Environment

Hi-Crush Inc.’s environmental programs are governed by our Environmental Management System (EMS). The EMS includes a continual cycle of planning, implementing, reviewing and improving the processes and actions Hi-Crush Inc. will undertake to meet environmental obligations and goals. The EMS is designed to cover environmental aspects which the facility can control and directly manage, and those it does not control or directly manage but over which it can be expected to have an influence. Those internal and external issues which are relevant and affect Hi-Crush Inc.’s ability to achieve intended outcomes of the EMS are assessed, reviewed, and established through proven procedures.

Water quality

Hi-Crush relies on water in our operations for washing and processing sand, and for dust control. Washing and processing sand removes unwanted silts and clays to produce the desired high-quality product. Resulting process water can be cloudy, a characteristic referred to as “turbidity.” The cloudy water is clarified mechanically or naturally through a settling process in ponds on our property. Having gone through this process, the water can either be reused, or, if necessary, is safe to discharge in accordance with local, state and federal regulatory agencies’ permitting standards.

The Hi-Crush Environmental Department works to ensure our facilities meet regulatory program requirements established by local, state and federal authorities. Our Environmental Specialists at each facility develop and maintain storm water pollution prevention plans for each site. We complete regular water testing, including third-party audits. Further, we engage our community regarding safe drinking water, and provide routine professional third-party testing of private wells surrounding our mining operations at no charge to the participants.

Water usage

Hi-Crush is committed to assessing and mitigating groundwater related impacts due to the withdrawals required for our operations. Impacts are minimized through on-site mitigation, reuse, and recycling of process and storm water. We have developed water use programs aimed at achieving the greatest recycling rates possible as a primary goal. This is accomplished through regular monitoring of our water withdrawal and recycling efforts, and implementing best management practices.

Well water use, and process and storm water recycling, are tracked at all of our facilities to the extent possible. Water recycling processes may consist of on-site capture basins coupled with pump-back systems which direct process and storm water back to our washing operations. Further, many of our washing operations utilize a mechanical process to collect water from the residual clay-silt mixture post-wash.

Hi-Crush’s 2018 performance for water use reduction programs achieved >85% recycle rates at two of three targeted facilities1; one of those facilities achieved a nearly 99% reduction of groundwater withdrawal as a result of increased reuse and recycling. We look forward to continuing the practice of recycling and reusing as much process and storm water as possible, achieving annually established goals under our EMS

1One of the three targeted facilities did not operate during the entirety of the 2018 calendar year, and therefore data for this metric was incomplete.

Restoration Update on Whitehall Release

On May 21, 2018 an employee of a contractor of Hi-Crush was operating a bulldozer at our Whitehall mine that accidentally slid into a temporary settling pond, completely submerging the bulldozer, including the enclosed cab containing the operator. With no other option available to save the life of the operator, and in consultation with local first responders, the life-saving decision was made to dig through an earthen berm, releasing water/soil solids into a nearby tributary of the Trempealeau River. The draining of the pond enabled the operator to be rescued by first responders without injury.

With the operator safe, Hi-Crush promptly notified the Wisconsin Department of Natural Resources (WDNR) of the release and since the date of the event, Hi-Crush has worked closely with environmental experts both within and outside of the WDNR to ensure wildlife was not affected by the release and to identify all appropriate measures to clean up remaining residues along area streams and rivers. Both the WDNR and the United States Fish and Wildlife Service confirmed there were no fish kills and did not find negative impacts on wildlife resulting from the release.

The following are the key events related to the release in 2018:

May 21 – The release occurred; operator’s life was saved; WDNR is notified; and, Hi-Crush begins immediate actions to mitigate the effects of the release and clean affected areas, and these efforts continue through 2018.

June 15 – Hi-Crush submits its Initial Site Restoration Plan (ISRP) to the WDNR.

June 18 – Hi-Crush provides a copy of the ISRP to all affected land owners.

July 9 – Hi-Crush meets with the WDNR and provides a status update.

July 17 – WDNR issues a Conditional Low-Hazard Waste Grant Exemption for Hi-Crush to incorporate recovered material into its mine reclamation.

September 7 – Site Investigation Work Plan, Surface Water and Sediment submitted to the WDNR.

September 12 – Hi-Crush has 2nd status update meeting with DNR.

October 16 – Hi-Crush begins sediment core sampling in Trempealeau River.

October 29 – Hi-Crush has 3rd status update meeting with WDNR.

December 20 – Site Investigation Report, Trempealeau River Sediment Sampling Removal submitted to WDNR.

The release was a mixture of soil, sediment and water and at the time it occurred, was deemed by Hi-Crush to not pose a risk to human health. Subsequent testing of water and sediment deposits by WDNR and Hi-Crush confirmed this finding; and is supported by statements later made by the WDNR and State of Wisconsin health officials:

“The results of the WET tests came back showing that there was no significant difference from the reference point through the spill location to the common Q location, indicating there is no acute or chronic toxicity to the water resource.” – Roberta Walls, WDNR;

“The water in the Trempealeau River does not appear to… have any sort of immediate health effects for people.” – Sarah Yang, Wisconsin Department of Health Services.

In 2019, Hi-Crush has continued its work to restore wildlife habitat in affected areas, including wetlands. As part of its effort to mitigate impacts, Hi-Crush purchased 171 acres of land that contained the area most directly affected by the release. This land includes large tracts of prime Whitetail Deer habitat and in 2019 Hi-Crush sponsored a deer hunt for hunters with disabilities on the property.

Air quality

Clean air is an important characteristic of a thriving community, and Hi-Crush is committed to minimizing air pollution impacts to the communities in which we operate. We monitor particulate emissions generated from our operations, including fugitive dust. We ensure the protection of air quality by utilizing the best available control techniques and equipment and following standard operating procedures.

Regulated air pollutants are assessed during our initial construction and continued operations. New and expanded operations have potential emissions analyzed and appropriate controls and reduction methods identified, to ensure continued attainment of (and compliance with) air quality standards. Those operations are then routinely monitored, and collected data provided to regulatory agencies.

We have continued to improve our dust suppression systems, which included moving from a less efficient mechanical collection to a more efficient wet suppression system. The systems are constantly monitored and adjusted to minimize water use while achieving maximum dust suppression.

Finally, Hi-Crush has multiple ambient air monitors that measure air quality around our plants. These monitors collect particulate emission data once every six days (per the Federal EPA schedule), and results are provided to both local and state regulatory agencies. During the entire period from the beginning of company operations through 2018, over 650 samples have been collected from those monitors and not a single sample showed a concentration level above the standard set by the U.S. Environmental Protection Agency to protect public health.

Energy usage and GHG emissions

Monitoring energy use identifies opportunities to become more energy-efficient, thereby reducing GHG emission generation and energy consumption per ton of sand produced. Hi-Crush works with energy sector representatives to review our facilities’ energy use and identify ways to reduce consumption. Assessments can range from routine maintenance of our dryers to the changing of lighting fixtures. Our Blair, WI facility completed a project in 2018 which decreased annual energy use by >38,000 kWh, and eliminated nearly 27 metric tons of GHG emissions. Further, Hi-Crush has worked with local communities to plant hundreds of trees to help sequester a portion of our GHG emissions (1,200 in 2018 alone).

The following GHG emission analysis is gathered from our mining and processing facilities, and includes Scope 1 and Scope 2 GHG emissions.

 

Energy and Greenhouse Gas (GHG) Emissions – Summary

  • Fuel Use by Type
  • Electricity (GWh) 101.3
  • Natural Gas (103 ft3)2,414,506
  • Diesel/Gasoline (103 gal)2,398
  • Energy Consumption (GWh)915.8
  • Energy Intensity (energy use in MWh / tons sold)0.09

 

Scope 1 and 2 Emissions [Thousands of Metric Tons of CO2 equivalents]

  • Direct Sources156.36
  • Indirect Sources71.61
  • Total Scope 1 and Scope 2 Emissions227.97
  • Scope 1 and 2 Emissions Intensity (metric tons CO2 equivalent / tons of sand sold)0.02

 

Light pollution

Hi-Crush operations utilize heavy machinery in and around each mine, and railcar and semi-tractor trailer traffic is commonplace around loading and well site operations. Many of these facilities operate around the clock, seven days a week. This operation schedule requires the use of proper lighting to ensure the safety of our employees. Lighting must comply with federal (MSHA/OSHA) and local regulations, and we have engaged our communities on the necessity of lighting safety requirements for our employees while finding solutions to minimize light that is bothersome to the community.

Hi-Crush has worked with vendors during construction to find appropriate light fixtures that meet both sets of requirements – satisfying safety needs while attaining minimum offsite impacts. Once construction is complete, we follow up with municipal leaders and community members to ensure compliance during operation, and further reduce in impacts in excess of requirements, where possible. Stakeholder meetings conducted in 2018 provided a venue for community members and neighbors to inform us of such lighting issues and to propose improvements.  Actions we’ve taken include installing full cut-off shrouds so that no light is directed upward, or at structures not on the property, and other means of directing lighting away from adjacent properties.

Noise pollution

Operation of industrial equipment and heavy mobile machinery at our locations generates noise just as any other industrial source. Noise levels at our facilities must comply with local and MSHA/OSHA safety regulations, and we have engaged our communities on ways to ensure noise levels meet those safety requirements so that our employees are not at risk, and our operations are not disruptive to community members. Heavy mobile machinery (i.e. front-end loaders, haul trucks) must have sufficiently audible alarms when moving, especially when moving in reverse.  Hi-Crush worked with manufacturers, vendors, and MSHA/OSHA to find solutions to alarms on equipment. We have successfully incorporated the use of low-tone squawk boxes in all our mining mobile equipment. We also followed up with municipality leaders and community members to ensure compliance during operation (by meeting specific decibel level limits as measured at either the property line or as measured at place of occupancy around our operations), and further reduce impacts beyond the requirements, whenever possible.

Reclamation/habitat improvements

Hi-Crush is committed to restoring land disturbed by our mining and processing activities to an end use that is beneficial to the community and ecosystem; In fact, we strive to return the land to a better state than when we first acquired it. Hi-Crush engages local stakeholders during the land acquisition process to best understand how they would like to see the land be reclaimed. We are also subject to state and local reclamation requirements. Adherence to these requirements and the engagement of the local community ensure the post-mining land use achieves our goal of returning it to a better state than when we first acquired it and meets the needs of the community and stakeholders.

Most land prior to Hi-Crush acquisition was used primarily for agriculture, with the balance being either industrial, or recreational. Therefore, most of our reclamation practices are geared towards ensuring the land can be once again used for agricultural purposes. In many cases, we have found the mining of the land and resulting reclamation provides improved agricultural utilization by farmers compared to the period prior to our purchase (e.g. decreased slope). Further, we incorporate landscape changes that provide sustained or increased beneficial storm water management, along with wildlife and aesthetic improvements.

Hi-Crush’s production facilities have been in operation since 2011, and do not yet have substantial mined parcels ready for final reclamation. To date, Hi-Crush has reclaimed 57 acres, with most of those acres being in interim reclamation, as well as reclaimed acreage at our Augusta facility that has been returned to productive agricultural use.

Our future goals in this regard include: finding ways to further integrate biodiversity enhancement into reclaimed areas where practical; utilizing land for public hunting by disabled persons, a program supported by the WDNR; and continuing to plant trees in and around our land and communities.

Wildlife Protection

Hi-Crush is committed to incorporating into our mine planning, operations and reclamation best management practices that provide the maximum possible assurances that we do not negatively impact threatened, endangered and other at-risk species. We assess potential impacts to sensitive resources, including wildlife, during many different environmental permitting phases. Where there may be an instance of identified potential impact, Hi-Crush implements actions which minimize or eliminate the impact. Hi-Crush works with science leaders to identify the actions that are best suited to eliminating or minimizing the impact, and has incorporated several of those practices into our everyday operations.

Karner Blue Butterfly (Federally Listed Endangered Species)

The Karner Blue Butterfly is currently listed as an endangered species. Hi-Crush has taken precautions to not disturb any sensitive habitat for this species through proper and timely presence/absence surveys. There has been no indication of habitat on any Hi-Crush property, but some habitat is known to exist in surrounding areas.

Northern Long-Eared Bat (Federally Listed Threatened Species)

The Northern Long-Eared Bat (NLEB) is currently listed as a threatened species. Hi-Crush follows the best management practices of performing seasonal resource management, such as timber harvesting, only during specified months of the year. Further, presence/absence surveys are conducted as needed during any phase mining that may occur within the sensitive seasonal timeframe.

Wood Turtle (State of Wisconsin Listed Threatened Species)

The Wood Turtle is a listed threatened species in the State of Wisconsin. Hi-Crush implements management plans that incorporate measures to assist and avoid turtle interaction through the use of “turtle fencing” and “turtle crossings.” We erect special barrier fencing to divert turtles away from operational and mining areas of our property. In addition, unique structures are created under our rail spurs to allow turtles to cross under the railroad lines and avoid injury.

Dunes Sagebrush Lizard (At-Risk Species)

The U.S. Fish and Wildlife Service has received a petition to list the Dunes Sagebrush Lizard as a threatened or endangered species. Hi-Crush is committed to contributing to the scientific understanding of the Dunes Sagebrush Lizard (DSL) and to help ensure it is afforded sufficient protection to make a listing under the Endangered Species Act unwarranted. We are committed to working with the Texas Comptroller’s Office of Public Accounts, the U.S. Fish and Wildlife Service and other industry members to that end and to make sure the stated impacts of sand mining in any conservation plan formed to protect the DSL are true and accurate.  We are currently engaged in a productive dialogue with both U.S. Fish and Wildlife Service and the Texas Comptroller’s Office to ensure the draft Texas Candidate Conservation Agreement with Assurances includes a process that sand mining and other industries can follow to improve the accuracy of what is identified as DSL habitat and ensure that statements made about the impacts of sand mining are based on the best available science.

Waste

Hi-Crush implements a strict waste handling program at each of its mining and processing facilities. The Environmental Department provides routine training, and coordinates the identification, sampling (where required), handling, storage and disposal of waste. We strive to produce the least amount of waste, and whenever waste is unavoidable, we attempt to find vendors who can reuse or recycle that waste. Further, we assess all materials that we may utilize on site and perform a review of the hazardous characteristics of the waste that could be generated, and attempt to find materials that would produce zero hazardous waste.

Hi-Crush is proud that each of our mining and processing facilities have achieved and maintained the smallest hazardous waste generator status; in fact, four of the five facilities generated zero hazardous waste in 2018, while the fifth had a one-time disposal of approximately 200 pounds. Hi-Crush generated 1,095 tons of non-hazardous waste in 2018.

Hi-Crush’s waste handling system recycled 450 tons of waste in 2018, saving more than $75,000 in disposal costs and generating revenue of more than $30,000 from vendors that received waste for recycling.

We continuously review our waste-to-landfill profiles, and are always looking for ways to improve. In 2018, Hi-Crush invested in equipment to more efficiently handle and store scrap metal parts at our Kermit, TX, facilities.

Green Tier Program

Hi-Crush participates in the Wisconsin Department of Natural Resources’ (WDNR) Green Tier program, as a Tier 1 participant. This program is designed to highlight and support companies in Wisconsin that are exceeding environmental standards to benefit surrounding communities; the program requires performance that results in measureable or discernable improvement in the quality of the air, water, land or natural resources, or in the protection of the environment beyond regulatory requirements. Participants are expected to have, implement and maintain an Environmental Management System (EMS).

Hi-Crush implements an EMS, based on the ISO 14001 standard, at all our production facilities. The EMS is a means to ensure accountability in our compliance with all local, state and federal environmental regulations, and planning and implementation of environmentally beneficial projects beyond the scope of applicable regulatory frameworks. The EMS is audited annually internally and by external 3rd party professionals that are certified to review such systems, with all such audits provided to the WDNR. Audits ensure the system is appropriate, functional, and maintained.

Some of the benefits realized through this participation includes:

  • Reduction in groundwater withdrawal, providing efficiencies in water use and decreased spending (expenditures) on fresh water [Hi-Crush Whitehall].
  • Reduction in energy use, operating cost, and GHG emission generation, by changing lighting fixtures and bulbs to more efficient LED based bulbs. Also, cooperatively working with Focus on Energy program experts for implementing additional energy reduction projects.
  • Reducing dust and noise generation, and operation and maintenance costs by changing one facility’s sand handling and transport operation from traditional conveyor systems to a slurry system; ensuring minimal increase in water use, to be offset by additional reuse and recycling efforts./li>
  • Local land management and habitat improvements by working with community leaders to plant trees, and installing natural scenic walking paths which stimulate environmental learning opportunities.
  • Working with local municipality emergency responders to provide funding and support to keep those departments (e.g. police and fire) functional and compliant.

2019 Environmental Objectives

Our Environmental Management Programs (i.e. goals) identified for calendar year 2019 include the following:

  • Converting from paper to electronic recording of pressure drop monitoring of air pollution control devices.
  • Planting trees in and around the facilities and communities in which we operate.
  • Participating in community outreach and support projects.
  • Establishing, implementing and monitoring water recycling (groundwater conservation) programs.
  • Identifying and implementing energy conservation and greenhouse gas emission reduction projects.
  • Identifying and implementing wetland restoration and/or enhancement project(s).
  • Updating and implementing our company-wide threatened or endangered, and at-risk, species standard operating procedures.
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