HITCHCOCK — From scenic cap rock to construction material for county roads, gypsum has long been a useful commodity in northwest Oklahoma.

The white powdery rock, deposited long ago when the state was covered by an inland sea, finds its way into a wide variety of products, from food and make-up to dry wall and cement.

While gypsum is useful in wide variety of applications, demand for the rock currently is on the rise for one purpose: as a construction material for the energy sector. Much of the increased demand has followed a resurgence in the oil and gas industry over the last year, as new drilling sites have required gypsum to build pads and roads.

Dana LaMunyon, owner of LaMunyon Drilling, LLC, has seen firsthand the increased demand for oilfield construction and for gypsum.

From a low point in 2008 to 2009, when little drilling was taking place in northwest Oklahoma, LaMunyon has seen the business rebound to the point he is looking to expand.

“We’ve got all our equipment running right now,” said LaMunyon, who currently has four rigs drilling in northwest Oklahoma and the Texas panhandle with a fifth rig set to go in service within the next 40 days.

LaMunyon said gypsum use in oilfield site construction has centered on horizontal drilling locations in Woods, Kay, Alfalfa and Garfield counties.

“The biggest thing we have going on right now is the horizontal play up in the north ... and they’re building locations as fast as they can,” LaMunyon said.

He estimated 30 drilling rigs currently are operating in northwest Oklahoma, with each rig moving locations once a month, and some moving as frequently as every two weeks.

“All of that moving requires construction of a new location for them to move to,” LaMunyon said, and all of that construction requires a steady supply of gypsum.

Jessie Hoskins, owner of Hoskins Gypsum Co., LLC and Hoskins Trucking, specializes in hauling gypsum to and constructing new oilfield locations.

Business for Hoskins, and other trucking and oilfield construction companies, has picked up considerably over the last year thanks to renewed drilling in northwest Oklahoma and the Texas panhandle.

“Oilfield activity has picked up significantly over the last 12 months,” Hoskins said, which has spurred new business for him in Kingfisher, Blaine, Canadian, Caddo, Dewey and Custer counties.

Oilfield pick-up

As the oilfield construction business has picked up the demand for gypsum has followed. That increase in demand presented Hoskins with an opportunity to expand into the supply end of the gypsum business by developing his own mining operation.

“We needed better service, so we created it ourselves,” Hoskins said, referring to a gypsum quarry he opened in March.

The new quarry, located five miles west of Hitchcock in Blaine County, is Hoskins’ first foray into gypsum production.

“We completely started from scratch with this,” said Hoskins of the pasture he has transformed into a gypsum mine.

By developing his own quarry, Hoskins has expanded his operations to cover every facet of gypsum supply in oilfield applications, from mining to hauling and final construction on location.

That all-inclusive approach is “unique from anyone else who’s in the business,” Hoskins said.

A steady flow of trucks may be seen entering and departing the Hoskins Gypsum Co. yard, west of Hitchcock, loaded with gypsum bound primarily for oilfield construction locations in the Anadarko Woodford near Geary and Calumet.

Approximately eight miles north of the Hoskins Gypsum yard crews are working to mine, process and ship gypsum at United States Gypsum’s Southard facility.

Gypsum grade

Unlike the Hoskins Gypsum facility, which is focused on construction grade gypsum, USG’s Southard facility specializes in providing finer grade gypsum for use in food and medical applications.

“We probably have the highest purity gypsum anywhere in the world as far as the whiteness and brightness of the rock,” said Matthew Huss, USG’s Southard plant manager.

He said high-purity gypsum is used in a wide variety of consumable products, from baked goods to pharmaceuticals, cosmetics and dental molds.

“Food and pharmaceutical grade gypsum is really our specialty here, and it’s the bulk of what we do as far as products,” Huss said.

While consumable gypsum products represent the bulk of the product line coming out of Southard, the vast majority of the rock that’s mined doesn’t meet the purity standards for use in food or pharmaceuticals.

“In order to get to the pure gypsum we have to take off the cap rock and the rock between the layers,” said Huss. That “byproduct” rock can’t be used for consumable products, but is processed and sold for road and construction projects.

“From a volume standpoint we probably process about five times as much rock for roads and oil and gas construction as anything else,” Huss said.

And, like other oilfield related businesses, Huss and the workers at USG have seen a marked increase in activity over the last year.

Huss said 2008 and 2009 were “the slowest years we’ve had here in a long time,” due to reductions in oilfield construction and the overall slower economy.

Since then the oil and natural gas industry has outpaced the recovery of the overall economy, spurring increased activity for gypsum producers.

“It’s been on a steady increase over the last year,” Huss said, “and we’re at least back to our normal levels.”

Drilling purposes

Road and construction grade gypsum mined at Southard heads primarily for drilling locations in Woods and Alfalfa counties, he said.

In order to service drilling sites in Blaine County Huss said USG is working to re-open an old quarry north of Watonga, to be re-named as the Bucher Quarry.

“Re-opening the Bucher Quarry will bring us closer to the market for oil and gas customers west of Geary,” said Huss, which is the area currently served by Hoskins Gypsum. To the north USG competes with Allied Custom Gypsum, which operates several mines in western Oklahoma serving the oil and gas industry.

“Supplying gypsum to our oil and gas customers is actually a very competitive business,” Huss said.

But, for all of the demand and competition in the oil and gas sector, gypsum suppliers are beginning to see more business from Oklahoma’s burgeoning wind power industry.

Wind farms

Huss said USG recently completed a contract to supply gypsum for an OG&E wind farm project west of Canton, in Blaine County.

That project called for supplying rock for 28 miles of roads and approaches in the wind farm.

“We had to set up a separate crushing system to meet the demand for that,” Huss said, “and on average they were hauling out 3,000 to 4,000 tons a day for that project.”

“And that,” Huss said, “was a lot more road rock than we’ve done for the oil and gas business this year.”

He expects the wind industry to continue growing, with a new wind farm being planned for the Hunter area.

That growth, matched with continued drilling operations for oil and gas, will increase the demand for gypsum in northwest Oklahoma well into the future, Huss said.

“We still have a lot of capability to grow in the future,” Huss said, “especially if the oil and gas business keeps up like it has been.”