Atlas Energy Solutions Announces First Commercial Delivery off the Dune Express

Rhea-AI Summary

Atlas Energy Solutions (NYSE: AESI) has achieved a significant milestone with its first commercial sand delivery through the Dune Express, a 42-mile conveyor system. The delivery occurred on January 12th, transporting proppant from the Kermit facility to the End-of-Line loadout facility in New Mexico.

The innovative project aims to enhance oilfield logistics efficiency and reliability in the Permian region while improving community safety by reducing truck traffic on public roads. This development marks a transformative step in the company's operational capabilities and service delivery to the oil and gas industry.

Positive

• Successfully launched 42-mile Dune Express conveyor system
• Operational efficiency improvement through automated sand transport
• Reduced transportation costs by eliminating truck transport
• Enhanced safety through reduction of truck traffic

Negative

• None.

Insights

Energy Infrastructure Analyst

The successful launch of the Dune Express conveyor system marks a transformative development in Permian Basin logistics. This 42-mile automated sand delivery system represents a paradigm shift in proppant transportation efficiency, effectively reducing operational costs and environmental impact. The system's completion positions Atlas Energy Solutions to capture significant market share in the Permian's proppant supply chain.

The immediate operational benefits include elimination of approximately 2,500 truck trips per day from public roads, translating to substantial cost savings in transportation and reduced maintenance expenses. From an ESG perspective, this infrastructure dramatically lowers carbon emissions while improving road safety in West Texas communities. The project's successful execution significantly de-risks Atlas's growth strategy and should drive meaningful margin expansion through operational leverage.

For context in simpler terms: Imagine replacing a convoy of 2,500 trucks with a single conveyor belt - that's essentially what Atlas has achieved. This is like upgrading from a bucket brigade to a modern pipeline, revolutionizing how essential materials reach oil and gas operations.

Supply Chain Expert

The Dune Express launch represents a revolutionary advancement in oilfield logistics. Traditional proppant delivery methods require complex coordination of hundreds of trucks, subject to weather delays, driver availability and road conditions. This automated system provides unprecedented reliability and consistency in supply chain operations.

The strategic placement connecting Kermit to New Mexico creates a competitive moat through infrastructure that competitors cannot easily replicate. The system's 42-mile reach effectively creates a virtual monopoly in this corridor, potentially allowing Atlas to command premium pricing while still offering customers lower total delivered costs compared to traditional trucking.

Think of this as building a private highway exclusively for sand delivery - while competitors still rely on congested public roads, Atlas now has an express lane that's faster, cheaper and always available.

AUSTIN, Texas--(BUSINESS WIRE)-- Atlas Energy Solutions Inc. (NYSE: AESI) (“Atlas” or the “Company”) today announced the first commercial delivery of sand off the Dune Express. On the early morning of Sunday, January 12^th, a commercial proppant delivery occurred at our End-of-Line facility utilizing the 42-mile Dune Express conveyor system. The sand was originally produced and placed onto the Dune Express at our Kermit facility and traveled 42-miles to our End-of-Line loadout facility in New Mexico.

John Turner, President & CEO of Atlas, commented, “The first commercial delivery utilizing the Dune Express conveyor system is a major milestone for Atlas, our shareholders and our customers we proudly serve. I want to extend a big thank you to all of our employees, and particularly our construction team, for bringing this innovative project online. The Dune Express is a step change in oilfield logistics and will help redefine the efficiency and reliability for the Permian oil and gas community. In addition, the Dune Express will help make the communities of West Texas safer places to work and live by reducing truck traffic on public roads.”

About Atlas Energy Solutions

Atlas Energy Solutions Inc. is a leading proppant producer and proppant logistics provider, serving primarily the Permian Basin of West Texas and New Mexico. We operate 14 proppant production facilities across the Permian Basin with a combined annual production capacity of 29 million tons, including both large-scale in-basin facilities and smaller distributed mining units. We manage a portfolio of leading-edge logistics assets, which includes our 42-mile Dune Express conveyor system. In addition to our conveyor infrastructure, we manage a fleet of 120 trucks, which are capable of delivering expanded payloads due to our custom-manufactured trailers and patented drop-depot process. Our approach to managing both our proppant production and proppant logistics operations is intently focused on leveraging technology, automation and remote operations to drive efficiencies.

We are a low-cost producer of various high-quality, locally sourced proppants used during the well completion process. We offer both dry and damp sand, and carry various mesh sizes including 100 mesh and 40/70 mesh. Proppant is a key component necessary to facilitate the recovery of hydrocarbons from oil and natural gas wells.

Our logistics platform is designed to increase the efficiency, safety and sustainability of the oil and natural gas industry within the Permian Basin. Proppant logistics is increasingly a differentiating factor affecting customer choice among proppant producers. The cost of delivering sand, even short distances, can be a significant component of customer spending on their well completions given the substantial volumes that are utilized in modern well designs.

We continue to invest in and pursue leading-edge technologies, including autonomous trucking, digital infrastructure, and artificial intelligence, to support opportunities to gain efficiencies in our operations. To this end, we have recently taken delivery of next-generation dredge mining assets to drive efficiencies in our proppant production operations. These technology-focused investments aim to improve our cost structure and also combine to produce beneficial environmental and community impacts.

While our core business is fundamentally aligned with a lower emissions economy, our core obligation has been, and will always be, to our stockholders. We recognize that maximizing value for our stockholders requires that we optimize the outcomes for our broader stakeholders, including our employees and the communities in which we operate. We are proud of the fact that our approach to innovation in the hydrocarbon industry while operating in an environmentally responsible manner creates immense value. Since our founding in 2017, our core mission has been to improve human beings’ access to the hydrocarbons that power our lives while also delivering differentiated social and environmental progress. Our Atlas team has driven innovation and has produced industry-leading environmental benefits by reducing energy consumption, emissions, and our aerial footprint. We call this Sustainable Environmental and Social Progress.

We were founded in 2017 by Ben M. “Bud” Brigham, our Executive Chairman, and are led by an entrepreneurial team with a history of constructive disruption bringing significant and complementary experience to this enterprise, including the perspective of longtime E&P operators, which provides for an elevated understanding of the end users of our products and services. Our executive management team has a proven track record with a history of generating positive returns and value creation. Our experience as E&P operators was instrumental to our understanding of the opportunity created by in-basin sand production and supply in the Permian Basin, which we view as North America’s premier shale resource and which we believe will remain its most active through economic cycles.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements that are predictive or prospective in nature, that depend upon or refer to future events or conditions or that include the words “may,” “assume,” “forecast,” “position,” “strategy,” “potential,” “continue,” “could,” “will,” “plan,” “project,” “budget,” “predict,” “pursue,” “target,” “seek,” “objective,” “believe,” “expect,” “anticipate,” “intend,” “estimate” and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements regarding our expectations for the operations of the Dune Express, our business strategy, industry, future operations and profitability, expected capital expenditures and the impact of such expenditures on our performance, statements about our financial position, production, revenues and losses, our capital programs, management changes, current and potential future long-term contracts and our future business and financial performance.

Although forward-looking statements reflect our good faith beliefs at the time they are made, we caution you that these forward-looking statements are subject to a number of risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. These risks include but are not limited to: unexpected future capital expenditures; our ability to successfully execute our stock repurchase program or implement future stock repurchase programs; commodity price volatility, including volatility stemming from the ongoing armed conflicts between Russia and Ukraine and Israel and Hamas; increasing hostilities and instability in the Middle East; adverse developments affecting the financial services industry; our ability to complete growth projects on time and on budget; the risk that stockholder litigation in connection with our recent corporate reorganization may result in significant costs of defense, indemnification and liability; changes in general economic, business and political conditions, including changes in the financial markets; transaction costs; actions of OPEC+ to set and maintain oil production levels; the level of production of crude oil, natural gas and other hydrocarbons and the resultant market prices of crude oil; inflation; environmental risks; operating risks; regulatory changes; lack of demand; market share growth; the uncertainty inherent in projecting future rates of reserves; production; cash flow; access to capital; the timing of development expenditures; the ability of our customers to meet their obligations to us; our ability to maintain effective internal controls; and other factors discussed or referenced in our filings made from time to time with the U.S. Securities and Exchange Commission (“SEC”), including those discussed under the heading “Risk Factors” in Annual Report on Form 10-K, filed with the SEC on February 27, 2024, and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250113640930/en/

Investor Contact

Kyle Turlington

5918 W Courtyard Drive, Suite #500

Austin, Texas 78730

United States

T: 512-220-1200

IR@atlas.energy

Source: Atlas Energy Solutions Inc.

FAQ

When did Atlas Energy Solutions (AESI) complete its first commercial delivery on the Dune Express?

Atlas Energy Solutions completed its first commercial delivery on the Dune Express on Sunday, January 12th, 2024.

What is the length of Atlas Energy Solutions' (AESI) Dune Express conveyor system?

The Dune Express conveyor system spans 42 miles, connecting the Kermit facility to the End-of-Line loadout facility in New Mexico.

How does Atlas Energy Solutions' (AESI) Dune Express benefit local communities?

The Dune Express benefits local communities by making West Texas safer through reduced truck traffic on public roads.

What operational advantages does the Dune Express provide for Atlas Energy Solutions (AESI)?

The Dune Express provides improved efficiency and reliability in oilfield logistics, offering a more streamlined approach to sand transportation for the Permian oil and gas community.