to produce a new proppant developed with nanotechnology developed by Rice University. (See video below of comments from area officials.)

The company will initially invest $15 million in the plant and hire up to 50 by summer 2010. Expansion plans “anticipated through 2014” could bring an additional $32 million investment and total employment of 300. The facility is located on Industrial Park Road in Van Buren near the corporate headquarters of USA Truck Inc.

Carl Sorrell, vice president of manufacturing for Oxane, said the announcement ends a “long decision process” in which more than 80 facilities in eight states were considered. He said reasons for ultimately selecting Van Buren included “excellent” logistics for bringing in raw materials and shipping the finished product, a great workforce and a “very business-minded” community.

Sorrell declined to disclose info on average wages.

Oxane President Chris Coker has pushed Oxane since its founding in late 2002. According to “Oil and Gas Investor” magazine, Coker raised more than $15 million from “industry partners, private-equity firms, and high-net-worth families.” He was responsible for directing Oxane to its focus on new proppant technology and is named the inventor on two issued Oxane patents and more than 10 Oxane patent applications. Prior to Oxane, Coker worked with a venture capital firmed tied to Enron Corp. He earned a masters in business administration from the University of Chicago and a bachelor’s degree in economics from Occidental College.

PROPPANTS
To improve production of a well, a well service company will force a frac fluid under high pressure into underground formations around the well bore. The proppants, suspended in the frac fluid, are forced into the underground fractures and “prop” them open after the frac fluid is removed.

Oxane, which boasts to be an “energy-focused nanoproducts company,” will be the second company producing proppants in the Fort Smith area. Paris, France-based St. Gobain (formerly Norton Proppants) has an operation in Fort Smith on Clayton Expressway.

However, Oxane’s proppants use nanotechnology to make the proppant lighter and stronger. The press release notes the following about the new proppant: “Oxane’s products have a superior weight-to-strength ratio, which promises to increase oil and gas recoveries, particularly when working in unconventional assets like shale, tight gas, tight oil and coal bed methane. OxFracTM and OxBallTM are designed to increase effective fracture length, enhance control over created fracture geometry, and reduce the environmental impact of hydraulic fracturing. Commercially available in 2010, modeling suggests Oxane’s products could increase initial production by up to 50 percent and shallow production decline by up to 15 percent, improving total recovery while reducing total well cost per play.”

RICE ALLIANCE
The Rice Alliance for Technology & Entrepreneurship, began in 1999, worked to develop the special proppant in order to capture more natural gas from new and existing wells, and to do this at a lower cost. According to this slide show presentation from Andrew Barron with the Rice Alliance, the new proppant developed by Rice and Oxane will allow for fewer wells to be drilled (less surface damage) for the same amount of gas, reduce chemical costs and reduce fluid costs. Such reductions also have the added benefit of less environmental impact, according to the Rice report.

Cheryl Garner, vice president of economic for the Fort Smith Regional Chamber of Commerce, praised the “quick action” from Van Buren Mayor Bob Freeman and Van Buren Chamber of Commerce President Jackie Krutsch for helping bring Oxane to the area.

Freeman and Krutsch said they were appreciative of the support from the Fort Smith chamber and the Arkansas Economic Development Commission in landing Oxane.

“We been on the wrong side of job news in the past, so its good to get this (Oxane) going into (2010),” Freeman told The City Wire.

Using nanotechnology in proppant manufacturing is new but not exclusive to Oxane. Houston-based Baker Hughes Inc., for example, filed for a patent in October 2007 for a “Nano-sized particle-coated proppants."