WINONA, Minn. (CN) – A mining company claims a Minnesota county’s recently enacted ban on “frac sand” intentionally singles out companies that process and transport silica sand used in fracking.
Minnesota Sands sued Winona County in Winona County District Court on Tuesday.
The company says it owns and develops silica deposits to produce custom sand “proppants” using high quality Minnesota quartz and substrates for customers in the energy industry.
Proppants like silica sand are used to keep a hydraulic fracture open during fracking, the process of injecting high-pressure liquid into subterranean rocks to force open fissures and extract oil or gas.
“The sand under lease by Minnesota Sands is unique because it has high crush resistant, sphericity and roundness, low turbidity, and a preferred grain size, making it extremely valuable for use in energy production,” the complaint states.
On Nov. 22, Winona County formalized its ban on mining silica sand and approved and adopted the zoning ordinance at issue.
“The ordinance prohibits the excavation, processing, storing, and hauling silica sand of so-called ‘industrial minerals’ but does not prohibit these activities for so-called ‘construction minerals,’” the lawsuit states.
The county defines industrial minerals as "naturally existing high quartz level stone, silica sand, quartz, graphite, diamonds, gemstones, kaolin, and other similar minerals used in industrial applications, but excluding construction minerals," according to the complaint.
It defines construction minerals as including "natural common rock, stone aggregate, gravel and sand that is produced and used for local construction purposes," such as road pavement, concrete, or unpaved road gravel.
Minnesota Sands argues that silica sand for fracking and sand seen as a construction mineral do not differ in any real way.
"The composition of the two types of sand and the methods used to mine, process, and transport both types of sand are in all relevant respects the same," the lawsuit states.
The ordinance allows sand that is produced and used for local construction purposes to be transported through Winona County, but does not allow the transport of silica sand to be used for industrial purposes.
Minnesota Sands says the county’s ordinance arbitrarily singles out mining companies that process and transport silica sand for industrial use, and subjects them to adverse treatment based on its disapproval of fracking that takes place hundreds or thousands of miles away.
“While the regional silica sand is an excellent proppant in the hydraulic fracturing process, the oil and gas production activities in which Minnesota silica sand is ultimately used are out-of-state, as there is not a significant oil or gas reserve in Minnesota,” the lawsuit states.
Because the ordinance bans industrial mining of all silica sand under leases with Winona County, Minnesota Sands says it has no economically viable use for any of its leases in the county.
The mining company says it currently leases more than 3,732 acres of land in southern Minnesota containing more than 250 million tons of monocrystalline silica sand. In Winona County alone, it says it has seven leases to mine 1,946 acres of land with more than 144 million tons of high quality silica sand.
According to the complaint, the silica sand under lease by Minnesota Sands in Winona County has a current market value $3.6 billion. The company says industry experts anticipate the market value to increase to $5.7 billion over the next 18 months as the result of demand.
Minnesota Sands says Winona County has no rational basis for treating it “differently than a similarly situated mining operation producing sand for local construction purposes.”
Jay T. Squires with Rupp, Anderson, Squires & Waldspurger in Minneapolis, representing Winona County, said in a statement, "We do not comment on pending litigation, but intend to defend the challenged ordinance amendment in court."
Minnesota Sands seeks an unspecified amount of damages from Winona County for allegedly denying its right to equal protection and due process, as well as violation of the Interstate Commerce Clause.
It is represented by Christopher Dolan with Faegre Baker Daniels in Minneapolis.
Rick Frick, president of Minnesota Sands, said in a statement, “Banning this type of mining based on the end use of this resource is not only unconstitutional, it takes away the rights of landowners and defies common sense.”
“The ban has not changed the fact that the energy industry in the U.S. has dramatically recovered from recent economic challenges and there is now a growing need for the kind of silica we are lucky to have here,” Frick said. “It has instead hurt people here and ignores the fact Minnesota already has a very rigorous and thorough approval and review process for any mining project.”
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