Tevlin: Mr. Sandman brings a dream to a river town in Wisconsin

  • Article by: JON TEVLIN , Star Tribune
  • Updated: June 19, 2012 - 8:47 PM

STOCKHOLM, WIS. - The man from the frac sand company stood at the front of the pole barn surrounded by cornfields Monday and made his pitch. He was one of them, he said, grew up just yonder. Went to the University of Wisconsin, where he got his "environmental protection background." He plans to move to town, if residents will approve his sand "transportation facility."

He even showed the crowd a picture of himself holding a huge muskie.

"We, too, share a lot of the same values you do," said the frac man, Cy Ingraham. "Everything you've heard are just rumors."

Someone asked Ingraham where the headquarters for his company, Muskie Proppants LLC, was located.

Ingraham looked puzzled, then mumbled something about a temporary office somewhere in Wisconsin.

"You can't even name your corporate headquarters, sir," said an area resident, Remy Ceci.

Finally Ingraham gave in: "Greenwich, Connecticut," he said. Muskie is a subsidiary of Wexford Capital, a hedge fund, and partly owned by another energy company in Oklahoma.

And so it went in a small pole barn in western Wisconsin as Ingraham tried to persuade residents of this quaint tourist town along the Mississippi that his plan to bring hundreds of train cars, barges and up to 80 trucks a day filled with sand lumbering through town all day would be good for them.

No one was buying.

Up and down both sides of the river, the battle for the new gold, sand, continues. Underground sand in parts of Minnesota and Wisconsin has skyrocketed in value because it is essential for the oil and gas extraction practice called hydro-fracking. The sand is injected into the earth to open up cracks in rock to release natural gas and oil.

This time, the residents had seen how similar developments were harming nearby towns, and were prepared. For two grueling hours, Ingraham and his engineer were grilled by locals and residents who have second homes in the area.

Ingraham insisted the site would simply be used as a place to transport sand from current mines, using train cars, trucks and barges. They would be moving a half-million to a million tons of sand annually through town. He tried to persuade people that the company would not want to mine the very valuable sand that would sit below and behind the storage facility. No one was buying.

The site was in foreclosure, and the bank has accepted the company's bid. If it goes forward, the plan would include six 50-foot-tall silos and open sand piles along the river, across Lake Pepin from Lake City, Minn., Ingraham acknowledged.

There would be train cars, but he wasn't sure how many. And barges, but he wasn't sure how many. The company "hoped to avoid" dredging the river and sending trucks down the main drag.

Asked the value of the sand around their town, Ingraham said he didn't know.

So a Connecticut hedge fund is pouring millions of dollars into Stockholm without knowing the value of the sand, someone asked. Ingraham shrugged.

"I really couldn't tell if they were inept or playing with us," said Mary Logue, a mystery writer who has a home in the area. "I don't think they expected the level of questioning they got, but did they think the questions would go away if they just said they didn't know the answer yet?"

Over and over, Ingraham kept referring to the project as "just a concept, nothing set in stone." But then someone in the audience pointed out that the Oklahoma company's website mentions that Muskie already has a mine deal nearby.

Oops.

Alan Nugent owns a gallery and general store on the small main street in Stockholm. He points out that the Huffington Post recently named Hwy. 35 "the most scenic drive in America" and that the town is one of the most popular day trips for people from the Twin Cities.

"If I have 40 trucks a day going down my street, I'm out of business," he said.

Another resident, William Mavity, is a former Minneapolis cop and lawyer who is trained to spot dishonest answers. Mavity, who sits on the county board that will eventually accept or deny Muskie's plea for a zoning change to allow the plant, noted the body language of the company's men and their evasive answers.

"Pretty typical," said Mavity. "They were fast and loose with the facts."

At the end, the Stockholm Town Board denied the zoning change for now, but no one believes Muskie will go away easily.

"Either they thought they were addressing a group of hillbillies who'd never heard of sand mining before, or they couldn't care less what anyone in the town says because they're going to steamroll this thing through with all the Wexford money at their disposal," said Lu Lippold, of Pepin, Wis. "I hope it's the former, but I fear it's the latter."

jtevlin@startribune.com • 612-673-1702

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