10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

Form 10-K

(Mark One)

þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2013

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-35630

Hi-Crush Partners LP

(Exact name of registrant as specified in its charter)

Delaware	90-0840530
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)
Three Riverway, Suite 1550
Houston, Texas	77056
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code (713) 960-4777

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common units representing limited partnership interests	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

¨  Yes        þ  No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

¨   Yes        þ  No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

þ  Yes        ¨  No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

¨   Yes        þ  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).         

þ  Yes         ¨  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer    ¨	Accelerated filer    þ	Non-accelerated filer    ¨	Smaller reporting company    ¨
	(Do not check if a smaller reporting company.)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).       

¨  Yes         þ  No

As of June 28, 2013, the last business day of the registrant's most recently completed second fiscal quarter, the aggregate market value of common units held by non-affiliates was approximately $329,389,211 based on the closing price of $23.55 per common unit on that date.

The registrant had 15,233,335 common units, 13,640,351 subordinated units and 3,750,000 convertible class B units outstanding on February 28, 2014.

INDEX TO FORM 10-K

PART I		Page
Item 1.	Business	3
Item 1A.	Risk Factors	20
Item 1B.	Unresolved Staff Comments	40
Item 2.	Properties	41
Item 3.	Legal Proceedings	45
Item 4.	Mine Safety Disclosures	46
PART II
Item 5.	Market for Registrant’s Common Units, Related Unitholder Matters and Issuer Purchases of Unit Securities	48
Item 6.	Selected Financial Data	51
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	53
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	78
Item 8.	Financial Statements and Supplementary Data	79
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	80
Item 9A.	Controls and Procedures	81
Item 9B.	Other Information	82
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	84
Item 11.	Executive Compensation	90
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Unitholder  Matters	93
Item 13.	Certain Relationships and Related Transactions, and Director Independence	95
Item 14.	Principal Accounting Fees and Services	100
PART IV
Item 15.	Exhibits, Financial Statement Schedules	102

Forward-Looking Statements

Some of the information in this Annual Report on Form 10-K may contain forward-looking statements. Forward-looking statements give our current expectations, contain projections of results of operations or of financial condition, or forecasts of future events. Words such as “may,” “assume,” “forecast,” “position,” “predict,” “strategy,” “expect,” “intend,” “plan,” “estimate,” “anticipate,” “believe,” “project,” “budget,” “potential,” or “continue,” and similar expressions are used to identify forward-looking statements. They can be affected by assumptions used or by known or unknown risks or uncertainties. Consequently, no forward-looking statements can be guaranteed. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in this Annual Report on Form 10-K. Actual results may vary materially. You are cautioned not to place undue reliance on any forward-looking statements. You should also understand that it is not possible to predict or identify all such risk factors and as such should not consider the following to be a complete list of all potential risks and uncertainties. Factors that could cause our actual results to differ materially from the results contemplated by such forward-looking statements include those described under “Risk Factors” in Item 1A of this Annual Report on Form 10-K, and the following factors, among others:

• the amount of frac sand we are able to excavate and process, which could be adversely affected by, among other things, operating difficulties and unusual or unfavorable geologic conditions;

• the volume of frac sand we are able to buy and sell;

• the price at which we are able to buy and sell frac sand;

• changes in the price and availability of natural gas, diesel fuel or electricity;

• changes in prevailing economic conditions;

• unanticipated ground, grade or water conditions;

• inclement or hazardous weather conditions, including flooding, and the physical impacts of climate change;

• environmental hazards;

• difficulties in obtaining or renewing environmental permits;

• industrial accidents;

• changes in laws and regulations (or the interpretation thereof) related to the mining and hydraulic fracturing industries, silica dust exposure or the environment;

• the outcome of litigation, claims or assessments, including unasserted claims;

• inability to acquire or maintain necessary permits or mining or water rights;

• facility shutdowns in response to environmental regulatory actions;

• inability to obtain necessary production equipment or replacement parts;

• reduction in the amount of water available for processing;

• technical difficulties or failures;

• labor disputes and disputes with our excavation contractor;

• late delivery of supplies;

• difficulty collecting receivables;

• inability of our customers to take delivery;

• fires, explosions or other accidents;

• cave-ins, pit wall failures or rock falls;

• our ability to borrow funds and access capital markets;

• changes in the political environment of the drilling basins in which we and our customers operate; and

• changes in railroad infrastructure, price, capacity and availability, including the potential for rail line washouts.

All forward-looking statements are expressly qualified in their entirety by the foregoing cautionary statements. You should assess any forward-looking statements made within this Annual Report on Form 10-K within the context of such risks and uncertainties.

1

PART I

2

ITEM 1.    BUSINESS

References in this Annual Report on Form 10-K to “Hi-Crush Partners LP,” “we,” “our,” “us” or like terms when used in a historical context to reference operations or matters prior to August 16, 2012 refer to the business of Hi-Crush Proppants LLC, which is our accounting predecessor that contributed certain of its subsidiaries to Hi-Crush Partners LP on August 16, 2012 in connection with our initial public offering. Otherwise, those terms refer to Hi-Crush Partners LP and its subsidiaries. References in this Annual Report on Form 10-K to “Hi-Crush Proppants LLC,” “our predecessor,” “our sponsor” and “the selling unitholder” refer to Hi-Crush Proppants LLC.

General

Hi-Crush Partners LP (together with its subsidiaries, the “Partnership”) is a Delaware limited partnership formed on May 8, 2012 to acquire selected sand reserves and related processing and transportation facilities of Hi-Crush Proppants LLC. In connection with its formation, the Partnership issued a non-economic general partner interest to Hi-Crush GP LLC, our general partner and a 100.0% limited partner interest to our sponsor, its organizational limited partner.

Initial Public Offering

On August 16, 2012, we completed our initial public offering (“IPO”) of 12,937,500 common units (amount includes 1,687,500 common units issued pursuant to the exercise of the underwriters’ over-allotment option) representing limited partner interests in the Partnership at a price to the public of $17.00 per common unit. Total net proceeds paid to our sponsor from the sale of common units in our IPO were $206.5 million after taking into account our underwriting discount.

Acquisition of Preferred Interest in Augusta Facility

On January 31, 2013, we entered into a contribution agreement with our sponsor to acquire a preferred interest in Hi-Crush Augusta LLC (“Augusta”), the entity that owns the sponsor’s Augusta raw frac sand processing facility, for $37.5 million in cash and 3.75 million of our convertible Class B Units (the “Class B Units”) representing limited partner interests in the Partnership. As of December 31, 2013, Augusta’s principal assets include 46.8 million tons of proven recoverable reserves of frac sand meeting API specifications on 1,187 acres, and its processing facilities with an annual rated capacity of 1,600,000 tons.

Our sponsor will not receive distributions on the Class B Units until converted into common units of the Partnership. The Class B Units are eligible for conversion into common units once we have, for two consecutive quarters, (i) generated operating surplus at least equal to $2.31 per common unit, subordinated unit and Class B Unit on an annualized basis and (ii) paid $2.10 per unit in annualized distributions on each common and subordinated unit, or 110% of the current minimum quarterly distribution for a period of two consecutive quarters, and our general partner has determined, with the concurrence of the conflicts committee of the board of directors of our general partner, that we are expected to maintain such performance for at least two succeeding quarters.

Under the contribution agreement, our acquired interest in Augusta entitles us to a preferred distribution of up to $3.75 million per quarter, or $15.0 million annually, in distributable cash flow. Upon the satisfaction of certain conditions, but no sooner than March 31, 2018 without the approval of the conflicts committee of the board of directors of our general partner, our acquired interest in Augusta will convert into a 20% common ownership position in Augusta.

In addition, in connection with the transaction, our sponsor waived its right to require that we assign to our sponsor a long-term customer contract for sand produced from our Wyeville facility. This contract was initially scheduled to be assigned to Augusta on May 1, 2013.

Acquisition of D & I Silica, LLC

On June 10, 2013, the Partnership acquired an independent frac sand supplier, D & I Silica, LLC (“D&I”), transforming the Partnership into an integrated Northern White frac sand producer, transporter, marketer and distributor. The Partnership acquired D&I for $95.2 million in cash and 1,578,947 common units. Founded in 2006, D&I was the largest independent frac sand supplier to the oil and gas industry drilling in the Marcellus and Utica shales, operating through an extensive logistics network of rail-served origin and destination terminals located in the Midwest near supply sources and strategically throughout Pennsylvania, Ohio and New York.

Overview

We are a pure play, low-cost, domestic producer and supplier of premium monocrystalline sand, a specialized mineral that is used as a proppant to enhance the recovery rates of hydrocarbons from oil and natural gas wells. Our reserves consist of “Northern White” sand, a resource existing predominately in Wisconsin and limited portions of the upper Midwest region of the United States, which is highly valued as a preferred proppant because it exceeds all American Petroleum Institute (“API”) specifications. We own, operate and develop sand reserves and related excavation and processing facilities and will seek to acquire or develop additional facilities. Our 651-acre facility with integrated rail infrastructure located near Wyeville, Wisconsin (the “Wyeville

3

facility”), enables us to process and cost-effectively deliver approximately 1,600,000 tons of frac sand per year. We also own a preferred interest in Hi-Crush Augusta LLC, a subsidiary of our sponsor, which owns a 1,187-acre facility with integrated rail infrastructure located in Eau Claire County, Wisconsin (the “Augusta facility”) and enables our sponsor to process and cost-effectively deliver approximately 1,600,000 tons of frac sand per year. A substantial portion of our frac sand production is sold to leading pressure pumping service providers under long-term contracts that require our customers to pay a specified price for a specified volume of frac sand each month.

Over the past decade, exploration and production companies have increasingly focused on exploiting the vast hydrocarbon reserves contained in North America’s unconventional oil and natural gas reservoirs through advanced techniques, such as horizontal drilling and hydraulic fracturing. In recent years, this focus has resulted in exploration and production companies drilling more and longer horizontal wells, completing more hydraulic fracturing stages per well and utilizing more proppant per stage in an attempt to efficiently maximize the volume of hydrocarbon recovery per wellbore. As a result, North American demand for proppant has increased rapidly, growing at an average annual rate of 33.5% from 2007 to 2012, with total annual sales of $4.7 billion in 2012, according to The Freedonia Group, Inc. We believe that the market for raw frac sand will continue to grow based on the expected long-term development of North America’s unconventional oil and natural gas reservoirs and the previously highlighted market dynamics.

We utilize the significant oil and natural gas industry experience of our management team to take advantage of what we believe are favorable, long-term market dynamics as we execute our growth strategy, which includes the acquisition of additional frac sand reserves, the development of new excavation and processing facilities and the development of new terminal facilities. We expect to have the opportunity to acquire significant additional acreage and reserves currently owned or under an agreement to be acquired by our sponsor, including the Augusta facility with 1,187 acres of land and associated reserves in western Wisconsin to which we have a right of first offer until August 20, 2015, in addition to potential acquisitions from third parties. Our sponsor will not, however, be required to accept any offer we make, and may, following good faith negotiations with us, sell the assets subject to our right of first offer to third parties that may compete with us. Our sponsor may also elect to develop, retain and operate properties in competition with us or develop new assets that are not subject to our right of first offer.

We intend to remain solely focused on the frac sand market as we believe it offers attractive long-term growth fundamentals.

Assets and Operations

We own and operate the Wyeville facility, which is located in Monroe County, Wisconsin and, as of December 31, 2013, contained 62.6 million tons of proven recoverable reserves of frac sand meeting API specifications. We also own a preferred interest in our sponsor’s Augusta facility, which is located in Eau Claire County, Wisconsin and, as of December 31, 2013, contained 46.8 million tons of proven recoverable reserves of frac sand meeting API specifications. According to John T. Boyd Company, a leading mining consulting firm focused on the mineral and natural gas industries (“John T. Boyd”), our proven reserves consist entirely of coarse grade “Northern White” sand exceeding API specifications. Analysis of our sand by independent third-party testing companies indicates that it demonstrates characteristics in excess of API specifications with regard to crush strength (ability to withstand high pressures), turbidity (low levels of contaminants) and roundness and sphericity (facilitates hydrocarbon flow, or conductivity).

As a result of the D&I acquisition, as of December 31, 2013, we operated 12 destination rail-based terminal locations throughout the Marcellus and Utica shale basins and leased or owned 1,202 railcars used to transport our sand from origin to destination. Each terminal location is strategically positioned in the Marcellus and Utica shale plays to facilitate our customers' operations. Our terminals include rail-to-truck and rail-to-storage capabilities and serve as the base for most of our terminal resources and materials management services. Our terminal facilities include origin and distribution material staging areas, rail track capabilities, material handling equipment, private rail fleet, bulk storage and quality assurance services.

Wyeville Production Facility

We acquired the Wyeville acreage and commenced construction of the Wyeville facility in January 2011. We completed construction of the Wyeville facility and commenced sand excavation and processing in June 2011 with an initial plant processing capacity of 950,000 tons per year, and customer shipments were initiated in July 2011. We completed an expansion in March 2012 that increased our annual processing capacity to approximately 1,600,000 tons per year. From the Wyeville in-service date to December 31, 2013, we processed and delivered 2,996,563 tons of frac sand. As of January 1, 2014, we have contracted approximately 89% of this capacity for 2014. Assuming production at the rated capacity of 1,600,000 tons per year, and based on a reserve report prepared by John T. Boyd, our Wyeville facility has an implied reserve life of 39 years as of December 31, 2013.

We operate two dryer facilities at Wyeville with a combined nameplate input capacity, based on manufacturer specifications, of 250 tons per hour. Unless processing operations are suspended to conduct maintenance, our dryer facilities are run on a 24-hour basis. Our estimate of annual expected processing capacity assumes a 15% loss factor due to waste and an uptime efficiency of 85% of nameplate capacity, which allows approximately 55 days for downtime and maintenance. We processed and delivered 1,502,015 tons of sand during the year ended December 31, 2013.

4

All of our product from the Wyeville facility is shipped by rail from our three 5,000-foot rail spurs that connect our processing and storage facilities to a Union Pacific Railroad mainline. The length of these rail spurs and the capacity of the associated product storage silos allow us to accommodate a large number of rail cars. It also enables us to accommodate unit trains, which significantly increases our efficiency in meeting our customers’ frac sand transportation needs. Unit trains, typically 80 rail cars in length or longer, are dedicated trains chartered for a single delivery destination. Generally, unit trains receive priority scheduling and do not switch cars at various intermediate junctions, which results in a more cost-effective and expedited method of shipping than the standard method of rail shipment.

Augusta Production Facility

On January 31, 2013, we acquired a preferred interest in our sponsor’s Augusta facility. Our sponsor acquired the Augusta acreage and commenced construction of the Augusta facility in April 2012. Our sponsor completed construction of the Augusta facility and commenced sand excavation and processing in July 2012 with a plant processing rated capacity of 1,600,000 tons per year, and customer shipments were initiated in August 2012. The cash flow stream attributable to our preferred interest in Augusta is supported by a long-term contract with an investment grade customer that requires our customer to pay a specified price for a specified volume of frac sand each month.

Destination Terminal Facilities

As of December 31, 2013, we operated 12 destination rail-based terminal locations throughout the Marcellus and Utica shale basins. Our destination terminals include 251,600 tons of rail storage capacity and 31,600 tons of silo storage capacity. Our Minerva, Pittston, Smithfield and Wellsboro terminals are capable of accommodating unit trains.

We are continuously looking to increase the number of destination terminals we operate and expand our geographic footprint, allowing us to further enhance our customer service and putting us in a stronger position to take advantage of opportunistic short term pricing agreements. Our destination terminals are strategically located to provide access to Class I railroads, which enables us to cost effectively ship product from our production facilities in Wisconsin. We also have the ability to connect to short-line railroads as necessary to meet our customers’ evolving in-basin product needs. As of December 31, 2013, we leased or owned 1,202 railcars used to transport our sand from origin to destination.

Competitive Strengths

We believe that we are well positioned to successfully execute our strategy and achieve our primary business objective because of the following competitive strengths:

• Long-term contracted cash flow stability. We generate a substantial portion of our revenues from the sale of frac sand under long-term contracts that require our customers to pay specified prices for specified volumes of product each month. We believe the volume requirements and pricing provisions and the long-term nature of our contracts provide us with a stable base of cash flows and limit the risks associated with price movements in the spot market and any changes in product demand during the contract period. As of January 1, 2014, we had contracted to sell 1,420,000 tons of frac sand annually from our Wyeville facility, with an average remaining contractual term of 2.6 years.

• Long-lived, high quality reserve base. Our Wyeville facility contains approximately 62.6 million tons of proven recoverable saleable coarse grade reserves as of December 31, 2013, based on a third-party reserve report by John T. Boyd and has an implied reserve life of 39 years, assuming production at the rated capacity of 1,600,000 tons per year. We also own a preferred interest in our sponsor’s Augusta facility, which, as of December 31, 2013, contained 46.8 million tons of proven reserves and has an implied reserve life of 30 years, assuming production at the rated capacity of 1,600,000 tons per year. These reserves consist of high quality Northern White frac sand. Analysis by independent third-party testing companies indicates that our sand demonstrates characteristics exceeding API specifications with regard to crush strength, turbidity and roundness and sphericity. As a result, our raw frac sand is particularly well suited for and is experiencing significant demand from customers for use in the hydraulic fracturing of unconventional oil and natural gas wells.

• Intrinsic logistics and infrastructure advantage. The strategic location and logistics capabilities of the Wyeville and Augusta facilities enable us to serve all major U.S. oil and natural gas producing basins. At our Wyeville and Augusta facilities, our on-site transportation assets include three 5,000-foot rail spurs off a Union Pacific Railroad mainline that are capable of accommodating unit trains, allowing our customers to receive priority scheduling, expedited delivery and a more cost-effective shipping alternative. Our logistics capabilities enable efficient loading of sand and minimize rail car turnaround times at the facility, and we expect to acquire or develop similar logistics capabilities at any facilities we own in the future. We believe we are one of the few frac sand producers with a facility initially designed to deliver frac sand exceeding API specifications to all of the major U.S. oil and natural gas producing basins by on-site rail facilities, including on-site storage capacity accommodating unit trains.

• Strategically located terminal facilities. We operate through an extensive logistics network of rail-served destination terminals strategically located throughout Pennsylvania, Ohio and New York to serve our customers' operations in the

5

Marcellus and Utica basins. Our extensive distribution network allows us to better service our customers’ short-notice needs in these basins and provide our customers with solutions to the logistical challenges presented by the large volume of sand required for each fracturing job. To further enhance our customer service in the Marcellus and Utica basins, we anticipate opening additional rail-served destination terminals in that region in the second quarter of 2014.  In addition, we expect to expand our geographic footprint into Texas in the second quarter of 2014 with the opening of a strategically located rail-served destination terminal to serve our customers’ needs in the Permian basin.

• Competitive operating cost structure. Our plant operations have been strategically designed to provide low per-unit production costs with a significant variable component for the excavation and processing of our sand. Our sand reserves at the Wyeville facility do not require blasting or crushing to be processed and, due to the shallow overburden at both our Wyeville and Augusta facilities, we are able to use surface mining equipment in our operations, which provides for a lower cost structure than underground mining operations. Our mining operations are subcontracted to Gerke Excavating, Inc. at a fixed cost per ton excavated, subject to a diesel fuel surcharge. Unlike some competitors, our processing and rail loading facilities are located on-site, which eliminates the requirement for on-road transportation, lowers product movement costs and minimizes the reduction in sand quality due to handling.

• Experienced and incentivized management team. Our management team has extensive experience investing and operating in the oil and natural gas industry and is focused on optimizing our current business and expanding our operations through disciplined development and accretive acquisitions. We believe our management team’s substantial experience and relationships with participants in the oilfield services and exploration and production industries provide us with an extensive operational and commercial understanding of the markets in which our customers operate. The expertise of our management and operations teams covers a wide range of disciplines, with an emphasis on development, construction and operation of frac sand processing and terminal facilities, frac sand supply chain management and consulting and bulk solids material handling. Members of our management team are strongly incentivized to profitably grow our business and cash flows through their 22% direct and indirect ownership interest in our limited partnership units, and their 39% interest in our sponsor, which owned all of our subordinated units, Class B Units and incentive distribution rights as of February 28, 2014.

Business Strategies

Our primary business objective is to increase our cash distributions per unit over time. We intend to accomplish this objective by executing the following strategies:

• Focusing on stable, long-term contracts with key customers. A key component of our business model is our contracting strategy, which seeks to secure a high percentage of our cash flows under long-term contracts that require our customers to pay a specified price for a specified volume of frac sand each month, while also staggering the tenors of our contracts so that they expire at different times. We believe this contracting strategy significantly mitigates our exposure to the potential price volatility of the spot market for frac sand in the short-term, allows us to take advantage of any increase in frac sand prices over the medium-term and provides us with long-term cash flow stability. As current contracts expire or as we add new processing capacity, we intend to pursue similar long-term contracts with our current customers and with other leading pressure pumping service providers. We intend to utilize a substantial majority of our processing capacity to fulfill these contracts, with any excess processed frac sand sold to existing and new customers through our distribution network.

• Pursuing accretive acquisitions from our sponsor and third parties. On January 31, 2013, we acquired a preferred interest in our sponsor’s Augusta facility, which entitles us to a preferred distribution of up to $3.75 million per quarter, or $15.0 million annually, in distributable cash flow. On June 10, 2013, we acquired D&I, which operates through an extensive logistics network of rail-served origin and destination terminals located in the Midwest near supply sources and strategically throughout Pennsylvania, Ohio and New York. We expect to continue pursuing accretive acquisitions of frac sand facilities from our sponsor, including through our right of first offer to acquire the Augusta facility, as well as from third-party frac sand operations. As we evaluate acquisition opportunities, we intend to remain focused on operations that complement our reserves of premium frac sand and that provide or would accommodate the development and construction of rail or other advantaged logistics and distribution capabilities. We believe these factors are critical to our business model and are important characteristics for any potential acquisitions.

• Expanding our proved reserve base and processing capacity. We seek to identify and evaluate economically attractive expansion and facility enhancement opportunities to increase our proved reserves and processing capacity. At Wyeville and any future sites, we expect to pursue add-on acreage acquisitions near our facilities to expand our reserve base and increase our reserve life. During 2013, we commenced an additional expansion of our Wyeville facility allowing us to produce 100 mesh sand. We will continue to analyze and pursue organic expansion efforts that will similarly allow us to cost-effectively optimize our existing assets and meet the customer demand for our high quality frac sand.

• Expanding our distribution network. We seek to identify and evaluate destination terminal sites to expand our geographic footprint allowing us to enhance our distribution network and ensure that sand is available to meet the in-basin needs of our customers. At our existing and future sites, we expect to pursue additional storage capabilities to enhance our ability

6

to meet short-term customer demands for the various mesh sizes of frac sand. We will continue to analyze and pursue third-party acquisition opportunities that would similarly allow us to cost-effectively expand our geographic footprint, optimize our existing assets and meet our customers' demand for our high quality frac sand.

• Capitalizing on compelling industry fundamentals. We intend to continue to position ourselves as a pure play producer of high quality frac sand, as we believe the frac sand market offers attractive long-term growth fundamentals. The growth in horizontal drilling in the various North American shale plays and other unconventional oil and natural gas plays has resulted in greater demand for frac sand. The growth in demand is underpinned by increased horizontal drilling, higher proppant use per well and cost advantages over resin-coated sand and manufactured ceramics. We believe frac sand supply will continue to be constrained by the difficulty in finding reserves that meet or exceed API technical specifications in contiguous quantities large enough to justify the capital investment required and the challenges associated with successfully obtaining the necessary local, state and federal permits required for operations.

• Maintaining financial flexibility and conservative leverage. We plan to pursue a disciplined financial policy and maintain a conservative capital structure. As of February 28, 2014, we had $138.3 million of outstanding indebtedness and $60.2 million of undrawn borrowing capacity ($200 million, net of $138.3 of indebtedness and $1.5 million letter of credit commitments) under our revolving credit facility. The revolving credit facility is available to fund working capital and general corporate purposes, including the making of certain restricted payments permitted therein. Borrowings under our revolving credit facility are secured by substantially all of our assets. We believe that our borrowing capacity and ability to access debt and equity capital markets provides us with the financial flexibility necessary to achieve our organic expansion and acquisition strategy.

Our Industry

The oil and natural gas proppant industry is comprised of businesses involved in the mining or manufacturing of the propping agents used in the drilling and completion of oil and natural gas wells. Hydraulic fracturing is the most widely used method for stimulating increased production from wells. The process consists of pumping fluids, mixed with granular proppants, into the geologic formation at pressures sufficient to create fractures in the hydrocarbon-bearing rock. Proppant-filled fractures create conductive channels through which the hydrocarbons can flow more freely from the formation into the wellbore and then to the surface.

Industry Data

The market and industry data included throughout this Annual Report on Form 10-K was obtained through our own internal analysis and research, coupled with industry publications, surveys, reports and other analysis conducted by third parties. We relied on Industry Study #3048, Proppants in North America, August 2013 (“The Freedonia Group Report”), an industry report provided by The Freedonia Group, Inc., a leading international business research company, as our primary source for third-party industry data. Industry publications, surveys, reports and other analysis generally state that the information contained therein has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. While we believe that the industry reports are generally reliable, we have not independently verified the industry data from third-party sources. While we believe our internal analysis and research is reliable and appropriate, such internal analysis and research has not been verified by any independent source.

The Freedonia Group Report pertains to North American proppant industry data through the year ended December 31, 2012. Reference herein to 2013 proppants pricing is based on our own observations, internal estimates, and consultations with third parties. We believe that such data, as it relates to the proppants industry, is accurate and we have included such 2013 pricing observations throughout this Annual Report on Form 10-K.

Types of Proppant

There are three primary types of proppant that are commonly utilized in the hydraulic fracturing process: raw frac sand, which is the product we produce, resin-coated sand and manufactured ceramic beads. The following chart illustrates the composition of the North American market for proppant by type.

7

2012 Proppant Consumed by Weight

Source: The Freedonia Group Report

Raw Frac Sand

Of the three primary types of proppant, raw frac sand is the most widely used due to its broad applicability in oil and natural gas wells and its cost advantage relative to other proppants. Raw frac sand may be used as a proppant in all but the highest pressure and temperature drilling environments, such as in the Haynesville Shale, and has been employed in nearly all major U.S. oil and natural gas producing basins.

Raw frac sand is generally mined from the surface or underground, and in some cases crushed, and then cleaned and sorted into consistent mesh sizes. The API has a range of guidelines it uses to evaluate frac sand grades and mesh sizes. In order to meet API specifications, frac sand must meet certain thresholds related to crush strength (ability to withstand high pressures), roundness and sphericity (facilitates hydrocarbon flow, or conductivity), particle size distribution, and turbidity (low levels of contaminants). Oil and gas producers generally require that frac sand used in their drilling and completion processes meet API specifications.

Raw frac sand can be further delineated into two main types: Northern White and Brady Brown. Northern White, which is the type of frac sand we produce, is considered to be of higher quality than Brady Brown and is known for its high crush strength, turbidity, roundness and sphericity and monocrystalline grain structure. Brady Brown has historically been considered the lower quality raw frac sand, as it is less monocrystalline in nature, more angular, has lower crush strength and often contains greater impurities, including feldspars and clays. Due to its quality, Northern White frac sand commands premium prices relative to Brady Brown. Northern White has historically experienced the greatest market demand relative to supply, due both to its superior physical characteristics and the fact that it is a limited resource that exists predominately in Wisconsin and other limited parts of the upper Midwest region of the United States. However, even within this superior class of Northern White sand, its quality can vary significantly across deposits due to the differing geological processes that formed the various Northern White reserves.

The term “Northern White” is a commonly-used designation for premium white sand produced in Wisconsin and other limited parts of the upper Midwest region of the United States.

Resin-Coated Frac Sand

Resin-coated frac sand consists of raw frac sand that is coated with a flexible resin that increases the sand’s crush strength and prevents crushed sand from dispersing throughout the fracture. The strength and shape of the end product are largely determined by the quality of the underlying raw frac sand. Pressured (or tempered) resin-coated sand primarily enhances crush strength, thermal stability and chemical resistance, allowing the sand to perform under harsh downhole conditions. Curable (or bonding) resin-coated frac sand uses a resin that is designed to bond together under closure stress and high temperatures, preventing proppant flowback. In general, resin-coated frac sand is better suited for higher pressure, higher temperature drilling operations commonly associated with deep wells and natural gas wells. In 2013, pricing for resin-coated frac sand was generally more than 5 times the price of raw frac sand.

Ceramics

Ceramic proppant is a manufactured product of comparatively consistent size and spherical shape that typically offers the highest crush strength relative to other types of proppants. As a result, ceramic proppant use is most applicable in the highest pressure and temperature drilling environments, such as the Haynesville Shale. Ceramic proppant derives its product strength from the molecular

8

structure of its underlying raw material and is designed to withstand extreme heat, depth and pressure environments. The deepest, highest temperature and highest pressure wells typically require heavy weight ceramics with high alumina/bauxite content and coarser mesh sizes. The lower crush resistant ceramic proppants are lighter weight and derived from kaolin clay, with densities closer to raw frac sand. In 2013, pricing for ceramic proppants was generally more than 10 times the price of raw frac sand, with bauxite-based, heavy grade ceramics commanding the highest prices.

Comparison of Key Proppant Characteristics

The following table sets forth what we believe to be the key comparative characteristics of our frac sand and the three primary types of proppant.

Products and Characteristics
Hi-Crush Partners LP	Raw Frac Sand	Resin-Coated	Ceramics
•  Natural resource–Northern White sand, which is considered highest quality raw frac sand	• Natural resource, primary types include Northern White, Brady Brown	• Raw frac sand substrate with resin coating; Bond together to prevent proppant flowback	• Manufactured product
• Monocrystalline in nature, exhibiting crush strength, turbidity and roundness and sphericity in excess of API specifications	• Quality of sand varies widely depending on source	• Coating increases crush strength	• Typically highest crush strength
• Crush strength for 30/50 and 40/70 frac sand of 8,000 to 10,000 psi	• Crush strength for 30/50 and 40/70 frac sand typically between 5,000 to 10,000 psi	• Crush strength of 10,000 to 15,000 psi	• Crush strength of 10,000 to 18,000 psi

Proppant Mesh Sizes

Mesh size is used to describe the size of the proppant and is determined by sieving the proppant through screens with uniform openings corresponding to the desired size of the proppant. Each type of proppant comes in various sizes, categorized as mesh sizes, and the various mesh sizes are used in different applications in the oil and natural gas industry. Generally, larger grain sizes are used in wells targeting oil and liquids-rich formations, and smaller grain sizes are used in wells targeting primarily gas bearing formations. The mesh number system is a measure of the number of equally sized openings there are per square inch of screen through which the proppant is sieved. For example, a 30 mesh screen has 30 equally sized openings per linear inch. Therefore, as the mesh size increases, the granule size decreases. In order to meet API specifications, 90% of the proppant described as 30/50 mesh size proppant must consist of granules that will pass through a 30 mesh screen but not through a 50 mesh screen. We excavate various mesh sizes at our Wyeville facility, and are contracted to sell 20/40, 30/50, 40/70 and 100 mesh frac sand used in the hydraulic fracturing process.

Frac Sand Extraction, Processing and Distribution

Raw frac sand is a naturally occurring mineral that is mined and processed. While the specific extraction method utilized depends primarily on the geologic setting, most raw frac sand is mined using conventional open-pit bench extraction methods. The composition, depth and chemical purity of the sand also dictate the processing method and equipment utilized. For example, broken rock from a sandstone deposit may require one, two or three stages of crushing to produce sand grains required to meet API specifications. In contrast, unconsolidated deposits (loosely bound sediments of sand), like those found at our Wyeville facility, may require little or no crushing during the excavation process. After extraction, the raw frac sand is washed with water to remove fine impurities such as clay and organic particles, with additional procedures used when contaminants are not easily removable. The final steps in the production process involve the drying and sorting of the raw frac sand according to mesh size.

Most frac sand is shipped in bulk from the processing facility to customers by truck, rail or barge. For bulk raw frac sand, transportation costs often represent a significant portion of the customer’s overall product cost. Consequently, shipping in large quantities, particularly when shipping over long distances, provides a significant cost advantage to the customer, emphasizing the importance of rail or barge access for low cost delivery. As a result, facility location and logistics capabilities are among the most important considerations for producers, distributors and customers.

All of our product from our Wyeville facility is shipped by rail from our three 5,000-foot rail spurs that connect our processing and storage facilities to a Union Pacific Railroad mainline. The length of these rail spurs and the capacity of the associated product storage silos allow us to accommodate a large number of rail cars. It also enables us to accommodate unit trains, which significantly increases our efficiency in meeting our customers’ frac sand transportation needs.

Transportation costs can be a large part of the final proppant cost for end users.  As a result, designing and using an optimized logistics system is a key strategy for many proppant suppliers.  As locating proppant production close to key markets is not always

9

possible, proppant suppliers will often have transload facilities in regions that they serve.  The ability to deliver sand shorter distances with fewer intermediate steps is instrumental in remaining cost competitive or gaining cost advantages.  Proppants are moved from their production site by rail or barge to transload or storage facilities.  From there, they are typically transported by truck to the well site.  Strategically locating transload facilities can therefore reduce the amount of conveyance by truck, which is typically the most expensive mode of transport.

Demand Trends

According to The Freedonia Group Report, the North American proppant market, including raw frac sand, ceramic and resin-coated proppants, was approximately 30 million tons in 2012. Industry estimates for 2012 indicate that the raw frac sand market represented approximately 24 million tons, or 79.6% of the total proppant market by weight. From 2007 through 2012, proppant demand by weight increased by 33.0% annually, and the market is projected to continue growing by 11.6% per year through 2017, representing an increase of approximately 21.7 million tons in annual proppant demand over that time period. The total North American proppant market size in dollars was $4.7 billion in 2012 and is projected to grow 14.9% annually through 2017. The following chart illustrates historical and projected demand for raw frac sand and other proppants for certain years from 2002 to 2022.

Historical and Projected Proppant Demand

Source: The Freedonia Group Report

Demand growth for frac sand and other proppants is primarily due to advancements in oil and natural gas drilling and well completion technology and techniques, such as horizontal drilling and hydraulic fracturing. These advancements have made the extraction of oil and natural gas increasingly cost-effective in formations that historically would have been unprofitable to develop. According to a January 2014 Baker Hughes, Inc. report, during the five year period beginning January 1, 2009 through December 31, 2013, North American horizontal rig count increased by 15.4% annually. Comparatively, The Freedonia Group Report noted that demand for proppant by weight grew at a rate of 33.5% annually during the five year period ended December 31, 2012. We believe that demand for proppant has and will continue to increase at a rate greater than horizontal rig count as a result of the following additional demand drivers:

10

• improved drilling rig productivity (from, among other things, pad drilling), resulting in more wells drilled per rig per year;

• increases in the number of wells drilled per acre;

• increases in the length of the typical horizontal wellbore;

• increases in the number of fracture stages per foot in the typical completed horizontal wellbore;

• increases in the volume of proppant used per fracturing stage; and

• recurring efforts to offset steep production declines in unconventional oil and natural gas reservoirs, including the drilling of new wells and secondary hydraulic fracturing of existing wells.

Furthermore, recent growth in demand for raw frac sand has outpaced growth in demand for other proppants, and industry analysts predict that this trend will continue. According to The Freedonia Group Report, North American demand for all types of proppants, in dollar terms, is projected to increase 14.9% annually through 2017, while demand for raw frac sand is projected to increase 15.7% annually over that time period. As well completion costs have increased as a proportion of total well costs, operators have increasingly looked for ways to improve per well economics by lowering costs without sacrificing production performance. To this end, the oil and natural gas industry is shifting away from the use of higher-cost proppants towards more cost-effective proppants, such as raw frac sand. The substantial increase in activity in North American oil and liquids-rich resource plays has further accelerated the demand growth for raw frac sand. Within these oil and liquids-rich basins, Northern White sand with coarser mesh sizes is often preferred due to its performance characteristics.

Supply Trends

As demand for raw frac sand has increased dramatically in recent years, the supply of raw frac sand failed to keep pace, resulting in a supply-demand disparity. As a result, a number of existing and new competitors have announced supply expansions and greenfield projects. However, there are several key constraints to increasing raw frac sand production on an industry-wide basis, including:

• the difficulty of finding frac sand reserves that meet API specifications;

• the difficulty of securing contiguous frac sand reserves large enough to justify the capital investment required to develop a processing facility;

• the challenges of identifying frac sand reserves with the above characteristics that either are located in close proximity to oil and natural gas reservoirs or have rail access needed for low-cost transportation to major shale basins;

• the hurdles of securing mining, production, water, air, refuse and other federal, state and local operating permits from the proper authorities;

• local opposition to development of facilities, especially those that require the use of on-road transportation, including hours of operations and noise level restrictions, in addition to moratoria on raw frac sand facilities in multiple counties in Wisconsin which hold potential sand reserves; and

• the typically long lead time required to design and construct sand processing facilities that can efficiently process large quantities of high quality frac sand.

Pricing

We believe raw frac sand has generally exhibited steady price increases over the past decade, reaching a peak in the first half of 2011. Prices were believed to have decreased in the latter half 2012, reaching a low point in the fourth quarter of 2012.  Since that time, we believe that prices have stabilized and are trending upward as demand for raw frac sand continues to increase. There are numerous grades and sizes of proppant which sell at various prices, dependent upon quality, grade of proppant, deliverability and many other factors, including the delivery point.  Pricing of proppant sold at the destination is higher than pricing of proppant sold FOB plant as a result of the associated rail cost to transport the sand from the mine to the destination terminal. No publicized pricing information for raw sand exists, however, it is believed that the overall pricing trends tend to be consistent across the various sizes. We believe the majority of proppant is sold under long-term contracts, with the remainder being sold under short-term pricing agreements.

Customers and Contracts

Our current contracted customer base includes subsidiaries of four of North America’s largest providers of pressure pumping services. For the year ended December 31, 2013, sales to each of FTS International, LLC ("FTS International"), Halliburton Company ("Halliburton") and Weatherford International Ltd. ("Weatherford") accounted for greater than 10% of our total revenues.

11

We sell the majority of the frac sand we produce under long-term contracts that require our customers to pay a specified price for a specified volume of frac sand each month, which significantly reduces our exposure to short-term fluctuations in the price of and demand for frac sand. For the year ended December 31, 2013, we generated 53% of our revenues from frac sand that we produced and delivered under our long-term contracts. We expect to continue selling a majority of our sand under long-term contracts in 2014 and future years. As of January 1, 2014, we have four long-term contracts with an average remaining contractual term of 2.6 years and with remaining terms ranging from 6 to 72 months. The following table presents a summary of our contracted volumes and revenues.

	2011			2012			2013			2014
Contracted Volumes (Tons)	331,667			1,216,667			1,347,500			1,420,000
% of Processing Capacity (1)	79		%	85		%	84		%	89		%
Contracted Revenue (in thousands)	$	19,917		$	78,967		$	77,825		$	82,188

(1) Percentage of processing capacity based on weighted average processing capacity for such period.

The terms of our customer contracts, including sand quality requirements, quantity parameters, permitted sources of supply, effects of future regulatory changes, force majeure and termination and assignment provisions, vary by customer. Our long-term customer contracts contain penalties for non-performance by our customers, with make-whole prices averaging $35 per ton in 2014. If one of our customers fails to meet its minimum obligations to us, we would expect that the make-whole payment, combined with a decrease in our variable costs (such as royalty payments and excavation costs), would substantially mitigate any adverse impact on our cash flow from such failure. We would also have the ability to sell these sand volumes for which we receive make-whole payments to third parties. Our long-term customer contracts also contain penalties for our non-performance. If we are unable to deliver contracted volumes within three months of contract year end, or otherwise arrange for delivery from a third party, we are required to pay make-whole payments averaging $35 per ton in 2014. We believe our Wyeville facility, substantial reserves and our on-site processing and logistics capabilities reduce our risk of non-performance. We also have the ability to supply our customers from third party facilities and facilities owned by our sponsor. We believe our levels of inventory combined with our three month cure period starting at contract year end are sufficient to prevent us from paying make-whole payments as a result of plant shutdowns due to repairs to our facilities necessitated by reasonably foreseeable mechanical interruptions.

In addition to the contracted volumes, revenues and pricing in the above table, we have sold raw frac sand through our distribution network under short-term pricing and other agreements. The terms of our short-term pricing agreements, including sand quality requirements, quantity parameters, permitted sources of supply, effects of future regulatory changes, force majeure and termination and assignment provisions, vary by customer.

Suppliers

Although the majority of the frac sand that we sell is produced from our Wyeville facility, we purchase a certain amount of frac sand from various third parties for use in our distribution network.  A significant portion of this third party sourced frac sand is purchased under contracts that require our suppliers to produce certain quantities and grades of frac sand and specifies the purchase prices for such produced frac sand.

Production Operations

Excavation Operations

The surface excavation operations at our Wyeville facility and our sponsor’s Augusta facility are conducted by a third-party contractor, Gerke Excavating, Inc. The mining technique at our Wyeville facility is open-pit excavation of approximately 20-acre panels of unconsolidated silica deposits. The excavation process involves clearing vegetation and trees overlying the proposed mining area. The initial two to five feet of overburden is removed and utilized to construct perimeter berms around the pit and property boundary. No underground mines are operated at our Wyeville facility or our sponsor’s Augusta facility.

A track excavator and articulated trucks are utilized for excavating the sand at several different elevation levels of the active pit. The pit is dry mined, and the water elevation is maintained below working level through a dewatering and pumping process. The mined material is loaded and hauled from different areas of the pit and different elevations within the pit to the primary loading facility at our mine’s on-site wet processing facility. At our Wyeville facility and our sponsor's Augusta facility, Gerke Excavating, Inc. is paid a fixed fee per ton of sand excavated, subject to a diesel fuel surcharge.

Processing Facilities

Our processing facilities are designed to wash, sort, dry and store our raw frac sand. Our Wyeville processing plant started operations in June 2011 and our sponsor’s Augusta processing plant started operations in July 2012, with each plant employing modern and efficient wet and dry processing technology.

Our mined raw frac sand is initially stockpiled before processing. The material is recovered by a mounted belt feeder, which extends beneath a surge pile, and is fed onto a conveyor. The sand exits the tunnel on the conveyor belt and is fed into the 600-

12

ton per hour wet plant where impurities and unusable fine grain sand are removed from the raw feed. The wet processed sand is then stockpiled in advance of being fed into the dry plant for further processing. The wet plant operates for seven to eight months per year due to the limitations arising from sustained freezing temperatures during winter months. When the wet plant is operating, however, it processes more sand per day than the dry plant to build up stockpiles of frac sand to be processed by the dry plant during the winter months.

The dry plant, which operates throughout the entire year, has a rated capacity of 250 tons per hour. The wet processed sand stockpile is fed into the dry plant hopper using a front end loader. The material is processed in a natural gas fired vibratory fluid bed dryer contained in an enclosed building. After drying, the sand is screened through gyratory screens and separated into industry standard product sizes. The finished product is then conveyed to multiple on-site storage silos for each size specification and our railcar loads are tested to ensure that the delivery meets API specifications. Oil and gas producers increasingly require current testing and proof that frac sand used in their drilling and completion processes meet API specifications.

Logistics Capabilities

All of our product sold from the Wyeville facility is shipped by rail from our three 5,000-foot rail spurs that connect our processing and storage facilities to a Union Pacific Railroad mainline. The length of these rail spurs and the capacity of the associated product storage silos allow us to accommodate a large number of rail cars. It also enables us to accommodate unit trains, which significantly increases our efficiency in meeting our customers’ frac sand transportation needs. Unit trains, typically 80 rail cars in length or longer, are dedicated trains chartered for a single delivery destination. Generally, unit trains receive priority scheduling and do not switch cars at various intermediate junctions, which results in a more cost-effective and efficient method of shipping than the standard method of rail shipment. We believe the Wyeville facility is one of the first frac sand facilities in the industry initially designed to accommodate large scale rail and unit train logistics, which require sufficient acreage, loading facilities and rail spurs to accommodate a unit train on site.

Logistics capabilities of frac sand producers are important to our customers, who focus on both the reliability and flexibility of product delivery. Because our customers generally find it impractical to store frac sand in large quantities near their job sites, they seek to arrange for product to be delivered where and as needed, which requires predictable and efficient loading and shipping of product. The integrated nature of our logistics operations and our three 5,000 foot rail spurs enables us to handle railcars for multiple customers simultaneously, minimizing the number of days required to successfully load shipments, even at times of peak activity, and avoid the use of trucks and minimize transloading within the facility. At the same time, we believe our ability to ship using unit trains differentiates us from most other frac sand producers that ship using manifest, or mixed freight, trains, which may make multiple stops to switch cars before delivering cargoes, or transport their products by truck or barge. In addition, unlike some competitors, our processing and rail loading facilities are located on-site, which eliminates the requirement for on-road transportation, lowers product movement costs and minimizes the reduction in sand quality due to handling. Together, these advantages provide our customers with a reliable and efficient delivery method from our facility to each of the major U.S. oil and natural gas producing basins, and allow us to take advantage of the increasing demand for such a delivery method.

Terminal Operations

As of December 31, 2013, we operated 12 destination rail-based terminal locations throughout Pennsylvania, Ohio and New York. Each terminal location is strategically positioned in the Marcellus and Utica shale plays so that our customers typically do not need to travel more than 75 miles from the well-site to purchase their frac sand requirements. Our terminals include rail-to-truck and, at our Bradford, Minerva, Sheffield, Smithfield and Wellsboro locations, rail-to-storage capabilities.

We generally operate our destination terminal locations under long-term lease agreements with the Class I railroad or applicable short-line rail company. Most of these lease agreements include performance requirements, which typically specify a minimum number of rail cars that must be processed by us each year through the terminal.

We have an extensive network of Class I and short-line railroads that service our destination terminals. Once the frac sand is loaded into rail cars at the origin, we utilize a combination of Class I and short-line railroads to move the sand to our destination terminals. Frac sand that is transported to our destination terminals by rail is then unloaded to delivery trucks directly via a conveyor. For our Bradford, Minerva, Sheffield, Smithfield and Wellsboro locations, which comprise our destinations that have silo storage capabilities, frac sand can also be loaded into delivery trucks directly from our silos. Our silos deploy sand via gravity at 10 tons per minute to trucks stationed directly on scales under each silo with the loading, electronic recording of weight and dispatch of the truck capable of being completed in less than five minutes. Silos are considerably more efficient than conveyors, which require trucks to be loaded and then moved to separate scales to be weighed. As of December 31, 2013, we had the ability to store 31,600 tons of frac sand in our silos, with additional tons of capacity under construction and expected to be completed in 2014.

13

Quality Control

We employ an automated process control system that efficiently manages our mining, loading, shipping, storage, processing and preventative maintenance functions. Furthermore, our co-located storage and loading facilities and shipment via unit trains reduce the incidence of contamination during the delivery process and result in higher quality sand being delivered to our customers. We monitor the quality and consistency of our products by conducting hourly tests throughout the production process to detect variances. These tests are conducted on several different machines to ensure that the results are repeatable and accurate. We take product samples from every rail car that is loaded and provide customers with reports per their request. Samples are retained for three months for testing upon customer request. We have a third-party calibration company certify all measurement devices at our facility on a monthly basis. We also provide customers with documentation verifying that all products shipped meet customer specifications. We continually refine our processes to ensure repeatable results in our processing plant and product quality accountability for our customers.

We have established sand testing processes to monitor sand sieve and turbidity and pre-test all railcars destined for silos at Minerva, Smithfield and Wellsboro. Our testing processes have also been developed to obtain samples from railcars to verify the grade of sand being delivered by railcar.

Competition

There are numerous large and small producers in all sand producing regions of the United States with whom we compete. Our main competitors include:

• Badger Mining Corporation

• Emerge Energy Services LP

• Fairmount Minerals, Ltd.

• Preferred Proppants LLC

• Unimin Corporation

• U.S. Silica Holdings, Inc.

The most important factors on which we compete are product quality, performance and sand characteristics, transportation capabilities, reliability of supply and price. Demand for frac sand and the prices that we will be able to obtain for our products, to the extent not subject to a long-term contract, are closely linked to proppant consumption patterns for the completion of oil and natural gas wells in North America. These consumption patterns are influenced by numerous factors, including the price for hydrocarbons, the drilling rig count and hydraulic fracturing activity, including the number of stages completed and the amount of proppant used per stage. Further, these consumption patterns are also influenced by the location, quality, price and availability of raw frac sand and other types of proppants such as resin-coated sand and ceramic proppant.

Our History and Relationship with Our Sponsor

Overview and History

Hi-Crush Proppants LLC, our sponsor, was formed in 2010 in Houston, Texas. Members of our sponsor’s management team have, on average, more than 20 years of experience investing in and operating businesses in the oil and natural gas and sand mining industries. Members of our management team have partnered with major oilfield services companies and exploration and production companies in the development of oil and natural gas reservoirs. In this capacity, members of our management team gained valuable expertise and developed strong relationships in the oilfield services industry. Recognizing the increasing demand for proppants as a result of rapidly evolving hydraulic fracturing techniques, members of our management team chose to leverage their expertise and relationships to capitalize on this increasing demand by developing raw frac sand reserves and facilities. In addition, our Chief Operating Officer has overseen the design, construction and staffing for multiple sand mining and processing facilities. The expertise of our management and operations teams covers a wide range of disciplines, with an emphasis on development, construction and operation of frac sand processing facilities, frac sand supply chain management and consulting and bulk solids material handling.

Our sponsor’s lead investor is Avista Capital Partners, a leading private equity firm with significant investing and operating expertise in the energy industry. Founded in 2005 by senior investment professionals who worked together at DLJ Merchant Banking Partners (“DLJMB”), then one of the world’s largest and most successful private equity franchises, Avista makes controlling or influential minority investments in connection with various transaction structures. The energy team at Avista is comprised of experienced professionals and industry executives with relevant expertise in the energy sector. Avista principals have led over $3.0 billion in equity investments in energy companies while at Avista and DLJMB, including Basic Energy Services, Inc., Brigham Exploration Company, Copano Energy, L.L.C., Seabulk International, Inc., and joint-ventures with Carrizo Oil & Gas, Inc.

14

Our Sponsor’s Assets and Our Right of First Offer

In connection with our IPO, our sponsor contributed to us its sand reserves and related excavation and processing facilities located in Wyeville, Wisconsin. On January 31, 2013, we acquired a preferred interest in our sponsor’s Augusta facility for $37.5 million in cash and 3.75 million of our Class B Units representing limited partner interests in the Partnership. John T. Boyd estimated that, as of December 31, 2013, the Augusta site had 46.8 million tons of proven recoverable coarse grade sand reserves located on 1,187 acres. In addition, our sponsor is constructing its third 1,600,000 tons per year processing facility near Whitehall, Wisconsin, expected to be completed in the second quarter of 2014. Our sponsor also has options to acquire several other sand mining locations where it could develop similar production facilities with similar logistics capabilities as the Wyeville and Augusta facilities. Pursuant to the terms of an omnibus agreement we entered into with our sponsor, we have a right of first offer with respect to certain of our sponsor’s assets.

Our sponsor continually evaluates acquisitions and may elect to acquire, construct or dispose of assets in the future, including in sales of assets to us. As the owner of our general partner, all of our subordinated units, Class B Units and incentive distribution rights, our sponsor is well aligned and highly motivated to promote and support the successful execution of our business strategies, including utilizing our partnership as a growth vehicle for its sand mining operations. Although we expect to have the opportunity to make additional acquisitions directly from our sponsor in the future, including the sand excavation and processing facilities described above that are subject to our right of first offer, our sponsor is under no obligation to accept any offer we make, and may, following good faith negotiations with us, sell the assets subject to our right of first offer to third parties that may compete with us. Our sponsor may also elect to develop, retain and operate properties in competition with us or develop new assets that are not subject to our right of first offer.

In addition, while we believe our relationship with our sponsor is a significant positive attribute, it may also be a source of conflict. For example, our sponsor is not restricted in its ability to compete with us, and since the commencement of operations at its Augusta facility in August 2012 our sponsor has been competing directly with us for new and existing customers. In addition, we expect that our sponsor will develop additional frac sand excavation and processing facilities in the future, which may also compete with us. While we expect that our management team, which also manages our sponsor’s retained assets, and our sponsor will allocate new and replacement customer contracts between us and our sponsor in a manner that balances the interests of both parties, they are under no obligation to do so.

Omnibus Agreement

On August 20, 2012, we entered into an omnibus agreement with our general partner and our sponsor. Pursuant to the terms of this agreement, our sponsor will indemnify us and our subsidiaries for certain liabilities over specified periods of time, including but not limited to certain liabilities relating to (a) environmental matters pertaining to the period prior to our initial public offering and the contribution of the Wyeville assets from our sponsor, provided that such indemnity is capped at $7.5 million in aggregate, (b) federal, state and local tax liabilities pertaining to the period prior to our initial public offering and the contribution of the Wyeville assets from our sponsor, (c) inadequate permits or licenses related to the contributed assets, and (d) any losses, costs or damages incurred by us that are attributable to our sponsor’s ownership and operation of the Wyeville assets prior to our initial public offering and our sponsor’s contribution of such assets. In addition, we have agreed to indemnify our sponsor from any losses, costs or damages it incurs that are attributable to our ownership and operation of the contributed assets following the closing of the IPO, subject to similar limitations as on our sponsor’s indemnity obligations to us.

The omnibus agreement had provided that we would assign to our sponsor all of our rights and obligations under our long-term contract with one customer on May 1, 2013, and our sponsor would be obligated to accept such assignment and assume our obligations under such contract. In connection with our acquisition of a preferred interest in Augusta on January 31, 2013, our sponsor waived its right to require that we assign to our sponsor such contract.

In addition, the omnibus agreement also grants us, for a period of three years, a right of first offer on our sponsor’s sand reserves and any related assets that have been or will be constructed on its current acreage in Augusta, Wisconsin in the event our sponsor proposes to transfer such reserves and assets to a third party other than in connection with a sale of all or substantially all of its assets. On January 31, 2013, we entered into an agreement with our sponsor to acquire a preferred interest in Augusta, the entity that owns our sponsor’s Augusta raw frac sand processing facility, for $37.5 million in cash and 3.75 million of Class B Units. Our sponsor will not receive distributions on the Class B Units unless certain thresholds are met and until they convert into common units. The preferred interest in Augusta entitles us to receive a preferred distribution of up to $3.75 million per quarter, or $15.0 million annually.

Our Management and Employees

We are managed and operated by the board of directors and executive officers of our general partner, Hi-Crush GP LLC, a wholly owned subsidiary of our sponsor. As a result of owning our general partner, our sponsor has the right to appoint all members of the board of directors of our general partner, including at least three independent directors meeting the independence standards

15

established by the New York Stock Exchange (“NYSE”). Our unitholders are not entitled to elect our general partner or its directors or otherwise directly participate in our management or operations. Even if our unitholders are dissatisfied with the performance of our general partner, they have limited ability to remove the general partner without its consent, because our general partner and its affiliates own a sufficient number of units. Our unitholders are able to indirectly participate in our management and operations only to the limited extent actions taken by our general partner require the approval of a percentage of our unitholders and our general partner and its affiliates do not own sufficient units to guarantee such approval.

We have entered into an omnibus agreement with our sponsor and our general partner which governs our relationship with them regarding the provisions of certain administrative services to us. In addition, under our partnership agreement, we reimburse our general partner and its affiliates, including our sponsor, for all expenses they incur and payments they make on our behalf, to the extent such expenses are not contemplated by the omnibus agreement. Our partnership agreement does not set a limit on the amount of expenses for which our general partner and its affiliates may be reimbursed. Our partnership agreement provides that our general partner will determine in good faith the expenses that are allocable to us.

Hi-Crush Partners LP does not have any employees. All of the employees who conduct our business pursuant to the omnibus agreement are employed by Hi-Crush Proppants LLC or its wholly owned subsidiaries. As of December 31, 2013, Hi-Crush Proppants LLC had 232 employees. In addition, we contract out our excavation operations to a third party, Gerke Excavating, Inc., and accordingly have no employees involved in those operations.

Environmental and Occupational Safety and Health Regulation

Mining and Workplace Safety

Federal Regulation

The U.S. Mine Safety and Health Administration (“MSHA”) is the primary regulatory agency with jurisdiction over the commercial silica industry. Accordingly, MSHA regulates quarries, surface mines, underground mines, and the industrial mineral processing facilities associated with quarries and mines. The mission of MSHA is to administer the provisions of the Federal Mine Safety and Health Act of 1977 and to enforce compliance with mandatory safety and health standards. As part of MSHA’s oversight, its representatives must perform at least two unannounced inspections annually for each surface mining facility in its jurisdiction. To date, these inspections have not resulted in any citations for material violations of MSHA standards.

We also are subject to the requirements of the U.S. Occupational Safety and Health Act (“OSHA”) and comparable state statutes that regulate the protection of the health and safety of workers. In addition, the OSHA Hazard Communication Standard requires that information be maintained about hazardous materials used or produced in operations and that this information be provided to employees, state and local government authorities, and the public. OSHA regulates the users of commercial silica and provides detailed regulations requiring employers to protect employees from overexposure to silica through the enforcement of permissible exposure limits and the OSHA Hazard Communication Standard.

Health and Safety Programs

We adhere to a strict occupational health program aimed at controlling employee exposure to silica dust, which includes dust sampling, a respiratory protection program, medical surveillance, training, and other components. Our safety program is designed to ensure compliance with MSHA regulations. For both health and safety issues, extensive training is provided to employees. We have safety meetings at our plants made up of salaried and hourly employees that are involved in establishing, implementing, and improving safety standards. We perform annual internal health and safety audits and conduct semi-annual crisis management drills to test our plants’ abilities to respond to various situations.

Environmental Matters

We and the commercial silica industry are subject to extensive governmental regulation pertaining to matters such as permitting and licensing requirements, plant and wildlife protection, hazardous materials, air and water emissions, and environmental contamination and reclamation. A variety of federal, state and local agencies have established, implement and enforce these regulations.

Federal Regulation

At the federal level, we may be required to obtain permits under Section 404 of the Clean Water Act from the U.S. Army Corps of Engineers for the discharge of dredged or fill material into waters of the United States, including wetlands and streams, in connection with our operations. We also may be required to obtain permits under Section 402 of the Clean Water Act from the EPA or the Wisconsin Department of Natural Resources, to whom the EPA has delegated local implementation of the permit program, for discharges of pollutants into waters of the United States, including discharges of wastewater or stormwater runoff associated with construction activities. Failure to obtain these required permits or to comply with their terms could subject us to administrative, civil, and criminal penalties as well as injunctive relief.

16

The U.S. Clean Air Act and comparable state laws regulate emissions of various air pollutants through air emissions permitting programs and the imposition of other requirements. These regulatory programs may require us to install expensive emissions abatement equipment, modify operational practices, and obtain permits for existing or new operations. Before commencing construction on a new or modified source of air emissions, such laws may require us to reduce emissions at existing facilities. As a result, we may be required to incur increased capital and operating costs to comply with these regulations. We could be subject to administrative, civil, and criminal penalties as well as injunctive relief for noncompliance with air permits or other requirements of the U.S. Clean Air Act and comparable state laws and regulations.

As part of our operations, we utilize or store petroleum products and other substances such as diesel fuel, lubricating oils, and hydraulic fluid. We are subject to regulatory programs pertaining to the storage, use, transportation, and disposal of these substances. Spills or releases may occur in the course of our operations, and we could incur substantial costs and liabilities as a result of such spills or releases, including claims for damage or injury to property and persons. The Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA,” also known as the Superfund law) and comparable state laws may impose joint and several liability, without regard to fault or legality of conduct, on classes of persons who are considered to be responsible for the release of hazardous substances into the environment. These persons include the owner or operator of the site where the release occurred and anyone who disposed of or arranged for disposal, including offsite disposal, of a hazardous substance generated or released at the site. Under CERCLA, such persons may be subject to liability for the costs of cleaning up the hazardous substances, for damages to natural resources, and for the costs of certain health studies. In addition, it is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment.

In addition, the Resource Conservation and Recovery Act (“RCRA”) and comparable state statutes regulate the generation, transportation, treatment, storage, disposal, and cleanup of hazardous and non-hazardous wastes. The EPA and Wisconsin Department of Natural Resources, to which the EPA has delegated portions of the RCRA program for local implementation, administer the RCRA program.

Our operations may also be subject to broad environmental review under the National Environmental Policy Act (“NEPA”). NEPA requires federal agencies to evaluate the environmental impact of all “major federal actions” significantly affecting the quality of the human environment. The granting of a federal permit for a major development project, such as a mining operation, may be considered a “major federal action” that requires review under NEPA. Therefore, our projects may require review and evaluation under NEPA. As part of this evaluation, the federal agency considers a broad array of environmental impacts, including, among other things, impacts on air quality, water quality, wildlife (including threatened and endangered species), historic and archeological resources, geology, socioeconomics, and aesthetics. NEPA also requires the consideration of alternatives to the project. The NEPA review process, especially the preparation of a full environmental impact statement, can be time consuming and expensive. The purpose of the NEPA review process is to inform federal agencies’ decision-making on whether federal approval should be granted for a project and to provide the public with an opportunity to comment on the environmental impacts of a proposed project. Though NEPA requires only that an environmental evaluation be conducted and does not mandate a particular result, a federal agency could decide to deny a permit or impose certain conditions on its approval, based on its environmental review under NEPA, or a third party could challenge the adequacy of a NEPA review and thereby delay the issuance of a federal permit or approval.

Federal agencies granting permits for our operations also must consider impacts to endangered and threatened species and their habitat under the Endangered Species Act. We also must comply with and are subject to liability under the Endangered Species Act, which prohibits and imposes stringent penalties for the harming of endangered or threatened species and their habitat. Federal agencies also must consider a project’s impacts on historic or archeological resources under the National Historic Preservation Act, and we may be required to conduct archeological surveys of project sites and to avoid or preserve historical areas or artifacts.

State and Local Regulation

We are also subject to a variety of state and local environmental review and permitting requirements. Some states, including Wisconsin where our current projects are located, have state laws similar to NEPA; thus our development of a new site or the expansion of an existing site may be subject to comprehensive state environmental reviews even if it is not subject to NEPA. In some cases, the state environmental review may be more stringent than the federal review. Our operations may require state-law based permits in addition to federal permits, requiring state agencies to consider a range of issues, many the same as federal agencies, including, among other things, a project’s impact on wildlife and their habitats, historic and archaeological sites, aesthetics, agricultural operations, and scenic areas. Wisconsin and some other states also have specific permitting and review processes for commercial silica mining operations, and state agencies may impose different or additional monitoring or mitigation requirements than federal agencies. The development of new sites and our existing operations also are subject to a variety of local environmental and regulatory requirements, including land use, zoning, building, and transportation requirements.

As demand for frac sand in the oil and natural gas industry has driven a significant increase in current and expected future production of commercial silica, some local communities have expressed concern regarding silica sand mining operations. These concerns

17

have generally included exposure to ambient silica sand dust, truck traffic, water usage, and blasting. In response, certain state and local communities have developed or are in the process of developing regulations or zoning restrictions intended to minimize the potential for dust to become airborne, control the flow of truck traffic, significantly curtail the area available for mining activities, require compensation to local residents for potential impacts of mining activities and, in some cases, ban issuance of new permits for mining activities. There are no operating restrictions in place at our facilities restricting our hours of operations; however the Augusta facility operates under a noise restriction of up to 60 decibels. We are not aware of any proposals for significant increased scrutiny on the part of state or local regulators in the jurisdictions in which we operate or community concerns with respect to our operations that would reasonably be expected to have a material adverse effect on our business, financial condition, or results of operations going forward.

Planned expansion of our mining and production capacity in new communities could be more significantly impacted by increased regulatory activity. Difficulty or delays in obtaining or inability to obtain new mining permits or increased costs of compliance with future state and local regulatory requirements could have a material negative impact on our ability to grow our business. In an effort to minimize these risks, we continue to be engaged with local communities in order to grow and maintain strong relationships with residents and regulators.

Costs of Compliance

We may incur significant costs and liabilities as a result of environmental, health, and safety requirements applicable to our activities. Failure to comply with environmental laws and regulations may result in the assessment of administrative, civil, and criminal penalties; imposition of investigatory, cleanup, and site restoration costs and liens; the denial or revocation of permits or other authorizations; and the issuance of injunctions to limit or cease operations. Compliance with these laws and regulations may also increase the cost of the development, construction, and operation of our projects and may prevent or delay the commencement or continuance of a given project. In addition, claims for damages to persons or property may result from environmental and other impacts of our activities.

The process for performing environmental impact studies and reviews for federal, state, and local permits required for our operations involves a significant investment of time and monetary resources. We cannot control the permit approval process. We cannot predict whether all permits required for a given project will be granted or whether such permits will be the subject of significant opposition. The denial of a permit essential to a project or the imposition of conditions with which it is not practicable or feasible to comply could impair or prevent our ability to develop a project. Significant opposition and delay in the environmental review and permitting process also could impair or delay our ability to develop a project. Additionally, the passage of more stringent environmental laws could impair our ability to develop new operations and have an adverse effect on our financial condition and results of operations.

Permits

Wyeville Facility

We operate the Wyeville facility under a number of federal, state and local authorizations.

The Wyeville facility currently operates under a construction air permit from the Wisconsin Department of Natural Resources (“Wisconsin DNR”). We must demonstrate our compliance with the construction air permit over an 18-month period, which began on September 25, 2013, after which the Wisconsin DNR will issue an operation air permit. We developed and are in compliance with a Fugitive Dust Control Plan and a Malfunction Prevention and Abatement Plan.

Stormwater discharges from the Wyeville facility are permitted under the Wisconsin Pollutant Discharge Elimination System (“WPDES”). An updated Notice of Intent for the WPDES general permit, which will include the new mine areas, was approved by the Wisconsin DNR on August 30, 2012. Placement of all permanent erosion control structures at the Wyeville facility is now complete.

The Wyeville facility has a U.S. Army Corps of Engineers Section 404 permit and a Wisconsin DNR Section 401 Water Quality Certification for filling of wetlands associated with the rail spur construction. The Section 404 permit includes the requirement that we restore and monitor 2.1 acres of wetlands at an on-site location per our Compensatory Wetland Mitigation Site Plan. We also obtained a Land Use Permit from Monroe County to fill in and grade a floodplain associated with the rail spur construction.

We conduct mining operations at the Wyeville facility pursuant to a Monroe County Nonmetallic Mining Reclamation Permit. We have submitted an updated Nonmetallic Mining Reclamation Plan to Monroe County and have applied for an amendment to the existing permit to address our proposed mine extension.

Augusta Facility

Our sponsor operates the Augusta facility under a number of federal, state and local authorizations.

18

The Augusta facility currently operates under a construction air permit from the Wisconsin Department of Natural Resources (“Wisconsin DNR”). Our sponsor must demonstrate compliance with the construction air permit over an 18-month period, which began on April 23, 2013, after which the Wisconsin DNR will issue an operation air permit. Our sponsor developed and is in compliance with a Fugitive Dust Control Plan and a Malfunction Prevention and Abatement Plan.

Storm water discharges from the Augusta facility are permitted under the Wisconsin Pollutant Discharge Elimination System (“WPDES”) and the Eau Claire County Storm Water Management and Erosion Control ordinance. The placement of all permanent storm water management and erosion control structures at the Wet Plant and Mine facility are now complete. An updated Notice of Intent for the WPDES general permit, which will include modifications to the existing storm water management and erosion control structures for the Dry Plant facility, has been submitted and is under review by the WDNR.

The Augusta facility has a U.S. Army Corps of Engineers Section 404 permit and a Wisconsin DNR Section 401 Water Quality Certification for filling of wetlands associated with the rail spur construction. The Section 404 permit includes the requirement that we debit 1.72 wetland credits from the Northland Mitigation Bank to provide compensatory mitigation for the 1.72 acres of unavoidable wetland impact. The debit of the aforementioned credits was performed prior to impacting the permitted wetlands. A Letter of Map Amendment was approved by the Federal Emergency Management Agency for a small portion of the rail spur. No remaining sections of the rail spur were shown within the mapped floodplain and no additional permitting was required.

Our sponsor conducts mining operations at the Augusta facility pursuant to an Eau Claire County Nonmetallic Mining Reclamation Permit. We are in compliance with the permit conditions and Wisconsin Administrative Code NR135.

Terminal Facilities

We operate our terminal facilities under various federal, state and local authorizations.  Although the list of permits we obtain in order to commence and maintain our operations at each facility vary by location, we are typically required to obtain, among other permits and authorizations, air, land development, local building and highway occupancy permits.  We are also occasionally required to obtain a wetlands permit.

Safety and Maintenance

We adhere to a strict occupational health program aimed at controlling exposure to silica dust, which includes dust sampling, a respiratory protection program, medical surveillance, training and other components. Our safety program is designed to ensure compliance with the standards of our Occupational Health and Safety Manual and MSHA regulations. For both health and safety issues, extensive training is provided to employees. We have safety meetings at our plants made up of salaried and hourly employees. We perform annual internal health and safety audits and conduct semi-annual crisis management drills to test our abilities to respond to various situations. Health and safety programs are administered by our corporate health and safety department with the assistance of plant Environmental, Health and Safety Coordinators.

Availability of Reports; Website Access; Other Information

Our internet address is http://www.hicrushpartners.com. Through “Investor Relations” — “SEC Filings” on our home page, we make available free of charge our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our proxy statements, our Current Reports on Form 8-K, SEC Forms 3, 4 and 5 and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. Our reports filed with the SEC are also made available to read and copy at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information about the Public Reference Room by contacting the SEC at 1-800-SEC-0330. Reports filed with the SEC are also made available on its website at www.sec.gov.

19

ITEM 1A.    RISK FACTORS

There are many factors that may affect our business, financial condition and results of operations and investments in us. Security holders and potential investors in our securities should carefully consider the risk factors set forth below, as well as the discussion of other factors that could affect us or investments in us included elsewhere in this Annual Report on Form 10-K. If one or more of these risks were to materialize, our business, financial condition or results of operations could be materially and adversely affected. These known material risks could cause our actual results to differ materially from those contained in any written or oral forward-looking statements made by us or on our behalf.

Risks Inherent in Our Business

We may not have sufficient cash from operations following the establishment of cash reserves and payment of costs and expenses, including cost reimbursements to our general partner and its affiliates, to enable us to pay the minimum quarterly distribution to our unitholders.

We may not have sufficient cash each quarter to pay the full amount of our minimum quarterly distribution of $0.475 per unit, or $1.90 per unit per year, which will require us to have cash available for distribution of $13.72 million per quarter, or $54.86 million per year, based on the number of common and subordinated units outstanding as of December 31, 2013. The amount of cash we can distribute on our common and subordinated units principally depends upon the amount of cash we generate from our operations, which will fluctuate from quarter to quarter based on the following factors, some of which are beyond our control:

• the amount of frac sand we are able to excavate and process, which could be adversely affected by, among other things, operating difficulties and unusual or unfavorable geologic conditions;

• the volume of frac sand we are able to buy and sell;

• the price at which we are able to buy and sell frac sand;

• changes in the price and availability of natural gas, diesel fuel or electricity;

• changes in prevailing economic conditions;

• unanticipated ground, grade or water conditions;

• inclement or hazardous weather conditions, including flooding, and the physical impacts of climate change;

• environmental hazards;

• difficulties in obtaining and renewing environmental permits;

• industrial accidents;

• changes in laws and regulations (or the interpretation thereof) related to the mining and hydraulic fracturing industries, silica dust exposure or the environment;

• the outcome of litigation, claims or assessments, including unasserted claims;

• inability to acquire or maintain necessary permits or mining or water rights;

• facility shutdowns in response to environmental regulatory actions;

• inability to obtain necessary production equipment or replacement parts;

• reduction in the amount of water available for processing;

• technical difficulties or failures;

• labor disputes and disputes with our excavation contractor;

• late delivery of supplies;

• difficulty collecting receivables;

• inability of our customers to take delivery;

• changes in the price and availability of transportation;

• fires, explosions or other accidents;

• cave-ins, pit wall failures or rock falls;

• our ability to borrow funds and access capital markets;

• the potential for rail line washouts;

• changes in the political environment of the drilling basis in which we operate; and

• changes in railroad infrastructure and capacity.

In addition, the actual amount of cash we will have available for distribution will depend on other factors, some of which are beyond our control, including:

20

• the level of capital expenditures we make;

• the cost of acquisitions;

• our debt service requirements and other liabilities;

• fluctuations in our working capital needs;

• our ability to borrow funds and access capital markets;

• restrictions contained in debt agreements to which we are a party; and

• the amount of cash reserves established by our general partner.

The amount of cash we have available for distribution to holders of our units depends primarily on our cash flow and not solely on profitability, which may prevent us from making cash distributions during periods when we record net income.

The amount of cash we have available for distribution depends primarily upon our cash flow, including cash flow from reserves and working capital or other borrowings, and not solely on profitability, which will be affected by non-cash items. As a result, we may pay cash distributions during periods when we record net losses for financial accounting purposes and may not pay cash distributions during periods when we record net income.

Inaccuracies in estimates of volumes and qualities of our sand reserves could result in lower than expected sales and higher than expected production costs.

John T. Boyd, our independent reserve engineers, prepared estimates of our reserves based on engineering, economic and geological data assembled and analyzed by our engineers and geologists. However, frac sand reserve estimates are by nature imprecise and depend to some extent on statistical inferences drawn from available data, which may prove unreliable. There are numerous uncertainties inherent in estimating quantities and qualities of reserves and non-reserve frac sand deposits and costs to mine recoverable reserves, including many factors beyond our control. Estimates of economically recoverable frac sand reserves necessarily depend on a number of factors and assumptions, all of which may vary considerably from actual results, such as:

• geological and mining conditions and/or effects from prior mining that may not be fully identified by available data or that may differ from experience;

• assumptions concerning future prices of frac sand, operating costs, mining technology improvements, development costs and reclamation costs; and

• assumptions concerning future effects of regulation, including the issuance of required permits and taxes by governmental agencies.

Any inaccuracy in John T. Boyd’s estimates related to our frac sand reserves and non-reserve frac sand deposits could result in lower than expected sales and higher than expected costs. For example, John T. Boyd’s estimates of our proven reserves assume that our revenue and cost structure will remain relatively constant over the life of our reserves. If these assumptions prove to be inaccurate, some or all of our reserves may not be economically mineable, which could have a material adverse effect on our results of operations and cash flows. In addition, we pay a fixed price per ton of sand excavated regardless of the quality of the frac sand, and our current customer contracts require us to deliver frac sand that meets certain specifications. If John T. Boyd’s estimates of the quality of our reserves, including the volumes of the various specifications of those reserves, prove to be inaccurate, we may incur significantly higher excavation costs without corresponding increases in revenues, we may not be able to meet our contractual obligations, or our facilities may have a shorter than expected reserve life, which could have a material adverse effect on our results of operations and cash flows.

The majority of our sales are generated under contracts with four customers, and the loss of, or significant reduction in purchases by, any of them could adversely affect our business, financial condition and results of operations.

As of January 1, 2014, we were contracted to sell raw frac sand produced from our Wyeville facility under long-term supply agreements to four customers with remaining terms ranging from 6 to 72 months. Upon the expiration of these current supply agreements, our customers may not continue to purchase the same levels of our frac sand due to a variety of reasons. In addition, we may choose to renegotiate our existing contracts on less favorable terms and at reduced volumes in order to preserve relationships with our customers. Furthermore, some of our customers could exit the pressure pumping business or be acquired by other companies that purchase the same products and services we provide from other third-party providers. Our current customers also may seek to acquire frac sand from other providers that offer more competitive pricing or superior logistics or to capture and develop their own sources of frac sand.

In addition, upon the expiration of our current contract terms, we may be unable to renew our existing contracts or enter into new contracts on terms favorable to us, or at all. The demand for frac sand or prevailing prices at the time our current supply agreements expire may render entry into new long-term supply agreements difficult or impossible. Any reduction in the amount of frac sand purchased by our customers, renegotiation on less favorable terms, or inability to enter into new contracts on economically

21

acceptable terms upon the expiration of our current contracts could have a material adverse effect on our business, financial condition and results of operations.

If we are unable to make acquisitions on economically acceptable terms, our future growth would be limited, and any acquisitions we make may reduce, rather than increase, our cash generated from operations on a per unit basis.

A portion of our strategy to grow our business and increase distributions to unitholders is dependent on our ability to make acquisitions that result in an increase in our cash available for distribution per unit. If we are unable to make acquisitions from third parties, including from our sponsor and its affiliates, because we are unable to identify attractive acquisition candidates or negotiate acceptable purchase contracts, we are unable to obtain financing for these acquisitions on economically acceptable terms or we are outbid by competitors, our future growth and ability to increase distributions will be limited. Furthermore, even if we do consummate acquisitions that we believe will be accretive, they may in fact result in a decrease in our cash available for distribution per unit. Any acquisition involves potential risks, some of which are beyond our control, including, among other things:

• inaccurate assumptions about revenues and costs, including synergies;

• inability to successfully integrate the businesses we acquire;

• inability to hire, train or retain qualified personnel to manage and operate our business and newly acquired assets;

• the assumption of unknown liabilities;

• limitations on rights to indemnity from the seller;

• mistaken assumptions about the overall costs of equity or debt;

• the diversion of management’s attention from other business concerns;

• unforeseen difficulties operating in new product areas or new geographic areas; and

• customer or key employee losses at the acquired businesses.

If we consummate any future acquisitions, our capitalization and results of operations may change significantly, and unitholders will not have the opportunity to evaluate the economic, financial and other relevant information that we will consider in determining the application of these funds and other resources.

Our right of first offer to acquire certain of our sponsor’s existing assets is subject to risks and uncertainty, and ultimately we may not acquire any of those assets.

Our omnibus agreement provides us with a right of first offer on our sponsor’s sand reserves and any related assets that have been or will be constructed on its acreage in Augusta, Wisconsin, into which we made a preferred investment in January 2013, and other land holdings or facilities of our sponsor, for a period of three years following the closing of our IPO on August 16, 2012. The consummation and timing of any future acquisitions of these assets will depend upon, among other things, our sponsor’s willingness to offer these assets for sale, our ability to negotiate acceptable customer contracts and other agreements with respect to the assets and our ability to obtain financing on acceptable terms. Although we acquired a preferred interest in the Augusta facility in January 2013, we can offer no assurance that we will be able to successfully consummate any future acquisitions pursuant to our right of first offer, and our sponsor is under no obligation to accept any offer that we may choose to make. For these or a variety of other reasons, we may decide not to exercise our right of first offer if and when any assets are offered for sale, and our decision will not be subject to unitholder approval.

Our long-term business and financial performance depends on the level of drilling and completion activity in the oil and natural gas industry.

Our primary exposure to market risk occurs at the time existing customer contracts expire and are subject to renegotiation, renewal or replacement. Our ability to renew existing customer contracts or enter into new customer contracts on favorable terms is dependent on the market for frac sand at such times. Demand for frac sand is materially dependent on the levels of activity in natural gas and oil exploration, development and production, and more specifically, the number of natural gas and oil wells completed in geological formations where sand-based proppants are used in hydraulic fracturing treatments and the amount of frac sand customarily used in the completion of such wells.

The number of wells drilled for natural gas has recently increased from its lowest level in 13 years as a result of increasing natural gas prices brought on by the higher use of natural gas in heating in the 2013-2014 winter. The number of wells drilled for oil has also been increasing as a result of relatively high prices for oil. To the extent that the recent fluctuations in global crude oil prices develop into a prolonged decline, this decline could result in a reduction in the growth rate of oil wells drilled and a decline in the number of oil wells drilled from current levels.

Oil and natural gas producers’ expectations for lower market prices for oil and natural gas, as well as the availability of capital for operating and capital expenditures, may cause them to curtail spending, thereby reducing hydraulic fracturing activity and the

22

demand for frac sand. Industry conditions that impact the activity levels of oil and natural gas producers are influenced by numerous factors over which we have no control, including:

• governmental regulations, including the policies of governments regarding the exploration for and production and development of their oil and natural gas reserves;

• global weather conditions and natural disasters;

• worldwide political, military, and economic conditions;

• the cost of producing and delivering oil and natural gas;

• commodity prices; and

• potential acceleration of development of alternative energy sources.

A prolonged reduction in natural gas and oil prices would generally depress the level of natural gas and oil exploration, development, production and well completion activity and result in a corresponding decline in the demand for the frac sand we produce. In addition, any future decreases in the rate at which oil and natural gas reserves are developed (particularly in the Marcellus and Utica shale basins where a substantial portion of our distribution network is focused), whether due to increased governmental regulation, limitations on exploration and drilling activity or other factors, could have a material adverse effect on our business, even in a stronger natural gas and oil price environment. If there is a sustained decrease in the demand for frac sand, we may be unable to renew contracts for our products, be forced to renegotiate our existing contracts, or be forced to reduce the prices at which we enter into new contracts, any of which would reduce the amount of cash we generate.

In addition, to the extent we make sales of our frac sand other than under long-term contracts, the price we receive for those sales will be impacted by short term fluctuations in the market for frac sand, and any negative fluctuations in this market could have an adverse effect on our results of operations and cash flows.

All of our FOB plant sales are generated at our Wyeville facility and cash flows earned under our preferred equity investment are generated through the Augusta facility. Any adverse developments at the Wyeville or Augusta facilities could have a material adverse effect on our financial condition and results of operations.

All of our FOB plant sales are currently derived from our Wyeville facility located in Wyeville, Wisconsin. Cash flows to be earned under our preferred equity investment are derived from sales by our sponsor from its Augusta facility. Any adverse development at these facilities due to catastrophic events or weather, or any other event that would cause us to curtail, suspend or terminate operations at the Wyeville or Augusta facilities, could result in us or our sponsor being unable to meet our contracted sand deliveries. If we are unable to deliver contracted volumes within three months of contract year end, or otherwise arrange for delivery from a third party, we will be required to pay make-whole payments to our customers that could have a material adverse effect on our financial condition and results of operations. Further, we purchase a certain amount of frac sand from third parties for use in our distribution network.  Upon expiration of our current contract terms with our frac sand suppliers, we may be unable to renew our existing contracts or enter into new contracts on terms favorable to us, or at all.  If we are unable to provide supply from our own facilities, any reduction in the amount of frac sand available for our purchase from third parties, renegotiation of contracts on less favorable terms, or inability to enter into new contracts on economically acceptable terms upon the expiration of our current contracts could have a material adverse effect on our business, financial condition and results of operations.

We may be adversely affected by decreased demand for raw frac sand due to the development of either effective alternative proppants or new processes to replace hydraulic fracturing.

Raw frac sand is a proppant used in the completion and re-completion of oil and natural gas wells to stimulate and maintain oil and natural gas production through the process of hydraulic fracturing. Raw frac sand is the most commonly used proppant and is less expensive than other proppants, such as resin-coated sand and manufactured ceramics. A significant shift in demand from frac sand to other proppants, or the development of new processes to replace hydraulic fracturing altogether, could cause a decline in the demand for the frac sand we produce and result in a material adverse effect on our financial condition and results of operations.

An increase in the supply of raw frac sand having similar characteristics as the raw frac sand we produce could make it more difficult for us to renew or replace our existing contracts on favorable terms, or at all.

We believe that the supply of raw frac sand had not kept pace with the increasing demand for raw frac sand until recently, which has been a contributing factor to steadily increasing prices for raw frac sand over the last decade. If significant new reserves of raw frac sand are discovered and developed, and those frac sands have similar characteristics to the raw frac sand we produce, we may be unable to renew or replace our existing contracts on favorable terms, or at all. Specifically, if high quality frac sand becomes more readily available, our customers may not be willing to enter into long-term contracts, or may demand lower prices, or both, which could have a material adverse effect on our results of operations and cash flows over the long-term.

23

Federal, state, and local legislative and regulatory initiatives relating to hydraulic fracturing and the potential for related litigation could result in increased costs, additional operating restrictions or delays for our customers, which could cause a decline in the demand for our frac sand and negatively impact our business, financial condition and results of operations.

We supply frac sand to hydraulic fracturing operators in the oil and natural gas industry. Hydraulic fracturing is an important and increasingly common practice that is used to stimulate production of natural gas and/or oil from low permeability hydrocarbon bearing subsurface rock formations. The hydraulic fracturing process involves the injection of water, proppants and chemicals under pressure into the formation to fracture the surrounding rock, increase permeability and stimulate production. Increased regulation of hydraulic fracturing may adversely impact our business, financial condition and results of operations.

Although we do not directly engage in hydraulic fracturing activities, our customers purchase our frac sand for use in their hydraulic fracturing activities. The federal Safe Drinking Water Act (“SDWA”) regulates the underground injection of substances through the Underground Injection Control Program (“UIC Program”). Currently, with the exception of certain hydraulic fracturing activities involving the use of diesel, hydraulic fracturing is exempt from federal regulation under the UIC Program, and the hydraulic fracturing process is typically regulated by state or local governmental authorities. However, the practice of hydraulic fracturing has become controversial and is undergoing increased political and regulatory scrutiny. Several federal agencies, regulatory authorities, and legislative entities are investigating the potential environmental impacts of hydraulic fracturing and whether additional regulation may be necessary. The U.S. Department of the Interior revised new regulations on May 16, 2013, which would require oil and natural gas operators to disclose the chemicals they use during hydraulic fracturing on federal lands. The proposed regulations would also strengthen standards for wellbore integrity and the management of fluids that return to the surface during and after fracturing operations on federal lands. In addition, the U.S. Environmental Protection Agency continues to study the potential environmental impacts of hydraulic fracturing activities and has announced plans to propose standards for the treatment and discharge of wastewater resulting from hydraulic fracturing by 2014. These studies and activities, depending on their results, could spur proposals or initiatives to regulate hydraulic fracturing under the SDWA or otherwise. From time to time Congress has considered legislation to provide for federal regulation of hydraulic fracturing under the SDWA and to require disclosure of the chemicals used in the hydraulic fracturing process.

In addition, various state, local, and foreign governments have implemented, or are considering, increased regulatory oversight of hydraulic fracturing through additional permitting requirements, operational restrictions, disclosure requirements, and temporary or permanent bans on hydraulic fracturing in certain areas such as environmentally sensitive watersheds. Many local governments also have adopted ordinances to severely restrict or prohibit hydraulic fracturing activities within their jurisdictions.

The adoption of new laws or regulations at the federal, state, local, or foreign levels imposing reporting obligations on, or otherwise limiting or delaying, the hydraulic fracturing process could make it more difficult to complete natural gas wells, increase our customers’ costs of compliance and doing business, and otherwise adversely affect the hydraulic oil and gas fracturing services they perform, which could negatively impact demand for our frac sand. In addition, heightened political, regulatory, and public scrutiny of hydraulic fracturing practices could expose us or our customers to increased legal and regulatory proceedings, which could be time-consuming, costly, or result in substantial legal liability or significant reputational harm. We could be directly affected by adverse litigation involving us, or indirectly affected if the cost of compliance limits the ability of our customers to operate. Such costs and scrutiny could directly or indirectly, through reduced demand for our frac sand, have a material adverse effect on our business, financial condition and results of operations.

Our long-term contracts may preclude us from taking advantage of increasing prices for frac sand or mitigating the effect of increased operational costs during the term of our long-term contracts.

The long-term supply contracts we have may negatively impact our results of operations. Our long-term contracts require our customers to pay a specified price for a specified volume of frac sand each month. As a result, in periods with increasing prices our sales will not keep pace with market prices.

Additionally, if our operational costs increase during the terms of our long-term supply contracts, we will not be able to pass any of those increased costs to our customers. If we are unable to otherwise mitigate these increased operational costs, our net income and available cash for distributions could decline.

We are exposed to the credit risk of our customers, and any material nonpayment or nonperformance by our customers could adversely affect our financial results and cash available for distribution.

We are subject to the risk of loss resulting from nonpayment or nonperformance by our customers, whose operations are concentrated in a single industry, the global oilfield services industry. Our credit procedures and policies may not be adequate to fully eliminate customer credit risk. If we fail to adequately assess the creditworthiness of existing or future customers or unanticipated deterioration in their creditworthiness, any resulting increase in nonpayment or nonperformance by them and our inability to re-market or otherwise use the production could have a material adverse effect on our business, financial condition, results of operations and ability to pay distributions to our unitholders.

24

Our operations are subject to operational hazards and unforeseen interruptions for which we may not be adequately insured.

Our operations are exposed to potential natural disasters, including blizzards, tornadoes, storms, floods and earthquakes. If any of these events were to occur, we could incur substantial losses because of personal injury or loss of life, severe damage to and destruction of property and equipment, and pollution or other environmental damage resulting in curtailment or suspension of our operations.

We are not fully insured against all risks incident to our business, including the risk of our operations being interrupted due to severe weather and natural disasters. Certain of the insurance policies covering entities that were contributed to us in connection with our formation and our operations also provide coverage to entities that were not contributed to us by our sponsor. The coverage available under those insurance policies has historically been and is currently allocated among the entities that were contributed to us and those entities that were not contributed to us. We reimburse our sponsor for our allocation of premium costs. This allocation may result in limiting the amount of recovery available to us for purposes of covered losses.

Furthermore, we may be unable to maintain or obtain insurance of the type and amount we desire at reasonable rates. As a result of market conditions, premiums and deductibles for certain of our insurance policies have increased and could escalate further. In addition sub-limits have been imposed for certain risks. In some instances, certain insurance could become unavailable or available only for reduced amounts of coverage. If we were to incur a significant liability for which we are not fully insured, it could have a material adverse effect on our financial condition, results of operations and cash available for distribution to unitholders.

Because we have a limited operating history, you may not be able to evaluate our current business and future earnings prospects accurately.

Our sponsor, which is our accounting predecessor for financial reporting purposes, was formed in October 2010 to develop excavation, processing and logistics facilities for raw frac sands used in hydraulic fracturing operations in oil and natural gas wells. We did not commence commercial operations until the third quarter of 2011, when our Wyeville facility became operational. As a result, we have limited operating history upon which you can base an evaluation of our current business and our future earnings prospects.

Our future performance will depend on our ability to succeed in competitive markets, and on our ability to appropriately react to potential fluctuations in the demand for and supply of frac sand.

We operate in a highly competitive market that is characterized by a small number of large, national producers and a larger number of small, regional or local producers. Competition in the industry is based on price, consistency and quality of product, site location, distribution and logistics capabilities, customer service, and reliability of supply and breadth of product offering.

We compete with large, national producers such as Badger Mining Corporation, Emerge Energy Services LP, Fairmount Minerals, Ltd., Preferred Proppants LLC, Unimin Corporation and U.S. Silica Holdings, Inc. Our larger competitors may have greater financial and other resources than we do, may develop technology superior to ours or may have production facilities that are located closer to key customers than ours. Should the demand for hydraulic fracturing services decrease, prices in the frac sand market could materially decrease as smaller, regional producers may exit the market, selling frac sand at below market prices. In addition, oil and natural gas exploration and production companies and other providers of hydraulic fracturing services could acquire their own frac sand reserves, expand their existing frac sand production capacity or otherwise fulfill their own proppant requirements and existing or new frac sand producers could add to or expand their frac sand production capacity, which may negatively impact pricing and demand for our frac sand. We may not be able to compete successfully against either our larger or smaller competitors in the future, and competition could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Fluctuations in transportation costs and the availability or reliability of rail transportation could reduce revenues by causing us to reduce our production or by impairing the ability of our customers to take delivery.

Transportation costs represent a significant portion of the total cost of frac sand for our customers and, as a result, the cost of transportation is a critical factor in a customer’s purchasing decision. Disruption of transportation services due to shortages of rail cars, weather-related problems, flooding, drought, accidents, mechanical difficulties, strikes, lockouts, bottlenecks or other events could temporarily impair our ability to supply our customers through our logistics network of rail-served origin and distribution terminals, or, if our customers are not using our rail transportation services, the ability of our customers to take delivery and, in certain circumstances, constitute a force majeure event under our customer contracts, permitting our customers to suspend taking delivery of and paying for our frac sand. Accordingly, if there are disruptions of the rail transportation services utilized by our customers (whether these services are provided by us or a third party), and they are unable to find alternative transportation providers to transport frac sand, our business could be adversely affected.

We face distribution and logistical challenges in our business.

25

As oil and natural gas prices fluctuate, our customers may shift their focus back and forth between different resource plays, some of which can be located in geographic areas that do not have well-developed transportation and distribution infrastructure systems. Transportation and logistical operating expenses comprise a significant portion of our total delivered cost of sales. Therefore, serving our customers in these less-developed areas presents distribution and other operational challenges that may affect our sales and negatively impact our operating costs. Disruptions in transportation services, including shortages of railcars or a lack of developed infrastructure, could affect our ability to timely and cost effectively deliver to our customers and could provide a competitive advantage to competitors located in closer proximity to our customers. Additionally, increases in the price of transportation costs, including freight charges, fuel surcharges, terminal switch fees and demurrage costs, could negatively impact operating costs if we are unable to pass those increased costs along to our customers. Failure to find long-term solutions to these logistical challenges could adversely affect our ability to respond quickly to the needs of our customers or result in additional increased costs, and thus could negatively impact our results of operations and financial condition.

Our production process consumes large amounts of natural gas and electricity. An increase in the price or a significant interruption in the supply of these or any other energy sources could have a material adverse effect on our financial condition or results of operations.

Energy costs, primarily natural gas and electricity, represented 2% of our total sales and 12% of our total production costs during the year ended December 31, 2013. Natural gas is the primary fuel source used for drying in the frac sand production process and, as such, our profitability is impacted by the price and availability of natural gas we purchase from third parties. Because we have not contracted for the provision of natural gas on a fixed-price basis, our costs and profitability will be impacted by fluctuations in prices for natural gas. The price and supply of natural gas are unpredictable and can fluctuate significantly based on international, political and economic circumstances, as well as other events outside our control, such as changes in supply and demand due to weather conditions, actions by OPEC and other oil and natural gas producers, regional production patterns and environmental concerns. In addition, potential climate change regulations or carbon or emissions taxes could result in higher production costs for energy, which may be passed on to us in whole or in part. The price of natural gas has been extremely volatile over the last two years, from a high of $4.52 per million British Thermal Units (“BTUs”) in December 2013 to a low of $1.82 per million BTUs in April 2012, and this volatility may continue. In order to manage this risk, we may hedge natural gas prices through the use of derivative financial instruments, such as forwards, swaps and futures. However, these measures carry risk (including nonperformance by counterparties) and do not in any event entirely eliminate the risk of decreased margins as a result of natural gas price increases. A significant increase in the price of energy that is not recovered through an increase in the price of our products or covered through our hedging arrangements or an extended interruption in the supply of natural gas or electricity to our production facilities could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.

Increases in the price of diesel fuel may adversely affect our results of operations.

Diesel fuel costs generally fluctuate with increasing and decreasing world crude oil prices, and accordingly are subject to political, economic and market factors that are outside of our control. Our operations are dependent on earthmoving equipment, railcars and tractor trailers, and diesel fuel costs are a significant component of the operating expense of these vehicles. We contract with a third party to excavate raw frac sand, deliver the raw frac sand to our processing facility and move the sand from our wet plant to our dry plant, and pay a fixed price per ton of sand delivered to our wet plant, subject to a fuel surcharge based on the price of diesel fuel. Accordingly, increased diesel fuel costs could have an adverse effect on our results of operations and cash flows.

We may be required to make substantial capital expenditures to maintain, develop and increase our asset base. The inability to obtain needed capital or financing on satisfactory terms, or at all, could have an adverse effect on our growth and profitability.

Although we currently use a significant amount of our cash reserves and cash generated from our operations to fund the development and expansion of our asset base, we may depend on the availability of credit to fund future capital expenditures. Our ability to obtain bank financing or to access the capital markets for future equity or debt offerings may be limited by our financial condition at the time of any such financing or offering, the covenants contained in our credit facility or other future debt agreements, adverse market conditions or other contingencies and uncertainties that are beyond our control. Our failure to obtain the funds necessary to maintain, develop and increase our asset base could adversely impact our growth and profitability.

Even if we are able to obtain financing or access the capital markets, incurring additional debt may significantly increase our interest expense and financial leverage, and our level of indebtedness could restrict our ability to fund future development and acquisition activities. In addition, the issuance of additional equity interests may result in significant dilution to our existing unitholders.

We have entered into a credit facility which contains restrictions and financial covenants that may restrict our business and financing activities.

Our credit facility, and potentially any other future financing agreements that we may enter into, contain operating and financial restrictions and covenants that may restrict our ability to finance future operations or capital needs, to engage in, expand or pursue our business activities or to make distributions to our unitholders. For example, our revolving credit facility contains covenants

26

requiring us to maintain a leverage ratio (as such term is defined in our revolving credit agreement) of not more than 3.00 to 1.00, which may increase to up to 3.50 to 1.00 during specified periods following a permitted acquisition, and a minimum interest coverage ratio (as such term is defined in our revolving credit agreement) of not less than 2.50 to 1.00.

Our ability to comply with any such restrictions and covenants is uncertain and will be affected by the levels of cash flow from our operations and events or circumstances beyond our control. If market or other economic conditions deteriorate, our ability to comply with these covenants may be impaired. If we violate any of the restrictions, covenants, ratios or tests in the credit facility that we expect to enter into, a significant portion of our indebtedness may become immediately due and payable and our lenders’ commitment to make further loans to us may terminate. We might not have, or be able to obtain, sufficient funds to make these accelerated payments.

Increases in interest rates could adversely affect our business and results of operations.

We have exposure to increases in interest rates under our credit facility. As of December 31, 2013, we had $138.3 million of debt outstanding under our credit facility, with an effective interest rate of 3.17%. Assuming no change in the amount outstanding, the impact on interest expense of a 10% increase or decrease in the average interest rate would be approximately $0.44 million per year. As a result of this variable interest rate debt, our financial condition could be adversely affected by increases in interest rates.

A facility closure entails substantial costs, and if we close our facility or our sponsor closes its Augusta facility sooner than anticipated, our results of operations may be adversely affected.

We base our assumptions regarding the life of our Wyeville excavation facility and our sponsor’s Augusta excavation facility on detailed studies that we perform from time to time, but our studies and assumptions may not prove to be accurate. If we close our Wyeville facility or our sponsor closes the Augusta facility sooner than expected, sales will decline unless we are able to acquire and develop additional facilities, which may not be possible. The closure of our Wyeville facility would involve significant fixed closure costs, including accelerated employment legacy costs, severance-related obligations, reclamation and other environmental costs and the costs of terminating long-term obligations, including energy contracts and equipment leases. We accrue for the costs of reclaiming open pits, stockpiles, non-saleable sand, ponds, roads and other mining support areas over the estimated mining life of our property. If we were to reduce the estimated life of our Wyeville facility, the fixed facility closure costs would be applied to a shorter period of production, which would increase production costs per ton produced and could materially and adversely affect our results of operations and financial condition.

Applicable statutes and regulations require that mining property be reclaimed following a mine closure in accordance with specified standards and an approved reclamation plan. The plan addresses matters such as removal of facilities and equipment, regrading, prevention of erosion and other forms of water pollution, re-vegetation and post-mining land use. We may be required to post a surety bond or other form of financial assurance equal to the cost of reclamation as set forth in the approved reclamation plan. The establishment of the final mine closure reclamation liability is based on permit requirements and requires various estimates and assumptions, principally associated with reclamation costs and production levels. If our accruals for expected reclamation and other costs associated with facility closures for which we will be responsible were later determined to be insufficient, our business, results of operations and financial condition would be adversely affected.

Our operations are dependent on our rights and ability to mine our properties and on our having renewed or received the required permits and approvals from governmental authorities and other third parties.

We hold numerous governmental, environmental, mining, and other permits, water rights, and approvals authorizing operations at our Wyeville facility. For our extraction and processing in Wisconsin, the permitting process is subject to federal, state and local authority. For example, on the federal level, a Mine Identification Request (MSHA Form 7000-51) must be filed and obtained before mining commences. If wetlands are implicated, a U.S. Army Corps of Engineers Wetland Permit is required. At the state level, a series of permits are required related to air quality, wetlands, water quality (waste water, storm water), grading permits, endangered species, archeological assessments, and high capacity wells in addition to others depending upon site specific factors and operational detail. At the local level, zoning, building, storm water, erosion control, wellhead protection, road usage and access are all regulated and require permitting to some degree. A non-metallic mining reclamation permit is required. A decision by a governmental agency or other third party to deny or delay issuing a new or renewed permit or approval, or to revoke or substantially modify an existing permit or approval, could have a material adverse effect on our ability to continue operations.

Title to, and the area of, mineral properties and water rights may also be disputed. Mineral properties sometimes contain claims or transfer histories that examiners cannot verify. A successful claim that we do not have title to our property or lack appropriate water rights could cause us to lose any rights to explore, develop, and extract minerals, without compensation for our prior expenditures relating to such property. Our business may suffer a material adverse effect in the event we have title deficiencies.

27

In some instances, we have received access rights or easements from third parties, which allow for a more efficient operation than would exist without the access or easement. A third party could take action to suspend the access or easement, and any such action could be materially adverse to our results of operations or financial condition.

We do not own the land on which the majority of our destination terminal facilities are located, which could disrupt our operations.

We do not own the land on which the majority of our destination terminals are located and instead own leaseholds interests and rights-of-way for the operation of these facilities.  Upon expiration, termination or other lapse of our current leasehold terms, we may be unable to renew our existing leases or rights-of-way on terms favorable to us, or at all.  Any renegotiation on less favorable terms or inability to enter into new leases on economically acceptable terms upon the expiration, termination or other lapse of our current leases or rights-of-way could cause us to cease operations on the affected land, increase costs related to continuing operations elsewhere and have a material adverse effect on our business, financial condition and results of operations.

A shortage of skilled labor together with rising labor costs in the excavation industry may further increase operating costs, which could adversely affect our results of operations.

Efficient sand excavation using modern techniques and equipment requires skilled laborers, preferably with several years of experience and proficiency in multiple tasks, including processing of mined minerals. Our mining operations are subcontracted to Gerke Excavating, Inc., but there is a shortage of skilled mining labor in Wisconsin. If the shortage of experienced labor continues or worsens, we may find it difficult to renew or replace that contract upon its expiration on acceptable terms, and we may be unable to hire or train the necessary number of skilled laborers to perform our own operations. In either event, there could be an adverse impact on our labor productivity and costs and our ability to expand production.

Our business may suffer if we lose, or are unable to attract and retain, key personnel.

We depend to a large extent on the services of our senior management team and other key personnel. Members of our senior management and other key employees have extensive experience and expertise in evaluating and analyzing sand reserves, maximizing production from such properties, marketing frac sand production, transportation, distribution and developing and executing financing strategies, as well as substantial experience and relationships with participants in the oilfield services and exploration and production industries. Competition for management and key personnel is intense, and the pool of qualified candidates is limited. The loss of any of these individuals or the failure to attract additional personnel, as needed, could have a material adverse effect on our operations and could lead to higher labor costs or the use of less-qualified personnel. In addition, if any of our executives or other key employees were to join a competitor or form a competing company, we could lose customers, suppliers, know-how and key personnel. We do not maintain key-man life insurance with respect to any of our employees. Our success will be dependent on our ability to continue to attract, employ and retain highly skilled personnel.

Failure to maintain effective quality control systems at our mining, processing and production facilities could have a material adverse effect on our business and operations.

The performance and quality of our products are critical to the success of our business. These factors depend significantly on the effectiveness of our quality control systems, which, in turn, depends on a number of factors, including the design of our quality control systems, our quality-training program and our ability to ensure that our employees adhere to our quality control policies and guidelines. Any significant failure or deterioration of our quality control systems could have a material adverse effect on our business, financial condition, results of operations and reputation.

Seasonal and severe weather conditions could have a material adverse impact on our business.

Our business could be materially adversely affected by severe weather conditions. Severe weather conditions may affect our customers’ operations, thus reducing their need for our products, impact our operations by resulting in weather-related damage to our facilities and equipment and impact our customers’ ability to take delivery of our products at our plant site. Any weather-related interference with our operations could force us to delay or curtail services and potentially breach our contractual obligations to deliver minimum volumes or result in a loss of productivity and an increase in our operating costs.

In addition, severe winter weather conditions impact our operations by causing us to halt our excavation and wet plant related production activities during the winter months. During non-winter months, we excavate excess sand to build a stockpile that will feed the dry plant which continues to operate during the winter months. Unexpected winter conditions (e.g., if winter comes earlier than expected or lasts longer than expected) may result in us not having a sufficient sand stockpile to supply feedstock for our dry plant during winter months, which could result in us being unable to meet our contracted sand deliveries during such time and lead to a material adverse effect on our business, financial condition, results of operation and reputation.

Our cash flow fluctuates on a seasonal basis.

Our cash flow is affected by a variety of factors, including weather conditions and seasonal periods. Seasonal fluctuations in weather impact the production levels at our wet processing plant. While our sales and finished product production levels are

28

contracted evenly throughout the year, our mining and wet sand processing activities are limited to non-winter months. As a consequence, we experience lower cash costs in the first and fourth quarter of each calendar year.

Diminished access to water may adversely affect our operations.

The excavation and processing activities in which we engage require significant amounts of water, of which we recycle a significant percentage in our operating process. As a result, securing water rights and water access is necessary for the operation of our processing facilities. If future excavation and processing activities are located in an area that is water-constrained, there may be additional costs associated with securing water access. We have obtained water rights that we currently use to service the activities on our property, and we plan to obtain all required water rights to service other properties we may develop or acquire in the future. However, the amount of water that we are entitled to use pursuant to our water rights must be determined by the appropriate regulatory authorities in the jurisdictions in which we operate. Such regulatory authorities may amend the regulations regarding such water rights, increase the cost of maintaining such water rights or eliminate our current water rights, and we may be unable to retain all or a portion of such water rights. These new regulations, which could also affect local municipalities and other industrial operations, could have a material adverse effect on our operating costs if implemented. Such changes in laws, regulations or government policy and related interpretations pertaining to water rights may alter the environment in which we do business, which may have an adverse effect on our financial condition and results of operations. Additionally, a water discharge permit may be required to properly dispose of water at our processing sites. The water discharge permitting process is also subject to regulatory discretion, and any inability to obtain the necessary permits could have an adverse effect on our financial condition and results of operations.

A terrorist attack or armed conflict could harm our business.

Terrorist activities, anti-terrorist efforts and other armed conflicts involving the United States could adversely affect the United States and global economies and could prevent us from meeting financial and other obligations. We could experience loss of business, delays or defaults in payments from payors or disruptions of fuel supplies and markets if pipelines, production facilities, processing plants or refineries are direct targets or indirect casualties of an act of terror or war. Such activities could reduce the overall demand for oil and natural gas, which, in turn, could also reduce the demand for our frac sand. Terrorist activities and the threat of potential terrorist activities and any resulting economic downturn could adversely affect our results of operations, impair our ability to raise capital or otherwise adversely impact our ability to realize certain business strategies.

Risks Related to Environmental, Mining and Other Regulation

We and our customers are subject to extensive environmental and health and safety regulations that impose, and will continue to impose, significant costs and liabilities. In addition, future regulations, or more stringent enforcement of existing regulations, could increase those costs and liabilities, which could adversely affect our results of operations.

We are subject to a variety of federal, state, and local regulatory environmental requirements affecting the mining and mineral processing industry, including among others, those relating to employee health and safety, environmental permitting and licensing, air and water emissions, water pollution, waste management, remediation of soil and groundwater contamination, land use, reclamation and restoration of properties, hazardous materials, and natural resources. These laws, regulations, and permits have had, and will continue to have, a significant effect on our business. Some environmental laws impose substantial penalties for noncompliance, and others, such as CERCLA, may impose strict, retroactive, and joint and several liability for the remediation of releases of hazardous substances. Liability under CERCLA, or similar state and local laws, may be imposed as a result of conduct that was lawful at the time it occurred or for the conduct of, or conditions caused by, prior operators or other third parties. Failure to properly handle, transport, store, or dispose of hazardous materials or otherwise conduct our operations in compliance with environmental laws could expose us to liability for governmental penalties, cleanup costs, and civil or criminal liability associated with releases of such materials into the environment, damages to property, or natural resources and other damages, as well as potentially impair our ability to conduct our operations. In addition, future environmental laws and regulations could restrict our ability to expand our facilities or extract our mineral deposits or could require us to acquire costly equipment or to incur other significant expenses in connection with our business. Future events, including changes in any environmental requirements (or their interpretation or enforcement) and the costs associated with complying with such requirements, could have a material adverse effect on us.

Any failure by us to comply with applicable environmental laws and regulations may cause governmental authorities to take actions that could adversely impact our operations and financial condition, including:

• issuance of administrative, civil, or criminal penalties;

• denial, modification, or revocation of permits or other authorizations;

• imposition of injunctive obligations or other limitations on our operations, including cessation of operations; and

• requirements to perform site investigatory, remedial, or other corrective actions.

29

Any such regulations could require us to modify existing permits or obtain new permits, implement additional pollution control technology, curtail operations, increase significantly our operating costs, or impose additional operating restrictions among our customers that reduce demand for our services.

We may not be able to comply with any new laws and regulations that are adopted, and any new laws and regulations could have a material adverse effect on our operating results by requiring us to modify our operations or equipment or shut down our facilities. Additionally, our customers may not be able to comply with any new laws and regulations, which could cause our customers to curtail or cease operations. We cannot at this time reasonably estimate our costs of compliance or the timing of any costs associated with any new laws and regulations, or any material adverse effect that any new standards will have on our customers and, consequently, on our operations.

Silica-related legislation, health issues and litigation could have a material adverse effect on our business, reputation or results of operations.

We are subject to laws and regulations relating to human exposure to crystalline silica. Several federal and state regulatory authorities, including the U.S. Mining Safety and Health Administration, may continue to propose changes in their regulations regarding workplace exposure to crystalline silica, such as permissible exposure limits and required controls and personal protective equipment. We may not be able to comply with any new laws and regulations that are adopted, and any new laws and regulations could have a material adverse effect on our operating results by requiring us to modify or cease our operations.

In addition, the inhalation of respirable crystalline silica is associated with the lung disease silicosis. There is recent evidence of an association between crystalline silica exposure or silicosis and lung cancer and a possible association with other diseases, including immune system disorders such as scleroderma. These health risks have been, and may continue to be, a significant issue confronting the frac sand industry. Concerns over silicosis and other potential adverse health effects, as well as concerns regarding potential liability from the use of frac sand, may have the effect of discouraging our customers’ use of our frac sand. The actual or perceived health risks of mining, processing and handling frac sand could materially and adversely affect frac sand producers, including us, through reduced use of frac sand, the threat of product liability or employee lawsuits, increased scrutiny by federal, state and local regulatory authorities of us and our customers or reduced financing sources available to the frac sand industry.

We are subject to the Federal Mine Safety and Health Act of 1977, which imposes stringent health and safety standards on numerous aspects of our operations.

Our operations are subject to the Federal Mine Safety and Health Act of 1977, as amended by the Mine Improvement and New Emergency Response Act of 2006, which imposes stringent health and safety standards on numerous aspects of mineral extraction and processing operations, including the training of personnel, operating procedures, operating equipment, and other matters. Our failure to comply with such standards, or changes in such standards or the interpretation or enforcement thereof, could have a material adverse effect on our business and financial condition or otherwise impose significant restrictions on our ability to conduct mineral extraction and processing operations.

We and our customers are subject to other extensive regulations, including licensing, plant and wildlife protection and reclamation regulation, that impose, and will continue to impose, significant costs and liabilities. In addition, future regulations, or more stringent enforcement of existing regulations, could increase those costs and liabilities, which could adversely affect our results of operations.

In addition to the regulatory matters described above, we and our customers are subject to extensive governmental regulation on matters such as permitting and licensing requirements, plant and wildlife protection, wetlands protection, reclamation and restoration activities at mining properties after mining is completed, the discharge of materials into the environment, and the effects that mining and hydraulic fracturing have on groundwater quality and availability. Our future success depends, among other things, on the quantity and quality of our frac sand deposits, our ability to extract these deposits profitably, and our customers being able to operate their businesses as they currently do.

In order to obtain permits and renewals of permits in the future, we may be required to prepare and present data to governmental authorities pertaining to the potential adverse impact that any proposed excavation or production activities, individually or in the aggregate, may have on the environment. Certain approval procedures may require preparation of archaeological surveys, endangered species studies, and other studies to assess the environmental impact of new sites or the expansion of existing sites. Compliance with these regulatory requirements is expensive and significantly lengthens the time needed to develop a site. Finally, obtaining or renewing required permits is sometimes delayed or prevented due to community opposition and other factors beyond our control. The denial of a permit essential to our operations or the imposition of conditions with which it is not practicable or feasible to comply could impair or prevent our ability to develop or expand a site. Significant opposition to a permit by neighboring property owners, members of the public, or other third parties, or delay in the environmental review and permitting process also could delay or impair our ability to develop or expand a site. New legal requirements, including those related to the protection of the environment, could be adopted that could materially adversely affect our mining operations (including our ability to extract

30

or the pace of extraction of mineral deposits), our cost structure, or our customers’ ability to use our frac sand. Such current or future regulations could have a material adverse effect on our business and we may not be able to obtain or renew permits in the future.

Our inability to acquire, maintain or renew financial assurances related to the reclamation and restoration of mining property could have a material adverse effect on our business, financial condition and results of operations.

We are generally obligated to restore property in accordance with regulatory standards and our approved reclamation plan after it has been mined. We are required under federal, state, and local laws to maintain financial assurances, such as surety bonds, to secure such obligations. The inability to acquire, maintain or renew such assurances, as required by federal, state, and local laws, could subject us to fines and penalties as well as the revocation of our operating permits. Such inability could result from a variety of factors, including:

• the lack of availability, higher expense, or unreasonable terms of such financial assurances;

• the ability of current and future financial assurance counterparties to increase required collateral; and

• the exercise by financial assurance counterparties of any rights to refuse to renew the financial assurance instruments.

Our inability to acquire, maintain, or renew necessary financial assurances related to the reclamation and restoration of mining property could have a material adverse effect on our business, financial condition, and results of operations.

Risks Relating to our Structure

Our sponsor owns and controls our general partner, which has sole responsibility for conducting our business and managing our operations. Our general partner and its affiliates, including our sponsor, have conflicts of interest with us and limited duties, and they may favor their own interests to the detriment of us and our unitholders.

Our sponsor, Hi-Crush Proppants LLC, owns and controls our general partner and appoints all of the directors of our general partner. Although our general partner has a duty to manage us in a manner it believes to be in our best interests, the executive officers and directors of our general partner have a fiduciary duty to manage our general partner in a manner beneficial to our sponsor. Therefore, conflicts of interest may arise between our sponsor or any of its affiliates, including our general partner, on the one hand, and us or any of our unitholders, on the other hand. In resolving these conflicts of interest, our general partner may favor its own interests and the interests of its affiliates over the interests of our common unitholders. These conflicts include the following situations, among others:

• our general partner is allowed to take into account the interests of parties other than us, such as our sponsor, in exercising certain rights under our partnership agreement, which has the effect of limiting its duty to our unitholders;

• neither our partnership agreement nor any other agreement requires our sponsor to pursue a business strategy that favors us;

• our partnership agreement replaces the fiduciary duties that would otherwise be owed by our general partner with contractual standards governing its duties, limits our general partner’s liabilities and restricts the remedies available to our unitholders for actions that, without such limitations, might constitute breaches of fiduciary duty;

• except in limited circumstances, our general partner has the power and authority to conduct our business without unitholder approval;

• our general partner determines the amount and timing of any capital expenditure and whether a capital expenditure is classified as a maintenance capital expenditure, which reduces operating surplus, or an expansion capital expenditure, which does not reduce operating surplus. This determination can affect the amount of cash that is distributed to our unitholders which, in turn, may affect the ability of the subordinated units to convert;

• our general partner determines the amount and timing of asset purchases and sales, borrowings, issuances of additional partnership securities and the level of reserves, each of which can affect the amount of cash that is distributed to our unitholders;

• our general partner may cause us to borrow funds in order to permit the payment of cash distributions, even if the purpose or effect of the borrowing is to make a distribution on the subordinated units, to make incentive distributions or to accelerate the expiration of the subordination period;

• our partnership agreement permits us to distribute up to $26 million as operating surplus, even if it is generated from asset sales, non-working capital borrowings or other sources that would otherwise constitute capital surplus. This cash may be used to fund distributions on our subordinated units or the incentive distribution rights;

• our general partner determines which costs incurred by it and its affiliates are reimbursable by us;

• our partnership agreement does not restrict our general partner from causing us to pay it or its affiliates for any services rendered to us or entering into additional contractual arrangements with its affiliates on our behalf;

• our general partner intends to limit its liability regarding our contractual and other obligations;

31

• our general partner may exercise its right to call and purchase common units if it and its affiliates own more than 80% of the common units;

• our general partner controls the enforcement of obligations that it and its affiliates owe to us;

• our general partner decides whether to retain separate counsel, accountants or others to perform services for us; and

• our sponsor may elect to cause us to issue common units to it in connection with a resetting of the target distribution levels related to our sponsor’s incentive distribution rights without the approval of the conflicts committee of the board of directors of our general partner or the unitholders. This election may result in lower distributions to the common unitholders in certain situations.

In addition, we may compete directly with entities in which our sponsor has an interest for acquisition opportunities and potentially will compete with these entities for new and existing customers. In particular, our sponsor’s Augusta facility, into which we made a preferred investment in January 2013, competes with us for new and existing frac sand customers.

The board of directors of our general partner may modify or revoke our cash distribution policy at any time at its discretion. Our partnership agreement does not require us to pay any distributions at all.

The board of directors of our general partner has adopted a cash distribution policy pursuant to which we intend to distribute quarterly at least $0.475 per unit on all of our units to the extent we have sufficient cash after the establishment of cash reserves and the payment of our expenses, including payments to our general partner and its affiliates. However, the board may change such policy at any time at its discretion and could elect to pay lesser distributions or not to pay distributions for one or more quarters.

In addition, our partnership agreement does not require us to pay any distributions at all. Accordingly, investors are cautioned not to place undue reliance on the permanence of such a policy in making an investment decision. Any modification or revocation of our cash distribution policy could substantially reduce or eliminate the amounts of distributions to our unitholders. The amount of distributions we make, if any, and the decision to make any distribution at all will be determined by the board of directors of our general partner, whose interests may differ from those of our common unitholders. Our general partner has limited duties to our unitholders, which may permit it to favor its own interests or the interests of our sponsor to the detriment of our common unitholders.

Our general partner intends to limit its liability regarding our obligations.

Our general partner intends to limit its liability under contractual arrangements between us and third parties so that the counterparties to such arrangements have recourse only against our assets, and not against our general partner or its assets. Our general partner may therefore cause us to incur indebtedness or other obligations that are nonrecourse to our general partner. Our partnership agreement provides that any action taken by our general partner to limit its liability is not a breach of our general partner’s duties, even if we could have obtained more favorable terms without the limitation on liability. In addition, we are obligated to reimburse or indemnify our general partner to the extent that it incurs obligations on our behalf. Any such reimbursement or indemnification payments would reduce the amount of cash otherwise available for distribution to our unitholders.

Our sponsor competes with us, and other affiliates of our general partner have the ability to compete with us.

Affiliates of our general partner, including our sponsor, are not prohibited from engaging in other businesses or activities, including those that might be in direct competition with us. Our sponsor has investments in entities that acquire, own and operate frac sand excavation and processing facilities and may make additional investments in the future. These investments and acquisitions may include entities or assets that we would have been interested in acquiring. Therefore, our sponsor may compete with us for investment opportunities. In addition, our sponsor owns Augusta, an entity that competes with us and we expect that it will acquire interests in additional entities that may compete with us. We share our management team with our sponsor, and despite our sponsor’s and management team’s meaningful economic interest in us, the shared management team is under no obligation to offer new and replacement customer contracts to us before offering them to our sponsor, which could have a material adverse impact on our ability to renew or replace existing customer contracts on favorable terms or at all.

Pursuant to the terms of our partnership agreement, the doctrine of corporate opportunity, or any analogous doctrine, does not apply to our general partner or any of its affiliates, including its executive officers and directors and our sponsor. Any such person or entity that becomes aware of a potential transaction, agreement, arrangement or other matter that may be an opportunity for us will not have any duty to communicate or offer such opportunity to us. Any such person or entity will not be liable to us or to any limited partner for breach of any fiduciary duty or other duty by reason of the fact that such person or entity pursues or acquires such opportunity for itself, directs such opportunity to another person or entity or does not communicate such opportunity or information to us. This may create actual or potential conflicts of interest between us and affiliates of our general partner and result in less than favorable treatment of us and our unitholders.

32

It is our policy to distribute a significant portion of our cash available for distribution to our partners, which could limit our ability to grow and make acquisitions.

We plan to distribute most of our cash available for distribution, which may cause our growth to proceed at a slower pace than that of businesses that reinvest their cash to expand ongoing operations. To the extent we issue additional units in connection with any acquisitions or expansion capital expenditures, the payment of distributions on those additional units may increase the risk that we will be unable to maintain or increase our per unit distribution level. There are no limitations in our partnership agreement on our ability to issue additional units, including units ranking senior to the common units. The incurrence of additional commercial borrowings or other debt to finance our growth strategy would result in increased interest expense, which, in turn, may impact the cash that we have available to distribute to our unitholders.

Our partnership agreement replaces our general partner’s fiduciary duties to holders of our units.

Our partnership agreement contains provisions that eliminate and replace the fiduciary standards to which our general partner would otherwise be held by state fiduciary duty law. For example, our partnership agreement permits our general partner to make a number of decisions in its individual capacity, as opposed to in its capacity as our general partner, or otherwise free of fiduciary duties to us and our unitholders. This entitles our general partner to consider only the interests and factors that it desires and relieves it of any duty or obligation to give any consideration to any interest of, or factors affecting, us, our affiliates or our limited partners. Examples of decisions that our general partner may make in its individual capacity include:

• how to allocate business opportunities among us and its affiliates;

• whether to exercise its call right;

• how to exercise its voting rights with respect to the units it owns;

• whether to exercise its registration rights;

• whether to elect to reset target distribution levels; and

• whether or not to consent to any merger or consolidation of the partnership or amendment to the partnership agreement.

By purchasing a common unit, a unitholder is treated as having consented to the provisions in the partnership agreement, including the provisions discussed above.

Our partnership agreement restricts the remedies available to holders of our units for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty.

Our partnership agreement contains provisions that restrict the remedies available to unitholders for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty under state fiduciary duty law. For example, our partnership agreement provides that:

• whenever our general partner makes a determination or takes, or declines to take, any other action in its capacity as our general partner, our general partner is required to make such determination, or take or decline to take such other action, in good faith, and will not be subject to any other or different standard imposed by our partnership agreement, Delaware law, or any other law, rule or regulation, or at equity;

• our general partner will not have any liability to us or our unitholders for decisions made in its capacity as a general partner so long as it acted in good faith, meaning that it believed that the decision was in the best interest of our partnership;

• our general partner and its officers and directors will not be liable for monetary damages to us or our limited partners resulting from any act or omission unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that our general partner or its officers and directors, as the case may be, acted in bad faith or, in the case of a criminal matter, acted with knowledge that the conduct was criminal; and

• our general partner will not be in breach of its obligations under the partnership agreement or its duties to us or our limited partners if a transaction with an affiliate or the resolution of a conflict of interest is:

(1) approved by the conflicts committee of the board of directors of our general partner, although our general partner is not obligated to seek such approval; or

(2) approved by the vote of a majority of the outstanding common units, excluding any common units owned by our general partner and its affiliates.

In connection with a situation involving a transaction with an affiliate or a conflict of interest, any determination by our general partner must be made in good faith. If an affiliate transaction or the resolution of a conflict of interest is not approved by our common unitholders or the conflicts committee then it will be presumed that, in making its decision, taking any action or failing to act, the board of directors of our general partner acted in good faith, and in any proceeding brought by or on behalf of any limited partner or the partnership, the person bringing or prosecuting such proceeding will have the burden of overcoming such presumption.

33

Our sponsor may elect to cause us to issue common units to it in connection with a resetting of the target distribution levels related to its incentive distribution rights, without the approval of the conflicts committee of the board of directors of our general partner or the holders of our common units. This could result in lower distributions to holders of our common units.

Our sponsor has the right, as the initial holder of our incentive distribution rights, at any time when there are no subordinated units outstanding and it has received incentive distributions at the highest level to which it is entitled (50.0%) for the prior four consecutive fiscal quarters, to reset the initial target distribution levels at higher levels based on our distributions at the time of the exercise of the reset election. Following a reset election by our sponsor, the minimum quarterly distribution will be adjusted to equal the reset minimum quarterly distribution and the target distribution levels will be reset to correspondingly higher levels based on percentage increases above the reset minimum quarterly distribution.

If our sponsor elects to reset the target distribution levels, it will be entitled to receive a number of common units. The number of common units to be issued to our sponsor will equal the number of common units that would have entitled the holder to an aggregate quarterly cash distribution in the quarter prior to the reset election equal to the distribution to our sponsor on the incentive distribution rights in the quarter prior to the reset election. We anticipate that our sponsor would exercise this reset right in order to facilitate acquisitions or internal growth projects that would not be sufficiently accretive to cash distributions per common unit without such conversion. It is possible, however, that our sponsor could exercise this reset election at a time when it is experiencing, or expects to experience, declines in the cash distributions it receives related to its incentive distribution rights and may, therefore, desire to be issued common units rather than retain the right to receive incentive distributions based on the initial target distribution levels. This risk could be elevated if our incentive distribution rights have been transferred to a third party. As a result, a reset election may cause our common unitholders to experience a reduction in the amount of cash distributions that our common unitholders would have otherwise received had we not issued new common units to our sponsor in connection with resetting the target distribution levels.

Holders of our common units have limited voting rights and are not entitled to elect our general partner or its directors, which could reduce the price at which our common units will trade.

Unlike the holders of common stock in a corporation, unitholders have only limited voting rights on matters affecting our business and, therefore, limited ability to influence management’s decisions regarding our business. Unitholders have no right on an annual or ongoing basis to elect our general partner or its board of directors. The board of directors of our general partner, including the independent directors, is chosen entirely by our sponsor, as a result of it owning our general partner, and not by our unitholders. Unlike publicly-traded corporations, we do not conduct annual meetings of our unitholders to elect directors or conduct other matters routinely conducted at annual meetings of stockholders of corporations. As a result of these limitations, the price at which the common units will trade could be diminished because of the absence or reduction of a takeover premium in the trading price.

Even if holders of our common units are dissatisfied, they cannot remove our general partner without its consent.

If our unitholders are dissatisfied with the performance of our general partner, they have limited ability to remove our general partner. Unitholders are currently unable to remove our general partner without its consent because our general partner and its affiliates own sufficient units to be able to prevent its removal. The vote of the holders of at least 66 ²/3% of all outstanding units voting together as a single class is required to remove our general partner. As of December 31, 2013, our sponsor owned an aggregate of 53.3% of our common, subordinated units and Class B units. Also, if our general partner is removed without cause during the subordination period and no units held by the holders of the subordinated units or their affiliates are voted in favor of that removal, all remaining subordinated units will automatically be converted into common units and any existing arrearages on the common units will be extinguished. Cause is narrowly defined in our partnership agreement to mean that a court of competent jurisdiction has entered a final, non-appealable judgment finding our general partner liable for actual fraud or willful or wanton misconduct in its capacity as our general partner. Cause does not include most cases of charges of poor management of the business.

Our general partner interest or the control of our general partner may be transferred to a third party without unitholder consent.

Our general partner may transfer its general partner interest to a third party in a merger or in a sale of all or substantially all of its assets without the consent of our unitholders. Furthermore, our partnership agreement does not restrict the ability of the members of our general partner to transfer their respective membership interests in our general partner to a third party. The new members of our general partner would then be in a position to replace the board of directors and executive officers of our general partner with their own designees and thereby exert significant control over the decisions taken by the board of directors and executive officers of our general partner. This effectively permits a “change of control” without the vote or consent of the unitholders.

The incentive distribution rights held by our sponsor may be transferred to a third party without unitholder consent.

Our sponsor may transfer the incentive distribution rights to a third party at any time without the consent of our unitholders. If our sponsor transfers the incentive distribution rights to a third party but retains its ownership interest in our general partner, our general partner may not have the same incentive to grow our partnership and increase quarterly distributions to unitholders over time as it would if our sponsor had retained ownership of the incentive distribution rights. For example, a transfer of incentive

34

distribution rights by our sponsor could reduce the likelihood of our sponsor accepting offers made by us relating to assets owned by it, as it would have less of an economic incentive to grow our business, which in turn would impact our ability to grow our asset base.

Our general partner has a call right that may require unitholders to sell their common units at an undesirable time or price.

If at any time our general partner and its affiliates own more than 80% of the common units, our general partner will have the right, but not the obligation, which it may assign to any of its affiliates or to us, to acquire all, but not less than all, of the common units held by unaffiliated persons at a price equal to the greater of (1) the average of the daily closing price of the common units over the 20 trading days preceding the date three days before notice of exercise of the call right is first mailed and (2) the highest per-unit price paid by our general partner or any of its affiliates for common units during the 90-day period preceding the date such notice is first mailed. As a result, unitholders may be required to sell their common units at an undesirable time or price and may not receive any return or a negative return on their investment. Unitholders may also incur a tax liability upon a sale of their units. Our general partner is not obligated to obtain a fairness opinion regarding the value of the common units to be repurchased by it upon exercise of the limited call right. There is no restriction in our partnership agreement that prevents our general partner from issuing additional common units and exercising its call right. If our general partner exercised its limited call right, the effect would be to take us private and, if the units were subsequently deregistered, we would no longer be subject to the reporting requirements of the Exchange Act. As of December 31, 2013, our sponsor owned an aggregate of 53.3% of our common, subordinated units and Class B units. At the end of the subordination period, assuming no additional issuances of units (other than upon the conversion of the subordinated and Class B units), our sponsor will own 53.3% of our common units.

We may issue additional units without unitholder approval, which would dilute existing unitholder ownership interests.

Our partnership agreement does not limit the number of additional limited partner interests we may issue at any time without the approval of our unitholders. The issuance of additional common units or other equity interests of equal or senior rank will have the following effects:

• our existing unitholders’ proportionate ownership interest in us will decrease;

• the amount of cash available for distribution on each unit may decrease;

• because a lower percentage of total outstanding units will be subordinated units, the risk that a shortfall in the payment of the minimum quarterly distribution will be borne by our common unitholders will increase;

• the ratio of taxable income to distributions may increase;

• the relative voting strength of each previously outstanding unit may be diminished; and

• the market price of the common units may decline.

There are no limitations in our partnership agreement on our ability to issue units ranking senior to the common units.

In accordance with Delaware law and the provisions of our partnership agreement, we may issue additional partnership interests that are senior to the common units in right of distribution, liquidation and voting. The issuance by us of units of senior rank may (i) reduce or eliminate the amount of cash available for distribution to our common unitholders; (ii) diminish the relative voting strength of the total common units outstanding as a class; or (iii) subordinate the claims of the common unitholders to our assets in the event of our liquidation.

Our partnership agreement restricts the voting rights of unitholders owning 20% or more of our common units.

Our partnership agreement restricts unitholders’ voting rights by providing that any units held by a person or group that owns 20% or more of any class of units then outstanding, other than our general partner and its affiliates, their transferees and persons who acquired such units with the prior approval of the board of directors of our general partner, cannot vote on any matter.

Cost reimbursements due to our general partner and its affiliates for services provided to us or on our behalf will reduce cash available for distribution to our unitholders. The amount and timing of such reimbursements will be determined by our general partner.

Prior to making any distribution on the common units, we will reimburse our general partner and its affiliates for all expenses they incur and payments they make on our behalf. Our partnership agreement does not set a limit on the amount of expenses for which our general partner and its affiliates may be reimbursed. These expenses include salary, bonus, incentive compensation and other amounts paid to persons who perform services for us or on our behalf and expenses allocated to our general partner by its affiliates. Our partnership agreement provides that our general partner will determine in good faith the expenses that are allocable to us. The reimbursement of expenses and payment of fees, if any, to our general partner and its affiliates will reduce the amount of cash available for distribution to our unitholders.

Your liability may not be limited if a court finds that unitholder action constitutes control of our business.

35

A general partner of a partnership generally has unlimited liability for the obligations of the partnership, except for those contractual obligations of the partnership that are expressly made without recourse to the general partner. Our partnership is organized under Delaware law, and we conduct business in a number of other states. The limitations on the liability of holders of limited partner interests for the obligations of a limited partnership have not been clearly established in some jurisdictions. You could be liable for our obligations as if you were a general partner if a court or government agency were to determine that:

• we were conducting business in a state but had not complied with that particular state’s partnership statute; or

• your right to act with other unitholders to remove or replace the general partner, to approve some amendments to our partnership agreement or to take other actions under our partnership agreement constitute “control” of our business.

Unitholders may have liability to repay distributions and in certain circumstances may be personally liable for the obligations of the partnership.

Under certain circumstances, unitholders may have to repay amounts wrongfully returned or distributed to them. Under Section 17-607 of the Delaware Revised Uniform Limited Partnership Act, or the Delaware Act, we may not make a distribution to our unitholders if the distribution would cause our liabilities to exceed the fair value of our assets. Delaware law provides that for a period of three years from the date of the impermissible distribution, limited partners who received the distribution and who knew at the time of the distribution that it violated Delaware law will be liable to the limited partnership for the distribution amount. Liabilities to partners on account of their partnership interests and liabilities that are non-recourse to the partnership are not counted for purposes of determining whether a distribution is permitted.

For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including those relating to disclosure about our executive compensation, that apply to other public companies.

In April 2012, the Jumpstart Our Business Startups Act, or the JOBS Act, was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for “emerging growth companies,” including certain requirements relating to compensation disclosure. We are classified as an emerging growth company. For as long as we are an emerging growth company, which may be up to five full fiscal years, unlike other public companies, we are not required to, among other things, (1) provide an auditor’s attestation report on management’s assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes Oxley Act of 2002, (2) comply with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer, (3) comply with any new audit rules adopted by the PCAOB after April 5, 2012 unless the SEC determines otherwise, (4) provide certain disclosure regarding executive compensation required of larger public companies or (5) hold unitholder advisory votes on executive compensation.

If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential unitholders could lose confidence in our financial reporting, which would harm our business and the trading price of our units.

Effective internal controls are necessary for us to provide reliable financial reports, prevent fraud and operate successfully as a public company. If we cannot provide reliable financial reports or prevent fraud, our reputation and operating results would be harmed. We cannot be certain that our efforts to develop and maintain our internal controls will be successful, that we will be able to maintain adequate controls over our financial processes and reporting in the future or that we will be able to comply with our obligations under Section 404 of the Sarbanes Oxley Act of 2002. Any failure to develop or maintain effective internal controls, or difficulties encountered in implementing or improving our internal controls, could harm our operating results or cause us to fail to meet our reporting obligations. Ineffective internal controls could also cause investors to lose confidence in our reported financial information, which would likely have a negative effect on the trading price of our units.

The New York Stock Exchange does not require a publicly-traded partnership like us to comply with certain of its corporate governance requirements.

Our common units are listed on the NYSE under the symbol “HCLP.” Because we are a publicly-traded partnership, the NYSE does not require us to have a majority of independent directors on our general partner’s board of directors or to establish a compensation committee or a nominating and corporate governance committee. Accordingly, unitholders do not have the same protections afforded to certain corporations that are subject to all of the NYSE corporate governance requirements.

We incur increased costs as a result of being a publicly-traded partnership.

We have a limited history operating as a publicly-traded partnership. As a publicly-traded partnership, we incur significant legal, accounting and other expenses that we did not incur prior to becoming public. In addition, the Sarbanes-Oxley Act of 2002, as well as rules implemented by the SEC and the NYSE, require publicly-traded entities to adopt various corporate governance practices that further increase our costs. Before we are able to make distributions to our unitholders, we must first pay or reserve

36

cash for our expenses, including the costs of being a publicly-traded partnership. As a result, the amount of cash we have available for distribution to our unitholders is affected by the costs associated with being a public company.

Tax Risks to Common Unitholders

Our tax treatment depends on our status as a partnership for federal income tax purposes, as well as our not being subject to a material amount of entity-level taxation by individual states. If the Internal Revenue Service ("IRS") were to treat us as a corporation for federal income tax purposes or we were to become subject to material additional amounts of entity-level taxation for state tax purposes, then our cash available for distribution to you could be substantially reduced.

The anticipated after-tax economic benefit of an investment in our common units depends largely on our being treated as a partnership for federal income tax purposes.

Despite the fact that we are organized as a limited partnership under Delaware law, it is possible in certain circumstances for a partnership such as ours to be treated as a corporation for federal income tax purposes. Although we do not believe, based upon our current operations, that we will be so treated, a change in our business (or a change in current law) could cause us to be treated as a corporation for federal income tax purposes or otherwise subject us to taxation as an entity.

If we were treated as a corporation for federal income tax purposes, we would pay federal income tax on our taxable income at the corporate tax rate, which is currently a maximum of 35%, and would likely pay state income tax at varying rates. Distributions to you would generally be taxed again as corporate distributions, and no income, gains, losses, deductions or credits would flow through to you. Because a tax would be imposed upon us as a corporation, our cash available for distribution to you would be substantially reduced. Therefore, treatment of us as a corporation would result in a material reduction in the anticipated cash flow and after-tax return to the unitholders, likely causing a substantial reduction in the value of our common units.

Our partnership agreement provides that if a law is enacted or existing law is modified or interpreted in a manner that subjects us to taxation as a corporation or otherwise subjects us to entity-level taxation for federal, state or local income tax purposes, the minimum quarterly distribution amount and the target distribution amounts may be adjusted to reflect the impact of that law on us.

The tax treatment of publicly-traded partnerships or an investment in our units could be subject to potential legislative, judicial or administrative changes and differing interpretations, possibly on a retroactive basis.

The present federal income tax treatment of publicly-traded partnerships, including us, or an investment in our common units may be modified by administrative, legislative or judicial changes or differing interpretations at any time. For example, members of Congress have recently considered substantive changes to the existing federal income tax laws that affect publicly-traded partnerships. Any modification to the federal income tax laws may be applied retroactively and could make it more difficult or impossible to meet the exception for certain publicly-traded partnerships to be treated as partnerships for federal income tax purposes. Although the considered legislation would not appear to have affected our treatment as a partnership, we are unable to predict whether any of these changes, or other proposals will be reintroduced or will ultimately be enacted. Any such changes could negatively impact the value of an investment in our common units.

Our unitholders are required to pay taxes on their share of our income even if they do not receive any cash distributions from us.

Because our unitholders are treated as partners to whom we allocate taxable income that could be different in amount than the cash we distribute, they are required to pay federal income taxes and, in some cases, state and local income taxes on their share of our taxable income whether or not they receive cash distributions from us. Our unitholders may not receive cash distributions from us equal to their share of our taxable income or even equal to the actual tax liability that results from that income.

The sale or exchange of 50% or more of our capital and profits interests during any twelve-month period will result in the termination of our partnership for federal income tax purposes.

We will be considered to have terminated as a partnership for federal income tax purposes if there is a sale or exchange of 50% or more of the total interests in our capital and profits within a twelve-month period. Our sponsor owns more than 50% of the total interests in our capital and profits. Therefore, a transfer by our sponsor of all or a portion of its interests in us could result in a termination of us as a partnership for federal income tax purposes. Our termination would, among other things, result in the closing of our taxable year for all unitholders and could result in a deferral of depreciation deductions allowable in computing our taxable income. In the case of a unitholder reporting on a taxable year other than the calendar year, the closing of our taxable year may also result in more than twelve months of our taxable income or loss being includable in his taxable income for the year of termination. Our termination currently would not affect our classification as a partnership for federal income tax purposes, but instead, after our termination we would be treated as a new partnership for federal income tax purposes. If treated as a new partnership, we must make new tax elections and could be subject to penalties if we are unable to determine that a termination occurred.

37

Tax gain or loss on the disposition of our common units could be more or less than expected.

If our unitholders sell their common units, they will recognize a gain or loss equal to the difference between the amount realized and their tax basis in those common units. Because distributions in excess of their allocable share of our net taxable income result in a decrease in their tax basis in their common units, the amount, if any, of such prior excess distributions with respect to the units they sell will, in effect, become taxable income to them if they sell such units at a price greater than their tax basis in those units, even if the price they receive is less than their original cost. Furthermore, a substantial portion of the amount realized, whether or not representing gain, may be taxed as ordinary income due to potential recapture of depreciation and depletion deductions and certain other items. In addition, because the amount realized includes a unitholder’s share of our nonrecourse liabilities, if they sell their units, they may incur a tax liability in excess of the amount of cash they receive from the sale.

Tax-exempt entities and non-U.S. persons face unique tax issues from owning common units that may result in adverse tax consequences to them.

Investments in common units by tax-exempt entities, such as employee benefit plans and individual retirement accounts (or “IRAs”), and non-U.S. persons raises issues unique to them. For example, virtually all of our income allocated to organizations that are exempt from federal income tax, including IRAs and other retirement plans, is unrelated business taxable income and is taxable to them. Distributions to non-U.S. persons are reduced by withholding taxes, and non-U.S. persons are required to file federal tax returns and pay tax on their shares of our taxable income.

If the IRS contests the federal income tax positions we take, the market for our common units may be adversely impacted and the cost of any IRS contest will reduce our cash available for distribution to our unitholders.

The IRS may adopt positions that differ from the positions we take. It may be necessary to resort to administrative or court proceedings to sustain some or all of the positions we take. A court may not agree with some or all of the positions we take. Any contest by the IRS may materially and adversely impact the market for our common units and the price at which they trade. Our costs of any contest by the IRS will be borne indirectly by our unitholders and our general partner because the costs will reduce our cash available for distribution.

We treat each purchaser of our common units as having the same tax benefits without regard to the actual common units purchased. The IRS may challenge this treatment, which could adversely affect the value of the common units.

Because we cannot match transferors and transferees of common units and in order to maintain the uniformity of the economic and tax characteristics of our common units, we have adopted certain depreciation and amortization positions that may not conform to all aspects of existing Treasury Regulations. These positions may result in an overstatement of deductions and losses and an understatement of income and gain to our unitholders. A successful IRS challenge to those positions could adversely affect the amount of tax benefits available to our unitholders. It also could affect the timing of these tax benefits or the amount of gain from the sale of common units and could have a negative impact on the value of our common units or result in audit adjustments to our unitholders’ tax returns.

We prorate our items of income, gain, loss and deduction between transferors and transferees of our units each month based upon the ownership of our units on the first day of each month, instead of on the basis of the date a particular unit is transferred. The IRS may challenge this treatment, which could change the allocation of items of income, gain, loss and deduction among our unitholders.

We generally prorate our items of income, gain, loss and deduction between transferors and transferees of our common units each month based upon the ownership of our common units on the first day of each month, instead of on the basis of the date a particular common unit is transferred. Nonetheless, we allocate certain deductions for depreciation of capital additions based upon the date the underlying property is placed in service. The use of this proration method may not be permitted under existing Treasury Regulations, and although the U.S. Treasury Department issued proposed Treasury Regulations allowing a similar monthly simplifying convention, such regulations are not final and do not specifically authorize the use of the proration method we have adopted. Accordingly, our counsel is unable to opine as to the validity of this method. If the IRS were to successfully challenge our proration method, we may be required to change the allocation of items of income, gain, loss, and deduction among our unitholders.

A unitholder whose common units are the subject of a securities loan (e.g., a loan to a “short seller” to cover a short sale of common units) may be considered as having disposed of those common units. If so, such unitholder would no longer be treated for federal income tax purposes as a partner with respect to those common units during the period of the loan and may recognize gain or loss from the disposition.

Because there is no tax concept of loaning a partnership interest, a unitholder whose common units are the subject of a securities loan may be considered as having disposed of the loaned units. In that case, such unitholder may no longer be treated for federal income tax purposes as a partner with respect to those common units during the period of the loan to the short seller and the unitholder may recognize gain or loss from such disposition. Moreover, during the period of the loan, any of our income, gain,

38

loss or deduction with respect to those common units may not be reportable by the unitholder and any cash distributions received by the unitholder as to those common units could be fully taxable as ordinary income. Unitholders desiring to assure their status as partners and avoid the risk of gain recognition from a loan to a short seller should modify any applicable brokerage account agreements to prohibit their brokers from borrowing their common units.

Our unitholders will likely be subject to state and local taxes and return filing requirements in states where you do not live as a result of investing in our common units.

In addition to federal income taxes, our unitholders could be subject to other taxes, including state and local taxes, unincorporated business taxes and estate, inheritance or intangible taxes that are imposed by the various jurisdictions in which we conduct business or own property now or in the future, even if they do not live in any of those jurisdictions. As of December 31, 2013, we own assets and conduct business in the states of Wisconsin, Pennsylvania, Ohio, New York, West Virginia and Texas. Most of these states currently impose a personal income tax and income taxes on corporations and other entities. Unitholders may be required to file state and local income tax returns and pay state and local income taxes in these states. Further, unitholders may be subject to penalties for failure to comply with those requirements. As we make acquisitions or expand our business, we may own assets or conduct business in additional states or foreign jurisdictions that impose a personal income tax. It is our unitholders' responsibility to file all U.S. federal, foreign, state and local tax returns.

39

ITEM 1B.      UNRESOLVED STAFF COMMENTS

Not applicable.

40

ITEM 2.         PROPERTIES

We are managed and operated by the board of directors and executive officers of our general partner, which leases office space for our principal executive offices in Houston, Texas. As of December 31, 2013, we operated one production facility located in Wyeville, Wisconsin of which we own all associated land. We own a preferred interest in our sponsor’s production facility located in Augusta, Wisconsin, which entitles us to a preferred distribution of up to $3.75 million per quarter, or $15.0 million annually. In addition, we own and operate 12 destination rail-based terminal locations throughout the Marcellus and Utica shale basins and lease or own 1,202 railcars used to transport our sand from origin to destination. Substantially all of our owned assets are pledged as security under our credit facility; please see Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources”.

Facilities

Wyeville Facility

We acquired the Wyeville acreage and commenced construction of the Wyeville facility in January 2011. We completed construction of the Wyeville facility and commenced sand excavation and processing in June 2011 with an initial plant processing capacity of 950,000 tons per year, and customer shipments were initiated in July 2011. We completed an expansion in March 2012 that increased our annual rated processing capacity to approximately 1,600,000 tons per year. From the Wyeville in-service date to December 31, 2013, we processed and delivered 2,996,563 tons of frac sand. As of December 31, 2013, the total cost of our plant and equipment was $54.2 million. The plant is in good physical condition and includes modernized equipment powered by natural gas, electricity and propane fuel.

We operate two dryer facilities at Wyeville with a combined nameplate input capacity, based on manufacturer specifications, of 250 tons per hour. Unless processing operations are suspended to conduct maintenance, our dryer facilities are run on a 24-hour basis. Our estimate of annual expected processing capacity assumes a 15% loss factor due to waste and an uptime efficiency of 85% of nameplate capacity, which allows approximately 55 days for downtime and maintenance. We processed and delivered 1,502,015 tons of sand during the year ended December 31, 2013.

All of our product from the Wyeville facility is shipped by rail from our three 5,000-foot rail spurs that connect our processing and storage facilities to a Union Pacific Railroad mainline. The length of these rail spurs and the capacity of the associated product storage silos allow us to accommodate a large number of rail cars. It also enables us to accommodate unit trains, which significantly increases our efficiency in meeting our customers’ frac sand transportation needs. Unit trains, typically 80 rail cars in length or longer, are dedicated trains chartered for a single delivery destination. Generally, unit trains receive priority scheduling and do not switch cars at various intermediate junctions, which results in a more cost-effective and expedited method of shipping than the standard method of rail shipment.

The following table summarizes certain of the key characteristics of our Wyeville facility that we believe allow us to provide our customers with high quality frac sand efficiently at competitive prices.

Facility Characteristics	Description
Site Geography	Situated on 651 contiguous acres, with on-site processing and rail loading facilities.
Deposits	Sand pay zones of up to 80 feet; coarse grade mesh sizes from 20 to 100; few impurities such as clay or other contaminants.
Excavation Technique	Shallow overburden allowing for surface excavation.
Sand Processing	Sands are unconsolidated; do not require crushing.
Logistics Capabilities	On-site transportation infrastructure capable of accommodating unit trains connected to Union Pacific Railroad mainline.

Augusta Facility

On January 31, 2013, we acquired a preferred interest in our sponsor’s Augusta facility. Our sponsor acquired the Augusta acreage and commenced construction of the Augusta facility in April 2012. Our sponsor completed construction of the Augusta facility and commenced sand excavation and processing in July 2012 with a plant rated processing capacity of 1,600,000 tons per year, and customer shipments were initiated in August 2012. As of December 31, 2013, the total cost of our sponsor’s Augusta plant and equipment was $71.2 million. The plant is in good physical condition and includes modernized equipment powered by natural gas, electricity and propane. The cash flow stream attributable to our preferred interest in Augusta is supported by a long-term contract with an investment grade customer.

All of Augusta’s product is shipped by rail from three 5,000-foot rail spurs that connect the processing and storage facilities to a Union Pacific Railroad mainline. The length of these rail spurs and the capacity of the associated product storage silos allow the accommodation of a large number of rail cars. It also enables the accommodation of unit trains, which significantly increases efficiency in meeting customers’ frac sand transportation needs as described above.

41

Augusta operates two dryer facilities with a combined nameplate input capacity, based on manufacturer specifications, of 250 tons per hour. Unless processing operations are suspended to conduct maintenance, Augusta’s dryer facilities are run on a 24-hour basis. Our estimate of annual expected processing capacity assumes a 15% loss of capacity due to waste and an uptime efficiency of 85% of nameplate capacity, which allows approximately 55 days for downtime and maintenance.

The following table summarizes certain of the key characteristics of our sponsor’s Augusta facility that we believe allow Augusta to provide its customers with high quality frac sand efficiently at competitive prices.

Facility Characteristics	Description
Site Geography	Situated on 1,187 contiguous acres, with on-site processing and rail loading facilities.
Deposits	Sand pay zones of up to 80 feet; coarse grade mesh sizes from 20 to 100; few impurities such as clay or other contaminants.
Excavation Technique	Shallow overburden allowing for surface excavation.
Sand Processing	Sands are consolidated.
Logistics Capabilities	On-site transportation infrastructure capable of accommodating unit trains connected to Union Pacific Railroad mainline.

Distribution Assets

As of December 31, 2013, we operated 12 destination rail-based terminal locations throughout the Marcellus and Utica shale basins, as summarized in the following table:

Location	Storage Capabilities	Railroad	Unit Train Capable	On-site Laboratory
Binghamton, NY	Rail	New York Susquehanna & Western Railway
Bradford, PA	Rail/Silo	Buffalo and Pittsburgh Railroad
Dennison, OH	Rail	Columbus and Ohio River Railroad
Driftwood, PA	Rail	Buffalo and Pittsburgh Railroad
Kittanning, PA	Rail	Buffalo and Pittsburgh Railroad		þ
Minerva, OH	Rail/Silo	Ohi-Rail Corp.	þ	þ
Mingo Junction, OH	Rail	Norfolk Southern
Pittston, PA	Rail	Reading Blue Mountain & Northern Railroad	þ
Ridgway, PA	Rail	Buffalo and Pittsburgh Railroad
Sheffield, PA	Rail/Silo	Buffalo and Pittsburgh Railroad		þ
Smithfield, PA	Rail/Silo	Southwest Pennsylvania Railroad	þ	þ
Wellsboro, PA	Rail/Silo	Wellsboro & Corning Railroad	þ	þ

As of December 31, 2013, we leased or owned 1,202 railcars used to transport our sand from origin to destination.

Sand Reserves

We own and operate the Wyeville facility, which is located in Monroe County, Wisconsin and, as of December 31, 2013, contained 62.6 million tons of proven recoverable sand reserves of mesh sizes we currently sell. We also own a preferred interest in our sponsor’s Augusta facility, which is located in Eau Claire County, Wisconsin and, as of December 31, 2013, contained 46.8 million tons of proven recoverable sand reserves.

“Reserves” consist of sand that can be economically extracted or produced at the time of determination based on relevant legal, economic and technical considerations. The reserve estimates referenced herein represent proven reserves, which are defined by SEC Industry Guide 7 as those for which (a) the quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established. The quantity and nature of the mineral reserves at our Wyeville facility are estimated by our internal geologists and mining engineers and updated periodically, with necessary adjustments for operations during the year and additions or reductions due to property acquisitions and dispositions, quality adjustments and mine plan updates. John T. Boyd has estimated our reserves as of December 31, 2013, and we intend to continue retaining third-party engineers to review our reserves on an annual basis.

42

To opine as to the economic viability of our reserves, John T. Boyd reviewed our financial cost and revenue per ton data at the time of the proven reserve determination. Based on its review of our cost structure and its extensive experience with similar operations, John T. Boyd concluded that it is reasonable to assume that we will operate under a similar cost structure over the remaining life of our reserves. Based on these assumptions, and taking into account possible cost increases associated with a maturing mine, John T. Boyd concluded that our current operating margins are sufficient to expect continued profitability throughout the life of our reserves.

Our reserves are a mineral resource created over millions of years. Approximately 500 million years ago, the quartz rich Cambrian sheet sands were deposited in the upper Midwest region of the United States. During the Pleistocene era, which occurred approximately two million years ago, erosion caused by the melting of glaciers cut channels into the Mount Simon sandstone formation, forming rivers. Loose grains of sand resulting from this same erosion settled in these river beds where they were washed by the consistent current of the river. The washing action of the river removed debris, known as fines, from the sand, rounded the sand grains and helped it to remain unconsolidated. The Wyeville deposit is located in one of these ancient river beds. The high quartz content of the Cambrian sands and the monocrystalline structure of the Wyeville deposit is responsible for the high crush strength relative to other types of sand.

A number of characteristics are utilized to define the quality of frac sand, such as particle shape, acid solubility, cleanliness, grain size and crush strength.  Crush strength is an indication of how well a proppant can retain its structural integrity under closure pressure and is one of the key characteristics for our customers and other purchasers of frac sand in determining whether the product will be suitable for its desired application.  For example, raw frac sand with high crush strength is suitable for use in high pressure downhole conditions that would otherwise require the use of more expensive resin-coated or ceramic proppants.  The crush strength is represented in terms of a K value, which is the closure in 1000 psi intervals whereby less than 10 percent of the proppant is crushed.  For example, frac sand with a measured 9.7% crush at 7,000 psi would be rated a 7K sand.  Based on results of crush strength testing performed on our sand at the Wyeville facility, the crush strength for our 30/50 raw frac sand was 8K as measured by PropTester and Stim-Lab and for our 40/70 raw frac sand was 10K and 9K as measured by PropTester and Stim-Lab, respectively.

Our sands at the Wyeville facility are unconsolidated, clean and well-rounded, and as a result do not require crushing or extensive processing to eliminate clays or other contaminants, enabling us to cost-effectively produce high quality, frac sand meeting API specifications. In addition, the sand deposits are present to a depth of approximately 80 feet, with a shallow overburden of approximately five feet. The shallow depth of the sand deposits allows us to conduct surface mining rather than underground mining, which lowers our production costs and decreases safety risks as compared to underground mining.

Wyeville Facility

Before acquiring new reserves, we perform extensive drilling of cores and analysis and other testing of the cores to confirm the quantity and quality of the acquired reserves. We have undertaken a comprehensive exploration drilling program at the Wyeville facility. In total, we have reviewed 52 core holes that were drilled utilizing mud rotary and sonic core drilling techniques with holes spaced between 500 feet and 800 feet to delineate the resource. The holes were drilled into the underlying Mount Simon sandstone formation through the unconsolidated sand, with depths generally ranging from 55 feet to 80 feet. The holes were sampled in 10-foot depth increments with each 10-foot depth increment yielding a corresponding lab gradation. Core samples were sent to leading proppant sand-testing laboratories, each of which adhered to procedures and testing methods in accordance with the American Society for Testing and Materials’ standards for testing materials. During the course of the drilling, John T. Boyd assisted in determining the number and location of drill holes. The results of this program were taken into account in determining the quality and volume of our reserves.

Mineral Rights

We acquired the Wyeville acreage in fee in January 2011 from three separate land owners, one of which had previously conducted limited surface excavation on-site. In each transaction, we acquired surface and mineral rights, all of which were initially subject to an aggregate non-participating royalty interest of $6.15 per ton of frac sand sold. These royalties were negotiated by us in connection with our acquisition of the Wyeville acreage. Effective July 2012, we terminated certain royalty agreements for a one-time cash payment of $14.0 million, reducing our ongoing royalty costs from $6.15 to $2.50 per ton of sand excavated, delivered and paid for. In some instances in the future, we may acquire the mineral rights to reserves without actually taking ownership of the properties.

An approximately 300 acre portion of the Wyeville acreage is subject to an agreement whereby we agreed to sell such acreage back to the individuals from whom the land was purchased in the event that the applicable minimum royalty payments have not been satisfied. If such minimum royalty payments for the three year period commencing on September 15, 2011 (the “Initial Operations Period”) have not been satisfied before September 15, 2014, we agreed to sell the property to the original landowner for one dollar, subject to certain terms. Additionally, at the end of each 12 month period following the conclusion of the Initial Operations Period, if such minimum royalties have not been satisfied for the rolling three previous years (the “Subsequent Operations Periods”), we agreed to sell the property to the original landowner for one dollar, subject to certain terms.

43

During the Initial Operations Period, the required royalty payments amount to an aggregate of $825,000 over the three year period. During any Subsequent Operations Period, the required royalty payments amount to an aggregate of $1,050,000 over each three year period. If we have not made the minimum required royalty payments associated with ongoing sand sales by the end of any Initial Operations Period or Subsequent Operations Period, we may satisfy our obligation by making a lump-sum cash make-whole payment. Accordingly, we believe there is no material risk that we will be required to sell back the subject property pursuant to this agreement.

Summary of Reserves

The following table provides a summary of our Wyeville facility and our sponsor’s Augusta facility as of December 31, 2013:

Mine/Plant Location	Owned/ Leased	Area     (in acres)	Proven Reserves (in thousands)	Primary End Markets Served
Wyeville, WI	Owned	651	62,575	Oil and gas proppants
Augusta, WI	(1)	1,187	46,797	Oil and gas proppants

(1) Hi-Crush Augusta LLC, a subsidiary of our sponsor, owns the Augusta facility. On January 31, 2013, we acquired a preferred interest in Hi-Crush Augusta LLC.

44

ITEM 3.      LEGAL PROCEEDINGS

Legal Proceedings

In addition to the matters described below, we are subject to various legal proceedings, claims, and governmental inspections, audits or investigations arising out of our business which cover matters such as general commercial, governmental regulations, environmental, employment and other actions. Although the outcomes of these routine claims cannot be predicted with certainty, in the opinion of management, the ultimate resolution of these matters will not have a material adverse effect on our financial position or results of operations.

In May 2012, Hi-Crush Operating LLC, a subsidiary of the Partnership, entered into a supply agreement for frac sand with Baker Hughes Oilfield Operations, Inc. (“Baker Hughes”). On September 19, 2012, Baker Hughes provided notice that it was terminating the contract and on November 12, 2012, Hi-Crush Operating LLC formally terminated the supply agreement and filed suit in the State District Court of Harris County, Texas. On October 8, 2013, Hi-Crush Operating LLC entered into a settlement agreement with Baker Hughes pursuant to which Hi-Crush Operating LLC and Baker Hughes agreed to jointly dismiss the lawsuit between the parties and, in connection with the settlement, the parties entered into a six-year supply agreement that requires Baker Hughes to purchase minimum volumes of frac sand each month.

Following the Partnership’s November 2012 announcement that Hi-Crush Operating LLC had formally terminated its supply agreement with Baker Hughes in response to the repudiation of the agreement by Baker Hughes, the Partnership, our general partner, certain of its officers and directors and its underwriters were named as defendants in purported securities class action lawsuits brought by the Partnership’s unitholders in the United States District Court for the Southern District of New York. On February 11, 2013, the lawsuits were consolidated into one lawsuit, styled In re: Hi-Crush Partners L.P. Securities Litigation, No. 12-Civ-8557 (CM). A consolidated amended complaint was filed on February 15, 2013. That complaint asserted claims under sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended, or the Securities Act, and sections 10(b) and 20(a) of the Exchange Act in connection with the Partnership’s Registration Statement and a subsequent presentation. Among other things, the consolidated amended complaint alleges that defendants failed to disclose to the market certain alleged information relating to Baker Hughes’ repudiation of the supply agreement. On March 22, 2013, the Partnership filed a motion to dismiss the complaint. On December 2, 2013, the court issued an order dismissing the claims relating to the Partnership’s Registration Statement, but did not dismiss the claims relating to alleged misrepresentations concerning the Partnership’s relationship with Baker Hughes after the Partnership’s initial public offering. The Partnership and the remaining defendants in the lawsuit have filed answers to the complaint. The Partnership believes the case is without merit and intends to vigorously defend itself. The Partnership cannot provide assurance, however, as to the outcome of this lawsuit.

On December 20, 2013, Stephen Bushansky, a purported unitholder of the Partnership, filed a lawsuit, derivatively on behalf of the Partnership, against our general partner and certain of its officers and directors, in an action styled Bushansky v. Hi-Crush GP LLC, Cause No. 2013-76463, in the 215th Judicial District Court, Harris County, Texas. This lawsuit alleges that by failing to disclose Baker Hughes’ attempted repudiation of its supply agreement with Hi-Crush Operating LLC prior to the Partnership’s November 2012 announcement terminating the agreement, defendants failed to design and implement an effective system of internal controls to prevent the Partnership from violating federal securities laws. Plaintiff asserts a claim for breach of fiduciary duties of good faith, care, loyalty, reasonable inquiry, oversight and supervision. Plaintiff also asserts that the defendants aided and abetted in one another’s breaches of fiduciary duties and seeks relief from defendants on the theory of indemnity for all damages that occurred as a result of defendants’ alleged violations. On January 29, 2014, defendants filed a motion to dismiss, plea to the jurisdiction, or in the alternative, motion to stay based on the mandatory contractual forum selection clause in our partnership agreement. The Partnership believes the case is without merit and intends to vigorously defend itself. The Partnership cannot provide assurance, however, as to the outcome of this lawsuit.

45

ITEM 4.      MINE SAFETY DISCLOSURES.

We adhere to a strict occupational health program aimed at controlling exposure to silica dust, which includes dust sampling, a respiratory protection program, medical surveillance, training and other components. Our safety program is designed to ensure compliance with the standards of our Occupational Health and Safety Manual and U.S. Federal Mine Safety and Health Administration (“MSHA”) regulations. For both health and safety issues, extensive training is provided to employees. We have safety meetings at our plants made up of salaried and hourly employees. We perform annual internal health and safety audits and conduct semi-annual crisis management drills to test our abilities to respond to various situations. Health and safety programs are administered by our corporate health and safety department with the assistance of plant environmental, health and safety coordinators.

All of our production facilities are classified as mines and are subject to regulation by MSHA under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). MSHA inspects our mines on a regular basis and issues various citations and orders when it believes a violation has occurred under the Mine Act. Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95.1 to this Annual Report on Form 10-K.

46

PART II

47

ITEM 5. MARKET FOR REGISTRANT’S COMMON UNITS, RELATED UNITHOLDER MATTERS AND ISSUER PURCHASES OF UNIT SECURITIES

Market Information

Our common units, representing limited partner interests, are listed on and traded on the NYSE under the symbol “HCLP.” Initial trading of our common units commenced on August 16, 2012. Accordingly, no market for our units existed prior to that date.

The following tables sets forth the range of high and low sales prices per unit for our common units as reported by the NYSE, and the quarterly cash distributions for the indicated periods:

Sales Price Per Common Units
For the Quarter Ended	High		Low
September 30, 2012 (from August 16, 2012)	$	23.78	$	17.00
December 31, 2012	$	22.28	$	13.21
March 31, 2013	$	19.82	$	15.00
June 30, 2013	$	24.24	$	17.44
September 30, 2013	$	27.44	$	20.26
December 31, 2013	$	38.75	$	25.07

Cash Distributions To Common And Subordinated Unitholders:
For the Quarter Ended	Record Date	Payment Date	Amount per Limited Partner   Unit
September 30, 2012 (from August 16, 2012) (1)	November 1, 2012	November 15, 2012	$	0.2375
December 31, 2012	February 1, 2013	February 15, 2013	$	0.4750
March 31, 2013	May 1, 2013	May 15, 2013	$	0.4750
June 30, 2013	August 1, 2013	August 15, 2013	$	0.4750
September 30, 2013	November 1, 2013	November 15, 2013	$	0.4900
December 31, 2013	January 31, 2014	February 14, 2014	$	0.5100
(1) The distribution for the third quarter of 2012 represented a proration of our minimum quarterly distribution of $0.4750 per unit for the period from August 16, 2012 to September 30, 2012.

As of December 31, 2013, there were 15,224,820 common units outstanding held by approximately 18,164 unitholders of record. Because many of our common units are held by brokers and other institutions on behalf of unitholders, we are unable to estimate the total number of unitholders represented by these record holders. As of December 31, 2013, we had also issued 13,640,351 subordinated units and 3,750,000 Class B Units, for which there is no established public market in which such units are exchanged. All of the subordinated units and Class B Units are held by our sponsor.

Cash Distributions to Unitholders

There is no guarantee that we will distribute quarterly cash distributions to our unitholders. We do not have a legal or contractual obligation to pay quarterly distributions at our minimum quarterly distribution rate or at any other rate. Our cash distribution policy is subject to certain restrictions and may be changed at any time. The reasons for such uncertainties in our stated cash distribution policy include the following factors:

• Our cash distribution policy is subject to restrictions on distributions under our revolving credit facility, which contains financial tests and covenants that we must satisfy. Should we be unable to satisfy these restrictions or if we are otherwise in default under our new credit facility, we will be prohibited from making cash distributions to you notwithstanding our stated cash distribution policy.

• Our general partner has the authority to establish cash reserves for the prudent conduct of our business, including for future cash distributions to our unitholders, and the establishment of or increase in those reserves could result in a reduction in cash distributions from levels we currently anticipate pursuant to our stated cash distribution policy. Our partnership agreement does not set a limit on the amount of cash reserves that our general partner may establish. Any decision to establish cash reserves made by our general partner in good faith will be binding on our unitholders.

• Prior to making any distribution on the common units, we reimburse our general partner and its affiliates for all direct and indirect expenses they incur on our behalf. Our partnership agreement does not set a limit on the amount of expenses for which our general partner and its affiliates may be reimbursed. These expenses include salary, bonus, incentive

48

compensation and other amounts paid to persons who perform services for us or on our behalf and expenses allocated to our general partner by its affiliates. Our partnership agreement provides that our general partner determines in good faith the expenses that are allocable to us. The reimbursement of expenses and payment of fees, if any, to our general partner and its affiliates reduces the amount of cash available for distribution to pay distributions to our unitholders.

• Even if our cash distribution policy is not modified or revoked, the amount of distributions we pay under our cash distribution policy and the decision to make any distribution is determined by our general partner.

• Under Section 17-607 of the Delaware Act, we may not make a distribution if the distribution would cause our liabilities to exceed the fair value of our assets.

• We may lack sufficient cash to pay distributions to our unitholders due to cash flow shortfalls attributable to a number of operational, commercial or other factors as well as increases in our operating or general and administrative expenses, principal and interest payments on our outstanding debt, tax expenses, working capital requirements and anticipated cash needs. While our general partner may cause us to borrow funds in order to permit the payment of cash distributions on our common units, subordinated units and incentive distribution rights, it has no obligation to cause us to do so.

• If we make distributions out of capital surplus, as opposed to operating surplus, any such distributions would constitute a return of capital and would result in a reduction in the minimum quarterly distribution and the target distribution levels.

• Our ability to make distributions to our unitholders depends on the performance of our subsidiaries and their ability to distribute cash to us. The ability of our subsidiaries to make distributions to us may be restricted by, among other things, the provisions of future indebtedness, applicable state limited liability company laws and other laws and regulations.

Distribution Policy

Intent to Distribute the Minimum Quarterly Distribution

Within 60 days after the end of each quarter, we intend to distribute to the holders of common and subordinated units on a quarterly basis at least the minimum quarterly distribution of $0.4750 per unit, or $1.90 on an annualized basis, to the extent we have sufficient cash after establishment of cash reserves and payment of fees and expenses, including payments to our general partner and its affiliates. The distribution made on November 15, 2012 represented a proration of our minimum quarterly distribution of $0.4750 per unit for the period from August 16, 2012 to September 30, 2012.

Even if our cash distribution policy is not modified or revoked, the amount of distributions paid under our policy and the decision to make any distribution is determined by our general partner. Our partnership agreement does not contain a requirement for us to pay distributions to our unitholders, and there is no guarantee that we will pay the minimum quarterly distribution, or any distribution, on the units in any quarter. However, it does contain provisions intended to motivate our general partner to make steady, increasing and sustainable distributions over time.

General Partner Interest

Our general partner owns a non-economic general partner interest in us, which does not entitle it to receive cash distributions. However, our general partner may in the future own common units or other equity securities in us and will be entitled to receive distributions on any such interests.

Incentive Distribution Rights

Our sponsor currently holds incentive distribution rights that entitle it to receive increasing percentages, up to a maximum of 50.0%, of the cash we distribute from operating surplus (as defined below) in excess of $0.54625 per unit per quarter. The maximum distribution of 50.0% does not include any distributions that our sponsor may receive on any limited partner units that it owns.

Equity Compensation Plan Information

See Part III, Item 12. “Security Ownership of Certain Beneficial Owners and Management and Related Unitholder Matters” for information regarding our equity compensation plans as of December 31, 2013.

Recent Sales of Unregistered Securities

On May 8, 2012, in connection with our formation, we issued (i) the non-economic general partner interest in us to our general partner and (ii) the 100.0% limited partner interest in us to our sponsor for $1,000.00. The issuance was exempt from registration under Section 4(2) of the Securities Act.

On January 30, 2013, we issued 5,522 common units to our independent directors, Mr. Winkler III and Mr. Affleck-Graves.

On January 31, 2013, in connection with our acquisition of a preferred equity interest in Hi-Crush Augusta LLC, we issued 3,750,000 Class B Units to our sponsor. The Class B Units are eligible for conversion into common units once we have, for two consecutive quarters, (i) earned $2.31 per common unit, subordinated unit and Class B Unit on an annualized basis and (ii) paid $2.10 per unit in annualized distributions on each common and subordinated unit, or 110% of the current minimum quarterly

49

distribution for a period of two consecutive quarters, and our general partner has determined, with the concurrence of the conflicts committee of the board of directors of our general partner, that we are expected to maintain such performance for at least two succeeding quarters. The issuance was exempt from registration under Section 4(2) of the Securities Act.

On June 10, 2013, the Partnership issued 1,578,947 common units in connection with its acquisition of D&I.

On January 8, 2014, we issued 4,149 common units to our independent directors, Mr. Winkler III, Mr. Affleck-Graves and Mr. Poorman and 4,366 common units to certain employees.

Purchase of Equity Securities by the Issuer and Affiliated Purchasers

None of our common units have been reacquired since August 16, 2012. There are currently no share repurchase programs authorized by the board of directors of our general partner.

Securities Authorized for Issuance under Equity Compensation Plans

See “Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Unitholder Matters” for information regarding our equity compensation plan as of December 31, 2013.

50

ITEM 6.  SELECTED FINANCIAL DATA

	Year Ended December 31, 2013			Period From August 16 Through December 31, 2012			Period From January 1 Through August 15, 2012			Year Ended December 31, 2011			Inception to December 31, 2010
(in thousands, except per unit amounts)	Successor			Successor			Predecessor			Predecessor			Predecessor
Statement of Operations Data:
Revenues	$	141,742		$	28,858		$	46,776		$	20,353		$	—
Production costs	20,898			6,282			12,247			5,998			—
Other cost of sales	49,177			—			—			—			—
Depreciation and depletion	4,464			863			1,089			449			—
Cost of goods sold	74,539			7,145			13,336			6,447			—
Gross profit	67,203			21,713			33,440			13,906			—
Operating costs and expenses:
General and administrative	16,205			2,795			4,631			2,324			26
Exploration expense	47			91			539			381			—
Accretion expense	117			56			16			28			—
Income (loss) from operations	50,834			18,771			28,254			11,173			(26		)
Other income (expense):
Income from preferred interest in Hi-Crush Augusta LLC	11,250			—			—			—			—
Other income	—			—			6			—			—
Interest expense	(3,522		)	(263		)	(3,240		)	(1,893		)	—
Net income (loss)	$	58,562		$	18,508		$	25,020		$	9,280		$	(26	)
Earnings per unit:
Common units	$	2.08		$	0.68
Subordinated units	$	2.08		$	0.68
Distributions per unit:
Common units	$	1.9500		$	0.7125
Subordinated units	$	1.9500		$	0.7125
Statement of Cash Flow Data:
Net cash provided by (used in):
Operating activities	$	55,005		$	18,384		$	16,660		$	18,788		$	(14	)
Investing activities	(138,715		)	(2,239		)	(80,045		)	(50,199		)	(322		)
Financing activities	89,259			(7,631		)	61,048			42,465			336
Other Financial Data:
EBITDA (1)	$	69,170		$	19,634		$	29,349		$	11,622		$	(26	)
Capital expenditures (2)	6,260			2,239			80,075			50,169			72
Operating Data:
Total tons sold	1,849,075			439,604			726,213			332,593			—
Average realized price (per ton sold)	$	69.32		$	65.65		$	64.41		$	61.19		$	—
Production costs (per ton produced and delivered)	13.91			14.29			16.86			18.03			—
Balance Sheet Data (at period end)
Cash and cash equivalents	$	16,047		$	10,498		$	8,717		$	11,054		$	—
Total assets	302,144			102,185			175,828			72,229			614
Long-term debt (includes current portion)	138,250			—			111,402			46,112			—
Total liabilities	155,175			7,002			140,747			61,942			304
Equity	146,969			95,183			35,081			10,287			310

(1) For more information, please read “Non-GAAP Financial Measures” below.

(2) Capital expenditures made to increase the long-term operating capacity of our asset base whether through construction or acquisitions.

51

Non-GAAP Financial Measures

EBITDA

We define EBITDA as net income plus depreciation, depletion and amortization and interest and debt expense, net of interest income. EBITDA is not a presentation made in accordance with GAAP.

EBITDA is a non-GAAP supplemental financial measure that management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess:

• our operating performance as compared to other publicly-traded companies in the proppants industry, without regard to historical cost basis or financing methods; and

• the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

We believe that the presentation of EBITDA will provide useful information to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to EBITDA is net income. Our non-GAAP financial measure of EBITDA should not be considered as an alternative to GAAP net income. EBITDA has important limitations as an analytical tool because it excludes some but not all items that affect net income. You should not consider EBITDA in isolation or as a substitute for analysis of our results as reported under GAAP. Because EBITDA may be defined differently by other companies in our industry, our definition of EBITDA may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.

Distributable Cash Flow

We use distributable cash flow to evaluate whether we are generating sufficient cash flow to support distributions to our unitholders. We define distributable cash flow as EBITDA less cash paid for interest expense and maintenance and replacement capital expenditures, including accrual for reserve replacement, plus accretion of asset retirement obligations. Distributable cash flow does not reflect changes in working capital balances. Distributable cash flow is a supplemental measure used to measure the ability of our assets to generate cash sufficient to support our indebtedness and make cash distributions to our unitholders.

The following table presents a reconciliation of EBITDA and distributable cash flow to the most directly comparable GAAP financial measure, as applicable, for each of the periods indicated.

	Year Ended December 31, 2013			Period From August 16 Through December 31,  2012			Period From January 1 Through August 15,  2012		Year Ended December 31, 2011		Inception to December 31, 2010
(in thousands)	Successor			Successor			Predecessor		Predecessor		Predecessor
Reconciliation of EBITDA and distributable cash flow to net income (loss):
Net income (loss)	$	58,562		$	18,508		$	25,020	$	9,280	$	(26	)
Depreciation and depletion expense	3,399			863			1,089		449		—
Amortization expense	3,687			—			—		—		—
Interest expense	3,522			263			3,240		1,893		—
EBITDA	$	69,170		$	19,634		$	29,349	$	11,622	$	(26	)
Less: Cash interest paid	(2,974		)	(136		)
Less: Maintenance and replacement capital expenditures, including accrual for reserve replacement (1)	(2,028		)	(593		)
Add: Accretion of asset retirement obligation	117			56
Add: Quarterly distribution from preferred interest in Augusta (2)	3,750			—
Distributable cash flow	$	68,035		$	18,961
(1) Maintenance and replacement capital expenditures, including accrual for reserve replacement, were determined based on an estimated reserve replacement cost of $1.35 per ton sold during the period. Such expenditures include those associated with the replacement of equipment and sand reserves, to the extent that such expenditures are made to maintain our long-term operating capacity. The amount presented does not represent an actual reserve account or requirement to spend the capital.
(2) The amount pertains to the fourth quarter performance of Augusta, on which we are entitled to receive a preferred distribution of $3,750. We have included this amount in our distributable cash flow for the year ended December 31, 2013 as we will receive this distribution on February 11, 2014, in advance of our fourth quarter 2013 cash distributions to our common and subordinated unitholders, which will be paid on February 14, 2014. The amount is not reflected in our GAAP net income during the year ended December 31, 2013 because our investment in Augusta is accounted for under the cost method. In accordance with that method, any distributions earned under our preferred interest are not recognized as income until the cash is actually received by the Partnership.

52

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion of our historical performance and financial condition together with Part II, Item 6, “Selected Financial Data,” the description of the business appearing in Part 1, Item 1, “Business,” and the consolidated financial statements and the related notes in Part II, Item 8 of this Annual Report on Form 10-K. This discussion contains forward-looking statements that are based on the views and beliefs of our management, as well as assumptions and estimates made by our management. Actual results could differ materially from such forward-looking statements as a result of various risk factors, including those that may not be in the control of management. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this report, particularly in Item 1A, “Risk Factors” and under “Forward-Looking Statements.” All amounts are presented in thousands except acreage, tonnage and per unit data, or where otherwise noted.

53

Overview

We are a pure play, low-cost, domestic producer and supplier of premium monocrystalline sand, a specialized mineral that is used as a proppant to enhance the recovery rates of hydrocarbons from oil and natural gas wells. Our reserves consist of “Northern White” sand, a resource existing predominately in Wisconsin and limited portions of the upper Midwest region of the United States, which is highly valued as a preferred proppant because it exceeds all API specifications. We own, operate and develop sand reserves and related excavation and processing facilities and will seek to acquire or develop additional facilities. Our 651-acre facility with integrated rail infrastructure located near Wyeville, Wisconsin (the “Wyeville facility”) enables us to process and cost-effectively deliver approximately 1,600,000 tons of frac sand per year. We also own a preferred interest in Hi-Crush Augusta LLC (“Augusta”), a subsidiary of our sponsor, which owns a 1,187-acre facility with integrated rail infrastructure located in Eau Claire County, Wisconsin (the “Augusta facility”), which enables our sponsor to process and cost-effectively deliver approximately 1,600,000 tons of frac sand per year. A substantial portion of our frac sand production is sold to leading pressure pumping service providers under long-term contracts that require our customers to pay a specified price for a specified volume of frac sand each month.

Our June 10, 2013 acquisition of D & I Silica, LLC (“D&I”) transformed us into an integrated Northern White frac sand producer, transporter, marketer and distributor. D&I is the largest independent frac sand supplier to the oil and gas industry drilling in the Marcellus and Utica shales. D&I operates through an extensive logistics network of rail-served origin and destination terminals located in the Midwest near supply sources and strategically throughout Pennsylvania, Ohio and New York.

In connection with our initial public offering and our sponsor's contribution of the Wyeville facility and operations, we entered into the following agreements:

Services Agreement: Effective August 16, 2012, we entered into a services agreement (the “Services Agreement”) with Hi-Crush Services LLC (“Hi-Crush Services”), pursuant to which Hi-Crush Services provides certain management and administrative services to our general partner in connection with operating our business. Under this agreement, we reimburse Hi-Crush Services, on a monthly basis, for the allocable expenses that it incurs in its performance of the specified services. These expenses include, among other things, salary, bonus, incentive compensation, rent and other administrative expenses for individuals and entities that perform services for us or on our behalf. In addition, effective August 16, 2012, we entered into an agreement with our sponsor, pursuant to which the sponsor provides maintenance and capital spares to us in connection with the ongoing maintenance of our Wyeville facility. Our sponsor will bill us for the approximate cost of such items.

Omnibus Agreement:On August 20, 2012, we entered into an omnibus agreement with our general partner and our sponsor. Pursuant to the terms of this agreement, our sponsor will indemnify us and our subsidiaries for certain liabilities over specified periods of time, including but not limited to certain liabilities relating to (a) environmental matters pertaining to the period prior to our initial public offering and the contribution of the Wyeville assets from our sponsor, provided that such indemnity is capped at $7,500 in aggregate, (b) federal, state and local tax liabilities pertaining to the period prior to our initial public offering and the contribution of the Wyeville assets from our sponsor, (c) inadequate permits or licenses related to the contributed assets, and (d) any losses, costs or damages incurred by us that are attributable to our sponsor’s ownership and operation of such assets prior to our initial public offering and our sponsor’s contribution of such assets. In addition, we have agreed to indemnify our sponsor from any losses, costs or damages it incurs that are attributable to our ownership and operation of the contributed assets following the closing of the initial public offering, subject to similar limitations as on our sponsor’s indemnity obligations to us.

The omnibus agreement provided that we would assign to our sponsor all of our rights and obligations under our long-term contract with one customer on May 1, 2013, and our sponsor would have been obligated to accept such assignment and assume our obligations under such contract. On January 31, 2013, in connection with our agreement with our sponsor to acquire a preferred interest in Augusta, the entity that owns our sponsor’s Augusta raw frac sand processing facility, the parties agreed that the contract would no longer be assigned. As such, the contract remained with us and continues to be fulfilled by the Wyeville facility for the remainder of its term.

In addition, the omnibus agreement also grants us, for a period of three years, a right of first offer on our sponsor’s sand reserves and any related assets that have been or will be constructed on its current acreage in Augusta, Wisconsin, in the event our sponsor proposes to transfer such reserves and assets to a third party other than in connection with a sale of all or substantially all of its assets.

On January 31, 2013, we entered into an agreement with our sponsor to acquire an interest in Hi-Crush Augusta LLC, the entity that owns our sponsor’s Augusta facility, for $37,500 in cash and 3.75 million Class B Units in the Partnership. Our sponsor will not receive distributions on the Class B Units unless certain thresholds are met and until they convert into common units. The preferred interest in Augusta entitles us to a preferred distribution of $3,750 per quarter, or $15,000 annually.

54

Basis of Presentation

The following discussion of our historical performance and financial condition is derived from the historical financial statements of our sponsor, Hi-Crush Proppants LLC, which is our accounting predecessor for financial reporting purposes through August 15, 2012. On August 16, 2012, our sponsor contributed some but not all of its assets and liabilities to us in connection with our initial public offering. Accordingly, the historical financial results through August 15, 2012 discussed below include capital expenditures and other costs related to assets that were not contributed to us in connection with our initial public offering as well as long-term debt and related expenses that were retained by our sponsor following the completion of our initial public offering. The consolidated financial statements include results of operations and cash flows for D&I prospectively from June 11, 2013.

Factors Impacting Comparability of Our Financial Results

Our historical results of operations and cash flows, are not indicative of results of operations and cash flows to be expected in the future, principally for the following reasons:

• We completed our acquisition of D&I in June 2013. On June 10, 2013, we acquired D&I, an independent frac sand supplier, transforming us into an integrated Northern White frac sand producer, transporter, marketer and distributor. As a result of the acquisition, we now operate through an extensive logistics network of rail-served origin and destination terminals located in the Midwest near supply sources and strategically throughout Pennsylvania, Ohio and New York.

• Our Wyeville facility did not generate sales until we commenced operations in July 2011. Our first shipment of frac sand to a customer from our Wyeville facility occurred on July 21, 2011. Accordingly, our financial statements for the year ended December 31, 2011 reflect operations only from July 21, 2011 through the end of the year.

• We completed an expansion of our Wyeville facility in March 2012. In March 2012, we completed an expansion of our Wyeville facility that increased rated processing capacity from 950,000 to approximately 1,600,000 tons per year. In connection with that expansion, we increased our annual contracted volumes from 730,000 tons to 1,160,000 tons, or 73% of our expanded processing capacity for 2013.

• Our historical financial results include certain capital expenditures and other costs related to assets outside of our Wyeville facility, which were not contributed to us by our sponsor in connection with our IPO. For the year ended December 31, 2011 and the period from January 1, 2012 through August 15, 2012, we had capital expenditures that related to the acquisition, development and construction of property, plant and equipment at sites other than our Wyeville facility, which were not contributed to us in connection with our IPO, of $1.7 million and $71.1 million, respectively. In addition, for the year ended December 31, 2011 and the period from January 1, 2012 through August 15, 2012, our sponsor incurred operating expenses, consisting of general and administrative expenses and exploration costs, in connection with these non-Wyeville operations of $1.0 million and $2.9 million, respectively.

• Our historical financial results include long-term debt and related expenses that were not contributed to us by our sponsor in connection with the IPO. Our sponsor had indebtedness outstanding under various subordinated promissory notes and a senior secured revolving credit facility, all of which were retained by our sponsor following the completion of the IPO. For the year ended December 31, 2011 and the period from January 1, 2012 through August 15, 2012, our sponsor incurred interest expense related to the subordinated promissory notes and senior secured credit facility of $1.9 million and $3.8 million, respectively. We did not have any indebtedness outstanding as of the closing of the IPO.

• We terminated certain royalty agreements in July 2012, which resulted in a reduction in our royalty costs. Effective July 2012, we terminated certain royalty agreements for a one-time cash payment of $14.0 million. The termination of these royalty agreements resulted in a reduction in our ongoing royalty costs from $6.15 per ton of sand excavated, delivered and paid for to $2.50 per ton of sand excavated, delivered and paid for at our Wyeville facility. If we produce and sell 1,600,000 tons of frac sand annually, we would expect the reduction in our royalty costs due to the termination of these agreements will be $5.8 million per year.

• We currently incur additional general and administrative expenses as a publicly traded partnership. We have incurred incremental expenses as a publicly traded entity since our IPO. These expenses are associated with compliance under the Exchange Act, annual and quarterly reports to unitholders, tax return and Schedule K-1 preparation and distribution, investor relations, registrar and transfer agent fees, audit fees, incremental director and officer liability insurance costs and director and officer compensation. These incremental expenses exclude the costs incurred by our Sponsor during the IPO process, as well as the costs associated with the initial implementation of our Sarbanes-Oxley Section 404 internal control reviews and testing.

• We are incurring additional general and administrative expenses as a result of our expansion and acquisitions. We are incurring additional general and administrative expenses to support our recent expansion, including management level positions in sales, operations, human resources, legal, accounting and reporting, as well as license fees associated with upgraded accounting and reporting software. We expect these incremental growth associated expenses to gradually increase over time as we hire additional personnel.

55

• We are incurring legal and advisory expenses in connection with our unitholder lawsuits. We incurred legal and advisory expenses in connection with our termination of the Baker Hughes supply agreement and related lawsuit, which settled on October 18, 2013, and we continue to incur legal and advisory expenses in connection with the resulting unit holder lawsuits.

Unless otherwise indicated, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “Hi-Crush Partners LP,” “we,” “our,” “us” or like terms when used in a historical context through August 15, 2012 refer to the business and results of operations of Hi-Crush Proppants LLC, our sponsor and accounting predecessor. Otherwise, those terms refer to Hi-Crush Partners LP and its subsidiaries following its initial public offering and formation transaction on August 16, 2012, as described in the “Overview” section.

Our Assets and Operations

We own and operate the Wyeville facility, which is located in Monroe County, Wisconsin and, as of December 31, 2013, contained 62.6 million tons of proven recoverable saleable sand reserves. We also own a preferred interest in our sponsor’s Augusta facility, which is located in Eau Claire County, Wisconsin and, as of December 31, 2013, contained 46.8 million tons of proven sand reserves. According to John T. Boyd, our proven reserves at the Wyeville facility consist of coarse grade Northern White sand exceeding API specifications. Analysis of our sand at the Wyeville facility by independent third-party testing companies indicates that it demonstrates characteristics exceeding of API specifications with regard to crush strength, turbidity and roundness and sphericity.

We acquired the Wyeville acreage and commenced construction of the Wyeville facility in January 2011. We completed construction of the Wyeville facility and commenced sand excavation and processing in June 2011 with an initial plant processing capacity of 950,000 tons per year, and customer shipments were initiated in July 2011. We completed an expansion in March 2012 that increased our annual processing rated capacity to approximately 1,600,000 tons per year. From the Wyeville in-service date to December 31, 2013, we processed and delivered 2,996,563 tons of frac sand.

56

How We Generate Revenue

We generate revenue by excavating, processing and delivering frac sand. A substantial portion of our frac sand is sold to our customers under long-term contracts that require our customers to pay a specified price for a specified annual volume of sand, which contracts have current terms expiring between 2014 and 2019. Each contract defines the minimum volume of frac sand that the customer is required to purchase monthly and annually, the volume that we are required to make available, the technical specifications of the product, the price per ton and liquidated damages in the event either we or the customer fails to meet minimum requirements. Prices in our current contracts are typically fixed for the entire term of the contracts. As a result, our revenue over the duration of these contracts may not follow broader industry pricing trends. If we have excess production and market conditions are favorable, we may elect to sell frac sand through short term pricing agreements.

We also generate frac sand revenues through the delivery of sand to our customers, which may occur at the rail origin or at the destination terminal. We generate service revenues through performance of transportation services including railcar storage fees, transload services, silo storage and other miscellaneous services performed on behalf of our customers. In addition to our frac sand and service revenues, we lease silo space to customers under long-term lease agreements, which typically require monthly payments over the term of the lease.

Due to sustained freezing temperatures in our area of operation during winter months, it is industry practice to halt excavation activities and operation of the wet plant during those months. As a result, we excavate and wash sand in excess of current delivery requirements during the months when those facilities are operational. This excess sand is placed in stockpiles that feed the dry plant and fill customer orders throughout the year.

As a preferred unit holder in Augusta, we are entitled to receive a distribution equal to $3,750 per quarter, beginning January 1, 2013, plus any unpaid arrearages from prior quarters. As our investment is accounted for under the cost method, income pertaining to such investment is recognized when the distribution is received.

57

Costs of Conducting Our Business

The principal expenses involved in production of raw frac sand are excavation costs, labor, utilities, maintenance and royalties. We have a contract with a third party to excavate raw frac sand, deliver the raw frac sand to our processing facility and move the sand from our wet plant to our dry plant. We pay a fixed price per ton excavated and delivered without regard to the amount of sand excavated that meets API specifications. Accordingly, we incur excavation costs with respect to the excavation of sand and other materials from which we ultimately do not derive revenue (rejected materials), and for sand which is still to be processed through the dry plant and not yet sold. However, the ratio of rejected materials to total amounts excavated has been, and we believe will continue to be, in line with our expectations, given the extensive core sampling and other testing we undertook at the Wyeville facility.

Labor costs associated with employees at our processing facility represent the most significant cost of converting raw frac sand to finished product. We incur utility costs in connection with the operation of our processing facility, primarily electricity and natural gas, which are both susceptible to fluctuations. Our facilities require periodic scheduled maintenance to ensure efficient operation and to minimize downtime. Excavation, direct and indirect labor, utilities and maintenance costs are capitalized as a component of inventory and are reflected in cost of goods sold when inventory is sold.

We initially paid royalties to third parties at our Wyeville facility at an aggregate rate of $6.15 per ton of sand excavated, delivered at our on-site rail facility and paid for by our customers. Effective July 2012, we terminated certain royalty agreements for a one-time cash payment of $14,000, which has reduced our ongoing royalty costs from $6.15 to $2.50 per ton of sand excavated and delivered from the Wyeville facility for which we have received payment.

The principal expenses involved in distribution of raw sand are the cost of purchased sand, freight charges, fuel surcharges, terminal switch fees, demurrage costs, storage fees, labor and rent.

We purchase sand through long-term supply agreements with third parties at a fixed price per ton and also through the spot market. We incur transportation costs including trucking, rail freight charges and fuel surcharges when transporting our sand from its origin to destination. We utilize a diverse base of railroads to transport our sand and transportation costs are typically negotiated through long-term working relationships.

In addition to our sand and transportation costs, we incur other costs, some of which are passed through to our customers. For example, we incur terminal switch fees payable to the railroads when they transport to certain of our locations along with demurrage and storage fees. We also pay demurrage and storage fees when we utilize system railcars as additional storage capacity at our terminals. Other key components involved in transporting and offloading our sand shipments include on-site labor and railcar rental fees.

We incur general and administrative costs related to our corporate operations. Under our partnership agreement and the services agreement with our sponsor and our general partner, our sponsor has discretion to determine, in good faith, the proper allocation of costs and expenses to us for its services, including expenses incurred by our general partner and its affiliates on our behalf. The allocation of such costs for the period from August 16, 2012 through December 31, 2013, subsequent to our IPO, was based on management’s best estimate of time and effort spent on the respective operations and facilities. Under these agreements, we reimburse our sponsor for all direct and indirect costs incurred on our behalf.

58

How We Evaluate Our Operations

Gross Profit and Production Costs

Price per ton excavated is fixed, and royalties are generally fixed based on tons excavated, delivered and paid for. Considering this largely fixed cost base, our production costs will largely be affected by our ability to control other direct and indirect costs associated with processing frac sand. We use production costs, which we define as costs of goods sold at our Wyeville facility excluding depreciation and depletion, to measure our financial performance. We believe production costs is a meaningful measure because it provides a measure of operating performance that is unaffected by historical cost basis.

Gross profit is further impacted by our ability to control other direct and indirect costs associated with the transportation and delivery of frac sand to our customers. We use gross profit, which we define as revenues less costs of goods sold, to measure our financial performance. We believe gross profit is a meaningful measure because it provides a measure of profitability and operating performance.

As a result, production volumes, costs of goods sold per ton, production costs per ton, sales volumes, sales price per ton sold and gross profit are key metrics used by management to evaluate our results of operations.

EBITDA and Distributable Cash Flow

We view EBITDA as an important indicator of performance. We define EBITDA as net income plus depreciation, depletion and amortization and interest and debt expense, net of interest income. Although our sponsor had not historically quantified distributable cash flow, effective with the date on which the Wyeville net assets were contributed to us by our sponsor, we use distributable cash flow to evaluate whether we are generating sufficient cash flow to support distributions to our unitholders. We define distributable cash flow as EBITDA less cash paid for interest expense and maintenance and replacement capital expenditures, including accrual for reserve replacement, plus accretion of asset retirement obligations and the distribution from the preferred interest in Augusta to the extent not included in net income. Distributable cash flow will not reflect changes in working capital balances. EBITDA is a supplemental measure utilized by our management and other users of our financial statements such as investors, commercial banks, research analysts and others, to assess the financial performance of our assets without regard to financing methods, capital structure or historical cost basis. Distributable cash flow is a supplemental measure used to measure the ability of our assets to generate cash sufficient to support our indebtedness and make cash distributions to our unitholders. Please read “Selected Financial Data—Non-GAAP Financial Measures.”

Note Regarding Non-GAAP Financial Measures

EBITDA and distributable cash flow are not financial measures presented in accordance with GAAP. We believe that the presentation of these non-GAAP financial measures will provide useful information to investors in assessing our financial condition and results of operations. Our non-GAAP financial measures should not be considered as alternatives to the most directly comparable GAAP financial measure. Each of these non-GAAP financial measures has important limitations as analytical tools because they exclude some but not all items that affect the most directly comparable GAAP financial measures. You should not consider EBITDA or distributable cash flow in isolation or as substitutes for analysis of our results as reported under GAAP. Because EBITDA and distributable cash flow may be defined differently by other companies in our industry, our definitions of these non-GAAP financial measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. Please read “Selected Financial Data—Non-GAAP Financial Measures.”

59

Results of Operations

The following discussion of our historical performance and financial condition is derived from the Partnership’s historical financial statements and those of our sponsor, Hi-Crush Proppants LLC, which was our accounting predecessor for financial reporting purposes through August 15, 2012. On August 16, 2012, our sponsor contributed some but not all of its assets and liabilities to us in connection with our IPO. Accordingly, the historical financial results through August 15, 2012 discussed below include capital expenditures and other costs related to assets that were not contributed to us in connection with our IPO as well as long-term debt and related expenses that were retained by our sponsor following the completion of our IPO.

The discussion of our historical performance and financial condition is presented for the Successor year ended December 31, 2013, the Successor period from August 16, 2012 through December 31, 2012 and the Predecessor periods from January 1, 2012 through August 15, 2012 and the year ended December 31, 2011. The results of operations for the year ended December 31, 2012 is also presented on a pro forma basis. The results of operations for the Predecessor periods are for our sponsor. We believe that the discussion on pro forma basis is a useful supplement to the historical results as it allows the Predecessor and Successor operating results for the period ended December 31, 2012 to be analyzed on a more comparable basis to the Successor results for the period ended December 31, 2013. The unaudited pro forma combined consolidated statements of operations reflect the consolidated results of operations of the Partnership as if our IPO had occurred on January 1, 2012. The historical information has been adjusted to give effect to events and circumstances that are (i) directly attributed to our IPO, (ii) factually supportable and (iii) with respect to the statement of operations, expected to have a continuing impact on the combined results. Such items include the elimination of interest expense related to outstanding debt held by our sponsor prior to our IPO as well as the operating results of entities retained by our sponsor. This unaudited pro forma information should not be relied upon as necessarily being indicative of the results that may be obtained in the future.

The following table presents consolidated revenues and expenses for the periods indicated. This information is derived from the consolidated statements of operations for the Successor year ended December 31, 2013, the Successor period from August 16, 2012 through December 31, 2012 and the Predecessor periods from January 1, 2012 through August 15, 2012 and the year ended December 31, 2011. The year ended December 31, 2012 is also presented on a pro forma basis, as described above.

				As Reported
				Period from			Period from						Pro Forma
				August 16			January 1						for the
	Year Ended			through			through			Pro Forma			Year Ended			Year Ended
	December 31,			December 31,			August 15,			Adjustments			December 31,			December 31,
	2013			2012			2012			(a)			2012			2011
	Successor			Successor			Predecessor									Predecessor
Revenues	141,742			$	28,858		$	46,776		$	(270	)	$	75,364		$	20,353
Costs of goods sold
Production costs	20,898			6,282			12,247			(279		)	18,250			5,998
Other cost of sales	49,177			—			—			—			—			—
Depreciation, depletion and amortization	4,464			863			1,089			(184		)	1,768			449
Gross profit	67,203			21,713			33,440			193			55,346			13,906
Operating costs and expenses	16,369			2,942			5,186			(2,949		)	5,179			2,733
Income from operations	50,834			18,771			28,254			3,142			50,167			11,173
Other income (expense)
Income from preferred interest in Hi-Crush Augusta LLC	11,250			—			—			—			—			—
Other income	—			—			6			(6		)	—			—
Interest expense	(3,522		)	(263		)	(3,240		)	3,240			(263		)	(1,893		)
Net income	$	58,562		$	18,508		$	25,020		$	6,376		$	49,904		$	9,280
(a) Pro forma adjustments exclude operating results relative to entities retained by our sponsor and interest expense incurred under our sponsor's credit facility through August 15, 2012.

60

Successor - Year Ended December 31, 2013

Revenues

Revenues include $128,185 generated from the sale of frac sand. For the year ended December 31, 2013, we sold 1,849,075 tons of frac sand.

Other revenue was $13,557 for the year ended December 31, 2013 related to transload and terminaling, silo leases and other services.

Costs of goods sold – Production costs

We incurred production costs of $20,898 to produce and deliver 1,502,015 tons of frac sand at our Wyeville facility, or $13.91 per ton produced and delivered, for the year ended December 31, 2013.

The principal components of production costs involved in operating our business are excavation costs, labor, utilities, maintenance and royalties. Such costs, with the exception of royalties, are capitalized as a component of inventory and are reflected in costs of goods sold when inventory is sold. Royalties are charged to expense in the period in which they are incurred. The following provides a summary of the drivers impacting the level of production costs during the year ended December 31, 2013.

For the year ended December 31, 2013, we incurred $5,712 of excavation costs and labor costs of $3,662, which were capitalized into the cost of inventory, $2,520 of utility costs and $1,572 of repairs and maintenance costs.

For the year ended December 31, 2013, we incurred royalties of $3,597 and purchased $964 of sand from Augusta at a purchase price in excess of our production cost per ton.

Costs of goods sold – Other cost of sales

The other principal costs of goods sold are the cost of purchased sand, freight charges, fuel surcharges, terminal switch fees, demurrage costs, storage fees, labor and rent. The cost of purchased sand and transportation related charges are capitalized as a component of inventory and are reflected in costs of goods sold when inventory is sold. Other cost components, including demurrage costs, storage fees, labor and rent, are charged to costs of goods sold in the period in which they are incurred.

We purchase sand through long-term supply agreements with third parties at a fixed price per ton, through the spot market and from the Augusta and Wyeville facilities. For the year ended December 31, 2013, we incurred $18,133 of purchased sand costs. In addition, we incurred $1,171 of non-cash costs associated with the sale of inventory marked up to fair value in connection with the D&I acquisition.

We incur transportation costs including trucking, freight charges and fuel surcharges when transporting our sand from its origin to destination. For the year ended December 31, 2013, we incurred $25,292 of transportation costs.

Other costs of sales was $10,250 during the year ended December 31, 2013, and was primarily comprised of demurrage, storage fees, on-site labor and railcar rental fees.

Costs of goods sold – Depreciation, depletion and amortization of intangible assets

For the year ended December 31, 2013, we incurred $4,464 of depreciation, depletion and amortization expense.

Gross Profit

Gross profit was $67,203 for the year ended December 31, 2013.

Operating Costs and Expenses

The principal components of our operating costs and expenses are general and administrative expenses, which totaled $16,205 for the year ended December 31, 2013. General and administrative expenses include costs directly incurred by the Partnership as well as those charged by Hi-Crush Services LLC, a subsidiary of our sponsor, under the Services Agreement for salaries, bonus incentive compensation, rent and other administrative expenses. General and administrative expenses also include the amortization expense attributable to intangible assets acquired through the D&I acquisition, which totaled $2,620 during 2013.

During 2013, we incurred legal and advisory expenses in connection with our termination of the Baker Hughes supply agreement and the resulting unit holder lawsuits of $643 and $500, respectively. As a result of our acquisition of D&I and our preferred interest in Augusta, we incurred transaction costs of $1,728 and $451, respectively. Such legal, advisory and transaction costs are reflected as general and administrative expenses.

Interest Expense

Interest expense was $3,522 for the year ended December 31, 2013 and is comprised of commitment fees and interest expense on borrowings under our four-year $200,000 revolving credit facility, coupled with the amortization of associated loan origination costs.

61

Other Income

Other income was $11,250 for the year ended December 31, 2013, representing the receipt of three quarterly preferred distributions from Augusta.

Net Income

Net income was $58,562 for the year ended December 31, 2013.

Successor - Period from August 16 to December 31, 2012

Revenue was $28,858 for the period from August 16 to December 31, 2012, during which we sold 439,604 tons of frac sand under four long-term contracts, one of which was terminated on November 12, 2012. Production costs were $6,282, or $14.29 per ton sold, and gross profit was $21,713. Net income was $18,508 for the period from August 16 to December 31, 2012.

Predecessor – Period from January 1 to August 15, 2012

Revenue was $46,776 for the period from January 1, 2012 to August 15, 2012, during which we sold 726,213 tons of frac sand under four long-term contracts, two of which commenced in May 2012. Production costs were $12,247, or $16.86 per ton sold, and gross profit was $33,440. Due to the nature of the long-term contracts with our customers that require our customers to pay a specified price for a specified volume of frac sand each month, gross profit is primarily affected by royalties and the cost to excavate and process sand. Production costs per ton were impacted by the reduced royalty rate per ton resulting from the July 2012 buyout of certain royalty agreements, as well as the full impact of enhanced production efficiencies derived from the Wyeville plant expansion, completed in March 2012. General and administrative expenses were $4,631, including certain expenses incurred by our sponsor, such as legal and professional fees and payroll and related costs associated with the preparation for, and in connection with, our initial public offering. Interest expense was $3,240 related to our sponsor’s debt, all of which was retained by our sponsor following the initial public offering. Net income was $25,020 for the period from January 1, 2012 to August 15, 2012.

Predecessor – Year Ended December 31, 2011

Revenue was $20,353 for the year ended December 31, 2011, during which we sold 332,593 tons of frac sand subsequent to the commencement of operations at the Wyeville facility in late July 2011. Production costs were $5,998, or $18.03 per ton sold, and gross profit was $13,906. Production costs per ton reflect the operating costs and cost of production subsequent to the commencement of operations at the Wyeville facility in July 2011 and the higher royalty rate per ton sold. General and administrative expenses were $2,324 reflecting the cost structure of a private company. Interest expense was $1,893 related to our sponsor’s debt, all of which was retained by our sponsor following the initial public offering. Net income was $9,280 for the year ended December 31, 2011.

Supplemental Analysis - Successor Year Ended December 31, 2013 Compared to Pro Forma Year Ended December 31, 2012

Revenues

Revenues generated from the sale of frac sand were $128,185 for the year ended December 31, 2013, during which we sold 1,849,075 tons of frac sand. Revenue was $75,364 for the pro forma year ended December 31, 2012, during which we sold 1,161,954 tons of frac sand produced from our Wyeville facility. Average sales price per ton was $69 for the year ended December 31, 2013 and $65 for the pro forma year ended December 31, 2012. The change in sales price between the two periods is due to the mix in pricing of FOB plant and FOB destination (71% and 100% of tons were sold FOB plant for the year ended December 31, 2013 and the pro forma year ended December 31, 2012, respectively) and the mix of product sold, partially offset by the reduced sales prices under on of our customer contracts.

Other revenue was $13,557 for the year ended December 31, 2013 related to transload and terminaling, silo leases and other services not provided by us prior to the acquisition of D&I in June 2013.

Costs of goods sold – Production costs

We incurred production costs of $20,898, or $13.91 per ton produced and delivered, for the year ended December 31, 2013, compared to $18,250, or $15.71 per ton sold, for the pro forma year ended December 31, 2012. The decrease in production cost per ton was primarily attributable to the reduced royalty rate per ton resulting from our July 2012 buyout of certain royalty agreements.

The principal components of production costs involved in operating our business are excavation costs, labor, utilities, maintenance and royalties. Such costs, with the exception of royalties, are capitalized as a component of inventory and are reflected in costs of goods sold when inventory is sold. Royalties are charged to expense in the period in which they are incurred. The following provides a summary of the drivers impacting the level of production costs between the year ended December 31, 2013 and the corresponding pro forma year ended December 31, 2012.

62

For the year ended December 31, 2013 and the pro forma year ended December 31, 2012, we incurred $5,712 and $5,219, respectively, of excavation costs due to increased tons excavated to meet demand and labor costs of $3,662 and $3,845, respectively, which were capitalized into the cost of inventory.

For the year ended December 31, 2013 and the pro forma year ended December 31, 2012, we incurred $2,520 and $1,929 of utility costs, respectively. The increase in such costs was the result of increased tons produced and sold in 2013, as compared to 2012.

For the year ended December 31, 2013 and the pro forma year ended December 31, 2012, we incurred $1,572 and $1,120, respectively, of repairs and maintenance costs. The increase in such costs was driven by projects at our wet plant during the first quarter of 2013, including the disposal and replacement of $191 of equipment.

For the year ended December 31, 2013 and the pro forma year ended December 31, 2012, we incurred royalties of $3,597 and $4,722, respectively. The impact of the lower royalty rate per ton following our July 2012 buyout of certain royalty agreements was partially offset by the increased number of tons sold in the year ended December 31, 2013.

During the year ended December 31, 2013, we purchased $964 of sand from Augusta at a purchase price in excess of our production cost per ton.

Costs of goods sold – Other cost of sales

The other principal costs of goods sold are the cost of purchased sand, freight charges, fuel surcharges, terminal switch fees, demurrage costs, storage fees, labor and rent. The cost of purchased sand and transportation related charges are capitalized as a component of inventory and are reflected in costs of goods sold when inventory is sold. Other cost components, including demurrage costs, storage fees, labor and rent are charged to costs of goods sold in the period in which they are incurred.

We purchase sand through long-term supply agreements with third parties at a fixed price per ton, through the spot market and from the Augusta and Wyeville facilities. For the year ended December 31, 2013, we incurred $18,133 of purchased sand costs. In addition, we incurred $1,171 of non-cash costs associated with the sale of inventory marked up to fair value in connection with the D&I acquisition.

We incur transportation costs including trucking, freight charges and fuel surcharges when transporting our sand from its origin to destination. For the year ended December 31, 2013, we incurred $25,292 of transportation costs.

Other costs of sales was $10,250 during the year ended December 31, 2013, and was primarily comprised of demurrage, storage fees, on-site labor and railcar rental fees.

We did not incur other costs of sales during the pro forma year ended December 31, 2012.

Costs of goods sold – Depreciation, depletion and amortization of intangible assets

For the year ended December 31, 2013 and the pro forma year ended December 31, 2012, we incurred $4,464 and $1,768, respectively, of depreciation, depletion and amortization expense. The increase in such costs is attributable to the acquisition of D&I and the depreciation and amortization of its tangible and intangible assets during the period.

Gross Profit

Gross profit was $67,203 for the year ended December 31, 2013 and $55,346 for the pro forma year ended December 31, 2012. The increase in gross profit was primarily the result of the D&I acquisition, additional tons sold, and reduced production costs per ton, offset by reduced average sales pricing resulting from the customer contract amendment effective April 1, 2013.

Operating Costs and Expenses

For the year ended December 31, 2013 and the pro forma year ended December 31, 2012, we incurred operating costs and expenses of $16,369 and $5,179, respectively. The principal components of our operating costs and expenses are general and administrative expenses. The increase in such costs was due to transaction costs of $2,179 associated with our acquisition of D&I and our preferred interest in Augusta, $2,620 of intangible asset amortization, $2,277 of costs attributable to the D&I operations, $1,143 of legal and advisory expenses in connection with our termination of the Baker Hughes supply agreement and the resulting unitholder lawsuits, and increased costs of $2,897 incurred in connection with the requirements of being a publicly traded partnership.

During the year ended December 31, 2013, legal fees included $500 in costs associated with unitholder litigation. Future legal expenses incurred in connection with the unit holder lawsuits beyond our $500 deductible, which was met during the second quarter of 2013, are reimbursable from our insurance carrier. Legal expenses associated with the Baker Hughes litigation are not reimbursable from our insurance carrier.

Interest Expense

Interest expense was $3,522 for the year ended December 31, 2013 compared to $263 in the pro forma year ended December 31, 2012. The interest expense for the 2012 pro forma period consisted of commitment fees and amortization of associated loan origination costs under the Partnership’s credit facility. The interest expense in the 2013 period related to commitment fees and

63

interest expense on borrowings under our four-year $200,000 revolving credit facility, coupled with the amortization of associated loan origination costs.

Other Income

Other income was $11,250 for the year ended December 31, 2013, representing the receipt of three quarterly preferred distributions from Augusta.

We did not earn other income during the pro forma year ended December 31, 2012.

Net Income

Net income was $58,562 for the year ended December 31, 2013 compared to net income of $49,904 for the pro forma year ended December 31, 2012.

Supplemental Analysis - Pro Forma Year Ended December 31, 2012 Compared to Predecessor Year Ended December 31, 2011

We were formed in October 2010 and commenced construction of our Wyeville facility in January 2011. We completed construction of our Wyeville facility in June 2011 and began selling sand to our customers in July 2011. Our historical financial statements for the year ended December 31, 2011 reflect operations from July 2011 through December 31, 2011 and general and administrative expenses for the entire year.

Revenues

Revenues generated from the sale of frac sand were $75,364 for the pro forma year ended December 31, 2012, during which we sold 1,161,954 tons of frac sand produced and delivered from our Wyeville facility. Revenue was $20,353 for the year ended December 31, 2011, during which we sold 332,593 tons of frac sand produced from our Wyeville facility. Average sales price per ton was $65 for the pro forma year ended December 31, 2012 and $61 for the year ended December 31, 2011.

Costs of goods sold – Production costs

We incurred production costs of $18,250, or $15.71 per ton produced and delivered, for the pro forma year ended December 31, 2012, compared to $5,998, or $18.03 per ton sold, for the year ended December 31, 2011. The decrease in production cost per ton was primarily attributable to the reduced royalty rate per ton resulting from our July 2012 buyout of certain royalty agreements.

The principal components of production costs involved in operating our business are excavation costs, labor, utilities, maintenance and royalties. Such costs, with the exception of royalties, are capitalized as a component of inventory and are reflected in costs of goods sold when inventory is sold. Royalties are charged to expense in the period in which they are incurred. The following provides a summary of the drivers impacting the level of production costs between the pro forma year ended December 31, 2012 and the year ended December 31, 2011.

For the pro forma year ended December 31, 2012 and the year ended December 31, 2011, we incurred $5,219 and $2,502, respectively, of excavation costs due to increased tons excavated to meet demand and labor costs of $3,845 and $1,696, respectively, which were capitalized into the cost of inventory.

For the pro forma year ended December 31, 2012 and the year ended December 31, 2011, we incurred $1,929 and $639 of utility costs, respectively. The increase in such costs was the result of increased tons produced and sold in 2012, as compared to 2011.

For the pro forma year ended December 31, 2012 and the year ended December 31, 2011, we incurred $1,120 and $308, respectively, of repairs and maintenance costs. The increase in such costs reflected the longer period of operations in 2012.

For the pro forma year ended December 31, 2012 and the year ended December 31, 2011, we incurred royalties of $4,722 and $2,045, respectively. The impact of the lower royalty rate per ton following our July 2012 buyout of certain royalty agreements was offset by the increased number of tons sold in the year ended December 31, 2012.

Costs of goods sold – Depreciation and depletion

For the pro forma year ended December 31, 2012 and the year ended December 31, 2011, we incurred $1,768 and $449, respectively, of depreciation and depletion expense. The increase in such costs reflected the longer period of operations in 2012.

Gross Profit

Gross profit was $55,346 for the pro forma year ended December 31, 2012 and $13,906 for the year ended December 31, 2011. The increase in gross profit was due primarily to the increase in tons sold, increased depreciation and depletion due to the longer period of time over which excavation and plant operations took place, reduced royalty rate per ton, and enhanced production efficiencies derived from the Wyeville plant expansion, completed in March 2012. Efficiencies included capturing certain grades of sand for sale that had previously been included in reject material, resulting in increased product yield and lower excavation costs per ton sold in 2012.

64

Operating Costs and Expenses

For the pro forma year ended December 31, 2012 and the year ended December 31, 2011, we incurred operating costs and expenses of $5,179 and $2,733, respectively. We were in a start-up phase for a portion of the year ended December 31, 2011 and did not incur the level of general and administrative expenses required to support an operating company. In addition to the impact from the ramp-up of our operations, these incremental general and administrative expenses were primarily driven by higher legal and other professional fees, along with higher payroll and related costs. Such costs were largely incurred in preparation for, and in connection with, our IPO.

Interest Expense

Interest expense was $263 for the pro forma year ended December 31, 2012 compared to $1,893 during the year ended December 31, 2011. The interest expense for the 2012 pro forma period consisted of commitment fees and amortization of associated loan origination costs under the Partnership’s credit facility. The interest expense of $1,893 for the year ended 2011 was related to our sponsor’s debt, all of which was retained by our sponsor following our initial public offering.

Net Income

Net income was $49,904 for the pro forma year ended December 31, 2012 compared to net income of $9,280 for the year ended December 31, 2011.

65

Liquidity and Capital Resources

Overview

The principal liquidity requirements of our sponsor, as predecessor, were to fund capital expenditures for the purchase of the Wyeville land, construction and expansion of the related sand processing facility, construction of railway spurs and to meet working capital needs. Our sponsor met its liquidity needs with a combination of funds generated through operations, proceeds from long-term indebtedness and prepayments under one of its long-term sales contracts.

We expect our principal sources of liquidity will be cash generated by our operations and quarterly distributions received from our preferred investment in Augusta, supplemented by borrowings under our $200,000 four-year revolving credit facility, as necessary. We believe that cash from these sources will be sufficient to meet our short-term working capital requirements and long-term capital expenditure requirements. As of December 31, 2013, our sources of liquidity consisted of $16,047 of available cash and $60,250 pursuant to available borrowings under our revolving credit facility ($200,000, net of $1,500 letter of credit commitments and $138,250 indebtedness). In addition, our general partner is authorized to issue an unlimited number of additional units without the approval of existing limited partner unitholders.

On May 9, 2013, we entered into a commitment increase agreement and second amendment to our credit facility whereby the lenders, among other things, consented to the increase of the aggregate commitments by $100,000 to a total of $200,000 and addition of other lenders to the lending bank group. Under the second amendment, we agreed to a term out feature under which $50,000 of borrowings would convert to a term loan due August 21, 2016 if the outstanding borrowings under the revolver exceeded $125,000 for four consecutive quarters. If balances are outstanding on a term loan, we would be required to maintain a debt service coverage ratio (as such term is defined in the credit agreement) of not less than 1.50 to 1.00. On June 10, 2013, we drew $100,000 under our revolving credit facility to fund the acquisition of D&I.

We expect that our future principal uses of cash will be for working capital, making distributions to our unitholders, capital expenditures and funding any debt service obligations. On January 16, 2014, our general partner’s board of directors declared a cash distribution for the fourth quarter of 2013 of $0.5100 per common and subordinated unit, or $2.04 on an annualized basis. This represented the sixth distribution declared by us and corresponds to a 7% increase from our minimum quarterly distribution of $0.4750 per unit. This distribution was paid on February 14, 2014 to unitholders of record on January 31, 2014. On a going-forward basis, we intend to pay a quarterly distribution of $0.5100 per common and subordinated unit per quarter, which equates to $14,726 per quarter, or $58,904 per year, based on the number of common and subordinated units outstanding as of February 28, 2014, to the extent we have sufficient operating surplus, as defined in our partnership agreement, and cash generated from our operations after establishment of cash reserves and payment of fees and expenses, including payments to our general partner and its affiliates. We do not have a legal or contractual obligation to pay this distribution. Holders of our Class B Units are not entitled to distributions until they are converted into common units, with such conversion being fully contingent upon defined earnings and distribution payment thresholds over a specific period of time.

Working Capital

Working capital is the amount by which current assets exceed current liabilities and is a measure of our ability to pay our liabilities as they become due. As of December 31, 2013, we had a positive working capital balance of $50,763, as compared to a balance of $22,799 at December 31, 2012.

66

The following table summarizes our working capital as of the dates indicated.

	December 31, 2013		December 31, 2012
	Successor		Successor
Current assets:
Cash	$	16,047	$	10,498
Restricted cash	690		—
Accounts receivable, net	31,581		8,199
Inventories	16,265		3,541
Due from sponsor	—		5,615
Prepaid expenses and other current assets	1,432		393
Total current assets	66,015		28,246
Current liabilities:
Accounts payable	8,306		1,977
Accrued and other current liabilities	4,375		1,755
Due to sponsor	2,571		—
Deferred revenue	—		1,715
Total current liabilities	15,252		5,447
Working capital	$	50,763	$	22,799

Working capital increased during the period primarily as a result of our acquisition of D&I.

Accounts receivable increased by $23,382 during the year ended December 31, 2013. The increase was primarily due to $20,332 of accounts receivable related to sales at our destination terminals. In addition, our accounts receivable increased due to balances receivable from a customer who as of December 31, 2012 maintained a prepaid balance for future deliveries of frac sand. The increase in accounts receivable was also attributable to increased shipments from our production facility of frac sand during the three months ended December 31, 2013, compared to the tons of frac sand shipped during the quarter ended December 31, 2012.

Our inventory consists primarily of sand that has been excavated and processed through the wet plant and finished goods in transit. The increase in our inventory of $12,724, was primarily driven by higher finished goods inventory of $12,427 during the period, coupled with an increase to our stockpile in advance of the winter months when our wet plant operations shut down. Most of our finished goods inventory is either in transit to our customers or held at our terminals for future sale.

At December 31, 2012, we had an amount due from our sponsor related to our payment of certain liabilities on its behalf. The subject liabilities were comprised of certain accounts payable that were paid related to the Augusta construction project. Our sponsor repaid the remainder of this balance during the first quarter of 2013. As of December 31, 2013, we had an amount due to our sponsor of $2,571 primarily related to management fees, sand purchases from Hi-Crush Augusta LLC and other payments made by the sponsor on our behalf.

Accounts payable and accrued liabilities increased by $8,949 on a combined basis during the year ended December 31, 2013. The increase was primarily attributable to $9,301 of such liabilities held by D&I.

Deferred revenue represents prepayments from a customer for future deliveries of frac sand. In July 2012, we received a payment of $8,250 from a customer in order to prepay for the remainder of its anticipated frac sand shipments in 2012. From July 2012 through December 2012, we recognized $6,535 of revenue related to the customer’s prepayment, resulting in a deferred revenue balance of $1,715 at December 31, 2012. During the year ended December 31, 2013, we recognized $1,715 of revenue related to the customer’s prepayment, thereby leading to no outstanding deferred revenue remaining as of December 31, 2013.

Cash Flow Activities Were As Follows For The Periods Indicated:
	Year Ended December 31, 2013			Period from August 16 through December 31, 2012			Period from January 1 Through August 15, 2012			Pro Forma Adjustments (a)			Pro Forma for the Year Ended December 31, 2012			Year Ended December 31, 2011
	Successor			Successor			Predecessor									Predecessor
Net cash provided by (used in):
Operating activities	$	55,005		$	18,384		$	16,660		$	1,383		$	36,427		$	18,788
Investing activities	(138,715		)	(2,239		)	(80,045		)	60,934			$	(21,350	)	(50,199		)
Financing activities	89,259			(7,631		)	61,048			(59,410		)	(5,993		)	42,465
(a) Pro forma adjustments give effect to exclude the cash flows attributable to entities retained by our sponsor through August 15, 2012.

67

Cash Flows - Successor Year Ended December 31, 2013

During the period, the Partnership generated $55,005 of cash flows from operations, $138,250 through receipts of borrowings under our credit facility and $5,615 of net repayments of affiliate financing from our sponsor. These funds were primarily used to pay $94,955 for the cash portion of the D&I acquisition price, $37,500 for the cash portion of the purchase of the preferred interest in Augusta, $53,777 of distributions to our unitholders and $829 of loan origination costs during the period. Excess cash generated during the period of $5,549 was retained by the Partnership.

Cash Flows – Successor Period from August 16 through December 31, 2012

During the period, we generated $18,384 of cash flows from operations and received a $4,606 cash contribution from our sponsor. These funds were used to pay for $2,239 of investing activities, make $6,479 of distributions, expend $5,615 of net affiliate financing activities and pay $143 in loan origination costs. Excess cash generated during the period of $8,513 was retained by us.

Cash Flows – Predecessor Period from January 1 through August 15, 2012

During the period, the Predecessor generated $16,660 of cash flows from operations and $61,048 from financing activities. The financings included borrowings under our sponsor’s secured credit facility and the subordinated promissory notes. These funds, along with a portion of the beginning cash on hand, were used to pay for $80,075 of capital expenditures, which primarily related to the construction of the Augusta plant and expansion of the Wyeville plant.

Cash Flows – Predecessor Year Ended December 31, 2011

During the period, the Predecessor generated $18,788 of cash flows from operations and $42,465 from financing activities. The financings included borrowings under the sponsor’s subordinated promissory notes. These funds were primarily used to pay for $50,169 of capital expenditures related to the construction of the Wyeville plant. Remaining cash of $11,054 was retained by the Predecessor.

Supplemental Analysis - Successor Year Ended December 31, 2013 Compared to Successor Pro Forma Year Ended December 31, 2012

Operating Activities

Net cash provided by operating activities was $55,005 for the year ended December 31, 2013 and $36,427 for the pro forma year ended December 31, 2012. Operating cash flows include $58,562 of net income earned during the year ended December 31, 2013 and $49,904 of net income earned in the pro forma year ended December 31, 2012, adjusted for non-cash operating expenses and changes in operating assets and liabilities.

Investing Activities

Net cash used in investing activities was $138,715 for the year ended December 31, 2013 and consisted primarily of $94,955 for the acquisition of D&I, $37,500 for the preferred interest in Augusta, and construction costs, including the addition of 100 mesh production capabilities and a new conveyor system installed over the rail line bisecting the Wyeville property. Net cash used in investing activities was $21,350 for the pro forma year ended December 31, 2012 and consisted primarily of costs associated with the expansion of our Wyeville facility.

Financing Activities

Net cash provided by financing activities was $89,259 for the year ended December 31, 2013, which included receipts of $138,250 of borrowings under our credit facility and $5,615 of net repayments of affiliate financing from our sponsor. These inflows were offset by $53,777 of distributions to our unitholders and payment of $829 of loan origination costs during the period.

Net cash used in financing activities was $5,993 for the pro forma year ended December 31, 2012, which comprised $4,606 of contributions received from the sponsor, offset by $6,479 of distributions, $3,971 of net affiliate financing outflows and payment of $149 of loan origination costs.

Supplemental Analysis - Successor Pro Forma Year Ended December 31, 2012 Compared to Year Ended December 31, 2011

Operating Activities

Net cash provided by operating activities was $36,427 for the pro forma year ended December 31, 2012 and $18,788 for year ended December 31, 2011. Operating cash flows include $49,904 of net income earned during the pro forma year ended December 31, 2012 and $9,280 of net income earned in the year ended December 31, 2011, adjusted for non-cash operating expenses and changes in operating assets and liabilities.

Investing Activities

Net cash used in investing activities was $21,350 for the pro forma year ended December 31, 2012 and consisted primarily of the expansion of our Wyeville facility. Net cash used in investing activities was $50,199 for the year ended December 31, 2011 and consisted primarily of costs associated with the initial acquisition, construction and development of our Wyeville facility.

68

Financing Activities

Net cash used in financing activities was $5,993 for the pro forma year ended December 31, 2012, which comprised $4,606 of contributions received from the sponsor, offset by $6,479 of distributions, $3,971 of net affiliate financing outflows and payment of $149 of loan origination costs.

Net cash provided by financing activities was $42,465 for the year ended December 31, 2011, which included $48,692 of proceeds and $5,000 of repayments under our sponsor’s subordinated promissory notes. In addition, our predecessor received capital contributions of $697 and incurred loan origination costs of $1,924.

Our sponsor retained each of its existing debt arrangements referred to in the above discussion. We did not have any borrowings under our new revolving credit facility following our initial public offering.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are likely to have a material effect on our current or future financial condition, changes in financial condition, sales, expenses, results of operations, liquidity, capital expenditures or capital resources.

The Partnership has long-term operating leases for rail access, railcars and equipment at its terminal sites, which are also under long-term lease agreements with various railroads.

Capital Requirements

Our sponsor contributed the net assets of its Wyeville facility and operations to us in connection with our IPO. The development, construction and 2012 expansion of the contributed Wyeville-based property, plant and equipment was completed from January 2011 to July 2011 and January 2012 to March 2012. We do not have any significant anticipated capital requirements associated with the Wyeville facility and there are currently no significant required capital commitments related to our terminal facilities.

Revolving Credit Facility

We have a four-year $200,000 senior secured revolving credit facility. As of December 31, 2013, we had $138,250 indebtedness and $60,250 of undrawn borrowing capacity ($200,000, net of $138,250 of indebtedness and $1,500 letter of credit commitments) under our credit facility. The credit facility is available to fund working capital and general corporate purposes, including the making of certain restricted payments permitted therein. Borrowings under our revolving credit facility are secured by substantially all of our assets.

On May 9, 2013, we entered into a commitment increase agreement and second amendment to our credit facility whereby the lenders, among other things, consented to the increase of the aggregate commitments by $100,000 to a total of $200,000 and addition of other lenders to the lending bank group. Under the second amendment, we agreed to a term out feature under which $50,000 of borrowings would convert to a term loan due August 21, 2016 if the outstanding borrowings under the revolver exceeded $125,000 for four consecutive quarters. If balances are outstanding on a term loan, we would be required to maintain a debt service coverage ratio (as such term is defined in the credit agreement) of not less than 1.50 to 1.00. On June 10, 2013, we drew $100,000 under our credit facility to fund the acquisition of D&I.

Subsidiary Guarantors

We filed a registration statement on Form S-3 to register, among other securities, debt securities. Each of the current subsidiaries of Hi-Crush Partners LP (other than Hi-Crush Finance Corp., whose sole purpose is to act as a co-issuer of any debt securities), each a 100 percent directly or indirectly owned subsidiary of us, will issue guarantees of the debt securities, if any of them issue guarantees, and such guarantees will be full and unconditional and will constitute the joint and several obligations of such guarantors. The guarantors are our sole subsidiaries, other than Hi-Crush Finance Corp., which is our 100 percent owned subsidiary. We have no assets or operations independent of our subsidiaries, and there are no significant restrictions upon our ability or any of our subsidiaries to obtain funds from our respective subsidiaries by dividend or loan. None of the assets of our subsidiaries represent restricted net assets pursuant to Rule 4-08(e)(3) of Regulation S-X under the Securities Act.

69

Customer Concentration

For the year ended December 31, 2013, sales to each of Halliburton, Weatherford and FTS International accounted for greater than 10% of our total revenues. For the pro forma year ended December 31, 2012, sales to each of Halliburton, Weatherford, FTS International and Baker Hughes accounted for greater than 10% of our total revenues. For the predecessor year ended December 31, 2011, sales to Halliburton and Weatherford accounted for greater than 10% of our total revenues.

70

Contractual Obligations

The following table presents our contractual obligations and other commitments as of December 31, 2013:

	Total		Less than 1 year		1-3 years		3-5 years		More than  5 years
Contractual Obligations
Asset retirement obligations (1)	$	1,673	$	—	$	—	$	—	$	1,673
Repayment of credit facility at maturity	138,250		—		138,250		—		—
Operating lease obligations	36,974		$	7,009	$	12,239	$	10,306	$	7,420
Total	$	176,897	$	7,009	$	150,489	$	10,306	$	9,093
(1) The asset retirement obligation represents the fair value of the post closure reclamation and site restoration commitments for the Wyeville property and processing facility.

71

Environmental Matters

We are subject to various federal, state and local laws and regulations governing, among other things, hazardous materials, air and water emissions, environmental contamination and reclamation and the protection of the environment and natural resources. We have made, and expect to make in the future, expenditures to comply with such laws and regulations, but cannot predict the full amount of such future expenditures.

72

Recent Accounting Pronouncements

In February 2013, the Financing Accounting Standards Board (“FASB”) issued amended guidance on the recognition, measurement, and disclosure of certain obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. Such arrangements may include debt, other contractual obligations, and settled litigation and judicial rulings. The amended guidance is to be applied retrospectively to all prior periods presented. This guidance will be effective for us beginning January 1, 2014. We anticipate that the adoption of this amended guidance will not materially affect its financial position, result of operations or cash flows.

In December 2011 and January 2013, the FASB issued amended guidance on disclosures pertaining to certain assets and liabilities that are either offset in an entity’s financial statements or those that are subject to a master netting agreement or similar arrangement. The scope of these disclosures is limited to derivatives, repurchase agreements and securities lending transactions. We adopted this guidance effective January 1, 2013, and, as it only impacts disclosures, it did not affect our financial position, result of operations or cash flows.

73

New and Revised Financial Accounting Standards

We qualify as an “emerging growth company” pursuant to the provisions of the JOBS Act, enacted on April 5, 2012. Section 102 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. However, we are choosing to “opt out” of such extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Our election to “opt-out” of the extended transition period is irrevocable.

74

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally acceptable in the United States of America. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements and the reported revenues and expenses during the reporting periods. We evaluate these estimates and assumptions on an ongoing basis and base our estimates on historical experience, current conditions and various other assumptions that we believe to be reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. Our actual results may materially differ from these estimates.

Listed below are the accounting policies we believe are critical to our financial statements due to the degree of uncertainty regarding the estimates or assumptions involved, and that we believe are critical to the understanding of our operations.

Preferred Interest in Hi-Crush Augusta LLC

We account for the preferred interest in Augusta obtained on January 31, 2013 as a cost method investment. The preferred interest is not allocated any of the periodic earnings or losses of Augusta, but will in the future convert to a 20% equity interest in that entity. In accordance with the cost method, distributions earned under the preferred interest are recognized as income on the date the cash is received by us. The preferred interest is reviewed for impairment if an event or change in circumstances occurs which may have a significant adverse effect on the fair value of the investment. No such events or changes in circumstances arose during the year ended December 31, 2013.

Impairment of Long-lived Assets

Recoverability of investments in property, plant and equipment, and mineral rights is evaluated annually. Estimated future undiscounted net cash flows are calculated using estimates of proven and probable sand reserves, estimated future sales prices (considering historical and current prices, price trends and related factors) and operating costs and anticipated capital expenditures. Reductions in the carrying value of our investment are only recorded if the undiscounted cash flows are less than our book basis in the applicable assets.

Impairment losses are recognized based on the extent that the remaining investment exceeds the fair value, which is determined based upon the estimated future discounted net cash flows to be generated by the property, plant and equipment and mineral rights.

Management’s estimates of prices, recoverable proven and probable reserves and operating and capital costs are subject to certain risks and uncertainties which may affect the recoverability of our investments in property, plant and equipment. Although management has made its best estimate of these factors based on current conditions, it is reasonably possible that changes could occur in the near term, which could adversely affect management’s estimate of the net cash flows expected to be generated from its operating property. No impairment charges were recorded during 2013, 2012 or 2011.

Revenue Recognition

Frac sand sales revenues are recognized when legal title passes to the customer, which may occur at the production facility, rail origin or at the destination terminal. At that point, delivery has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of sand deliveries are recorded as deferred revenue. Revenue from make-whole provisions in our customer contracts is recognized at the end of the defined cure period.

A substantial majority of our frac sand is sold under long-term supply agreements, the current terms of which expire between 2014 and 2019. The long-term agreements define, among other commitments, the volume of product that the Partnership must provide, the price that will be charged to the customer, and the volume that the customer must purchase at the end of the defined cure period, which can range from three months to the end of a contract year.

Transportation services revenues are recognized as the services have been completed, meaning the related services have been rendered. At that point, delivery of service has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of transportation services being rendered are recorded as deferred revenue.

Revenue attributable to silo storage leases is recorded on a straight-line basis over the term of the lease.

Asset Retirement Obligation

We estimate the future cost of dismantling, restoring and reclaiming operating excavation sites and related facilities in accordance with federal, state and local regulatory requirements. We record the initial estimated present value of reclamation costs as an asset retirement obligation and increase the carrying amount of the related asset by a corresponding amount. We allocate reclamation costs to expense over the life of the related assets and adjust the related liability for changes resulting from the passage of time

75

and revisions to either the timing or amount of the original present value estimate. If the asset retirement obligation is settled for more or less than the carrying amount of the liability, a loss or gain will be recognized, respectively.

Inventories

Sand inventory is stated at the lower of cost or market using the average cost method.

Inventory manufactured at our production facilities includes direct excavation costs, processing costs, overhead allocation, depreciation and depletion. Stockpile tonnages are calculated by measuring the number of tons added and removed from the stockpile. Tonnages are verified periodically by an independent surveyor. Costs are calculated on a per ton basis and are applied to the stockpiles based on the number of tons in the stockpile.

Inventory transported for sale at our terminal facility includes the cost of purchased or manufactured sand, plus transportation related charges.

Spare parts inventory includes critical spares, materials and supplies. We account for spare parts on a first-in, first-out basis, and value the inventory at the lower of cost or market.

Depletion

We amortize the cost to acquire land and mineral rights using a units of production method, based on the total estimated reserves and tonnage extracted each period.

Goodwill and Intangible Assets

Goodwill represents the excess of purchase price over the fair value of net assets acquired. The Partnership performs an assessment of the recoverability of goodwill during the third quarter of each fiscal year, or more often if events or circumstances indicate the impairment of an asset may exist. Our assessment of goodwill is based on qualitative factors to determine whether the fair value of the reporting unit is more likely than not less than the carrying value. An additional quantitative impairment analysis is completed if the qualitative analysis indicates that the fair value is not substantially in excess of the carrying value. The quantitative analysis determines the fair value of the reporting unit based on the discounted cash flow method and relative market-based approaches. There was no impairment charge related to goodwill during the year ended December 31, 2013.

We amortize the cost of other intangible assets on a straight line basis over their estimated useful lives, ranging from 1 to 18 years. An impairment assessment is performed if events or circumstances occur and may result in the change of the useful lives of the intangible assets. During the year ended December 31, 2013, we did not record any impairment charges or changes in the useful life of its intangible assets.

Net Income per Limited Partner Unit

We have identified the sponsor’s incentive distribution rights as participating securities and compute income per unit using the two-class method under which any excess of distributions declared over net income shall be allocated to the partners based on their respective sharing of income specified in the partnership agreement. Net income per unit applicable to limited partners (including subordinated unitholders) is computed by dividing limited partners’ interest in net income, after deducting any sponsor incentive distributions, by the weighted-average number of outstanding common and subordinated units. Basic and diluted net income per unit are the same as there are no potentially dilutive common or subordinated units outstanding.

As the 3,750,000 Class B Units do not have voting rights or rights to share in our periodic earnings, either through participation in its distributions or through an allocation of its undistributed earnings or losses, they are not deemed to be participating securities in their current form. In addition, the conversion of the Class B Units into common units is fully contingent upon the satisfaction of defined criteria pertaining to the cumulative payment of distributions and earnings per unit of the Partnership. Therefore, it is possible that the Class B Units may never be converted into common units. As such, until all of the defined payment and earnings criteria are satisfied, the Class B Units will not be included in our calculation of either basic or diluted earnings per unit.

Income Taxes

We and our sponsor are pass-through entities and are not considered taxing entities for federal tax purposes. Therefore, there is not a provision for income taxes in the accompanying condensed consolidated financial statements. Our net income or loss is allocated to our partners in accordance with the partnership agreement. The partners are taxed individually on their share of the Partnership’s earnings. At December 31, 2013 and 2012, we did not have any liabilities for uncertain tax positions or gross unrecognized tax benefit.

76

Related Party Transactions

Effective August 16, 2012, in connection with our IPO and our sponsor’s contribution of the Wyeville facility and operations, we entered into the Services Agreement with Hi-Crush Services, pursuant to which Hi-Crush Services provides certain management and administrative services to our general partner in connection with operating our business. Under this agreement, we reimburse Hi-Crush Services, on a monthly basis, for the allocable expenses that it incurs in its performance of the specified services. These expenses include, among other things, salary, bonus, incentive compensation, rent and other administrative expenses for individuals and entities that perform services for us or on our behalf. In addition, effective August 16, 2012, we entered into an agreement with our sponsor, pursuant to which the sponsor provides maintenance and capital spares to us in connection with the ongoing maintenance of our Wyeville facility. Our sponsor bills us for the approximate cost of such items. During the year ended December 31, 2013 and the period from August 16 through December 31, 2012, we incurred $3,698 and $1,028, respectively, of management service expenses from Hi-Crush Services under the Services Agreement.

In the normal course of business, our sponsor and its affiliates, including Hi-Crush Services, and the Partnership may from time to time make payments on behalf of each other. During the period from August 16 through December 31, 2012, we made payments of $9,866 to various suppliers, vendors or other counterparties on behalf of our sponsor. This balance was offset by $1,028 of management fees charged by our sponsor and $3,223 of net payments made by our sponsor on our behalf. The balance of $5,615 was maintained as a current asset under the caption “Due from sponsor”, and was repaid by our sponsor in February 2013. During the year ended December 31, 2013, we maintained a current liability under the caption “Due to sponsor” of $2,571, which represented outstanding management fees, sand purchases and other net payments payable to our sponsor.

On May 25, 2011, our sponsor entered into a management services agreement with Red Oak Capital Management LLC (the “Service Provider”) which is owned by two members who are also equity members in our sponsor. The agreement provides for certain management and administrative support services to be provided to our sponsor for a term of one year and that thereafter remains in place upon the same terms and conditions. Either party may terminate the agreement by delivering written notice within 90 days prior to the date of expiration of the initial term or any time after the expiration of the initial term, by delivering written notice 90 days prior to the desired date of termination. Our sponsor reimburses the Service Provider 95% of the Service Provider’s actual costs limited to $850 per year. These fees are included in general and administrative expenses. Total management fees under this agreement were $318 and $370 for the period from January 1 to August 15, 2012 and the year ended December 31, 2011, respectively. The management fee was $140 for the period from August 16 to December 31, 2012. Management fees incurred during the year ended December 31, 2013 are included as a portion of the management services expense from Hi-Crush Services.

Through August 15, 2012, our sponsor paid quarterly director fees to non-management directors that may be members and/or holders of our sponsor’s debt through the date of the IPO. Total director fees were $62 and $60 for the period from January 1 to August 15, 2012 and the year ended December 31, 2011, respectively.

Between May 25, 2011 and July 20, 2012, our sponsor entered into various subordinated promissory notes with certain of its equity investors and their affiliates in an aggregate initial principal amount of $52,167. Borrowings under the subordinated promissory notes bore interest, at the sponsor’s option, at a rate of 10% for cash interest and 12% for paid-in-kind interest (“PIK interest”). Accruals for PIK interest increased the outstanding principal balance of these promissory notes. The balances of the PIK interest and subordinated promissory notes were paid in full on August 21, 2012 with the proceeds of the sale of the common units by our sponsor. At December 31, 2011, there was $46,112 outstanding under the sponsor’s subordinated promissory notes, including $2,421 of PIK interest.

In order to fund a royalty termination payment, the sponsor entered into new subordinated promissory notes in July 2012 with certain of its equity investors and their affiliates in an aggregate initial principal amount of $14,981. Consistent with its existing subordinated promissory notes, borrowings under the new subordinated promissory notes bore interest, at the sponsor’s option, at a rate of 10% for cash interest and 12% for PIK interest. The balances of the PIK interest and subordinated promissory notes, as retained by the sponsor, were paid in full by the sponsor on August 21, 2012 with the proceeds of the sale of the common units by our sponsor.

During the year ended December 31, 2013, we purchased $4,402 of sand from Hi-Crush Augusta LLC.

77

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. (Dollars in thousands)

Quantitative and Qualitative Disclosure of Market Risks

Market risk is the risk of loss arising from adverse changes in market rates and prices. Historically, our sponsor’s risks have been predominantly related to potential changes in the fair value of its long-term debt due to fluctuations in applicable market interest rates. Going forward, our market risk exposure generally will be limited to those risks that arise in the normal course of business as we do not engage in speculative, non-operating transactions, or utilize financial instruments or derivative instruments for trading purposes.

The market for frac sand is indirectly exposed to fluctuations in the prices of crude oil and natural gas to the extent such fluctuations impact drilling and completion activity levels and thus impact the activity levels of our customers in the pressure pumping industry. However, because we generate a substantial amount of our revenues under long-term contracts that require our customers to pay a specified price for a specified volume of frac sand each month, we believe we have only limited exposure to short-term fluctuations in the prices of crude oil and natural gas. We do not intend to hedge our indirect exposure to commodity risk.

Interest Rate Risk

As of December 31, 2013, we had $138,250 of debt outstanding under our credit facility, with an effective interest rate of 3.17%. Assuming no change in the amount outstanding, the impact on interest expense of a 10% increase or decrease in the average interest rate would be approximately $440 per year.

Credit Risk – Customer Concentration

A substantial amount of our revenue is generated from four customers. One of these customers is not investment grade. Our customers are generally pressure pumping service providers. This concentration of counterparties operating in a single industry may increase our overall exposure to credit risk in that the counterparties may be similarly affected by changes in economic, regulatory or other conditions. If a customer defaults or if any of our contracts expires in accordance with its terms, and we are unable to renew or replace these contracts, our gross profit and cash flows, and our ability to make cash distributions to our unitholders, may be adversely affected.

78

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Our consolidated financial statements are included in this Annual Report on Form 10-K beginning on page F-1.

79

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND   FINANCIAL DISCLOSURE

None.

80

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our general partner's Co-Chief Executive Officers and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Annual Report on Form 10-K. Based on such evaluation, our general partner's Co-Chief Executive Officers and Chief Financial Officer have concluded that as of such date, our disclosure controls and procedures were effective.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control over financial reporting is a process designed under the supervision of our general partner's Co-Chief Executive Officers and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with accounting principles generally accepted in the United States.

Because of its inherent limitations, internal control over financial reporting may not detect or prevent misstatements.  Also, projections of any evaluation of the effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As of December 31, 2013, our management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control - Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission in 1992. Based on the assessment, management determined that we maintained effective internal control over financial reporting as of December 31, 2013, based on those criteria.

Attestation Report of the Registered Public Accounting Firm

Our independent registered public accounting firm is not required to formally attest to the effectiveness of our internal controls over financial reporting for as long as we are an “emerging growth company” pursuant to the provisions of the JOBS Act.

Changes in Internal Controls Over Financial Reporting

During the quarter ended December 31, 2013, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

81

ITEM 9B. OTHER INFORMATION

None.

82

PART III

83

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Management of Hi-Crush Partners LP

We are managed and operated by the board of directors and executive officers of our general partner. As of February 28, 2014, all of our outstanding subordinated units, Class B Units and incentive distribution rights were owned by our sponsor. As a result of owning our general partner, our sponsor has the right to appoint all members of the board of directors of our general partner, including the independent directors. Our unitholders are not entitled to elect our general partner or its directors or otherwise directly participate in our management or operation. Our general partner owes certain duties to our unitholders as well as a fiduciary duty to its owners.

Our general partner has ten directors, three of whom are independent as defined under the independence standards established by the NYSE and the Exchange Act. The NYSE does not require a listed publicly-traded partnership, such as ours, to have a majority of independent directors on the board of directors of our general partner or to establish a compensation committee or a nominating committee. However, our general partner is required to have an audit committee of at least three members, and all its members are required to meet the independence and experience standards established by the NYSE and the Exchange Act. As of December 31, 2013, the following directors served on the audit committee:

Name	Independence Status
John F. Affleck-Graves	Independent
Joseph C. Winkler III	Independent
John Kevin Poorman	Independent

All of the executive officers of our general partner allocate their time between managing our business and affairs and the business and affairs of our sponsor. While the amount of time that our executive officers devote to our business and the business of our sponsor varies in any given year based on a variety of factors, we currently estimate that each of our executive officers spend approximately 50% of their time on the management of our business. Our executive officers devote as much time to the management of our business and affairs as is necessary for the proper conduct of our business and affairs.

Following the IPO on August 16, 2012, neither our general partner nor our sponsor receive any management fee or other compensation in connection with our general partner’s management of our business, but we reimburse our general partner and its affiliates, including our sponsor, for all expenses they incur and payments they make on our behalf. Our partnership agreement does not set a limit on the amount of expenses for which our general partner and its affiliates may be reimbursed. These expenses include salary, bonus, incentive compensation and other amounts paid to persons who perform services for us or on our behalf and expenses allocated to our general partner by its affiliates. Our partnership agreement provides that our general partner determines in good faith the expenses that are allocable to us.

In evaluating director candidates, our sponsor assesses whether a candidate possesses the integrity, judgment, knowledge, experience, skill and expertise that are likely to enhance the board’s ability to manage and direct our affairs and business, including, when applicable, to enhance the ability of committees of the board to fulfill their duties.

84

Executive Officers and Directors of Our General Partner

The following table shows information for the executive officers and directors of our general partner. Directors are appointed for a one-year term and hold office until their successors have been elected or qualified or until the earlier of their death, resignation, removal or disqualification. Executive officers serve at the discretion of the board. There are no family relationships among any of our directors or executive officers. Some of our directors and all of our executive officers also serve as executive officers of our sponsor.

Name	Age	Position With Our General Partner
Robert E. Rasmus	56	Co-Chief Executive Officer and Director
James M. Whipkey	56	Co-Chief Executive Officer and Director
Jefferies V. Alston, III	36	Chief Operating Officer and Director
Laura C. Fulton	50	Chief Financial Officer
Mark C. Skolos	54	General Counsel and Secretary
William H. Fehr	58	Executive Vice President
Chad M. McEver	41	Vice President
John F. Affleck-Graves	63	Director
Gregory F. Evans	33	Director
John R. Huff	67	Director
John Kevin Poorman	62	Director
Trevor M. Turbidy	46	Director
Steven A. Webster	62	Director
Joseph C. Winkler III	62	Director

Robert E. Rasmus—Co-Chief Executive Officer. Mr. Rasmus is a co-founder of Hi-Crush Proppants LLC and has served as its Co-Chief Executive Officer since its formation in October 2010. Mr. Rasmus was named Co-Chief Executive Officer and appointed to the board of directors of our general partner in May 2012. Mr. Rasmus was a founding member of Red Oak Capital Management LLC (“ROCM”) in June 2002 and has served as Managing Director since inception. ROCM’s business model centered on partnering with the largest oil services companies in unconventional basins in the United States. Prior to the founding of ROCM, Mr. Rasmus was the President of Thunderbolt Capital Corp., a venture firm focused on start-up and early stage private equity investments. Previously, Mr. Rasmus started, built and expanded a variety of domestic and international capital markets and corporate finance businesses. Mr. Rasmus was the Senior Managing Director of Banc One Capital Markets, Inc. (formerly First Chicago Capital Markets, Inc.) where he was responsible for the high yield and private placement businesses while functioning as a member of the management committee. Prior thereto, Mr. Rasmus was the Managing Director and Head of Investment Banking in London for First Chicago Ltd. Mr. Rasmus holds a BA in Government and International Relations from the University of Notre Dame. We believe that Mr. Rasmus’ industry experience and deep knowledge of our business makes him well-suited to serve on the board of directors of our general partner.

James M. Whipkey—Co-Chief Executive Officer. Mr. Whipkey has a 34 year background in the oil and natural gas industry with broad experience in both technical and financial areas. Mr. Whipkey is a co-founder of Hi-Crush Proppants LLC and has served as its Co-Chief Executive Officer since its formation in October 2010. Mr. Whipkey was named Co-Chief Executive Officer and appointed to the board of directors of our general partner in May 2012. Mr. Whipkey was a founding member of ROCM in June 2002 and has served as Managing Director since inception. Prior to the founding of ROCM, Mr. Whipkey was an equity analyst covering the exploration and production sector, most recently as a Managing Director at ABN Amro Bank N.V. From 1997 to 2000, Mr. Whipkey was the Chief Financial Officer and Treasurer for NYSE-listed Benton Oil and Gas Company. Prior thereto, Mr. Whipkey worked in a number of investment banking positions managing a wide range of relationships and responsibilities in the energy sector. His various roles included energy derivatives trading at Phibro Energy Inc., investment banking at Kidder, Peabody & Co., and stock analysis at Lehman Brothers Holdings Inc., where he won “All-Star” recognition from the Wall Street Journal in both the E&P and oil service sectors. Mr. Whipkey began his career as a petroleum engineer with Amoco Corporation where he spent five years in operations, drilling and reservoir simulation roles. Mr. Whipkey holds a BS in Petroleum and Natural Gas Engineering from The Pennsylvania State University and an MBA in Finance from the University of Chicago. We believe that Mr. Whipkey’s experience in senior financial management and knowledge of our business serve him well as a member of the board of directors of our general partner.

Jefferies V. Alston, III—Chief Operating Officer. Mr. Alston has served as Chief Operating Officer of Hi-Crush Proppants LLC since May 2011 and was appointed Chief Operating Officer and appointed to the board of directors of our general partner in May 2012. Mr. Alston founded Trinity Consulting, LLC (“Trinity”) in December 2009, where he designed and managed construction of numerous frac sand processing facilities and became one of the leading consultants in the industry, until dissolving Trinity to join Hi-Crush Proppants LLC. Mr. Alston worked for Alston Equipment Company, Inc. (“Alston Equipment”) from February

85

1999 until he founded Trinity in December 2009. While at Alston Equipment, Mr. Alston was responsible for sales, growth initiatives and customer relations. Mr. Alston attended The University of Southern Mississippi and Southeastern Louisiana University. With his extensive knowledge of the frac sand industry, we believe Mr. Alston brings substantial experience and leadership skills to the board of directors of our general partner.

Laura C. Fulton—Chief Financial Officer. Ms. Fulton has served as Chief Financial Officer of Hi-Crush Proppants LLC since April 2012. In May 2012, Ms. Fulton was appointed to Chief Financial Officer of our general partner. On February 26, 2013, Ms. Fulton was elected director of Targa Resources Corp. and serves on the audit committee. From March 2008 to October 2011, Ms. Fulton served as the Executive Vice President, Accounting and then Executive Vice President, Chief Financial Officer of AEI Services, LLC (“AEI”), an owner and operator of essential energy infrastructure assets in emerging markets. Prior to AEI, Ms. Fulton spent 12 years with Lyondell Chemical Company in various capacities, including as general auditor responsible for internal audit and the Sarbanes-Oxley certification process, and as the assistant controller. Previously, Ms. Fulton worked for Deloitte & Touche in its audit and assurance practice for 11 years. Ms. Fulton is a CPA and graduated cum laude from Texas A&M University with a BBA in Accounting. Ms. Fulton is a member of the American Institute of Certified Public Accountants and serves on the Accounting Department Advisory Board at Texas A&M University.

Mark C. Skolos—General Counsel and Secretary. Mr. Skolos was appointed General Counsel of Hi-Crush Proppants LLC in April 2012 and named General Counsel and Secretary of our general partner in May 2012. Prior to joining Hi-Crush Proppants LLC, Mr. Skolos was a shareholder at the law firm of Weld, Riley, Prenn and Ricci S.C. (“Weld Riley”) from September 2011 to April 2012. Mr. Skolos worked as an attorney for Skolos, Millis and Matousek, S.C., or its predecessor firms (“Skolos Millis”), for 26 years prior to its merger with Weld Riley in April 2012. Mr. Skolos was made a shareholder at Skolos Millis in 1990. In his private practice, Mr. Skolos represented developers, businesses and local units of government on issues of government regulation, land use and real estate. Mr. Skolos has extensive experience representing companies in the non-metallic mining and processing industry on a wide spectrum of issues, including permitting, land acquisition and government relations. He graduated from the University of Wisconsin Law School in 1985 with a JD. Mr. Skolos has served as President of the Tri-County Bar Association of Wisconsin and acted as both Circuit Court and Family Court Commissioner in the State of Wisconsin.

William H. Fehr—Executive Vice President. Mr. Fehr was named an Executive Vice President of Hi-Crush Partners LP on June 11, 2013. Mr. Fehr co-founded D&I, acquired by Hi-Crush Partners in June 2013, and currently oversees our sales and marketing, supplier and rail relationship management, car logistics and finance functions. Prior to D&I, Mr. Fehr founded and operated several companies in the natural resource and logistics industries. In 2005, Mr. Fehr founded Chestnut Oil, a shallow oil and gas drilling and production company. In 1997, Mr. Fehr founded and assumed the role of President & CEO of the companies Agile Stone Systems and Rock&Rail, Inc. Agile Stone Systems was a greenfield operation located in Parkdale, CO which acquired and permitted acreage with sand, gravel and granite mines. Rock&Rail, Inc. was used for the purposes of purchasing the rail through the Royal Gorge of Colorado and to then acquire track rights from the BNSF. Rock&Rail was later expanded and developed a unit train aggregate transloading facility in Colorado Springs. Agile Stone and Rock&Rail were sold in 2001 to Colorado Materials, Inc. In 1986 Mr. Fehr became Chairman and CEO of Berks Products Corporation (“BPC”), a family-owned business. BPC was an integrated material supply, mining, road building and petroleum marketing company. Mr. Fehr is a graduate of the University of Arizona with a BS in International Agriculture Economics and holds an MBA from the Thunderbird School of Global Management.

Chad M. McEver—Vice President. Mr. McEver has served as Vice President of Hi-Crush Proppants LLC since its inception in October 2010. Mr. McEver was named Vice President of our general partner in May 2012. Mr. McEver joined ROCM as an Associate in 2004 and has served as Vice President since 2010. In executing the business model of ROCM, Mr. McEver has been responsible for analysis, execution and origination of projects with exploration and production and oilfield services companies and ROCM’s co-investors. From 2001 to 2004, Mr. McEver was a Director at EnerCom, Inc., an investor relations consulting firm exclusively serving the energy industry. From 1999 to 2001, Mr. McEver was an analyst in the investment banking energy group at Raymond James & Associates. Mr. McEver holds a BBA from Stephen F. Austin State University and an MBA in Finance from the University of Denver.

John F. Affleck-Graves—Director. Mr. Affleck-Graves joined the board of directors of our general partner in November 2012 and serves as a member of the Audit Committee and Conflicts Committee. He has served in roles of increasing responsibility and seniority at The University of Notre Dame from 1986 to present, including as an Executive Vice President from 2004 to present. As Executive Vice President, he serves as one of three executive officers of the University. Additionally, Mr. Affleck-Graves is a prior Board member of St. Joseph’s Capital Bank, Student Loan Corporation and Express-1 Inc. Throughout his career, Mr. Affleck-Graves has received many distinctions and honors including MBA Outstanding Teacher Award, University of Notre Dame. He received his BSc Mathematical Statistics and Computer Science in 1971 from the University of Capetown. Mr. Affleck-Graves also holds a PhD in Mathematical Statistics and a BCom in Accounting and Financial Management from the University of Capetown. Mr Affleck-Graves previously served as a director of Express-1 Expedited Solutions, Inc. from October 2006 to October 2011 and served on its audit committee. We believe that Mr. Affleck-Graves’ expertise and the unique perspective gained from his service at the University of Notre Dame enable him to effectively serve as a director.

86

Gregory F. Evans—Director. Mr. Evans has served as a director of Hi-Crush Proppants LLC since January 2014 and was appointed to the board of directors of our general partner in February 2014. Mr. Evans currently serves as a Principal of Avista Capital Partners, where he has worked since 2005. From 2003 to 2005, Mr. Evans was an Analyst at DLJ Merchant Banking Partners. Prior to joining DLJ Merchant Banking Partners, he was an Analyst in Credit Suisse First Boston’s Investment Banking Department. Mr. Evans holds an BBA in Finance from the University of Texas at Austin. We believe that Mr. Evans brings financial and analytical expertise in the energy sector, including experience as a director of numerous energy-related companies, to the board of directors of our general partner.

John R. Huff—Director. Mr. Huff has served as a director of Hi-Crush Proppants LLC since May 2011 and was appointed to the board of directors of our general partner in May 2012. Mr. Huff has served as Chairman of the board of directors of Oceaneering International, Inc. (“Oceaneering”) since 1990 and served as its Chief Executive Officer from 1986 to 2006. Prior to joining Oceaneering, Mr. Huff served as Chairman, President and Chief Executive Officer of Western Oceanic, Inc. from 1972 to 1986. In addition to his service as chairman of the board of directors of Oceaneering, Mr. Huff has served as a member of the board of directors of KBR, Inc. since April 2007 and of Suncor Energy, Inc. since 1998. Mr. Huff also served as a member of the board of directors of Rowan Companies, Inc. from April 2006 to May 2009 and of BJ Services Company from 1992 to April 2010. Mr. Huff received a Bachelor’s degree in Civil Engineering from Georgia Tech and attended the Harvard Business School’s Program for Management Development. Mr. Huff is a Registered Professional Engineer in the State of Texas and a member of the National Academy of Engineering, Washington D.C. We believe that Mr. Huff’s substantial knowledge of energy-related businesses, as well as his considerable experience as a director of public companies, has prepared him well to serve on the board of directors of our general partner.

John Kevin Poorman—Director. Mr. Poorman joined the board of directors of our general partner in August 2013 and serves as a member of the Audit Committee and Conflicts Committee. Since June 2013, Mr. Poorman has been Chief Executive Officer of PSP Capital Partners, LLC and Pritzker Realty Group, LLC, investment managers for affiliated entities in real estate and other non-real estate business. Pritzker Realty Group, LLC is also an operator of real estate. Mr. Poorman is responsible for implementing and overseeing each company's strategic direction. He is also Executive Chairman of Vi Senior Living (formerly Classic Residence by Hyatt). Mr. Poorman previously served as an officer and director of several businesses owned by interests of the extended Pritzker family. Mr. Poorman is the Chairman of the Board of Trustees of the Loyola University of New Orleans and serves as a director of The New Orleans Jazz Orchestra, Inc. Prior to joining Hyatt Hotels Corporation in 1988, Mr. Poorman was a partner in the Dallas-based law firm of Johnson & Swanson. We believe that Mr. Poorman’s business leadership skills make him well-suited to serve on the board of directors of our general partner.

Trevor M. Turbidy—Director. Mr. Turbidy has served as a director of Hi-Crush Proppants LLC since May 2011 and was appointed to the board of directors of our general partner in May 2012. Mr. Turbidy has served as an energy industry advisor for Avista Capital Partners since 2007. Prior to joining Avista Capital Partners, Mr. Turbidy served as Chief Executive Officer of Trico Marine Services (“Trico”), an international provider of marine support vessel services to the offshore oil and gas industry from 2005 to 2007. Prior to that, Mr. Turbidy was Chief Financial Officer of Trico from 2003 to 2005, functioned as the Chief Restructuring Officer during the company’s restructuring and subsequently was promoted to Chief Executive Officer after its successful completion. Prior to his service at Trico, Mr. Turbidy spent more than a decade with Donaldson, Lufkin & Jenrete Inc. (“DLJ”) and Credit Suisse First Boston in their investment banking divisions. During his tenure with DLJ and Credit Suisse First Boston, Mr. Turbidy focused on the energy sector, principally offshore and land drilling contractors, seismic service providers, oilfield equipment manufacturers, offshore support vessel providers and exploration and production companies, as well as regional opportunities in the Southwest. Mr. Turbidy previously served as a director of Grey Wolf, Inc., Precision Drilling Corporation and Trico Marine Services Inc., as well as a number of private companies in the energy industry. Mr. Turbidy holds an AB in Economics from Duke University. We believe that Mr. Turbidy’s substantial management-level experience with public and private companies, together with his considerable knowledge of the energy industry as a whole, are of great value to the board of directors of our general partner.

Steven A. Webster—Director. Mr. Webster has served as a director of Hi-Crush Proppants LLC since May 2011 and was appointed to the board of directors of our general partner in May 2012. Mr. Webster has served as Co-Managing Partner of Avista Capital Partners since he co-founded the firm in July 2005. From January 2000 until June 2005, Mr. Webster served as the Chairman of Global Energy Partners, which was a specialty group within Credit Suisse's asset management business that made private equity investments in energy companies. From December 1997 to May 1999, Mr. Webster was the Chief Executive Officer and President of R&B Falcon Corporation, an offshore drilling contractor, and prior to that, was Chairman and Chief Executive Officer of Falcon Drilling Company, which he founded in 1988. Mr. Webster currently serves as a director of Carrizo Oil & Gas, Inc., Era Group, Inc., Geokinetics, Inc., Basic Energy Services, Inc. and Hercules Offshore, Inc. Mr. Webster also serves as a trust manager of Camden Property Trust and as a director of several private companies. Mr. Webster previously served as a director of Pinnacle Gas Resources, Inc. from 2003 to June 2009, Encore Bancshares from 2000 to May 2009, Solitario Exploration & Royalty Corp. (formerly Solitario Resources Corp.) from 2006 to March 2009, Brigham Exploration Company from 2000 to April 2007, Goodrich Petroleum Corporation from 2004 to March 2007, Seabulk International, Inc. from 2002 to March 2006, Grey Wolf, Inc. from

87

1996 to December 2008, Crown Resources Corporation from 1988 to August 2006 and SEACOR Holdings, Inc. from September 2005 to January 2013. Mr. Webster holds a BSIM from Purdue University, an MBA from Harvard Business School and an honorary doctorate in management from Purdue University. We believe Mr. Webster’s experience in, and knowledge of, the energy industry, business leadership skills and experience as a director of numerous other public companies make him well-qualified to serve on the board of directors of our general partner.

Joseph C. Winkler III—Director. Mr. Winkler joined the board of directors of our general partner in connection with our IPO and serves as the Chairman of the Audit Committee and Conflicts Committee. Mr. Winkler served as Chairman and Chief Executive Officer of Complete Production Services, Inc. (“Complete”), a provider of specialized oil and gas services and equipment in North America, from March 2007 until February 2012, at which time Complete was acquired by Superior Energy Services, Inc. From June 2005 to March 2007, Mr. Winkler served as Complete’s President and Chief Executive Officer. Prior to that, from March 2005 until June 2005, Mr. Winkler served as the Executive Vice President and Chief Operating Officer of National Oilwell Varco, Inc., an oilfield capital equipment and services company, and from May 2003 until March 2005 as the President and Chief Operating Officer of the company’s predecessor, Varco International, Inc. (“Varco”). From April 1996 until May 2003, Mr. Winkler served in various other capacities with Varco and its predecessor, including Executive Vice President and Chief Financial Officer. From 1993 to April 1996, Mr. Winkler served as the Chief Financial Officer of D.O.S., Ltd., a privately held provider of solids control equipment and services and coil tubing equipment to the oil and gas industry, which was acquired by Varco in April 1996. Prior to joining D.O.S., Ltd., Mr. Winkler served as Chief Financial Officer of Baker Hughes INTEQ, and served in a similar role for various companies owned by Baker Hughes Incorporated including Eastman/Telco and Milpark Drilling Fluids. Mr. Winkler is a member of the board of directors of Dresser-Rand Group, Inc., a NYSE-listed provider of rating equipment solutions, and serves on the Compensation and Nominating and Governance Committees. Mr. Winkler is also a member of the board of directors of Commercial Metals Company, a vertically integrated Fortune 500 steel company, and serves on its Finance Committee. Mr. Winkler is a Gulf Coast District Director of the Petroleum Equipment Suppliers Association (PESA), an oilfield service and supply industry trade association. Mr. Winkler received a BS degree in Accounting from Louisiana State University. We believe that Mr. Winkler’s many years of operational, financial, international and capital markets experience, a significant portion of which was with publicly traded companies in the oil and gas services, manufacturing and exploration and production industries, make him particularly well-suited to serve on the board of directors of our general partner.

Director Independence

As of December 31, 2013, three of our directors were independent.

Committees of the Board of Directors

The board of directors of our general partner maintains an audit committee and a conflicts committee. As permitted by NYSE rules, we do not currently have a compensation committee, but rather the board of directors of our general partner approves equity grants to directors and employees.

Audit Committee

We are required to have an audit committee of at least three members, and all its members are required to meet the independence and experience standards established by the NYSE and the Exchange Act. The audit committee assists the board of directors in its oversight of the integrity of our financial statements and our compliance with legal and regulatory requirements and partnership policies and controls. The audit committee has the sole authority to (1) retain and terminate our independent registered public accounting firm, (2) approve all auditing services and related fees and the terms thereof performed by our independent registered public accounting firm, and (3) pre-approve any non-audit services and tax services to be rendered by our independent registered public accounting firm. The audit committee is also responsible for confirming the independence and objectivity of our independent registered public accounting firm. Our independent registered public accounting firm is given unrestricted access to the audit committee and our management, as necessary. Messrs. Winkler III, Affleck-Graves and Poorman are the members of the audit committee, with Mr. Winkler III currently serving as chairman.

The board of directors of our general partner has determined that Mr. Winkler III qualifies as an “audit committee financial expert,” as such term is defined under SEC rules.

Conflicts Committee

Three independent members of the board of directors of our general partner serve on the conflicts committee to review specific matters that the board believes may involve conflicts of interest and determines to submit to the conflicts committee for review. The conflicts committee determines if the resolution of the conflict of interest is in our best interest. The members of the conflicts committee may not be officers or employees of our general partner or directors, officers or employees of its affiliates, including our sponsor, and must meet the independence standards established by the NYSE and the Exchange Act to serve on an audit committee of a board of directors, along with other requirements in our partnership agreement. Any matters approved by the conflicts committee are conclusively deemed to be in our best interest, approved by all of our partners and not a breach by our

88

general partner of any duties it may owe us or our unitholders. Messrs. Winkler III, Affleck-Graves and Poorman are the members of the conflicts committee, with Mr. Winkler III currently serving as chairman.

Section 16(a) Beneficial Ownership Reporting Compliance

Pursuant to Section 16(a) of the Exchange Act, certain officers and directors of our general partner, and persons beneficially owning more than 10% of our units, are required to file with the SEC reports of their initial ownership and changes in ownership of our units. These officers and directors, and persons beneficially owning more than 10% of our units are also required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of Forms 3, 4 and 5 and amendments thereto furnished to us and written representations from reporting persons that no other reports were required for those persons, we believe that during 2013, all officers and directors, and persons beneficially owning more than 10% of our units who were required to file reports under Section 16(a) complied with such requirements on a timely basis.

Corporate Governance Matters

We have a Code of Business Conduct and Ethics for directors, executive officers and employees that applies to, among others, the principal executive officers, principal financial officer and principal accounting officer or controller of our general partner, as required by SEC and NYSE rules. Furthermore, we have Corporate Governance Guidelines and charters for our Audit Committee and Conflicts Committee. Each of the foregoing is available on our website at www.hicrushpartners.com in the “Corporate Governance” section. We provide copies, free of charge, of any of the foregoing upon receipt of a written request to Hi-Crush Partners LP, Three Riverway, Suite 1550, Houston, Texas 77056, Attn: General Counsel. We disclose amendments and director and executive officer waivers with regard to the Code of Business Conduct and Ethics, if any, on our website or by filing a Current Report on Form 8-K to the extent required.

The certifications of our general partner’s Co-Chief Executive Officers and Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act have been included as exhibits to this Annual Report on Form 10-K.

Communication with the Board of Directors

A holder of our units or other interested party who wishes to communicate with the directors of our general partner may do so by contacting our corporate secretary at the address or phone number appearing on the front page of this Annual Report on Form 10-K. Communications will be relayed to the intended recipient of the board of directors of our general partner except in instances where it is deemed unnecessary or inappropriate to do so pursuant to our communications policy, which is filed available on our website at www.hicrushpartners.com in the “Corporate Governance” section. Any communications withheld under those guidelines will nonetheless be recorded and available for any director who wishes to review them.

Executive Sessions of Non-Management Directors

The board of directors of our general partner holds regular executive sessions in which the independent directors meet without any non-independent directors or members of management. The purpose of these executive sessions is to promote open and candid discussion among the independent directors. The director who presides at these meetings, the Lead Director, is chosen by the board of directors to serve until the first meeting of the Board to occur after the first anniversary of the date that the Lead Director is chosen. The current Lead Director is Mr. Winkler III.

89

ITEM 11. EXECUTIVE COMPENSATION

(All amounts presented in dollars)

We are providing compensation disclosure that satisfies the requirements applicable to emerging growth companies, as defined in the JOBS Act.

Summary Compensation Table

The table below sets forth the annual compensation earned during the fiscal years ended December 31, 2013 and 2012 by our principal executive officers and our next two most highly-compensated executive officers (our “Named Executive Officers” or “NEOs”).

Name and Principal Position	Year	Salary ($)	Bonuses ($)(4)	All Other Compensation ($) (6)	Total ($)
Robert E. Rasmus, Co-Chief Executive Officer	2013	1 (1)	—	16,648 (5)	16,649
	2012	46,644 (1)	—	22,540 (5)	69,184
James M. Whipkey, Co-Chief Executive Officer	2013	1 (1)	—	14,260 (5)	14,261
	2012	46,644 (1)	—	19,294 (5)	65,938
Laura C. Fulton, Chief Financial Officer	2013	151,250 (2)	137,500	11,023	299,773
	2012	142,397 (2)	—	4,472	146,869
Mark C. Skolos, General Counsel	2013	108,654 (3)	—	7,176	115,830
	2012	106,192 (3)	50,000	4,256	160,448
(1) Represents the actual amount of salary paid to Mr. Rasmus and Mr. Whipkey during 2012 based upon the annualized base salary of $75,000 defined under such NEO’s employment agreement with us. Upon the closing of the IPO, Messrs. Rasmus and Whipkey’s base salary under their respective employment agreements became $1.
(2) Represents the actual amount of salary paid to Ms. Fulton until August 16, 2012, the date of the closing of our IPO, based upon the annualized base salary of $275,000 defined under Ms. Fulton’s employment agreement with us, which became effective on April 30, 2012. Since August 16, 2012, represents the portion of the base salary paid by our sponsor to Ms. Fulton that was reimbursable by us under the Services Agreement.
(3) Represents the actual amount of salary paid to Mr. Skolos until August 16, 2012, the date of the closing of our IPO based upon the annualized base salary of $190,000 defined under Mr. Skolos’ employment agreement with us, which became effective on April 16, 2012. Since August 16, 2012, represents the portion of the base salary paid by our sponsor to Mr. Skolos that was reimbursable by us under the Services Agreement.
(4) The amounts reported in this column represent (i) discretionary bonuses earned by the NEO during the applicable fiscal year, including the portion of any cash bonuses paid by our sponsor to the NEO that was reimbursable by us under the Services Agreement and (ii) any bonuses provided for in the NEO's employment agreement.
(5) Pursuant to a management services agreement entered into between Red Oak Capital Management LLC and our sponsor, our sponsor reimburses Red Oak Capital Management LLC for the health and welfare benefits and coverage paid for Messrs. Rasmus and Whipkey.
(6) Amounts in this column reflect the amount paid by our sponsor from January 1, 2012 until August 16, 2012, and the amount paid by our sponsor since August 16, 2012 that was reimbursable by us under the Services Agreement since August 16, 2012, for matching 401(k) contributions and premiums paid for health and welfare benefits and coverage.

Narrative Disclosure to the Summary Compensation Table

Employment Agreements

Each of our NEOs has entered into an employment agreement with our sponsor (collectively, the “Employment Agreements”). The initial term of each Employment Agreement is one year from the effective date of such agreement, with automatic extensions for additional one-year periods unless either party provides at least sixty days' advance written notice of the intent to terminate the Employment Agreement.

Under the Employment Agreements, each NEO is entitled to an annualized base salary and is eligible for discretionary bonuses awarded by our sponsor from time to time, each of which is described in greater detail below.

The Employment Agreements also contain severance provisions, which are discussed in detail below under “Additional Narrative Disclosure—Potential Payments Upon Termination or a Change in Control.”

In addition, the Employment Agreements contain a confidentiality obligation on the part of the NEO of indefinite duration and a non-competition and non-solicitation obligation on the part of the executive for a period of one-year following his or her termination

90

of employment with us for any reason. We do not currently provide any additional or enhanced payments or benefits to our NEOs in connection with any change in control transactions.

On July 13, 2012, our sponsor entered into a side letter agreement with Mr. Rasmus and Mr. Whipkey (collectively, the “Side Letter Agreements”). The Side Letter Agreements modify Mr. Rasmus’ and Mr. Whipkey’s base salary and severance provisions as described in further detail below provided that certain conditions are met.

Base Salary

Each NEO’s base salary is a fixed component of compensation and is specified in the Employment Agreements. Mr. Rasmus and Mr. Whipkey currently receive an annualized base salary of $1. Ms. Fulton receives an annualized base salary of $275,000 and Mr. Skolos receives an annualized base salary of $190,000.

Bonuses

Under the Employment Agreements, our NEOs are eligible for discretionary bonuses that may be awarded from time to time; provided that our sponsor has sole discretion as to whether a bonus is awarded, the criteria for any bonus, and the amount of any bonus. During 2012, Mr. Skolos received a discretionary cash bonus in the amount of $100,000 that was reimbursable by us under the Services Agreement. Pursuant to the terms of Ms. Fulton’s Employment Agreement, Ms. Fulton is eligible to receive two cash bonuses of $275,000 upon the successful completion of our IPO, with the bonuses payable six months and 18 months after the closing of the IPO.

Our sponsor is considering the type, amount, and terms of incentive compensation to be awarded to Mr. Rasmus and Mr. Whipkey as consideration for services to be provided to us following our IPO. Our sponsor anticipates reaching a conclusion and entering into a written agreement with Mr. Rasmus and Mr. Whipkey regarding incentive compensation.

Incentive Profits Interests

Pursuant to their employment agreements, each of Ms. Fulton and Mr. Skolos have been granted a 0.75% profits interest and 0.25% profits interest, respectively, in our sponsor entitling them to receive 0.75% and 0.25%, respectively, of any net distributions by the sponsor after the capital members of the sponsor have received aggregated distributions from the sponsor above a threshold amount. This profits interest is subject to vesting at the rate of 25% per full year of employment for three full years. No profits interest was paid to Ms. Fulton or Mr. Skolos for 2013.

Other Compensation Elements

Each NEO is entitled to 20 days of paid time off each calendar year during the term of the Employment Agreement.

Outstanding Equity Awards at 2013 Fiscal Year-End

We have not previously granted any equity awards to our NEOs. As a result, none of our NEOs had outstanding equity awards as of December 31, 2013.

Additional Narrative Disclosure

Retirement Benefits

As of December 31, 2012, our sponsor had not maintained a defined benefit pension plan, defined contribution plan or nonqualified deferred compensation plan. As a result, there were no retirement benefits provided to our NEOs through December 31, 2012.

On January 1, 2013, our general partner began sponsorship of a tax-qualified Section 401(k) retirement savings plan. Our NEOs are eligible to participate in our tax-qualified Section 401(k) retirement savings plan on the same basis as other employees who satisfy the plan’s eligibility requirements, including requirements relating to age and length of service. Under this plan, participants may elect to make pre-tax contributions not to exceed the applicable statutory income tax limitation, which was $17,500 for 2013. In addition, we may make discretionary contributions to the plan in any year, up to certain limits.

Potential Payments Upon Termination or a Change in Control

The Employment Agreements contain severance provisions. Under the terms of the Employment Agreements, the employment of each NEO may be terminated by our sponsor with or without Cause, by the NEO for or without Good Reason, due to the NEO’s disability or death, or due to expiration of the term of the Employment Agreement.

Upon a termination by us for Cause, by the NEO without Good Reason, due to the NEO’s disability or death, or due to expiration of the term of the Employment Agreement, the NEO is entitled to the following severance benefits: (i) payment of all accrued and unpaid base salary through the date of termination, (ii) reimbursement for all incurred but unreimbursed expenses entitled to reimbursement, and (iii) provision of any benefits to which the NEO is entitled pursuant to the terms of any applicable benefit plan or program (collectively, the “Accrued Obligations”).

91

Upon a termination by us without Cause or by the NEO for Good Reason, the NEO is entitled to the following severance benefits: (i) payment of the Accrued Obligations and (ii) (A) in the case of Mr. Rasmus and Mr. Whipkey, payment of an amount equal to $750,000 in a lump sum payment on the date that is 30 days after the date of termination and (B) in the case of Ms. Fulton and Mr. Skolos, the remainder of such employee’s base salary for the remaining term of the employment agreement, which in no event shall be less than 50% of such base salary, payable over the remainder of the term of the employment agreement in installments substantially similar to the sponsor’s salary payment practices. Payment of the additional lump sum payment is contingent upon the NEO’s execution and non-revocation of a general release of claims in favor of us.

Under the Employment Agreements, “Cause” means an NEO’s: (i) conviction of, or entry of a guilty plea or plea of no contest with respect to, a felony or any other crime directly or indirectly involving the NEO’s lack of honesty or moral turpitude, (ii) drug or alcohol abuse for which the NEO fails to undertake and maintain treatment within five calendar days after requested by the Company, (iii) acts of fraud, embezzlement, theft, dishonesty or gross misconduct, (iv) material misappropriation (or attempted misappropriation) of any of our funds or property, or (v) a breach of the NEO’s obligations described under the Employment Agreement, as determined by a majority of our board of directors. Under the Employment Agreements, “Good Reason” means, without the NEO’s consent: (i) a material breach by us of our obligations under the Employment Agreement, (ii) any material diminution of the duties of the NEO, (iii) a reduction in the NEO’s base salary, other than pursuant to a proportionate reduction applicable to all senior executives or employees generally and the members of our board of directors, to the extent such board members receive board fees, or (iv) the relocation of the geographic location of the NEO’s principal place of employment by more than 50 miles.

No NEO has any right to receive a “gross up” for any excise tax imposed by Section 4999 of the Code, or any federal, state or local income tax.

Director Compensation

The executive officers of our general partner who also serve as directors of our general partner do not receive additional compensation for their services as a director of our general partner. The table below sets forth the annual compensation earned during 2013 by the non-executive directors of our general partner.

Director	Fees Earned or Paid in Cash ($)	Unit Awards ($)	Total ($)
John F. Affleck-Graves	70,000	50,000	120,000
Robert L. Cabes, Jr. (1)	—	—	—
Gregory F. Evans (2)	—	—	—
John R. Huff	—	—	—
John Kevin Poorman (3)	26,535	—	26,535
Trevor M. Turbidy	—	—	—
Steven A. Webster	—	—	—
Joseph C. Winkler III	100,000	50,000	150,000
(1) Mr. Cabes resigned as a director of our general partner on February 14, 2014.
(2) Mr. Evans was appointed as a director of our general partner on February 17, 2014.
(3) Mr. Poorman was appointed as a director of our general partner on August 16, 2013.

Following the IPO on August 16, 2012, each independent director of our general partner receives an annual retainer of $50,000. Each January, our independent directors also receive an annual grant of the number of common units having a grant date fair value of approximately $50,000 as of such date. Such units are not subject to a vesting period. Further, each independent director serving as a chairman or a member of a committee of the board of directors of our general partner will receive an annual retainer of $25,000 or $10,000, respectively.

The Partnership granted $100,000 of equity awards to its directors during 2013 and $150,000 in January 2014.

Compensation Committee Interlocks and Insider Participation

None of the directors or executive officers of our general partner served as members of the compensation committee or board of directors of another entity that has or had an executive officer who served as a member of the board of directors of our general partner during 2013. Our general partner’s board of directors is not required to maintain, and does not maintain, a compensation committee. In addition, as previously noted, we do not directly employ or compensate the executive officers of our general partner. Rather, under the Services Agreement, we reimburse Hi-Crush Services and its affiliates for, among other things, the allocable expenses incurred in compensating our general partner’s executive officers. Messrs. Rasmus, Whipkey and Alston, who are members of the board of directors of our general partner, are also executive officers of our general partner.

92

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED UNITHOLDER MATTERS

The following table sets forth the beneficial ownership of our common units, subordinated units and Class B Units issued and outstanding as of February 28, 2014 for:

• our general partner;

• beneficial owners of 5% or more of our common and subordinated units;

• each director and named executive officer of our general partner; and

• all of our general partner's directors and named executive officers as a group.

	Common Units Beneficially Owned	Percentage of Common Units Beneficially Owned		Subordinated Units Beneficially Owned	Percentage of Subordinated Units Beneficially Owned		Percentage of Common and Subordinated Units Beneficially Owned		Class B Units Beneficially Owned	Percentage of Class B Units Beneficially Owned
Hi-Crush Proppants LLC (1)(2)	—	—	%	13,640,351	100	%	47.24	%	3,750,000	100	%
Hi-Crush GP LLC (2)	—	—		—	—		—		—	—
Robert E. Rasmus (2)(4)	600	*		—	—		*		—	—
James M. Whipkey (2)	100	*		—	—		*		—	—
Jefferies V. Alston, III (2)	—	—		—	—		—		—	—
Laura C. Fulton(2)	10,000	*		—	—		*		—	—
Mark C. Skolos (2)	—	—		—	—		—		—	—
Chad M. McEver (2)	—	—		—	—		—		—	—
William H. Fehr (2)(5)	1,121,795	7.36	%	—	—		3.89	%	—	—
John F. Affleck-Graves(2)	4,144	*		—	—		*		—	—
Gregory F. Evans (3)	—	—		—	—		—		—	—
John R. Huff (2)	100,000	*		—	—		*		—	—
John Kevin Poorman (2)	1,383	*		—	—		*		—	—
Trevor M. Turbidy (3)	—	—		—	—		—		—	—
Steven A. Webster (3)	—	—		—	—		—		—	—
Joseph C. Winkler III (2)	4,144	*		—	—		*		—	—
All named executive officers and directors as a group (12 persons)	120,371	*		—	—		*		—	—

*  Less than one percent

(1) Avista Capital Partners II, LP, Avista Capital Partners (Offshore) II-A, LP and Avista Capital Partners (Offshore) II, LP indirectly own 58% of the membership interests of Hi-Crush Proppants LLC, through two investment vehicles, ACP HIP Splitter, LP and ACP HIP Splitter (Offshore), LP. Each of Avista Capital Partners II, LP, Avista Capital Partners (Offshore) II-A, LP and Avista Capital Partners (Offshore) II, LP is controlled by its general partner, Avista Capital Partners II GP, LLC (“Avista GP”). Voting and investment determinations are made by an investment committee of Avista GP, comprised of the following members: Thompson Dean, Steven Webster, David Burgstahler and David Durkin. As a result, and by virtue of the relationships described above, each of Thompson Dean, Steven Webster, David Burgstahler and David Durkin may be deemed to exercise voting and dispositive power with respect to securities held by ACP HIP Splitter, LP and ACP HIP Splitter (Offshore), LP. The address for Avista Capital Partners is 65 East 55^th Street, 18^th Floor, New York, NY 10022.

(2) The address for each of Hi-Crush Proppants LLC, Hi-Crush GP LLC, Robert E. Rasmus, James M. Whipkey, Jefferies V. Alston, III, Laura C. Fulton, Mark C. Skolos, Chad M. McEver, William H. Fehr, John R. Huff, John F. Affleck-Graves, Joseph C. Winkler III and John Kevin Poorman is Three Riverway, Suite 1550, Houston, Texas 77056.

(3) The address for each of Gregory F. Evans, Trevor M. Turbidy and Steven A. Webster is 1000 Louisiana St., Suite 3700, Houston, Texas 77002.

(4) Includes 500 common units owned by the reporting person’s son. Mr. Rasmus disclaims beneficial ownership of the 500 common units held by his son.

(5) I.N.A.P., Inc. owns 1,121,795 common units. Mr. Fehr is the sole shareholder of I.N.A.P., Inc.

93

Equity Compensation Plan Information

The following table sets forth information as of December 31, 2013 with respect to compensation plans under which our equity securities are authorized for issuance.

	(a) Number of  Units to be Issued Upon Exercise of Outstanding Unit Options and Rights	(b) Weighted  Average Exercise Price Of Outstanding Unit Options and Rights	(c) Number of  Units Remaining Available For Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
Plan Category
Equity compensation plans approved by unitholders
N/A	—	—	—
Equity compensation plans not approved by unitholders:
Long-Term Incentive Plan	—	—	1,358,513
Total for equity compensation plans	—	—	1,358,513

The Partnership’s Long-Term Incentive Plan (“LTIP”) was adopted by our general partner in August 2012 in connection with our IPO. The LTIP contemplates the issuance or delivery of up to 1,364,035 common units to satisfy awards under the plan. As of December 31, 2013, 5,522 units had been granted to independent directors Mr. Winkler III and Mr. Affleck-Graves under the LTIP.

On January 8, 2014, we issued 4,149 common units to our independent directors, Mr. Winkler III, Mr. Affleck-Graves and Mr. Poorman, and 4,366 common units to certain employees.

94

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE (Dollars in thousands)

As of February 28, 2014, our sponsor owned 13,640,351 subordinated units and 3,750,000 Class B Units, representing an aggregate 53.3% limited partner interest in us, owned the incentive distribution rights and owned and controlled our general partner. Our sponsor also appoints all of the directors of our general partner, which maintains a non-economic general partner interest in us.

The terms of the transactions and agreements disclosed in this section were determined by and among affiliated entities and, consequently, are not the result of arm’s length negotiations. These terms are not necessarily at least as favorable to the parties to these transactions and agreements as the terms that could have been obtained from unaffiliated third parties.

Distributions and Payments to Affiliates of our General Partner

The following summarizes the distributions and payments made or to be made by us to our general partner and its affiliates in connection with the formation, ongoing operation and any liquidation of Hi-Crush Partners LP.

Formation Stage

The aggregate consideration received by affiliates of our general partner for the contribution of their interests:

• 13,640,351 common units including 12,937,500 common units the selling unitholder sold to the public in our IPO;

• 13,640,351 subordinated units; and

• our incentive distribution rights.

Operational Stage

Distributions of cash available for distribution to our general partner and its affiliates:

• We will generally make cash distributions 100% to our unitholders, including affiliates of our general partner. In addition, if distributions exceed the minimum quarterly distribution and other higher target distribution levels, our sponsor (as the holder of our incentive distribution rights) will be entitled to increasing percentages of the distributions, up to 50.0% of the distributions above the highest target distribution level.

• Assuming we have sufficient cash available for distribution to pay the full minimum quarterly distribution on all of our outstanding common units and subordinated units for four quarters and that we pay such minimum quarterly distribution, affiliates of our general partner would receive an annual distribution of $28,277 on their units.

Payments to our general partner and its affiliates:

• Our general partner does not receive a management fee or other compensation for its management of our partnership, but we reimburse our general partner and its affiliates for all direct and indirect expenses they incur and payments they make on our behalf. Our partnership agreement does not set a limit on the amount of expenses for which our general partner and its affiliates may be reimbursed. These expenses include salary, bonus, incentive compensation and other amounts paid to persons who perform services for us or on our behalf and expenses allocated to our general partner by its affiliates. Our partnership agreement provides that our general partner will determine in good faith the expenses that are allocable to us.

Withdrawal or removal of our general partner:

• If our general partner withdraws or is removed, its non-economic general partner interest and our sponsor’s incentive distribution rights will either be sold to the new general partner for cash or converted into common units, in each case for an amount equal to the fair market value of those interests.

Liquidation Stage

• Upon our liquidation, the partners will be entitled to receive liquidating distributions according to their particular capital account balances.

Agreements with Affiliates in Connection with our Initial Public Offering

In connection with our IPO on August 16, 2012, we entered into certain agreements with our sponsor, as described in more detail below.

Contribution Agreement

We entered into a contribution agreement that affected the transactions, including the transfer of the ownership interests in Hi-Crush Chambers LLC, Hi-Crush Railroad LLC, Hi-Crush Wyeville LLC and Hi-Crush Operating LLC and the issuance by us to our sponsor of common units, subordinated units and incentive distribution rights. While we believe this agreement is on terms no less favorable to any party than those that could have been negotiated with an unaffiliated third party, it was not the result of

95

arm’s-length negotiations. All of the transaction expenses incurred in connection with these transactions were paid by our sponsor from the proceeds of the IPO.

Omnibus Agreement

We entered into an omnibus agreement with affiliates of our general partner, including our sponsor, which addresses certain aspects of our relationship with them, including:

• our use of the name “Hi-Crush” and related marks;

• our payment of administrative services fees to our sponsor for general and administrative services;

• the assumption by our sponsor of one of our customer contracts beginning on May 1, 2013;

• our right of first offer with respect to our sponsor’s Augusta acreage and other assets, which were retained; and

• certain indemnification obligations.

The omnibus agreement can be amended by written agreement of all parties to the agreement. However, we may not agree to any amendment or modification that would, in the reasonable discretion of our general partner, be adverse in any material respect to the holders of our common units without prior approval of the conflicts committee. So long as our sponsor controls our general partner, the omnibus agreement will remain in full force and effect unless mutually terminated by the parties. If our sponsor ceases to control our general partner, the omnibus agreement will terminate.

Indemnification Obligations

Our sponsor’s indemnification obligations include certain liabilities relating to:

• for a period of three years after the closing of the IPO, environmental liabilities, including (i) any violation or correction of violation of environmental laws associated with our assets, where a correction of violation would include assessment, investigation, monitoring, remediation, or other similar action and (ii) any event, omission or condition associated with the ownership of our assets (including the presence of hazardous materials), including (A) the cost and expense of any assessment, investigation, monitoring, remediation or other similar action and (B) the cost and expense of any environmental or toxic tort litigation, provided that the aggregate amount payable to us pursuant to this bullet point does not exceed $7,500;

• until 60 days after the applicable statute of limitations, any of our federal, state and local income tax liabilities attributable to the ownership and operation of our assets and the assets of our subsidiaries prior to the closing of the initial public offering;

• for a period of three years after the closing of the IPO, the failure to have all necessary consents and governmental permits where such failure renders us unable to use and operate our assets in substantially the same manner in which they were used and operated immediately prior to the closing of the initial public offering (subject to certain exceptions for the revocation or non-renewal of consents and governmental permits due to changes in laws, governmental regulations or certain other events outside of the control of our sponsor and our general partner);

• for a period of three years after the closing of the IPO, our failure to have valid and indefeasible easement rights, rights-of-way, leasehold and/or fee ownership interest in the lands where our assets are located and such failure prevents us from using or operating our assets in substantially the same manner as operated immediately prior to the closing of the initial public offering; and

• any losses, costs or damages incurred by us that are attributable to the ownership and operation of the assets our sponsor is contributing to us prior to the closing of our IPO.

In no event will our sponsor be obligated to indemnify us for any claims, losses or expenses or income taxes referred to above to the extent either (i) reserved for in our financial statements as of December 31, 2011, or (ii) we recover any such amounts under available insurance coverage, from contractual rights or other recoveries against any third party.

In addition, we will also agree to indemnify our sponsor from any losses, costs or damages incurred by our sponsor that are attributable to the ownership and operation of our assets and the assets of our subsidiaries following the closing of the initial public offering, subject to the same limitations on our sponsor’s indemnity to us.

Assignment of Customer Contract

Our sponsor has waived an existing right to require that we assign to the sponsor a long-term customer contract for sand produced by our Wyeville facility. This contract was initially scheduled to be assigned from the Wyeville facility to the Augusta facility on May 1, 2013, but will remain at Wyeville for the duration of the contract.

Right of First Offer With Respect to Augusta and Other Assets

96

Our sponsor has granted us, for a period of 3 years following our IPO, a right of first offer on its sand reserves and any related assets that have been or will be constructed on its current acreage in Augusta and another location (the “ROFO assets”) to the extent that our sponsor proposes to transfer a ROFO asset to a third party other than in connection with a sale of all or substantially all of its assets.

In the event our sponsor proposes to transfer any ROFO asset, it will first give notice to us of its intention to transfer such asset (a “ROFO notice”), and the ROFO notice will include any material terms and conditions as would be reasonably necessary for us to make a responsive offer to enter into the proposed transaction. We will have 15 days following the receipt of the ROFO notice to propose an offer to acquire the ROFO asset from our sponsor (a “ROFO response”), which proposal will include the terms on which we would be willing to enter into a binding agreement to acquire the assets. If we do not deliver a ROFO response within such 15-day period, then we will be deemed to have waived our right of first offer with respect to the ROFO asset in question, and our sponsor will be free to transfer the ROFO asset to any third party on terms and conditions determined in the sole discretion of our sponsor.

If we do submit a ROFO response, then we and our sponsor will be obligated to negotiate, in good faith, the terms of the purchase and sale of the ROFO asset for 10 days following our delivery of the ROFO response. If we are unable to reach a definitive agreement during such 10-day period, then our sponsor may transfer the ROFO asset to any third party on terms and conditions determined in the sole discretion of our sponsor.

Our sponsor and its affiliates are not restricted, under either our partnership agreement or the omnibus agreement, from competing with us. In particular, our sponsor’s Augusta facility competes with us for new and existing frac sand customers. Our sponsor may, except with respect to the right of first offer described above, acquire or dispose of frac sand reserves and processing facilities or other assets in the future without any obligation to offer us the opportunity to purchase those assets.

Assignment of Augusta Contracts

We have assigned all rights and obligations under certain of our contracts to the extent they relate to the Augusta facility to our sponsor. Pursuant to the terms of certain of these assigned contracts, such assignment will not relieve us of any liability under the contract, but our sponsor has agreed to fully and unconditionally indemnify us in connection with any loses we incur with regard to the assigned contracts from and after the date of the assignment.

Because of our indemnification rights, we will effectively have no rights, obligations or liability under the assigned contracts relating to the Augusta facility.

Registration Rights Agreement

In connection with our IPO on August 16, 2012, we entered into a registration rights agreement with our sponsor, pursuant to which we may be required to register the sale of the (i) common units issued (or issuable) to our sponsor pursuant to the contribution agreement, (ii) subordinated units and (iii) common units issuable upon conversion of the subordinated units or the Combined Interests (as defined in our partnership agreement) pursuant to the terms of the partnership agreement (together, the “Registrable Securities”) it holds. Under the registration rights agreement, our sponsor will have the right to request that we register the sale of Registrable Securities held by it, and our sponsor will have the right to require us to make available shelf registration statements permitting sales of Registrable Securities into the market from time to time over an extended period, subject to certain limitations. The registration rights agreement also includes provisions dealing with indemnification and contribution and allocation of expenses. All of our Registrable Securities held by our sponsor and any permitted transferee will be entitled to these registration rights.

Agreements with Affiliates in Connection with our Acquisition of a Preferred Interest in Augusta

Contribution Agreement

On January 31, 2013, we entered into a contribution agreement that affected the transactions, including the acquisition by us of a preferred interest in Hi-Crush Augusta LLC in exchange for the issuance by us to our sponsor of 3,750,000 Class B Units representing limited partner interests in the Partnership and $37,500 in cash. While we believe this agreement is on terms no less favorable to any party than those that could have been negotiated with an unaffiliated third party, it was not the result of arm’s-length negotiations.

Amendment to Omnibus Agreement

Our sponsor has waived an existing right to require that the Partnership assign to the sponsor a long-term customer contract for sand produced by the Partnership’s Wyeville facility. This contract was initially scheduled to be assigned from the Wyeville facility to the Augusta facility on May 1, 2013, but will remain at Wyeville for the duration of the contract.

97

Amendment to Registration Rights Agreement

In connection with our acquisition of a preferred interest in the Augusta facility, the definition of “Registrable Securities” set forth in the registration rights agreement was amended to incorporate common units representing limited partner interests issuable upon conversion of the Class B Units issued pursuant to the contribution agreement, dated January 31, 2013.

Other Transactions with Related Persons

Effective August 16, 2012, in connection with our IPO and our sponsor’s contribution of the Wyeville facility and operations, we entered into the Services Agreement with Hi-Crush Services, pursuant to which Hi-Crush Services provides certain management and administrative services to our general partner in connection with operating our business. Under this agreement, we reimburse Hi-Crush Services, on a monthly basis, for the allocable expenses that it incurs in its performance of the specified services. These expenses include, among other things, salary, bonus, incentive compensation, rent and other administrative expenses for individuals and entities that perform services for us or on our behalf. In addition, effective August 16, 2012, we entered into an agreement with our sponsor, pursuant to which the sponsor provides maintenance and capital spares to us in connection with the ongoing maintenance of our Wyeville facility. Our sponsor bills us for the approximate cost of such items. During the year ended December 31, 2013 and the period from August 16 through December 31, 2012, we incurred $3,698 and $1,028, respectively, of management service expenses from Hi-Crush Services under the Services Agreement.

In the normal course of business, our sponsor and its affiliates, including Hi-Crush Services, and the Partnership may from time to time make payments on behalf of each other. During the period from August 16 through December 31, 2012, we made payments of $9,866 to various suppliers, vendors or other counterparties on behalf of our sponsor. This balance was offset by $1,028 of management fees charged by our sponsor and $3,223 of net payments made by our sponsor on our behalf. The balance of $5,615 was maintained as a current asset under the caption “Due from sponsor”, and was repaid by our sponsor in February 2013. During the year ended December 31, 2013, we maintained a current liability under the caption “Due to sponsor” of $2,571, which represented outstanding management fees, sand purchases and other net payments payable to our sponsor.

On May 25, 2011, our sponsor entered into a management services agreement with Red Oak Capital Management LLC (the “Service Provider”) which is owned by two members who are also equity members in our sponsor. The agreement provides for certain management and administrative support services to be provided to our sponsor for a term of one year and that thereafter remains in place upon the same terms and conditions. Either party may terminate the agreement by delivering written notice within 90 days prior to the date of expiration of the initial term or any time after the expiration of the initial term, by delivering written notice 90 days prior to the desired date of termination. Our sponsor reimburses the Service Provider 95% of the Service Provider’s actual costs limited to $850 per year. These fees are included in general and administrative expenses. Total management fees under this agreement were $318 and $370 for the period from January 1 to August 15, 2012 and the year ended December 31, 2011, respectively. The management fee was $140 for the period from August 16 to December 31, 2012. Management fees incurred during the year ended December 31, 2013 are included as a portion of the management services expense from Hi-Crush Services.

Through August 15, 2012, our sponsor paid quarterly director fees to non-management directors that may be members and/or holders of our sponsor’s debt through the date of the IPO. Total director fees were $62 and $60 for the period from January 1 to August 15, 2012 and the year ended December 31, 2011, respectively.

Between May 25, 2011 and July 20, 2012, our sponsor entered into various subordinated promissory notes with certain of its equity investors and their affiliates in an aggregate initial principal amount of $52,167. Borrowings under the subordinated promissory notes bore interest, at the sponsor’s option, at a rate of 10% for cash interest and 12% for paid-in-kind interest (“PIK interest”). Accruals for PIK interest increased the outstanding principal balance of these promissory notes. The balances of the PIK interest and subordinated promissory notes were paid in full on August 21, 2012 with the proceeds of the sale of the common units by our sponsor. At December 31, 2011, there was $46,112 outstanding under the sponsor’s subordinated promissory notes, including $2,421 of PIK interest.

In order to fund a royalty termination payment, the sponsor entered into new subordinated promissory notes in July 2012 with certain of its equity investors and their affiliates in an aggregate initial principal amount of $14,981. Consistent with its existing subordinated promissory notes, borrowings under the new subordinated promissory notes bore interest, at the sponsor’s option, at a rate of 10% for cash interest and 12% for PIK interest. The balances of the PIK interest and subordinated promissory notes, as retained by the sponsor, were paid in full by the sponsor on August 21, 2012 with the proceeds of the sale of the common units by our sponsor.

During the year ended December 31, 2013, we purchased $4,402 of sand from Hi-Crush Augusta LLC.

Procedures for Review, Approval and Ratification of Transactions with Related Persons

The board of directors of our general partner has adopted policies for the review, approval and ratification of transactions with related persons and a written Code of Business Conduct and Ethics. Under our code of business conduct and ethics, a director is

98

required to bring to the attention of the chief executive officer(s) or the board any conflict or potential conflict of interest that may arise between the director or any affiliate of the director, on the one hand, and us or our general partner on the other. The resolution of any such conflict or potential conflict should, at the discretion of the board in light of the circumstances, be determined by a majority of the disinterested directors. In determining whether to approve or ratify a transaction with a related party, the board of directors of our general partner will take into account, among other factors it deems appropriate, (1) whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances, (2) the extent of the related person’s interest in the transaction and (3) whether the interested transaction is material to the Partnership. Our partnership agreement contains detailed provisions regarding the resolution of conflicts of interest, as well as the standard of care the board of directors of our general partner must satisfy in doing so.

If a conflict or potential conflict of interest arises between our general partner or its affiliates, on the one hand, and us or our unitholders, on the other hand, the resolution of any such conflict or potential conflict will be addressed by the board of directors of our general partner in accordance with the provisions of our partnership agreement. Such a conflict of interest may arise, for example, in connection with negotiating and approving the acquisition of any assets from our sponsor, including in connection with our right of first offer under the omnibus agreement. At the discretion of the board in light of the circumstances, the resolution may be determined by the board in its entirety or by the conflicts committee meeting the definitional requirements for such a committee under our partnership agreement. We do not expect that our code of business conduct and ethics or any policies that the board of directors of our general partner will adopt will require the approval of any transactions with related persons, including our sponsor, by our unitholders.

We expect to have the opportunity to acquire additional assets from our sponsor in the future, including in connection with our right of first offer provided in the omnibus agreement. Our sponsor or other affiliates of our general partner are free to offer properties to us on terms they deem acceptable. Under our code of business conduct and ethics, the board of directors of our general partner (or the conflicts committee, if the board of directors delegates the necessary authority to the conflicts committee) will be free to accept or reject any such offers and to negotiate any terms it deems acceptable to us and that the board of directors of our general partner or the conflicts committee will decide the appropriate value of any assets offered to us by affiliates of our general partner. In making such determination of value, the board of directors of our general partner or the conflicts committee are permitted to consider any factors they determine in good faith to consider. The board of directors or the conflicts committee will consider a number of factors in its determination of value, including, without limitation, operating data, reserve information, operating cost structure, current and projected cash flow, financing costs, the anticipated impact on distributions to our unitholders, the price outlook for frac sand, reserve life and the location and quality of the reserves.

Based on our code of business conduct and ethics, any executive officer is required to avoid conflicts of interest unless approved by the board of directors of our general partner.

In the case of any sale of equity by us in which an owner or affiliate of an owner of our general partner participates, our practice is to obtain approval of the board for the transaction. The board will typically delegate authority to set the specific terms to a pricing committee, consisting of one of the co-chief executive officers and one independent director. Actions by the pricing committee require unanimous approval.

99

ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES

Our general partner is responsible for the Partnership’s internal controls and the financial reporting process. The independent registered public accounting firm, PricewaterhouseCoopers LLP (“PwC”), is responsible for performing independent audits of the Partnership’s consolidated financial statements and issuing an opinion on the conformity of those audited financial statements with United States generally accepted accounting principles. The audit committee monitors the Partnership’s financial reporting process and reports to the board of directors of our general partner on its findings.

Prior to us becoming a public company, in 2012 our sponsor selected and engaged PwC as its independent registered public accounting firm to audit the consolidated financial statements of our sponsor for the fiscal years ending December 31, 2011 and 2010. The audit committee of the board of directors of our general partner selected and engaged PwC to audit our consolidated financial statements for the years ended December 31, 2013 and 2012.

In connection with our IPO and the formation of our audit committee, the board of directors of our general partner adopted a policy for pre-approving the services and associated fees of the our independent registered public accounting firm. Under this policy, the audit committee must pre-approve all services and associated fees provided to us by its independent registered public accounting firm, with certain exceptions described in the policy.

All PwC services and fees in each of the three years ended December 31, 2013 were pre-approved by our sponsor or the board of directors of our general partner, as applicable.

The following table presents fees billed or expected to be billed for professional audit services and other services rendered to the Partnership by PwC for the periods ended December 31, 2013, 2012 and 2011 (in thousands).

	Year Ended December 31, 2013		Period From August  16 Through December 31, 2012		Period From January 1 Through August 15, 2012		Year Ended December 31, 2011
	Successor		Successor		Predecessor		Predecessor
Audit Fees	$	504	$	401	$	231	$	70
All Other Fees (1)	127		144		131		8
Audit-Related Fees (2)	—		78		167		—
Tax Fees (3)	262		—		62		—
Total Fees paid to PwC	$	893	$	623	$	591	$	78
(1) Represents fees related to tax compliance and consulting
(2) Represents fees related to offering documents
(3) Represents fees related to tax return preparation

The audit committee has established procedures for engagement of PwC to perform services other than audit, review and attest services. In order to safeguard the independence of PwC, for each engagement to perform such non-audit service, (a) management and PwC affirm to the audit committee that the proposed non-audit service is not prohibited by applicable laws, rules or regulations; (b) management describes the reasons for hiring PwC to perform the services; and (c) PwC affirms to the audit committee that it is qualified to perform the services. The audit committee has delegated to its chair its authority to pre-approve such services in limited circumstances, and any such pre-approvals are reported to the audit committee at its next regular meeting. All services provided by PwC in 2013 were audit-related or tax and are permissible under applicable laws, rules and regulations and were pre-approved by the board of directors of our general partner in accordance with its procedures. In 2013, the board of directors of our general partner considered the amount of non-audit services provided by PwC in assessing its independence.

100

PART IV

101

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)(1) Financial Statements

Our Consolidated and Pro Forma Financial Statements are included under Part II, Item 8 of this Annual Report on Form 10-K. For a listing of these statements and accompanying footnotes, please read “Index to Financial Statements” on page F-1 of this Annual Report.

(a)(2) Financial Statement Schedules

All schedules have been omitted because they are either not applicable, not required or the information called for therein appears in the consolidated financial statements or notes thereto.

(a)(3) Exhibits

The following documents are filed as a part of this Annual Report on Form 10-K or incorporated by reference:

102

Exhibit  Number	Description
2.1***	Membership Interest Purchase Agreement, dated May 13, 2013, by and among the Partnership, the members of D & I Silica, LLC, and their respective owners (incorporated by reference to Exhibit 1.01 to the Registrant’s Current Report on Form 8-K, filed with the SEC on May 16, 2013).
3.1	Certificate of Limited Partnership of Hi-Crush Partners LP (incorporated by reference to Exhibit 3.1 to the Registrant's Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
3.2	Second Amended and Restated Agreement of Limited Partnership of Hi-Crush Partners LP, dated January 31, 2013 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on February 5, 2013).
4.1	Registration Rights Agreement by and between Hi-Crush Partners LP and Hi-Crush Proppants LLC dated August 20, 2012 (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on August 21, 2012).
4.2	First Amendment to Registration Rights Agreement by and between Hi-Crush Partners LP and Hi-Crush Proppants LLC, dated January 31, 2013 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on February 5, 2013).
10.1	Credit Agreement, dated August 21, 2012, among Hi-Crush Partners LP, Amegy Bank National Association and the lenders named therein (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed with the SEC on November 11, 2012).
10.2	Consent and First Amendment, dated January 31, 2013 among Hi-Crush Partners LP, Amegy Bank National Association and the lenders named therein (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K, filed with the SEC on February 5, 2013).
10.3	Commitment Increase Agreement and Second Amendment, dated May 9, 2013, by and among the Partnership, the lenders party thereto and Amegy Bank, N.A., as administrative agent for the lenders (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on May 15, 2013).
10.4	Management Services Agreement dated effective August 16, 2012, among Hi-Crush Partners LP, Hi-Crush GP LLC and Hi-Crush Services LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed with the SEC on November 11, 2012).
10.5	Maintenance and Capital Spare Parts Agreement dated effective August 16, 2012, among Hi-Crush Partners LP, Hi-Crush GP LLC and Hi-Crush Proppants LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, filed with the SEC on November 11, 2012).
10.6	Contribution, Assignment and Assumption Agreement by and among Hi-Crush Partners LP, Hi-Crush GP LLC and Hi-Crush Proppants LLC, dated August 15, 2012 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on August 21, 2012).
10.7	Contribution Agreement by and among Hi-Crush Partners LP, Hi-Crush Augusta LLC and Hi-Crush Proppants LLC, dated January 31, 2013 (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on February 5, 2013).
10.8	Omnibus Agreement by and among Hi-Crush Partners LP, Hi-Crush GP LLC and Hi-Crush Proppants LLC, dated August 20, 2012 (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed with the SEC on August 21, 2012).
10.9	First Amendment to Omnibus Agreement, among Hi-Crush Partners LP, Hi-Crush GP LLC and Hi-Crush Proppants LLC, dated January 31, 2013 (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed with the SEC on February 5, 2013).
10.10†	Hi-Crush Partners LP Long-Term Incentive Plan, adopted as of August 15, 2012 (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed with the SEC on August 21, 2012).
10.11†	Employment Agreement, dated May 25, 2011, between Hi-Crush Proppants LLC and Robert E. Rasmus (incorporated by reference to Exhibit 10.14 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
10.12†	Employment Agreement, dated May 25, 2011, between Hi-Crush Proppants LLC and James M. Whipkey (incorporated by reference to Exhibit 10.15 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
10.13†	Employment Agreement, dated May 25, 2011, between Hi-Crush Proppants LLC and Jefferies V. Alston, III (incorporated by reference to Exhibit 10.16 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
10.14†	Letter Agreement, dated July 13, 2012, between Hi-Crush Proppants LLC and Robert E. Rasmus (incorporated by reference to Exhibit 10.19 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 25, 2012).

103

Exhibit Number	Description
10.15†	Letter Agreement, dated July 13, 2012, between Hi-Crush Proppants LLC and James M. Whipkey (incorporated by reference to Exhibit 10.20 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 25, 2012).
10.16†	Letter Agreement, dated July 13, 2012, between Hi-Crush Proppants LLC and Jefferies V. Alston, III (incorporated by reference to Exhibit 10.21 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 25, 2012).
10.17	Management Services Agreement, dated May 25, 2011 between Red Oak Capital Management LLC and Hi-Crush Proppants LLC (incorporated by reference to Exhibit 10.18 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 25, 2012).
10.18+	Supply Agreement, effective as of January 11, 2011, between Weatherford Artificial Lift Systems, Inc. and Hi-Crush Operating LLC (incorporated by reference to Exhibit 10.5 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
10.19+	Supply Agreement, effective as of May 24, 2011, between Halliburton Energy Services, Inc. and Hi-Crush Operating LLC (incorporated by reference to Exhibit 10.6 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
10.20+	First Amendment to Supply Agreement, effective as of November 23, 2011, between Halliburton Energy Services, Inc. and Hi-Crush Operating LLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
10.21+	Second Amendment to Supply Agreement, effective as of April 1, 2013, between Halliburton Energy Services, Inc. and Hi-Crush Operating LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, filed with the SEC on August 14, 2013).
10.22*	Amended and Restated Supply Agreement, effective as of January 1, 2014, between Baker Hughes Oilfield Operations, Inc. and Hi-Crush Operating LLC.
10.23+	Supply Agreement, effective as of May 1, 2012, between FTS International Services, LLC and Hi-Crush Operating LLC (incorporated by reference to Exhibit 10.10 to the Registrant’s Registration Statement on Form S-1, Registration No. 333-182574, filed with the SEC on July 9, 2012).
21.1	List of Subsidiaries of Hi-Crush Partners LP
23.1	Consent of PricewaterhouseCoopers LLP
23.2	Consent of John T. Boyd Company
23.3	Consent of PropTester, Inc.
23.4	Consent of Stim-Lab, Inc.
23.5	Consent of The Freedonia Group, Inc.
31.1	Certification pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 signed by the Principal Executive Officer, filed herewith.
31.2	Certification pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 signed by the Principal Executive Officer, filed herewith.
31.3	Certification pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 signed by the Principal Financial Officer, filed herewith.
32.1	Statement Required by 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 signed by Principal Executive Officer, filed herewith. (1)
32.2	Statement Required by 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 signed by Principal Executive Officer, filed herewith. (1)
32.3	Statement Required by 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 signed by Principal Financial Officer, filed herewith. (1)
95.1	Mine Safety Disclosure Exhibit
101	Interactive Data Files- XBRL

(1) This document is being furnished in accordance with SEC Release Nos. 33-8212 and 34-47551.

† Compensatory plan or arrangement.

+    Confidential treatment has been granted with respect to portions of this exhibit.

*    Parts of the exhibit have been omitted pursuant to a request for confidential treatment.

***    Pursuant to Item 601(b)(2) of Regulation S-K, the Partnership agrees to furnish supplementally a copy of any omitted exhibit or schedule to the SEC upon request.

104

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized, on this 28^th day of February, 2014.

HI-CRUSH PARTNERS LP
By:	Hi-Crush GP LLC, its general partner
By:	/s/ Laura C. Fulton
	Laura C. Fulton Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated below

Hi-Crush Partners LP (Registrant)

By: Hi-Crush GP LLC, its general partner

Name	Capacity	Date
/s/ Robert E. Rasmus	Co-Chief Executive Officer and Director (Principal Executive Officer)	February 28, 2014
Robert E. Rasmus
/s/ James M. Whipkey	Co-Chief Executive Officer and Director (Principal Executive Officer)	February 28, 2014
James M. Whipkey
/s/ Laura C. Fulton	Chief Financial Officer (Principal Financial and Accounting Officer)	February 28, 2014
Laura C. Fulton
/s/ John F. Affleck-Graves	Director	February 28, 2014
John F. Affleck-Graves
/s/ Jefferies V. Alston, III	Director	February 28, 2014
Jefferies V. Alston, III
/s/ Gregory F. Evans	Director	February 28, 2014
Gregory F. Evans
/s/ John R. Huff	Director	February 28, 2014
John R. Huff
/s/ John Kevin Poorman	Director	February 28, 2014
John Kevin Poorman
/s/ Trevor M. Turbidy	Director	February 28, 2014
Trevor M. Turbidy
/s/ Steven A. Webster	Director	February 28, 2014
Steven A. Webster
/s/ Joseph C. Winkler III	Director	February 28, 2014
Joseph C. Winkler III

105

INDEX TO FINANCIAL STATEMENTS

Reports of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets as of December 31, 2013 and 2012	F-4
Consolidated Statements of Operations for the years ended December 31, 2013; 2012; and 2011	F-5
Consolidated Statements of Cash Flows for the years ended December 31, 2013; 2012; and 2011	F-6
Consolidated Statements of Successor Partners’ Capital for the period from May 8, 2012 (inception) to December 31, 2013	F-8
Consolidated Statements of Predecessor Members’ Capital for the period from October 28, 2010 (inception) to August 15, 2012	F-9
Notes to Consolidated Financial Statements	F-10

F-1

HI-CRUSH PARTNERS LP

Report of Independent Registered Public Accounting Firm

To the Board of Directors of Hi-Crush GP LLC and Unitholders of Hi-Crush Partners LP:

In our opinion, the accompanying consolidated balance sheets as of December 31, 2013 and 2012 and the related consolidated statements of operations, partners’ capital and cash flows for the year ended December 31, 2013 and the period from August 16, 2012 through December 31, 2012 present fairly, in all material respects, the financial position of Hi-Crush Partners LP and its subsidiaries (Successor) at December 31, 2013 and 2012 and the results of their operations and their cash flows for the year ended December 31, 2013 and the period from August 16, 2012 through December 31, 2012 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Houston, Texas

February 28, 2014

F-2

HI-CRUSH PARTNERS LP

Report of Independent Registered Public Accounting Firm

To the Board of Directors of Hi-Crush GP LLC and Unitholders of Hi-Crush Partners LP:

In our opinion, the consolidated statements of operations, members’ capital and cash flows for the period from January 1, 2012 through August 15, 2012 and the year ended December 31, 2011 present fairly, in all material respects, the results of operations and cash flows of Hi-Crush Proppants LLC and its subsidiaries (Predecessor) for the period from January 1, 2012 through August 15, 2012 and the year ended December 31, 2011 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Houston, Texas

March 13, 2013

F-3

HI-CRUSH PARTNERS LP

Consolidated Balance Sheets

(In thousands, except unit amounts)

	December 31, 2013		December 31, 2012
	Successor		Successor
Assets
Current assets:
Cash	$	16,047	$	10,498
Restricted cash	690		—
Accounts receivable, net	31,581		8,199
Inventories	16,265		3,541
Due from sponsor	—		5,615
Prepaid expenses and other current assets	1,432		393
Total current assets	66,015		28,246
Property, plant and equipment, net	113,342		72,844
Goodwill and intangible assets, net	71,936		—
Preferred interest in Hi-Crush Augusta, LLC	47,043		—
Other assets	3,808		1,095
Total assets	$	302,144	$	102,185
Liabilities and Partners’ Capital
Current liabilities:
Accounts payable	$	8,306	$	1,977
Accrued and other current liabilities	4,375		1,755
Due to sponsor	2,571		—
Deferred revenue	—		1,715
Total current liabilities	15,252		5,447
Long-term debt	138,250		—
Asset retirement obligation	1,673		1,555
Total liabilities	155,175		7,002
Commitments and contingencies	—		—
Partners’ capital:
General partner interest	—		—
Limited partner interest, 28,865,171 and 27,280,702 units outstanding, respectively	137,426		95,183
Class B units, 3,750,000 and zero units outstanding, respectively	9,543		—
Total partners’ capital	146,969		95,183
Total liabilities and partners’ capital	$	302,144	$	102,185

See Notes to Consolidated Financial Statements.

F-4

HI-CRUSH PARTNERS LP

Consolidated Statements of Operations

(In thousands, except unit and per unit amounts)

	For the Year Ended December 31, 2013			Period From August 16 Through December 31, 2012			Period From January 1 Through August 15, 2012			For the Year Ended December 31, 2011
	Successor			Successor			Predecessor			Predecessor
Revenues	$	141,742		$	28,858		$	46,776		$	20,353
Cost of goods sold (including depreciation, depletion and amortization)	74,539			7,145			13,336			6,447
Gross profit	67,203			21,713			33,440			13,906
Operating costs and expenses:
General and administrative expenses	16,205			2,795			4,631			2,324
Exploration expense	47			91			539			381
Accretion of asset retirement obligation	117			56			16			28
Income from operations	50,834			18,771			28,254			11,173
Other income (expense):
Income from preferred interest in Hi-Crush Augusta LLC	11,250			—			—			—
Other income	—			—			6			—
Interest expense	(3,522		)	(263		)	(3,240		)	(1,893		)
Net income	$	58,562		$	18,508		$	25,020		$	9,280
Earnings per unit:
Common units	$	2.08		$	0.68
Subordinated units	$	2.08		$	0.68
Limited Partner Units Outstanding:
Common units	14,527,914			13,640,351
Subordinated units	13,640,351			13,640,351

See Notes to Consolidated Financial Statements.

F-5

HI-CRUSH PARTNERS LP

Consolidated Statements of Cash Flows

(In thousands)

	Year Ended December 31, 2013			Period From August 16 Through December 31, 2012			Period From January 1 Through August 15, 2012			Year Ended December 31,  2011
	Successor			Successor			Predecessor			Predecessor
Operating activities:
Net income	$	58,562		$	18,508		$	25,020		$	9,280
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and depletion	3,399			863			1,089			449
Amortization of intangible assets	3,687			—			—			—
Amortization of deferred charges into interest expense	463			105			364			154
Accretion of asset retirement obligation	117			56			16			28
Loss on replacement of equipment	191			—			—			—
Unit based compensation to independent directors	100			—			—			—
Income from restricted cash	(2		)	—			—			—
Interest expense converted into principal	—			—			3,083			2,421
Changes in operating assets and liabilities:
Accounts receivable	(5,474		)	4,254			(8,698		)	(4,026		)
Prepaid expenses and other current assets	(230		)	(368		)	(4,549		)	(294		)
Inventories	(2,295		)	362			(2,052		)	(2,374		)
Other assets	(2,234		)	—			—			—
Accounts payable	(3,959		)	(375		)	2,814			3,156
Accrued liabilities and other current liabilities	1,824			(145		)	2,161			816
Due to sponsor	2,571			—			—			—
Deferred revenue	(1,715		)	(4,876		)	(2,588		)	9,178
Net cash provided by operating activities	55,005			18,384			16,660			18,788
Investing activities:
Cash paid for acquisition of preferred interest in Hi-Crush Augusta LLC	(37,500		)	—			—			—
Cash paid for acquisition of D&I Silica LLC, net of cash acquired	(94,955		)	—			—			—
Capital expenditures for property, plant and equipment	(6,260		)	(2,239		)	(80,075		)	(50,169		)
(Increase) decrease in restricted cash	—			—			30			(30		)
Net cash used in investing activities	(138,715		)	(2,239		)	(80,045		)	(50,199		)
Financing activities:
Proceeds from issuance of long-term debt	138,250			—			63,985			48,692
Repayment of long-term debt	—			—			(1,250		)	(5,000		)
Affiliate financing, net	5,615			(5,615		)	—			—
Loan origination costs	(829		)	(143		)	(1,462		)	(1,924		)
Distributions paid	(53,777		)	(6,479		)	(225		)	—
Contributions received	—			4,606			—			697
Net cash provided by (used in) financing activities	89,259			(7,631		)	61,048			42,465
Net increase (decrease) in cash	5,549			8,514			(2,337		)	11,054
Cash:
Beginning of period	10,498			1,984			11,054			—
End of period	$	16,047		$	10,498		$	8,717		$	11,054

F-6

Non-cash investing and financing activities:
Increase (decrease) in accounts payable and accrued liabilities for additions to property, plant and equipment	$	(1,358	)	$	1,012		$	9,345	$	1,544
Transferred basis of preferred interest in Hi-Crush Augusta LLC	9,543			—			—		—
Issuance of common units for acquisition of D&I Silica, LLC	37,538			—			—		—
Increase (decrease) in accounts payable for loan origination costs	—			(56		)	1,238		—
Non-cash component of capital contribution by sponsor to the Partnership	—			81,170			—		—
Non-cash transfer of other assets and deferred charges to property, plant and equipment	—			—			—		277
Distribution to a related party	—			—			—		(400		)
Contribution from an affiliate	—			—			—		400
Increase in property, plant and equipment for asset retirement obligation	—			—			—		804
Cash paid for interest, net of amount capitalized	$	2,974		$	63		$	90	$	—

See Notes to Consolidated Financial Statements.

F-7

HI-CRUSH PARTNERS LP

Successor Consolidated Statements of Partners’ Capital

(In thousands)

	General Partner Capital		Sponsor Class B Units			Limited Partners
						Public Common Unit Capital			Sponsor Common Unit Capital			Sponsor Subordinated Unit Capital			Total Limited Partner  Capital			Total Partner Capital
Balance at May 8, 2012 (Inception)	$	—	$	—		$	—		$	—		$	—		$	—		$	—
Contribution of net assets on August 16, 2012	—		—			39,435			2,142			41,577			83,154			83,154
Net income from August 16, 2012 to December 31, 2012	—		—			8,777			477			9,254			18,508			18,508
Cash distributions	—		—			(3,073		)	(166		)	(3,240		)	(6,479		)	(6,479		)
Balance at December 31, 2012	—		—			45,139			2,453			47,591			95,183			95,183
Issuance of 5,522 common units to independent directors	—		—			100			—			—			100			100
Issuance of Class B units in acquisition of preferred interest in Hi-Crush Augusta LLC	—		57,900			—			—			—			—			57,900
Issuance of 1,578,947 common units in acquisition of D&I Silica, LLC	—		—			37,358			—			—			37,358			37,358
Deemed distribution	—		(48,357		)	—			—			—			—			(48,357		)
Cash distributions	—		—			(26,310		)	(1,346		)	(26,121		)	(53,777		)	(53,777		)
Net income	—		—			28,989			1,339			28,234			58,562			58,562
Secondary offering of units by sponsor	—		—			2,446			(2,446		)	—			—			—
Balance at December 31, 2013	$	—	$	9,543		$	87,722		$	—		$	49,704		$	137,426		$	146,969

See Notes to Consolidated Financial Statements

F-8

HI-CRUSH PARTNERS LP

Predecessor Consolidated Statements of Members’ Capital

(In thousands)

	Members’ Equity			Accumulated Earnings			Total Members’ Capital
Balance at January 1, 2011	336			(26		)	310
Distributions	(400		)	—			(400		)
Contributions	1,097			—			1,097
Net income	—			9,280			9,280
Balance at December 31, 2011	1,033			9,254			10,287
Net income	—			25,020			25,020
Cash distributions	(225		)	—			(225		)
Balance at August 15, 2012	$	808		$	34,274		$	35,082

See Notes to Consolidated Financial Statements

F-9

HI-CRUSH PARTNERS LP

Notes to Consolidated Financial Statements

(Dollars in thousands, except per ton and per unit amounts, or where otherwise noted)

F-10

1. Business and Organization

Hi-Crush Partners LP (together with its subsidiaries, the “Partnership”) is a Delaware limited partnership formed on May 8, 2012 to acquire selected sand reserves and related processing and transportation facilities of Hi-Crush Proppants LLC. The Partnership is engaged in the excavation and processing of raw frac sand for use in hydraulic fracturing operations for oil and natural gas wells. In connection with its formation, the Partnership issued (a) a non-economic general partner interest to Hi-Crush GP LLC (the “General Partner”), and (b) a 100.0% limited partner interest to Hi-Crush Proppants LLC (the “sponsor”), its organizational limited partner.

Through August 15, 2012, Hi-Crush Proppants LLC owned 100% of the sand reserves and related excavation and processing facilities located in Wyeville, Wisconsin (“Wyeville Plant”). On August 16, 2012, the sponsor contributed its ownership of Hi-Crush Chambers LLC, Hi-Crush Railroad LLC, Hi-Crush Wyeville LLC, Hi-Crush Operating LLC and $4,606 of cash to the Partnership (the “Contribution”). In addition, the sponsor agreed to (1) convert all $23,916 of consolidated net intercompany receivables due from the Partnership into capital and (2) assume via capital contribution $10,028 of outstanding accounts payable maintained by Hi-Crush Operating LLC as of the transaction date. In return, the Partnership issued 13,640,351 common units and 13,640,351 subordinated units to the sponsor. In connection with this transaction, the Partnership also completed an initial public offering through the sale of 12,937,500 of the common units by the sponsor.

The Partnership considers all contributed assets to be under common control with Hi-Crush Proppants LLC. As such, we are presenting the consolidated historical financial statements of Hi-Crush Proppants LLC as our historical financial statements as we believe they provide a representation of our management’s ability to execute and manage our business plan. The financial statement data and operations of Hi-Crush Proppants LLC are referred to herein as “Predecessor,” whereas operations following the IPO transaction on August 16, 2012 are referred to herein as “Successor”.

On January 31, 2013, the Partnership entered into an agreement with the sponsor to acquire an interest in Hi-Crush Augusta LLC, the entity that owns the sponsor’s Augusta raw frac sand processing facility, for $37,500 in cash and 3.75 million of newly issued convertible Class B units in the Partnership. The sponsor will not receive distributions on the Class B units unless certain thresholds are met and until they convert into common units. The preferred interest in Augusta entitles the Partnership to a preferred distribution of $3,750 per quarter, or $15,000 annually.

On June 10, 2013, the Partnership acquired an independent frac sand supplier, D & I Silica, LLC (“D&I”), transforming the Partnership into an integrated Northern White frac sand producer, transporter, marketer and distributor. The Partnership acquired D&I for $95,159 in cash and 1,578,947 common units (See Note 5 – Business Combination – Acquisition Accounting). Founded in 2006, D&I is the largest independent frac sand supplier to the oil and gas industry drilling in the Marcellus and Utica shales. D&I operates through an extensive logistics network of rail-served origin and destination terminals located in the Midwest near supply sources and strategically throughout Pennsylvania, Ohio and New York.

F-11

2. Basis of Presentation

The consolidated financial statements through August 15, 2012 include the consolidated results of operations and cash flows, as well as the financial position of the sponsor (the "Predecessor"). In early 2011, the sponsor acquired land in Monroe County, Wisconsin for the purpose of excavating sand for sale into the oil and natural gas markets. In June 2011, the sponsor completed its construction of the Wyeville Plant in order to process sand excavated from the Monroe County, Wisconsin site, with its first shipments occurring on July 21, 2011.

The consolidated financial statements from August 16, 2012 through December 31, 2013 include the consolidated results of operations and cash flows of the Partnership (the "Successor"). The consolidated financial statements include results of operations and cash flows for D&I prospectively from June 11, 2013. The balance sheet as of December 31, 2013 includes only the financial position of the Partnership, including the retained earnings of the Partnership’s operations from August 16, 2012 through December 31, 2013.

F-12

3. Significant Accounting Policies

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The more significant estimates relate to our estimates and assumptions for our mineral reserves and its impact on calculating our depreciation and depletion expense under the units-of-production depreciation method, assessing potential impairment of long-lived assets, estimating potential loss contingencies and estimated cost of future asset retirement obligations. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist of all cash balances and highly liquid investments with an original maturity of three months or less.

Restricted Cash

The Partnership must pledge cash escrow accounts for the benefit of the Pennsylvania Department of Transportation, Bureau of Rail Freight, Ports and Waterways (“Bureau”) to guarantee performance on rail improvement projects partially funded by the Bureau. The funds are released when the project is completed.

Accounts Receivable

Trade receivables relate to sales of raw frac sand and related services for which credit is extended based on the customer’s credit history and are recorded at the invoiced amount and do not bear interest. The Partnership regularly reviews the collectability of accounts receivable. When it is probable that all or part of an outstanding balance will not be collected, the Partnership establishes or adjusts an allowance as necessary using the specific identification method. Account balances are charged against the allowance after all means of collection have been exhausted and potential recovery is considered remote.

Deferred Charges

Certain direct costs incurred in connection with debt financing have been capitalized and are being amortized using the straight-line method, which approximates the effective interest method, over the life of the debt. Amortization expense is included in interest expense and was $463 for the year ended December 31, 2013, $105 for the period from August 16, 2012 to December 31, 2013, $364 for the period from January 1, 2012 to August 15, 2012 and $154 for the year ended December 31, 2011.

The following is a summary of future amortization expense associated with deferred charges:

For the years ending December 31,
2014	$	533
2015	533
2016	401
Total	$	1,467

Inventories

Sand inventory is stated at the lower of cost or market using the average cost method.

Inventory manufactured at our plant facilities includes direct excavation costs, processing costs, overhead allocation, depreciation and depletion. Stockpile tonnages are calculated by measuring the number of tons added and removed from the stockpile. Tonnages are verified periodically by an independent surveyor. Costs are calculated on a per ton basis and are applied to the stockpile based on the number of tons in the stockpile.

Inventory transported for sale at our terminal facility includes the cost of purchased or manufactured sand, plus transportation related charges.

Spare parts inventory includes critical spares, materials and supplies. We account for spare parts on a first-in, first-out basis, and value the inventory at the lower of cost or market. Detail reviews are performed related to the net realizable value of the spare parts inventory, giving consideration to quality, excessive levels, obsolescence and other factors.

Property, Plant and Equipment

Additions and improvements occurring through the normal course of business are capitalized at cost. When assets are retired or disposed of, the cost and the accumulated depreciation and depletion are eliminated from the accounts and any gain or loss is

F-13

reflected in the income statement. Expenditures for normal repairs and maintenance are expensed as incurred. Construction-in-progress is primarily comprised of machinery and equipment which has not been placed in service.

Mine development costs include engineering, mineralogical studies, drilling and other related costs to develop the mine, the removal of overburden to initially expose the mineral and building access ways. Exploration costs are expensed as incurred and classified as exploration expense. Capitalization of mine development project costs begins once the deposit is classified as proven and probable reserves.

Drilling and related costs are capitalized for deposits where proven and probable reserves exist and the activities are directed at obtaining additional information on the deposit or converting non-reserve minerals to proven and probable reserves and the benefit is to be realized over a period greater than one year.

Mine development costs are amortized using the units-of-production (“UOP”) method on estimated measured tons in in-place reserves. The impact of revisions to reserve estimates is recognized on a prospective basis.

Capitalized costs incurred during the year for major improvement and capital projects that are not placed in service are recorded as construction-in-progress. Construction-in-progress is not depreciated until the related assets or improvements are ready to be placed in service. We capitalize interest cost as part of the historical cost of constructing an asset and preparing it for its intended use. These interest costs are included in the property, plant and equipment line in the balance sheet. The Partnership did not capitalize any interest for the period from August 16, 2012 to December 31, 2013. Capitalized interest was $1,739 for the period from January 1, 2012 to August 15, 2012 and $756 for the year ended December 31, 2011.

Fixed assets other than plant facilities and buildings associated with productive, depletable properties are carried at historical cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows:

Computer equipment	3 years
Furniture and fixtures	7 years
Vehicles	5 years
Equipment	5-15 years
Rail spur and asset retirement obligation	33 years
Rail and rail equipment	15-20 years
Transload facilities and equipment	15-20 years

Plant facilities and buildings associated with productive, depletable properties that contain frac sand reserves are carried at historical cost and are depreciated using the units-of-production method. Units-of-production rates are based on the amount of proved developed frac sand reserves that are estimated to be recoverable from existing facilities using current operating methods.

The sponsor was in a developmental stage from the date of formation until the Wyeville Plant was deemed to be operational on July 21, 2011.

Preferred Interest in Hi-Crush Augusta

The Partnership accounts for the preferred interest in Augusta acquired on January 31, 2013 as a cost method investment. The preferred interest is not allocated any of the periodic earnings or losses of Augusta, but may in the future convert to a 20% equity interest in that entity. In accordance with the cost method, distributions earned under the preferred interest are recognized as income on the date the cash is received by the Partnership. The preferred interest is reviewed for impairment if an event or change in circumstances occurs which may have a significant adverse effect on the fair value of the investment. No such events or changes in circumstances arose during the year ended December 31, 2013.

Impairment of Long-lived Assets

Recoverability of investments in property, plant and equipment, and mineral rights is evaluated annually. Estimated future undiscounted net cash flows are calculated using estimates of proven and probable sand reserves, estimated future sales prices (considering historical and current prices, price trends and related factors) and operating costs and anticipated capital expenditures. Reductions in the carrying value of our investment are only recorded if the undiscounted cash flows are less than our book basis in the applicable assets.

Impairment losses are recognized based on the extent that the remaining investment exceeds the fair value, which is determined based upon the estimated future discounted net cash flows to be generated by the property, plant and equipment and mineral rights.

Management’s estimates of prices, recoverable proven and probable reserves and operating and capital costs are subject to certain risks and uncertainties which may affect the recoverability of our investments in property, plant and equipment. Although management has made its best estimate of these factors based on current conditions, it is reasonably possible that changes could

F-14

occur in the near term, which could adversely affect management’s estimate of the net cash flows expected to be generated from its operating property. No impairment charges were recorded during 2013, 2012 or 2011.

Goodwill and Intangible Assets

Goodwill represents the excess of purchase price over the fair value of net assets acquired. The Partnership performs an assessment of the recoverability of goodwill during the third quarter of each fiscal year, or more often if events or circumstances indicate the impairment of an asset may exist. Our assessment of goodwill is based on qualitative factors to determine whether the fair value of the reporting unit is more likely than not less than the carrying value. An additional quantitative impairment analysis is completed if the qualitative analysis indicates that the fair value is not substantially in excess of the carrying value. The quantitative analysis determines the fair value of the reporting unit based on the discounted cash flow method and relative market-based approaches. There was no impairment charge related to goodwill during the year ended December 31, 2013.

The Partnership amortizes the cost of other intangible assets on a straight line basis over their estimated useful lives, ranging from 1 to 18 years. An impairment assessment is performed if events or circumstances occur and may result in the change of the useful lives of the intangible assets. During the year ended December 31, 2013, the Partnership did not record any impairment charges or changes in the useful life of its intangible assets.

Revenue Recognition

Frac sand sales revenues are recognized when legal title passes to the customer, which may occur at the production facility, rail origin or at the destination terminal. At that point, delivery has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of sand deliveries are recorded as deferred revenue. Revenue from make-whole provisions in our customer contracts is recognized at the end of the defined cure period.

The majority of our frac sand is sold under long-term supply agreements, the current terms of which expire between 2014 and 2019. The agreements define, among other commitments, the volume of product that the Partnership must provide, the price that will be charged to the customer, and the volume that the customer must purchase at the end of the defined cure period, which can range from three months to the end of a contract year.

Transportation services revenues are recognized as the services have been completed, meaning the related services have been rendered. At that point, delivery of service has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of transportation services being rendered are recorded as deferred revenue.

Revenue attributable to silo storage leases is recorded on a straight-line basis over the term of the lease.

Deferred Revenue

In January 2011, the sponsor received $16,500 in an advance payment from a customer for a certain volume of product to be delivered over a one-year period starting in July 2011. Revenue was recognized as product was delivered and the deferred revenue obligation was recognized over the one-year period ended June 30, 2012. In July 2012, the sponsor received an $8,250 advance payment from a customer for a certain volume of frac sand to be delivered over the six-month period beginning in July 2012. As of August 15, 2012, the outstanding balance under this obligation was $6,590 while the cash held by the Partnership was $1,984. As a result, the sponsor made a cash contribution of $4,606 to align the cash balance with the outstanding balance under this advance. As of December 31, 2012, the balance was $1,715, and as of December 31, 2013, no deferred revenue balance was outstanding under this advance payment.

Asset Retirement Obligation

In accordance with Accounting Standards Codification (“ASC”) 410-20, Asset Retirement Obligations, we recognize reclamation obligations when incurred and record them as liabilities at fair value. In addition, a corresponding increase in the carrying amount of the related asset is recorded and depreciated over such asset’s useful life. The reclamation liability is accreted to expense over the estimated productive life of the related asset and is subject to adjustments to reflect changes in value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs.

Fair Value of Financial Instruments

The amounts reported in the balance sheet as current assets or liabilities, including cash, accounts receivable, accounts payable, accrued liabilities and deferred revenue approximate fair value due to the short-term maturities of these instruments.

The amount recorded on the balance sheet pertaining to the Partnership’s long-term debt outstanding at December 31, 2013 is considered a Level 2 financial instrument, as although there is no observable quoted price, the underlying floating rate of interest is based on a published benchmark interest rate that is observable at commonly quoted intervals. As of December 31, 2013, the carrying value of the debt approximated its fair value as it is subject to floating rate interest and there have not been any significant changes to the Partnership’s credit profile since the debt was issued in January 2013.

F-15

Net Income per Limited Partner Unit

We have identified the General Partner’s incentive distribution rights as participating securities and compute income per unit using the two-class method under which any excess of distributions declared over net income shall be allocated to the partners based on their respective sharing of income specified in the partnership agreement. Net income per unit applicable to limited partners (including subordinated unitholders) is computed by dividing limited partners’ interest in net income, after deducting any General Partner incentive distributions, by the weighted-average number of outstanding common and subordinated units. Diluted net income per unit includes the effects of potentially dilutive units on our subordinated and common units. Basic and diluted net income per common and subordinated unit are the same as there are no potentially dilutive subordinated units outstanding.

As the 3,750,000 Class B units do not have voting rights or rights to share in the Partnership’s periodic earnings, either through participation in its distributions or through an allocation of its undistributed earnings or losses, they are not deemed to be participating securities in their current form. In addition, the conversion of the Class B units into common units is fully contingent upon the satisfaction of defined criteria pertaining to the cumulative payment of distributions and earnings per unit of the Partnership as described in Note 11. Therefore, it is possible that the Class B units may never be converted into common units. As such, until all of the defined payment and earnings criteria are satisfied, the Class B units will not be included in our calculation of either basic or diluted earnings per unit.

Income Taxes

The Partnership and sponsor are pass-through entities and are not considered taxable entities for federal tax purposes. Therefore, there is not a provision for income taxes in the accompanying condensed consolidated financial statements. The Partnership’s net income or loss is allocated to its partners in accordance with the partnership agreement. The partners are taxed individually on their share of the Partnership’s earnings. At December 31, 2013 and 2012, the Partnership did not have any liabilities for uncertain tax positions or gross unrecognized tax benefit.

Recent Accounting Pronouncements

In February 2013, the Financing Accounting Standards Board (“FASB”) issued amended guidance on the recognition, measurement, and disclosure of certain obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. Such arrangements may include debt, other contractual obligations, and settled litigation and judicial rulings. The amended guidance is to be applied retrospectively to all prior periods presented. This guidance will be effective for the Partnership beginning January 1, 2014. The Partnership anticipates that the adoption of this amended guidance will not materially affect its financial position, result of operations or cash flows.

In December 2011 and January 2013, the FASB issued amended guidance on disclosures pertaining to certain assets and liabilities that are either offset in an entity’s financial statements or those that are subject to a master netting agreement or similar arrangement. The scope of these disclosures is limited to derivatives, repurchase agreements and securities lending transactions. The Partnership adopted this guidance effective January 1, 2013, and, as it only impacts disclosures, it did not affect the Partnership’s financial position, result of operations or cash flows.

F-16

4. Initial Public Offering

On August 16, 2012, we completed our initial public offering (“IPO”) of 11,250,000 common units representing limited partner interests in the Partnership at a price to the public of $17.00 per common unit. Total net proceeds paid to our sponsor from the sale of common units in our IPO were $179,536 after taking into account our underwriting discount of $11,714. Our sponsor received all proceeds from the IPO and incurred capitalized transaction costs of $3,383 through September 30, 2012. These capitalized transaction costs were retained by the sponsor. On August 16, 2012, our underwriters exercised their option to purchase an additional 1,687,500 common units for $26,930. As a result, total net proceeds were $206,466 from the sale of 12,937,500 total common units to the public.

The following table outlines the consolidated net assets contributed to the Partnership on August 16, 2012:

Assets:
Cash	$	1,984
Accounts receivable	12,453
Inventories	4,085
Due from sponsor	4,606
Prepaid expenses and other current assets	26
Property, plant and equipment, net	69,623
Deferred charges, net	1,113
Total Assets	$	93,890
Liabilities:
Accounts payable	$	1,397
Accrued liabilities	1,901
Deferred revenue	6,590
Asset retirement obligation	848
Total liabilities	10,736
Net assets contributed to the Partnership	$	83,154

The following is a reconciliation of the Predecessor’s equity as of August 15, 2012 and total net assets contributed to the Partnership on August 16, 2012:

Predecessor Members’ Capital – August 15, 2012	$	35,082
Net liabilities of non-contributed sponsor entities	9,522
Members’ capital attributable to entities contributed to the Partnership	44,604
Conversion of debts payable by Partnership entities to sponsor	23,916
Assumption of payables held by Partnership entities by sponsor	10,028
Cash contribution commitment from sponsor	4,606
Net Assets Contributed to Partnership – August 16, 2012	$	83,154

As a result of our IPO, our sponsor entered into or amended the following agreements:

Amended and Restated Agreement of Limited Partnership of Hi-Crush Partners LP

On August 20, 2012, the Partnership amended and restated its Limited Partnership Agreement to establish the organizational framework for a public master limited partnership. On January 31, 2013, the Partnership amended and restated its amended and restated Limited Partnership Agreement to, among other things, provide for the creation of the Class B units. See Note 11 – Equity.

Omnibus Agreement

On August 20, 2012, we entered into an omnibus agreement with both our General Partner and our sponsor. Pursuant to the terms of this agreement, our sponsor will indemnify us and our subsidiaries for certain liabilities over specified periods of time, including but not limited to certain liabilities relating to (a) environmental matters pertaining to the period prior to our IPO and the contribution of the Wyeville assets from our sponsor, provided that such indemnity is capped at $7,500 in aggregate, (b) federal, state and local tax liabilities pertaining to the period prior to our IPO and the contribution of the Wyeville assets from our sponsor, (c) inadequate permits or licenses related to the contributed assets, and (d) any losses, costs or damages incurred by us that are attributable to our sponsor’s ownership and operation of the Wyeville assets prior to our IPO and our sponsor’s contribution of such assets. In addition, we have agreed to indemnify our sponsor from any losses, costs or damages it incurs that are attributable to our ownership and operation of the contributed assets following the closing of the IPO, subject to similar limitations as on our sponsor’s indemnity obligations to us.

F-17

The omnibus agreement had provided that we would assign to our sponsor all of our rights and obligations under our long-term contract with one customer as of May 1, 2013, and our sponsor would have been obligated to accept such assignment and assume our obligations under such contract. In connection with our acquisition of a preferred interest in Augusta on January 31, 2013, our sponsor waived its right to require that we assign to our sponsor such contract. As such, the contract remains with the Partnership and will continue to be fulfilled by the Wyeville Plant for the remainder of its term. In addition, the omnibus agreement also grants us, for a period of three years from the effective date of the agreement, a right of first offer on our sponsor’s sand reserves and any related assets that have been or will be constructed on its current acreage in Augusta, Wisconsin in the event our sponsor proposes to transfer such reserves and assets to a third party other than in connection with a sale of all or substantially all of its assets.

Services Agreements

Effective August 16, 2012, we entered into a services agreement (the “Services Agreement”) by and among our General Partner, Hi-Crush Services LLC (“Hi-Crush Services”), a wholly-owned subsidiary of the sponsor, and the Partnership, pursuant to which Hi-Crush Services provides certain management and administrative services to our General Partner to assist in operating our business. Under the Services Agreement, the Partnership reimburses Hi-Crush Services and its affiliates, on a monthly basis, for the allocable expenses it incurs in its performance under the Services Agreement. These expenses include, among other things, salary, bonus, incentive compensation, rent and other administrative expense for individuals and entities that perform services for us or on our behalf. Hi-Crush Services and its affiliates are not liable to us for its performance of services under the Services Agreement except a liability resulting from gross negligence.

In addition, effective August 16, 2012, we entered into an agreement with our sponsor, pursuant to which the sponsor provides maintenance and capital spares to us in connection with the ongoing maintenance of our Wyeville facility. Our sponsor bills us for the approximate cost of such items.

Long-Term Incentive Plan

On August 21, 2012, the General Partner adopted the Hi-Crush Partners LP Long Term Incentive Plan (the “Plan”) for employees, consultants and directors of the General Partner and those of its affiliates, including the sponsor, who perform services for the Partnership. The Plan consists of restricted units, unit options, phantom units, unit payments, unit appreciation rights, other equity-based awards, distribution equivalent rights, and performance awards. The Plan limits the number of common units that may be delivered pursuant to awards under the plan to 1,364,035 units. Common units withheld to satisfy exercise prices or tax withholding obligations are available for delivery pursuant to other awards. The Plan is administered by the General Partner’s Board of Directors or a committee thereof.

F-18

5. Business Combination – Acquisition Accounting

On June 10, 2013, the Partnership acquired D&I, an independent frac sand supplier, transforming the Partnership into an integrated Northern White frac sand producer, transporter, marketer and supplier. The Partnership acquired D&I for $95,159 in cash and 1,578,947 common units, valued at $37,358 as of June 10, 2013.

The acquisition was accounted for under the acquisition method of accounting whereby management assessed the net assets acquired and recognized amounts for the identified assets acquired and liabilities assumed.

The total purchase price of $132,517 was allocated to the net assets acquired as follows:

Assets acquired:
Cash	$	204
Restricted cash	688
Accounts receivable	17,908
Inventories	10,372
Prepaid expenses and other current assets	809
Property, plant and equipment	39,242
Intangible assets	41,878
Goodwill	33,745
Other assets	113
Total assets acquired	$	144,959
Liabilities assumed:
Accounts payable	$	11,646
Accrued liabilities and other current liabilities	796
Total liabilities assumed	12,442
Fair value of net assets acquired	$	132,517

The operations of D&I have been included in the financial statements of the Partnership prospectively from June 11, 2013 through December 31, 2013. During this period, D&I earned $66,071 in revenue and $3,801 of net income, as consolidated into the Partnership’s results of operations. In connection with this acquisition, the Partnership incurred $1,728 of acquisition-related costs, as included in general and administrative expenses.

The following tables summarize the supplemental condensed consolidated statements of operations information on an unaudited pro forma basis as if the acquisition had occurred at January 1, 2012. The tables include adjustments that were directly attributable to the acquisition or are not expected to have a future impact on the Partnership. The pro forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred should the transaction have been consummated at the beginning of the period, nor are they indicative of future results of operations.

Pro Forma Financial Information for the:
	Year Ended December 31, 2013		Year Ended December 31, 2012 (1)
	Successor		Pro Forma (1)
Revenues	$	196,794	$	179,486
Net income	$	68,413	$	62,455
Net income per limited partner unit:
Common units – basic and diluted	2.37		2.16
Subordinated units – basic and diluted	2.37		2.16
(1) The comparative period includes the combination of the Predecessor and Successor results before and after our IPO on August 16. These pro-forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred if the acquisition and IPO would have taken place on January 1, 2012.

The pro forma financial information includes the impact of the following pro forma adjustments:

F-19

Adjustments Utilized to Prepare the Pro Forma Financial Information for the:
	Year Ended December 31, 2013			Year Ended December 31, 2012
Debit / (Credit)	Successor			Pro Forma (1)
Acquisition related expenses	$	(4,775	)	$	—
Other general and administrative expenses	(117		)	(239		)
Interest expense on debt issued to fund acquisition	1,226			2,561
Depreciation and amortization expense	(8		)	3,947
Increase in weighted average common units outstanding	696,467			1,578,947

F-20

6. Goodwill and Intangible Assets

Changes in goodwill and intangible assets consisted of the following:

	Goodwill		Intangible Assets
Balance at December 31, 2012	$	—	$	—
Additions from D&I acquisition	33,745		41,878
Amortization expense	—		(3,687		)
Balance at December 31, 2013	$	33,745	$	38,191

Goodwill

As of December 31, 2013, the Partnership had goodwill of $33,745 based on the allocation of the purchase price of its acquisition of D&I.

Intangible Assets

Intangible assets arising from the acquisition of D&I consisted of the following:

	Useful life	December 31, 2013
		Successor
Supplier agreements	1-20 Years	21,997
Customer contracts and relationships	1-10 Years	18,132
Other intangible assets	1-3 Years	1,749
Intangible assets		41,878
Less: Accumulated amortization		(3,687		)
Intangible assets, net		$	38,191

Amortization expense was $3,687 for the year ended December 31, 2013. The weighted average remaining life of intangible assets was 13 years as of December 31, 2013. As of December 31, 2013, future amortization is as follows:

Fiscal Year	Amortization
2014	$	5,127
2015	2,967
2016	2,938
2017	2,850
2018	2,850
Thereafter	21,459
	$	38,191

F-21

7. Inventories

Inventories consisted of the following:

	December 31, 2013		December 31, 2012
	Successor		Successor
Raw material	$	—	$	124
Work-in-progress	3,699		3,280
Finished goods	12,431		4
Spare parts	135		133
	$	16,265	$	3,541

F-22

8. Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	December 31, 2013			December 31, 2012
	Successor			Successor
Buildings	$	2,107		$	417
Mining property and mine development	24,522			24,156
Plant and equipment	47,669			43,767
Rail and rail equipment	12,774			5,499
Transload facilities and equipment	30,265			—
Construction-in-progress	1,829			1,380
	119,166			75,219
Less: Accumulated depreciation and depletion	(5,824		)	(2,375		)
	$	113,342		$	72,844

Depreciation and depletion expense was as follows during the periods presented:

Predecessor Periods
Year ended December 31, 2011	$	449
Period from January 1 through August 15, 2012	1,089
Successor Period
Period from August 16 through December 31, 2012	$	863
Year ended December 31, 2013	3,399

F-23

9. Preferred Interest in Hi-Crush Augusta LLC

On January 31, 2013, the Partnership entered into an agreement with our sponsor to acquire 100,000 preferred units in Augusta, the entity that owns our sponsor’s Augusta Plant, for $37,500 in cash and 3,750,000 newly issued convertible Class B units in the Partnership.

The transaction represented an exchange of ownership interests between entities under common control. As a result, the Partnership recorded an investment in the preferred interest equal to the total amount of the cash paid and our sponsor’s cost basis in the preferred units. Excess consideration exchanged over the cost basis was recorded as a deemed distribution to our sponsor, determined as follows:

Total consideration paid	$	95,400
Less: Cash paid	(37,500		)
Less: Sponsor’s cost basis in the investment	(9,543		)
Deemed distribution	$	48,357

In connection with this acquisition, the Partnership incurred $451 of acquisition related costs during the year ended December 31, 2013, as included in general and administrative expenses.

As a preferred unit holder in Augusta, the Partnership votes as a separate class from the common unitholders of Augusta and ranks senior to all other equity classes of Augusta. The preferred units entitle the Partnership to receive a distribution equal to $3,750 per quarter, beginning January 1, 2013, plus any unpaid arrearages from prior quarters. During 2013, Augusta declared and paid three quarterly distributions of $3,750. Income pertaining to the distributions is recognized during the period the distribution is received. On January 2014, Augusta declared its fourth quarterly distribution of $3,750, to be paid on February 11, 2014.

The preferred units in Augusta will automatically convert to common units in Augusta on March 31, 2018 unless (i) there are any arrearages in preferred unit distributions, (ii) the preferred units would not have received, on an as-converted basis, an annualized distribution of at least $10,000 over the preceding four quarters or (iii) the Partnership, with concurrence of the conflicts committee of the board of directors of our General Partner, elects to convert at an earlier time. The number of common units issued upon conversion will be equal to 25% of the then outstanding common units, such that, following the conversion, the Partnership would own 20% of the common units in Augusta.

F-24

10. Long-Term Debt

Long-term debt consisted of the following:

	December 31, 2013		December 31, 2012
	Successor		Successor
Partnership credit facility	$	138,250	$	—
Less: current portion of long-term debt	—		—
	$	138,250	$	—

Subordinated Promissory Notes

Between May 25, 2011 and July 20, 2012, the sponsor entered into various subordinated promissory notes with certain of its equity investors and their affiliates in an aggregate initial principal amount of $52,167. Borrowings under the subordinated promissory notes bore interest, at the sponsor’s option, at a rate of 10% for cash interest and 12% for paid-in-kind interest (“PIK interest”). Accruals for PIK interest increased the outstanding principal balance of these promissory notes. The balances of the PIK interest and subordinated promissory notes were paid in full on August 21, 2012 with the proceeds of the sale of the common units by the sponsor.

New Subordinated Promissory Notes

In order to fund a royalty termination payment (See Note 14—Commitments and Contingencies), the sponsor entered into new subordinated promissory notes in July 2012 with certain of its equity investors and their affiliates in an aggregate initial principal amount of $14,981. The balances of the PIK interest and subordinated promissory note, as retained by the sponsor, were paid in full by the sponsor on August 21, 2012 with the proceeds of the sale of the common units by the sponsor.

Sponsor Credit Facility

On April 6, 2012, the sponsor entered into a four-year $62,500 secured credit facility (the “Sponsor Credit Facility”) with Amegy Bank, N.A. and a syndicate of other financial institutions (collectively, the “Lending Banks”). The Sponsor Credit Facility consists of the following commitments on the part of the Lending Banks: (1) a $25,000 term loan, (2) a $30,000 advancing term loan commitment (“Tranche B”) and (3) a $7,500 revolving loan commitment (the “Revolving Commitment”). In addition, the Sponsor Credit Facility includes sub-limits for letters of credit and swing line borrowings of up to $5,000 and $2,500, respectively.

Borrowings under the Sponsor Credit Facility bear interest at a floating rate equal to, at the sponsor’s option, either (a) a base rate plus a range of 225 basis points to 325 basis points per annum or (b) a Eurodollar rate, which is based on one-month LIBOR, plus a range of 325 basis points to 425 basis points per annum. The base rate is established as the highest of (i) the U.S. prime rate last quoted by The Wall Street Journal, (ii) the federal funds rate plus 50 basis points or (iii) daily one-month LIBOR plus 100 basis points. The Revolving Commitment and the Tranche B term loan provides for a commitment fee of 0.5% on the unused portion.

After consummation of the IPO on August 16, 2012, our sponsor retained the Sponsor Credit Facility and related borrowings. In addition, as of August 16, 2012, the Sponsor Credit Facility was no longer guaranteed by the subsidiaries contributed to the Partnership. As such, the sponsor’s long-term debt is not reflected on the Partnership’s successor balance sheets.

On August 21, 2012, the sponsor entered into that certain consent and third amendment to the Sponsor Credit Facility, whereby the lending banks, among other things, (i) consented to the consummation of the initial public offering of the Partnership, (ii) released and discharged certain credit parties in connection with the initial public offering.

Partnership Credit Facility

On August 21, 2012, the Partnership entered into a credit agreement (the “Credit Agreement”) providing for a new $100,000 senior secured revolving credit facility (the “Credit Facility”) with a term of four years. In connection with our acquisition of a preferred interest in Augusta, on January 31, 2013, the Partnership entered into a consent and first amendment to the Credit Agreement whereby the Lending Banks, among other things, (i) consented to the amendment and restatement of the partnership agreement of the Partnership and (ii) agreed to amend the Credit Agreement to permit the acquisition by the Partnership of a preferred equity interest in Hi-Crush Augusta LLC. On May 9, 2013, the Partnership entered into a commitment increase agreement and second amendment to the Credit Agreement whereby the Lending Banks, among other things, consented to the increase of the aggregate commitments by $100,000 to a total of $200,000 and addition of lenders to the lending bank group. The Credit Facility is available to fund working capital and general corporate purposes, including the making of certain restricted payments permitted therein. Borrowings under the Credit Facility are secured by substantially all of the Partnership’s assets, including its preferred equity interest in Augusta.

F-25

Loans under the Credit Facility bear interest at a floating rate based upon the Partnership’s leverage ratio, equal to, at the Partnership’s option, either (a) a base rate plus a range from 150 to 250 basis points per annum or (b) a LIBOR rate, plus a range of 250 to 350 basis points. The base rate is established as the highest of (i) the U.S. prime rate, (ii) daily one-month LIBOR plus 100 basis points and (iii) the federal funds rate plus 0.50%. The unused portion of the Credit Facility is subject to a commitment fee calculated based upon the Partnership’s leverage ratio ranging from 0.375% to 0.50% per annum. Upon any event of default, the interest rate shall, upon the request of the lenders holding a majority of the commitments, be increased by 2.0% per annum for the period during which the event of default exists.

The Credit Agreement contains customary representations and warranties, affirmative covenants, negative covenants and events of default. The negative covenants include restrictions on the Partnership’s ability to incur additional indebtedness, acquire and sell assets, create liens, make investments and make distributions.

The Credit Agreement requires the Partnership to maintain a leverage ratio (as such term is defined in the Credit Agreement) of not more than 3.00 to 1.00, which may increase to up to 3.50 to 1.00 during specified periods following a permitted acquisition, and a minimum interest coverage ratio (as such term is defined in the Credit Agreement) of not less than 2.50 to 1.00. Under the second amendment, the Partnership agreed to a term out feature under which $50,000 of borrowings would convert to a term loan due August 21, 2016 if the outstanding borrowings under the revolver exceeded $125,000 for four consecutive quarters. If balances are outstanding on a term loan, the Partnership would be required to maintain a debt service coverage ratio (as such term is defined in the Credit Agreement) of not less than 1.50 to 1.00.

If an event of default (as defined the Credit Agreement) occurs, the agent would be entitled to take various actions, including the acceleration of amounts due under the Credit Facility, termination of the commitments under the Credit Facility and all remedial actions available to a secured creditor. As of December 31, 2013, we were in compliance with the covenants contained in the Partnership Credit Facility. 

As of December 31, 2013, we had $138,250 indebtedness and $60,250 of undrawn borrowing capacity ($200,000, net of $138,250 indebtedness and $1,500 letter of credit commitments) under our Credit Facility. The outstanding balance is due on December 31, 2016 and carries an interest rate of 3.17% as of December 31, 2013.

Subsidiary Guarantors

The Partnership has filed a registration statement on Form S-3 to register, among other securities, debt securities. Each of the current subsidiaries of Hi-Crush Partners LP (other than Hi-Crush Finance Corp., whose sole purpose is to act as a co-issuer of any debt securities), each a 100 percent directly or indirectly owned subsidiary of the Partnership (the “guarantors”), will issue guarantees of the debt securities, if any of them issue guarantees, and such guarantees will be full and unconditional and will constitute the joint and several obligations of such guarantors. The guarantors are our sole subsidiaries, other than Hi-Crush Finance Corp., which is our 100 percent owned subsidiary. The Partnership has no assets or operations independent of its subsidiaries, and there are no significant restrictions upon the ability of the Partnership or any of its subsidiaries to obtain funds from its respective subsidiaries by dividend or loan. None of the assets of our subsidiaries represent restricted net assets pursuant to Rule 4-08(e)(3) of Regulation S-X under the Securities Act of 1933, as amended (the “Securities Act”).

F-26

11. Equity

On January 30, 2013, the Partnership issued 2,761 common units to each of its independent directors, valued in the aggregate at $100 and reflected as general and administrative expense in the accompanying financial statements. In January 2014, the Partnership issued 4,149 common units to the independent directors of the General Partner and 4,366 common units to certain employees.

On June 10, 2013, the Partnership issued 1,578,947 common units to certain former members of D&I, representing the non-cash portion of the purchase price for the acquisition (See Note 5 – Business Combination – Acquisition Accounting).

As of December 31, 2013, our sponsor owned all 13,640,351 subordinated units and 3,750,000 Class B units, representing a 47.3% ownership interest in the limited partner units and 100% ownership of the Class B units of the Partnership. In addition, the sponsor is the owner of our General Partner.

Subordinated Class B Units

On January 31, 2013, the Partnership issued 3,750,000 subordinated Class B units and paid $37,500 in cash to the sponsor in return for 100,000 preferred equity units in the sponsor’s Augusta facility. Our sponsor will not receive distributions on the Class B units until converted into common units of the Partnership. The Class B units are eligible for conversion into common units once we have, for two consecutive quarters, (i) earned $2.31 per common unit, subordinated unit and Class B unit on an annualized basis and (ii) paid $2.10 per unit in annualized distributions on each common and subordinated unit, or 110% of the current minimum quarterly distribution for a period of two consecutive quarters, and our General Partner has determined, with the concurrence of the conflicts committee of the board of directors of our General Partner, that we are expected to maintain such performance for at least two succeeding quarters.

Allocations of Net Income

Our partnership agreement contains provisions for the allocation of net income and loss to the unitholders and the General Partner. For purposes of maintaining partner capital accounts, the partnership agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage ownership interest. Normal allocations according to percentage interests are made after giving effect, if any, to priority income allocations in an amount equal to incentive cash distributions allocated 100% to the General Partner.

Incentive Distribution Rights

Incentive distribution rights represent the right to receive increasing percentages (ranging from 15.0% to 50.0%) of quarterly distributions from operating surplus after minimum quarterly distribution and target distribution levels exceed $0.54625 per unit, per quarter. Our sponsor currently holds the incentive distribution rights, but may transfer these rights at any time.

Distributions

Our partnership agreement sets forth the calculation to be used to determine the amount of cash distributions that our common and subordinated unitholders and sponsor will receive.

Our distributions have been as follows:

Declaration Date	Amount Declared Per Unit (a)			Record Date	Date Paid	Amount Paid
October 19, 2012	$	0.2375	(b)	November 1, 2012	November 15, 2012	$	6,480
January 17, 2013	$	0.4750		February 1, 2013	February 15, 2013	$	12,961
April 16, 2013	$	0.4750		May 1, 2013	May 15, 2013	$	12,961
July 17, 2013	$	0.4750		August 1, 2013	August 15, 2013	$	13,711
October 17, 2013	$	0.4900		November 1, 2013	November 15, 2013	$	14,144
January 15, 2014	$	0.5100		January 31, 2014	February 14, 2014	$	14,726
(a) For all common and subordinated units. No distributions were declared for our holders of incentive distribution rights or the holders of our Class B units.
(b) Represents a pro rata distribution of our minimum quarterly distribution for the period from August 16, 2012 through September 30, 2012.

For purposes of calculating the Partnership’s earnings per unit under the two-class method, common units are treated as participating preferred units, and the subordinated units are treated as the residual equity interest, or common equity. Incentive distribution rights are treated as participating securities.

F-27

Distributions made in future periods based on the current period calculation of cash available for distribution is allocated to each class of equity that will receive the distribution. Any unpaid cumulative distributions are allocated to the appropriate class of equity.

Each period the Partnership determines the amount of cash available for distributions in accordance with the partnership agreement. The amount to be distributed to common unitholders, subordinated unitholders and incentive distribution rights holders is based on the distribution waterfall in the partnership agreement. Net earnings for the period are allocated to each class of partnership interest based on the distributions to be made. Additionally, if, during the subordination period, the Partnership does not have enough cash available to make the required minimum distribution to the common unit holders, the Partnership will allocate net earnings to the common unit holders based on the amount of distributions in arrears. When actual cash distributions are made based on distributions in arrears, those cash distributions will not be allocated to the common unit holders, as such earnings were allocated in previous periods.

Net income attributable to our limited partner unitholders is as follows during the year ended December 31, 2013 (in thousands, except per unit amounts):

	Common Unitholders		Subordinated Unitholders
Distributions during the period	$	21,174	$	19,642
Subsequent distributions declared (See Note 18)	7,769		6,957
Undistributed earnings	1,385		1,635
Limited partners’ interest in net income	30,328		28,234
Subsequent distributions declared (per unit)	$	0.5100	$	0.5100

During the year ended December 31, 2013 and the period from August 16 through December 31, 2012, no net income was attributable to our incentive distribution rights holders.

F-28

12. Related Party Transactions

On May 25, 2011, the sponsor entered into a management services agreement with Red Oak Capital Management LLC (the “Service Provider”) which is owned by two members who are also equity members in the sponsor. The agreement provides for certain management and administrative support services to be provided to the sponsor for a term of one year and that thereafter remains in place upon the same terms and conditions. Either party may terminate the agreement by delivering written notice within 90 days prior to the date of expiration of the initial term or any time after the expiration of the initial term, by delivering written notice 90 days prior to the desired date of termination. The sponsor reimburses the Service Provider 95% of the Service Provider’s actual costs limited to $850 per year. These fees are included in general and administrative expenses. Management fees incurred during the year ended December 31, 2013 are included as a portion of the management services expense from Hi-Crush Services, as discussed below.

The sponsor paid quarterly director fees to non-management directors that may be members and/or holders of the sponsor’s debt through the date of the IPO.

The total management and director fees incurred were as follows:

	Management Fee		Director Fees
Predecessor Periods
Year ended December 31, 2011	$	370	$	60
Period from January 1 through August 15, 2012	318		62
Successor Periods
Period from August 16 through December 31, 2012	$	140	$	—
Year ended December 31, 2013	—		—

During the year ended December 31, 2013 and period from August 16 through December 31, 2012, the Partnership incurred $3,698 and $1,028, respectively, of management service expenses from Hi-Crush Services under the Services Agreement discussed in Note 4.

In the normal course of business, our sponsor and its affiliates, including Hi-Crush Services, and the Partnership may from time to time make payments on behalf of each other. During the period from August 16 through December 31, 2012, we made payments of $9,866 to various suppliers, vendors or other counterparties on behalf of our sponsor. This balance was offset by $1,028 of management fees charged by our sponsor and $3,223 of net payments made by our sponsor on behalf of us. The balance of $5,615 which was maintained as a current asset under the caption “Due from sponsor” as of December 31, 2012, was repaid by our sponsor in February 2013.

As of December 31, 2013, an outstanding balance of $2,571 payable to our Sponsor is maintained as a current liability under the caption “Due to Sponsor.”

During the year ended December 31, 2013, we purchased $4,402 of sand from Hi-Crush Augusta LLC.

F-29

13. Segment Reporting

The Partnership manages, operates and owns assets utilized to supply frac sand to its customers. As a result of its June 10, 2013 acquisition of D&I, the Partnership identified its production plant and terminal facilities as separate operating segments through the third quarter of 2013. These two operating segments were aggregated into one reportable segment as they sell the same products, source product from frac sand production facilities in the Midwestern United States, have similar customers, use similar distribution systems and have similar economic characteristics and regulatory environments. Through the fourth quarter of 2013, the Partnership continued to integrate the recently acquired terminal facilities, which resulted in a change in the way the chief operating decision maker allocates capital resources and assesses performance. As a result of this integration, the two previously identified operating segments were combined into one operating segment titled "Frac Sand Sales" for reporting purposes.

F-30

14. Commitments and Contingencies

The Partnership enters into sales contracts with customers. These contracts establish minimum annual sand volumes that the Partnership is required to make available to such customers under initial terms ranging from 3 to 6 years. Through December 31, 2013, no payments for non-delivery of minimum annual sand volumes have been made by the Partnership to these customers under these contracts.

D&I has entered into long-term supply agreements with certain of its suppliers which include requirements to purchase certain volumes and grades of sands, at specified prices. The quantities set forth in such agreements are not in excess of our current requirements.

Hi-Crush Operating LLC, a subsidiary of the Partnership, has entered into royalty agreements under which such entity is under a commitment to pay royalties on sand sold from the Wyeville Plant for which the Partnership has received payment.Royalty expense is recorded as the sand is sold and the royalty payment is paid based on sand volumes sold and paid for by the customer. Royalty expense is included in costs of goods sold. Royalty expense was $2,045 for the Predecessor’s year ended December 31, 2011. Royalty expense was $3,795 for the Predecessor period from January 1 through August 15, 2012. Royalty expense was $3,597 and $948 for the Successor year ended December 31, 2013 and the period of August 16 to December 31, 2012, respectively.

On July 13, 2012, the sponsor paid $14,000 in cash to terminate one of its existing royalty agreements, including $370 of outstanding obligations at the time. As a result of this payment, the Partnership is no longer required to make ongoing future royalty payments to the applicable counterparties for each ton of frac sand that is excavated, processed and sold to the Partnership’s customers. As part of this transaction, the Predecessor recorded an asset of $13,630, in property, plant and equipment.

The Partnership has long-term operating leases for rail access, railcars and equipment at its terminal sites, which are also under long-term lease agreements with various railroads. Rail car rental expense was $2,035 for the year ended December 31, 2013. As of December 31, 2013, future minimum operating lease payments are as follows:

Fiscal Year	Amount
2014	$	7,009
2015	6,599
2016	5,640
2017	5,425
2018	4,881
Thereafter	7,420
	$	36,974

From time to time the Partnership may be subject to various claims and legal proceedings which arise in the normal course of business. Management is not aware of any legal matters that are likely to have a material adverse effect on the Partnership’s financial position, results of operations or cash flows.

In May 2012, Hi-Crush Operating LLC, a subsidiary of the Partnership, entered into a supply agreement for frac sand with Baker Hughes Oilfield Operations, Inc. (“Baker Hughes”). On September 19, 2012, Baker Hughes provided notice that it was terminating the contract and on November 12, 2012, Hi-Crush Operating LLC formally terminated the supply agreement and filed suit in the State District Court of Harris County, Texas. On October 8, 2013, Hi-Crush Operating LLC entered into a settlement agreement with Baker Hughes pursuant to which Hi-Crush Operating LLC and Baker Hughes agreed to jointly dismiss the lawsuit between the parties and, in connection with the settlement, the parties entered into a six-year supply agreement that requires Baker Hughes to purchase minimum volumes of frac sand each month.

Following the Partnership’s November 2012 announcement that Hi-Crush Operating LLC had formally terminated its supply agreement with Baker Hughes in response to the repudiation of the agreement by Baker Hughes, the Partnership, our general partner, certain of its officers and directors and its underwriters were named as defendants in purported securities class action lawsuits brought by the Partnership’s unitholders in the United States District Court for the Southern District of New York. On February 11, 2013, the lawsuits were consolidated into one lawsuit, styled In re: Hi-Crush Partners L.P. Securities Litigation, No. 12-Civ-8557 (CM). A consolidated amended complaint was filed on February 15, 2013. That complaint asserted claims under sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended, or the Securities Act, and sections 10(b) and 20(a) of the Exchange Act in connection with the Partnership’s Registration Statement and a subsequent presentation. Among other things, the consolidated amended complaint alleges that defendants failed to disclose to the market certain alleged information relating to Baker Hughes’ repudiation of the supply agreement. On March 22, 2013, the Partnership filed a motion to dismiss the complaint. On December 2, 2013, the court issued an order dismissing the claims relating to the Partnership’s Registration Statement, but did not dismiss the claims relating to alleged misrepresentations concerning the Partnership’s relationship with Baker Hughes after the Partnership’s initial public offering. The Partnership and the remaining defendants in the lawsuit have filed answers to the

F-31

complaint. The Partnership believes the case is without merit and intends to vigorously defend itself. The Partnership cannot provide assurance, however, as to the outcome of this lawsuit.

On December 20, 2013, Stephen Bushansky, a purported unitholder of the Partnership, filed a lawsuit, derivatively on behalf of the Partnership, against our general partner and certain of its officers and directors, in an action styled Bushansky v. Hi-Crush GP LLC, Cause No. 2013-76463, in the 215th Judicial District Court, Harris County, Texas. This lawsuit alleges that by failing to disclose Baker Hughes’ attempted repudiation of its supply agreement with Hi-Crush Operating LLC prior to the Partnership’s November 2012 announcement terminating the agreement, defendants failed to design and implement an effective system of internal controls to prevent the Partnership from violating federal securities laws. Plaintiff asserts a claim for breach of fiduciary duties of good faith, care, loyalty, reasonable inquiry, oversight and supervision. Plaintiff also asserts that the defendants aided and abetted in one another’s breaches of fiduciary duties and seeks relief from defendants on the theory of indemnity for all damages that occurred as a result of defendants’ alleged violations. On January 29, 2014, defendants filed a motion to dismiss, plea to the jurisdiction, or in the alternative, motion to stay based on the mandatory contractual forum selection clause in our partnership agreement. The Partnership believes the case is without merit and intends to vigorously defend itself. The Partnership cannot provide assurance, however, as to the outcome of this lawsuit.

F-32

15. Asset Retirement Obligation

Although the ultimate amount of reclamation and closure costs to be incurred is uncertain, the Partnership maintained a post-closure reclamation and site restoration obligation as follows:

Balance at January 1, 2011	$	—
Additions to liabilities	804
Accretion expense	28
Balance at December 31, 2011	832
Additions to liabilities	651
Accretion expense from January 1 to August 15, 2012	16
Accretion expense from August 16 to December 31, 2012	56
Balance at December 31, 2012	1,555
Additions to liabilities	—
Accretion expense	118
Balance at December 31, 2013	$	1,673

F-33

16. Quarterly Financial Data (Unaudited)

	First Quarter		Second Quarter		Third Quarter (1)		Fourth Quarter		Total
2013	Successor		Successor		Successor		Successor		Successor
Revenues	$	19,628	$	27,101	$	43,515	$	51,498	$	141,742
Gross profit	13,846		15,516		17,557		20,284		67,203
Income from operations	11,097		11,594		12,498		15,645		50,834
Net income	10,783		14,681		15,040		18,058		58,562
Earnings per unit – common units	$	0.40	$	0.53	$	0.52	$	0.63	$	2.08
Earnings per unit – subordinated units	$	0.40	$	0.53	$	0.52	$	0.63	$	2.08
2012	Predecessor		Predecessor		Pro Forma		Successor		Pro Forma
Revenues	13,532		20,643		25,244		16,215		75,634
Gross profit	8,756		15,149		19,347		11,902		55,154
Income (loss) from operations	7,067		13,269		17,107		9,582		47,025
Net income (loss)	6,137		11,814		16,178		9,399		43,528
Earnings per unit – common units (2)					0.33		0.35		0.68
Earnings per unit – subordinated units (2)					0.33		0.35		0.68

(1) The results for the third quarter ended September 30, 2012 include those of our predecessor (July 1 to August 15) combined with the successor (August 16 to September 30)

(2) Earnings per unit was only calculated for periods subsequent to the August 16, 2012 initial public offering.

The following table reconciles our pro forma quarterly results for the third quarter ended September 30, 2012, to our predecessor and successor period resulting during that quarter.

	Period from July 1 Through August 15, 2012		Period from August 16 Through September 30, 2012		Total
	Predecessor		Successor		Pro Forma
Revenues	$	12,601	$	12,643	$	25,244
Gross profit	9,536		9,811		19,347
Income from operations	7,918		9,189		17,107
Net income	7,069		9,109		16,178
Earnings per unit – common units			$	0.33	$	0.33
Earnings per unit – subordinated units			$	0.33	$	0.33

F-34

17. Concentration of Credit Risk

The Partnership is a producer of sand mainly used by the oil and natural gas industry for fracing wells. The Partnership’s business is, therefore, dependent upon economic activity within this market. For the year ended December 31, 2013, sales to three customers accounted for 76% of the Partnership’s revenue. Sales to four customers accounted for 100% of the Partnership's revenue from inception through December 31, 2012.

Throughout 2013, the Partnership has maintained cash balances in excess of federally insured amounts on deposit with financial institutions.

F-35

18. Subsequent Events

On January 16, 2014, we declared a cash distribution totaling $14,726, or $0.5100 per unit. This distribution was paid on February 14, 2014 to unitholders of record on January 31, 2014. No distributions were declared for our holders of incentive distribution rights.

F-36

EX-10.22

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

AMENDED AND RESTATED SUPPLY AGREEMENT

This AMENDED AND RESTATED SUPPLY AGREEMENT (this “Agreement”) is effective as of January 1, 2014, between Baker Hughes Oilfield Operations, Inc., a California corporation with its principal place of business at 2929 Allen Parkway, Houston, Texas 77019, and its Affiliates (as defined below) (“Baker”), and Hi-Crush Operating LLC, a Delaware limited liability company with its principal place of business at Three Riverway, Suite 1550, Houston, Texas 77056 (“Supplier”).

RECITALS:

1. Baker and Supplier are parties to that certain Supply Agreement, effective as of May 1, 2012, as amended by that certain First Amendment to Supply Agreement, effective as of May 1, 2012 (as amended, the “Original Agreement”);

2. Baker and Supplier desire to amend and restate in its entirety the Original Agreement as set forth in this Agreement;

3. Baker and its Affiliates carry on the business of the design, manufacture and supply of goods and services in the Oilfield Business as defined below;

4. Supplier is able to supply certain goods for Baker;

5. Baker requires high quality sand for use as a proppant in providing certain of its hydraulic fracturing and oilfield services;

6. Supplier desires to sell such sand and is able to provide the proppant to Baker;

7. Baker desires to purchase Northern White frac sand from Supplier under the terms and conditions set forth in this Agreement; and

8. Supplier is willing to undertake the supply of the products for Baker and its Affiliates under the terms of this Agreement.

AGREEMENT

In consideration of the premises and the respective covenants and agreements contained herein, the receipt and sufficiency of which is hereby acknowledged, the Parties hereto agree as follows:

1. Definitions

1.1 In addition to terms defined elsewhere in this Agreement, the following terms shall have the following meanings unless the context otherwise requires:

(a) Affiliate or affiliate in relation to either Party means any corporation, limited liability company, partnership, proprietorship, joint venture or other entity directly or indirectly controlled by, controlling, or under common control with that Party. With respect to Supplier, Affiliate shall mean

pg. 1

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

and include Hi-Crush Proppants LLC and its subsidiary entities (other than Supplier). With respect to Baker entities, it shall include any U.S. and international entities.

(b) Business Day means any day other than a Saturday, Sunday, or other day on which commercial banks in Houston, Texas are authorized or required by law to close.

(c) Contract Year means a period of twelve (12) calendar months starting on the Effective Date, and each successive period of twelve (12) calendar months occurring immediately thereafter.

(d) Effective Date means the date written at the beginning of this Agreement.

(e) Force Majeure means in relation to either Party, any circumstances beyond the reasonable control of that Party, including war (whether declared or undeclared), acts of God, including fire, flood, storms and earthquakes, embargoes, riot, civil disturbance, insurrection, sabotage, and events or occurrences adversely impacting Supplier’s facility, but excluding (i) economic downturns, (ii) recessions, (iii) depressions, and (iv) strikes, lock-outs or other similar acts of the Party’s employees.

(f) Oilfield Business as used herein means the fields of exploration, recovery and production of minerals, gases, solid materials, fluids, water, oil, gas, and geothermal and such exploration, recovery and production includes,without limitation, exploration, drilling, production, reinjection, characterization, seismic modeling and data, extraction, treatment, storage, and transportation of each of such minerals, gases, solid materials, fluids, water, oil, gas and geothermal and any and all associated equipment, products and services, well site treatment, pipelines, offshore platforms, and fluid waste disposal. For purposes of clarification, the refining of oil and gas, and the storage and transportation of refined oil and gas, shall be excluded from the foregoing definition.

(g) Person or person means any entity, including any partnership, corporation, limited liability company or governmental entity, and any natural person.

(h) Product(s) means generally, whether singular or plural, Northern White grade *** and *** frac sand that meets the Specifications, or any other Northern White frac sand that is sold by Supplier to Baker hereunder.

(i) Purchase Order means the documents by which Baker orders Product from Supplier. For clarification, the Parties are free to issue/accept Purchase Orders in various formats, including purchase orders, emails and other communications between the Parties, which shall be hereafter referred to as Purchase Order regardless of format. Each Purchase Order shall be subject to the Parties’ agreement as specified in the Purchase Order and all terms and provisions of this Agreement. No terms of a Purchase Order, Internet site, order confirmation or other writing shall have the effect of modifying this Agreement unless reduced to writing and signed by both parties.

(j) Quality Standard means a manufacturing standard that conforms to ISO 13503‑2, Proppant Specifications, and will be accompanied by appropriate supporting documentation, as outlined in Exhibit A, attached hereto and incorporated herein for all purposes.

(k) Specifications means the specifications for the Products as set forth in Exhibit A to this Agreement.

pg. 2

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

(l) Supplier or Baker means, for the purposes of Article 9 as follows: “Supplier” shall include Supplier and Supplier’s parent, subsidiary or affiliated entities, and their respective officers, directors, employees, or any or all of such parties. “Baker” shall include Baker, its parent, subsidiary or affiliated entities, and their respective officers, directors, employees, or any or all of such parties.

(m) Term means the period commencing on the Effective Date of this Agreement and ending when this Agreement is terminated or expires in accordance with the provisions of Article 8.

(n) Year means a twelve-month period.

(o) *** Premium Frac Sand means Northern White grade *** frac sand that meets the Specifications.

(p) *** Premium Frac Sand means Northern White grade *** frac sand that meets the Specifications.

1.1 General Terms. As used in this Agreement, unless expressly stated otherwise, references to (a) “including” mean “including, without limitation”; (b) “or” mean “either or both”; (c) a “party” or “Party” means Baker or Supplier, as the context may require, and “parties ” or “Parties” means Baker and Supplier and (d) “day” or “days” means calendar days unless specified as a “Business Day.” Unless otherwise specified, all references in this Agreement to Articles or Sections are deemed references to the corresponding Articles or Sections in this Agreement.

2.     Production and Supply of the Products

2.1     Commencement of Production/Minimum Supply.

(a) During the Term, Supplier is obligated to sell and Baker is obligated to buy a minimum annual volume of *** tons of Product each Contract Year (the “Minimum Annual Purchase Requirement”) of which (i) between *** tons and *** tons of Product shall consist of *** Premium Frac Sand and (ii) the remaining tons of Product shall consist of *** Premium Frac Sand. Notwithstanding the foregoing, subject to agreement of Baker and Supplier on all applicable terms (including, without limitation, price and volume), Supplier may sell to Baker, and Baker may buy from Supplier, additional Product that is not *** Premium Frac Sand or *** Premium Frac Sand (“Additional Product”). Any tons of Additional Product purchased under this Section 2.1(a) shall be applied to the Minimum Annual Purchase Requirement for the applicable Contract Year and the Monthly Minimum Supply Requirement for the applicable calendar month as if *** of such Additional Product was *** Premium Frac Sand and the other *** of such Additional Product was *** Premium Frac Sand.

(b) Supplier shall be under no obligation to supply or sell Product in excess of (A) the Minimum Annual Purchase Requirement during any Contract Year or (B) the Monthly Maximum Supply Availability during any calendar month. In the event that (i) Baker has provided Purchase Orders during the Contract Year for the Minimum Annual Purchase Requirement and such Purchase Orders have been in compliance with Section 2.1(c) and (ii) Supplier fails to supply to Baker the Minimum Annual Purchase Requirement during any Contract Year (a “Supply Shortfall”), Supplier shall have *** months after the end of such Contract Year to, as the sole and exclusive remedy for such Supply Shortfall, either (i) tender the Supply Shortfall, including by supplying Product from one or more

pg. 3

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

third parties in accordance with Section 2.11, or (ii) pay to Baker within *** months of the end of the Contract Year, as liquidated damages and not as a penalty, an amount equal to the amount of the Supply Shortfall (expressed in tons) multiplied by $***. It will be Supplier’s sole discretion as to which option is utilized.

(c) The “Monthly Maximum Supply Availability” during the Term for each calendar month is *** tons. Supplier will not be obligated to fulfill orders that exceed the Monthly Maximum Supply Availability for a specific calendar month. The “Monthly Minimum Supply Requirement” during the Term for each calendar month is *** tons. Supplier is obligated to sell and Baker is obligated to buy the Monthly Minimum Supply Requirement each calendar month. Additionally, no more than *** percent (***%) of the Monthly Maximum Supply Availability in any given calendar month shall be *** Premium Frac Sand and no less than *** percent (***%) of the Monthly Minimum Supply Requirement (as may be adjusted pursuant to the last sentence of Section 2.1(a)) in any given calendar month shall be *** Premium Frac Sand.

2.2    Price

(a) From the Effective Date through the end of the *** (***^th) month after the Effective Date (the “Initial Pricing Period”), pricing will be fixed at (i) $***/short ton of *** Premium Frac Sand for contracted volumes as well as any additional *** Premium Frac Sand that becomes available for purchase by Baker and (ii) $***/short ton of *** Premium Frac Sand for contracted volumes as well as any additional *** Premium Frac Sand that becomes available for purchase by Baker.

(b) At the end of the Initial Pricing Period, the pricing for each short ton of *** Premium Frac Sand and *** Premium Frac Sand, as applicable, shall be ***.

2.3 Baker Minimum Purchase Requirement. During the Term, Baker shall be required to take and, in accordance with Section 3.1, pay for a minimum aggregate number of tons of Product during (a) each Contract Year equal to the Minimum Annual Purchase Requirement and (b) each calendar month equal to the Monthly Minimum Supply Requirement, in all cases in compliance with Sections 2.1(a) and (c); provided, however, that if, due solely to Force Majeure or the unavailability of rail cars in the market, Baker is unable to take delivery of Products as contemplated hereunder for a period of time during a Contract Year, Baker shall not be deemed to be in breach of this Agreement as a result of such failure so long as Baker is using best efforts to obtain rail cars and minimize the period of time during which Baker is unable to take delivery of Products; provided, further, however, that nothing in this sentence shall be construed to relieve Baker of its obligations to make payments under this Agreement (including the obligation to make any Makewhole Payments as contemplated in Section 2.5).

2.4 During the Term of this Agreement, the Minimum Annual Purchase Requirement shall be ordered by Baker in installments of not less than the Monthly Minimum Supply Requirement of Product per calendar month, and not more than the Monthly Maximum Supply Availability, and in all cases in compliance with Section 2.1(c). In the event that Baker fails to purchase one twelfth (1/12) of the Minimum Annual Purchase Requirement of Product from Supplier during any particular calendar month in which Supplier was ready, willing and able to deliver the Monthly Maximum Supply

pg. 4

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

Availability, then the “Purchase Shortfall” shall be the amount by which one twelfth (1/12) of the Minimum Annual Purchase Requirement exceeds the amount of Product actually purchased by Baker during such calendar month until the minimum annual volume is met.

2.5 On written notice of such Purchase Shortfall to Baker by Supplier, Baker shall have *** months after the month of the Purchase Shortfall to purchase tonnage of Product in excess of one twelfth (1/12) of the Minimum Annual Purchase Requirement (but subject to the Monthly Maximum Supply Availability and the provisions of Section 2.1(c)) to make up for the Purchase Shortfall. If Baker fails to purchase the full amount of the Purchase Shortfall in such *** month period, Baker shall be obligated to pay to Supplier an amount equal to the amount of the Purchase Shortfall not purchased by Baker in such *** month period (expressed in tons) multiplied by *** ($***) (the “Makewhole Payment”). The Makewhole Payment shall be paid as liquidated damages and not as a penalty, within *** days of written demand by Supplier by wire transfer of immediately available funds to the account designated in writing by Supplier. The aggregate Purchase Shortfall amount for a Contract Year shall not exceed the Minimum Annual Purchase Requirement for such Contract Year less the amount of Product ordered and delivered to Baker. Baker reserves the right to resell goods purchased from Supplier if deemed necessary by Baker in order to satisfy the Minimum Annual Purchase Requirement. Supplier shall not be obligated to deliver more than the Monthly Maximum Supply Availability on any given calendar month.

2.6 Baker may elect to sell all or any amount of Product comprising the Minimum Annual Purchase Requirement or Monthly Minimum Supply Requirement in order to meet its obligations under this Agreement. If requested by Baker, Supplier will use its best efforts to assist Baker with delivery schedules and delivery locations for any Product sold by Baker. Sales of such Product by Baker will count towards fulfilling Baker’s Minimum Annual Purchase Requirement and Monthly Minimum Supply Requirement. Nothing in this Section will release Baker from its payment obligations to Supplier for such Product sold by Baker.

2.7 Forecast of Demand. Baker shall provide a non-binding six-month rolling volume forecast of its anticipated purchase of Products (“Forecast Amount”). Updates to the Forecast Amount indicated in the six-month rolling volume forecast will be made and communicated periodically as promptly as practicable after Baker becomes aware of such changes. Supplier shall notify Baker within ten (10) Business Days of receiving a forecast or update if Supplier anticipates being unable to meet the anticipated purchase amounts. Supplier shall not be obligated to deliver more than the Monthly Maximum Supply Availability in any given calendar month.

pg. 5

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

2.8 Title and Risk Of Loss. Title and risk of loss or damage to Products shall pass to Baker FCA (details listed in table below), Incoterms 2010. Supplier is not responsible for unfilled orders resulting from any shortage or lack of availability of rail cars for shipment of orders except that Supplier must always meet the minimum supply volumes as specified in Section 2.1. Supplier warrants clear title to the Products at the time title to the Products passes to Baker, free from any and all liens or other encumbrances. Supplier is responsible for proper loading and correct stowing of the Product on the Baker nominated carrier, at its expense, and will comply with any documentary instructions of Baker in the shipment process.

Mode of Transportation	Incoterm	Title and Risk of Loss
Rail Car	FCA (Supplier’s facility in Augusta, WI)	Title and risk of loss will transfer from Supplier to Baker when the Products are loaded by Supplier onto Baker’s designated rail car at the Supplier’s facility in Augusta, WI and/or Wyeville, WI.
Rail Car	FCA (Supplier’s facility in Wyeville, WI)

2.9 Orders. During the Term, Supplier shall supply to Baker, and Baker shall purchase, the types and amounts of the Products ordered by Baker from time to time under this Agreement; provided that Supplier shall be under no obligation to supply or sell, and Baker shall not have the right to buy Products in excess of the Minimum Annual Purchase Requirement during a Contract Year or the Monthly Maximum Supply Availability during a calendar month. This Agreement shall control and govern all transactions between the Parties with respect to the sales and purchases of Products, whether under subsequent verbal and/or written Purchase Orders, unless subject to an express, duly executed agreement (which is not a pre-printed form, terms contained on an Internet site or order confirmation) for the particular subject matter. The terms of this Agreement shall prevail over the terms in the Purchase Order in the event of a conflict unless specific reference and identification is made to the provision of this Agreement to be modified and the intention to modify is explicitly stated and signed by both Parties. Such changes shall be effective for that Purchase Order only. Printed terms and conditions contained in documents issued to Baker by Supplier or from Baker to Supplier with respect to the Products shall be of no force and effect and shall be superseded by the terms and conditions which are contained in this Agreement. Supplier agrees to promptly process all of Baker’s orders under the terms of this Agreement.

2.10 Delivery. Supplier agrees that all Products ordered by Baker will be delivered to Baker per this Article 2 and in accordance with a reasonable delivery date contained in the applicable Purchase Order, subject to the Monthly Maximum Supply Availability.

2.11 Alternate Sources of Supply. Supplier may, in its discretion, source Product from third Persons for purposes of selling such Product to Baker hereunder, so long as such Product meets or exceeds the Specifications and Quality Standards subject to Section 5.1 and Supplier is otherwise in compliance with the other provisions of this Agreement.

pg. 6

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

3.    Invoicing and Payment

3.1 Invoicing and Payment Terms. Subject to any special terms agreed in writing from time to time between Baker and Supplier:

(a) Supplier shall invoice Baker on a monthly basis in respect of all Products supplied under this Agreement during the applicable calendar month, within *** (***) days of the end of such calendar month. Each invoice shall be for the tonnage actually shipped. Payment shall be due no later than the ***^th day after the date of receipt of the invoice.

(b) Should Baker fail to make an adjustment to an invoice to which it was entitled, and as a result has overpaid amounts due to Supplier, then upon such overpayment becoming known and agreed to by the Parties, Supplier shall issue a credit to Baker within *** (***) days, which credit may be applied by and utilized by Baker against future invoices owing to Supplier and, to the extent any credit has not been applied or utilized within *** (***) days from the date of such overpayment, Supplier shall, upon demand received from Baker, immediately refund such remaining credit amount.

(c) Interest Rate on Past Due Payments. Payments *** (***) days or more past due shall bear interest at the rate of *** percent (***%) per month from (and including) the date on which the applicable payment was due to (but excluding) the date on which the applicable payment is paid in full. The accrual of interest as provided in the preceding sentence shall not limit any other remedies of Supplier, which shall include the right to terminate this Agreement in accordance with Section 8.3.

4. Taxes.Supplier is responsible for all taxes legally imposed upon its business, including but not limited to taxes imposed upon its income, its personnel or its property. Such taxes are for Supplier's account. Baker shall pay and Supplier shall collect and is responsible for the reporting of applicable transaction taxes such as severance, sales, use, value added, manufacture, excise, or similar taxes, unless a valid exemption is claimed by Baker. Transaction taxes are in addition to established prices and shall be shown as a separate line item on the invoice. If tax withholding is required by law, Baker will adhere to statutory tax withholding requirements with respect to payments to Supplier. Such withholdings are for Supplier's account and amounts invoiced by Supplier shall not be increased or grossed up to shift the withholding tax cost to Baker.  Certificates of withholding taxes shall be provided to Supplier as soon as administratively possible.

5.    Quality of the Products

5.1 Quality. In entering into this Agreement, Baker relies upon Supplier’s expertise to manufacture the Products and Supplier covenants and warrants to Baker that all Products supplied by Supplier pursuant to this Agreement shall:

(a) Comply with the Quality Standards;

(b) Conform in all respects to the ISO 13503-2 standard Specifications, if any as per this Agreement; and

pg. 7

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

(c) be free and clear of all liens and other encumbrances at the time title to the Products passes to Baker.

5.2 Inspection. Supplier shall permit representatives of Baker, at any reasonable time and upon reasonable prior notice, to inspect the Products manufactured by Supplier at Supplier’s Facility prior to the time of delivery of Products to the carrier. Whether or not Baker conducts an inspection, Supplier shall provide Baker a production sample per Purchase Order in order to show compliance with Section 5.1. A “Production Sample” is defined as one hundred (100) grams of the actual production run and/or lot number of the delivered Product. Such Production Sample shall be retained by Supplier and provided to Baker up to one hundred twenty (120) days from the date of the Purchase Order. Supplier shall provide multiple-sieve analysis of Product at Supplier’s facility for inspection/confirmation by Baker.

5.3 Rejection. Baker shall be entitled to reject any of the Products that do not comply with Section 5.1; provided that any Products not rejected prior to the time of delivery of such Products to the carrier shall be deemed accepted by Baker, unless testing of the applicable Production Sample by an independent third party laboratory conclusively determines that Products previously accepted by Baker do not comply with Section 5.1 (in which case Baker may reject such previously accepted Products upon such determination by the independent third party laboratory). In the event that Baker timely rejects any Products, Supplier shall replace such Products at its sole cost. Supplier shall provide such replacement Products at Supplier’s Facility within a reasonable time under the circumstances. The time for fulfillment of the Minimum Annual Purchase Requirement shall be extended by the amount of time Supplier takes to replace the non-conforming Product with conforming Product.

5.4 Warranty and Claims. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, AS EXPRESSLY SET FORTH IN SECTION 5.1 ABOVE, NO WARRANTY, EXPRESS OR IMPLIED, SHALL BE APPLICABLE TO THE PRODUCTS, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY AS TO THE QUALITY OF THE PRODUCTS, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR SUITABILITY OR ANY IMPLIED WARRANTY THAT ANY OF THE PRODUCTS ARE FIT FOR A PARTICULAR PURPOSE, NOTWITHSTANDING ANY COURSE OF DEALING OR INDUSTRY PRACTICE INCONSISTENT WITH THIS AGREEMENT. Should Baker choose to provide a warranty to its customers beyond the warranty provided by Supplier, then Baker shall bear the entire cost of such warranty. Should any Product not comply with the warranties of Supplier expressly made in this Agreement, then Supplier shall, as the sole and exclusive remedy of Baker, provide replacement Product to Baker at Supplier’s Facility.

5.5 Insurance Requirements. Each of Supplier and Baker shall maintain and exhibit to the other on demand, (a) certificates of comprehensive general liability insurance and employers liability insurance for such amount as may from time to time be agreed between the Parties but in any event not be less than US$*** in each case and (b) certificates of excess liability insurance for such amount as may from time to time be agreed between the Parties but in any event not be less than US$*** per occurrence.

pg. 8

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

6.    Confidentiality

6.1 Confidential Information. All terms of this Agreement regarding price, volume, percentage product mix, product specifications, and liquidated damages (collectively, “Confidential Contract Terms”), and any other terms of this Agreement or other data obtained pursuant to this Agreement, including, without limitation, intellectual property, shall be deemed “Confidential Information”. Baker and Supplier shall hold all Confidential Information in confidence and shall not disclose such information to any third party or otherwise use the Confidential Information except as stated herein or otherwise agreed between the Parties.

6.2 Agreements as to Confidential Information. Each of the Parties, except as agreed otherwise or to the extent necessary in the performance of this Agreement, shall:

(a) instruct its directors, officers and employees not to use, analyze, sell, lease, assign, transfer, license, disclose or make available to any third party the Confidential Information; and

(b) not copy or duplicate by any means, in whole or in part, the Confidential Information except as permitted herein.

6.3 Excluded Information. The obligations of the Parties under this Agreement shall not extend to or include Confidential Information exchanged between the Parties that:

(a) Is or becomes publicly available without the fault of the receiving Party;

(b) Is obtained by the receiving Party from a source other than the disclosing Party and where such source was free of any restrictions owed to the disclosing Party on its use or disclosure;

(c) Was in the receiving Party’s possession prior to the receiving Party’s receipt thereof from the disclosing Party, without any restriction owed to the disclosing Party on its use or disclosure;

(d) Is required to be disclosed by operation of law, judicial or administrative procedure, decree or order or by any regulation or law (including any rules and regulations promulgated by the Securities and Exchange Commission), subject to Section 6.5 hereof; or

(e) Is independently developed by Persons who did not have access to the Confidential Information.

6.4 Additional Obligations. Even if a receiving Party is relieved of its obligations by the exceptions recited above, the receiving Party shall not make known or cause to be made known that the Confidential Information was acquired from the disclosing Party, or that there may be any similarity between such Confidential Information and other information made available from any other source.

6.5 Non-disclosure of Agreement. Except as otherwise provided under this Agreement or as may be required by law or regulation (including any rules and regulations promulgated by the Securities and Exchange Commission), neither Party, without the prior written consent of the other Party, will disclose to any other Person any Confidential Information; provided that a Party may disclose such information

pg. 9

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

(a) to its advisors and Affiliates who agree or who are under a legal or fiduciary obligation to maintain the confidentiality of such information and (b) to prospective purchasers, investors or lenders (subject to the execution by the prospective purchasers, investors or lenders of written confidentiality agreements with terms at least as stringent as those contained herein); provided, that in no event shall such information be disclosed to a competitor of such other Party unless such competitor is seeking to purchase, invest or lend funds to Supplier. If a receiving Party receives a request to disclose all or any part of the disclosing Party’s Confidential Information under the terms of a valid and effective subpoena, decree or order issued by a court of competent jurisdiction or by a governmental body (which, for the avoidance of doubt, shall not include disclosure required pursuant to rules and regulations promulgated by the Securities and Exchange Commission), the receiving Party hereby agrees to, and agrees to cause its Affiliates to, immediately notify the disclosing Party in writing of the existence, terms and circumstances surrounding the request, so that the disclosing Party may seek an appropriate protective order or waive the receiving Party’s compliance with the provisions of this Agreement (and, if the disclosing Party seeks an order, to provide the cooperation as said owner shall reasonably request); and if disclosure of Confidential Information is required in the written opinion of a receiving Party’s counsel, the receiving Party shall exercise reasonable efforts, with the cooperation of the disclosing Party, to obtain an order or other reliable assurance that confidential treatment will be accorded to the disclosed Confidential Information. To the extent that disclosure of Confidential Information (including Confidential Contract Terms) is required by Supplier pursuant to rules and regulations promulgated by the Securities and Exchange Commission or other governmental body, Supplier may disclose such information without liability hereunder if (i) Supplier uses commercially reasonable efforts to obtain (to the extent permitted by applicable law) confidential treatment of the Confidential Contract Terms, (ii) Supplier provides Baker a draft of Supplier’s confidential treatment application no later than five (5) days prior to such application being submitted to the Securities and Exchange Commission, and (iii) Supplier considers in good faith any input received from Baker regarding such application so long as such input is received no later than three (3) days after Baker’s receipt of Supplier’s draft application; provided, however, that Supplier is entitled to rely on the advice of its counsel in determining the content of the application that is ultimately submitted to the Securities and Exchange Commission. Notwithstanding anything to the contrary in this Agreement, Baker hereby agrees and acknowledges that Supplier may disclose companywide aggregate figures, including without limitation weighted average remaining contract length and weighted average pricing, and such disclosure shall not be a violation of this Agreement.

6.6 Materiality. The Parties agree that any disclosure of any Confidential Contract Term in violation of this Agreement shall be considered a material breach for purposes of Sections 8.2 and 8.3 of this Agreement, as applicable. In the event that any Party discloses any Confidential Contract Term in violation of this Agreement, the non-breaching Party’s sole and exclusive remedy for the first two breaches, and only the first two breaches, shall be liquidated damages in an amount equal to (i) $*** if such breach occurs on or prior to April 8, 2014 and (ii) $*** if such breach occurs after April 8, 2014; provided, however, that in each case, the non-breaching party, at its option, may elect to pursue actual damages in lieu of such liquidated damages.

pg. 10

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

7.    Force Majeure

7.1 Force Majeure Events. If either Party is affected by Force Majeure it shall promptly notify the other Party of the nature and extent of the circumstances in question. Neither Party shall be deemed to be in breach of this Agreement, or otherwise be liable to the other, for any delay in performance or the non-performance of any of its obligations under this Agreement, to the extent that the delay or non-performance is due to any Force Majeure, and the time for performance of that obligation shall be extended accordingly; provided, that if the Force Majeure in question prevails for a continuous period in excess of thirty (30) days, the Parties shall enter into discussions with a view to alleviating its effects, or to agreeing upon such alternative arrangements as the Parties mutually agree.

7.2 Limitation. Notwithstanding Section 7.1, neither Party shall be relieved of its obligations to make payments as provided herein (including, but not limited to, the obligations to pay for delivered Products as required hereunder).

8.    Duration and Termination

8.1 Term. This Agreement shall be deemed to become effective on the Effective Date and shall continue in effect through *** (such period being referred to herein as the “Primary Term”), unless earlier terminated as provided herein. This Agreement may be extended beyond the Primary Term by mutual written agreement of the Parties.

8.2 Termination by Baker. If Baker is not then in breach of this Agreement giving rise to an event of termination, this Agreement may be immediately terminated for breach if Supplier fails to produce and deliver Products that meet the Specifications for a period of more than *** (***) days. Upon such breach, Baker may terminate this Agreement immediately by giving written notice of termination to Supplier. Subject to fulfilling its obligations to purchase the Minimum Annual Purchase Requirement each Contract Year and the Monthly Minimum Supply Requirement each calendar month, Baker may terminate any Purchase Order upon *** (***) Business Days written notice. In the event Supplier has incurred costs in executing the Purchase Order up to termination, Baker shall reimburse Supplier for such documented costs. In the event of Supplier’s failure to perform any of its material obligations under this Agreement (including failure to deliver agreed upon amounts of Product and not making up the Supply Shortfall as contemplated by Section 2.1(c)), Baker shall promptly give Supplier notice thereof. Such notice shall specifiy the nature of such failure with particularity and in reasonable detail, including the specific provision of this Agreement to which such purported failure relates. Supplier shall use commercially reasonable efforts to cure or otherwise remedy the failure specified in such notice within *** (***) days after its receipt of such notice. A failure specified in such notice that Supplier does not cure or otherwise remedy in such *** (***) day period shall be deemed a “Supplier Uncured Failure”. Baker shall have the right to terminate this Agreement if Supplier has more than *** (***) Supplier Uncured Failures in any *** (***) month period. Baker’s sole and exclusive damages in case of such termination shall be limited to $*** per short ton of Product that Supplier is obligated to deliver and remains undelivered for the remaining Term of the Agreement after the filling of all outstanding Purchase Orders. The Parties acknowledge and agree that in the event of a breach under this Section 8.2, the damages would be difficult if not

pg. 11

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

impossible to quantify, and accordingly, such payment shall be for liquidated damages and not as any form of penalty.

8.3 Termination by Supplier. If Supplier is not then in breach of this Agreement giving rise to an event of termination, this Agreement may be immediately terminated for breach if Baker fails to pay any invoice submitted by Supplier under this Agreement within *** days of the date of receipt of such invoice, provided that Supplier has provided two (2) separate prior written notices to Baker that such invoice is due and outstanding and such second written notice is provided not less than 30 days prior to the date that Supplier seeks such termination. Upon such breach, Supplier may terminate this Agreement immediately by giving written notice of termination to Baker. In the event of Baker’s failure to perform any of its material obligations under this Agreement (including the failure to order and take delivery of the required volumes of Product or pay sums due hereunder), Supplier shall promptly give Baker notice thereof. Such notice shall specifiy the nature of such failure with particularity and in reasonable detail, including the specific provision of this Agreement to which such purported failure relates. Baker shall use commercially reasonable efforts to cure or otherwise remedy the failure specified in such notice within *** (***) days after its receipt of such notice. A failure specified in such notice that Baker does not cure or otherwise remedy in such *** (***) day period shall be deemed a “Baker Uncured Failure”. Supplier shall have the right to terminate this Agreement if Baker has more than *** (***) Baker Uncured Failures in any *** (***) month period. Supplier’s sole and exclusive damages in case of such termination shall be limited to $*** per short ton of Product that remains undelivered under each Minimum Annual Purchase Requirement for the remaining Term of the Agreement after the filling of all outstanding Purchase Orders. The Parties acknowledge and agree that in the event of a breach under this Section 8.3, the damages would be difficult if not impossible to quantify, and accordingly, such payment shall be for liquidated damages and not as any form of penalty.

8.4 Termination of Purchase Order. Termination of a Purchase Order does not terminate this Agreement. Termination of this Agreement will automatically terminate all outstanding Purchase Orders, except those Purchase Orders that are expressly affirmed by Baker.

8.5    Events Upon Termination.

(a) Upon expiration of this Agreement or the termination of the Agreement for reasons other than pursuant to Section 8.2, Baker shall purchase from Supplier all Products which have been ordered from Supplier but not delivered to Baker at the date of termination, and Supplier shall promptly manufacture and deliver such Products to Baker.

(b) Upon expiration of this Agreement or the termination of this Agreement for any reason, all obligations of the Parties hereunder shall terminate, except for any obligations that are expressly stated to survive the expiration of the Term or termination of this Agreement and any obligations that remain executory which obligations, to the extent they remain executory, shall remain in full force and effect until fully performed by the obligated Party as stated in this Agreement. The respective Parties’ obligations under Section 3.1, Section 5.4, Article 6, this Section 8.5 and Articles 9 through 13 shall survive the expiration of the Term or termination of this Agreement. Neither expiration nor termination of this

pg. 12

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

Agreement shall relieve any Party of liability for breaches of this Agreement prior to such expiration or termination.

9.    INDEMNITY AND LIMITATION OF LIABILITY

9.1    INDEMNIFICATION. 

(a) BAKER AND SUPPLIER AGREE TO FULLY RELEASE, INDEMNIFY, DEFEND AND HOLD ONE ANOTHER AND THEIR RESPECTIVE PARENT, SUBSIDIARY OR AFFILIATED ENTITIES HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, COSTS, CAUSES OF ACTION, FINES, PENALTIES OR OTHER LIABILITY THAT MAY BE ASSERTED AGAINST THE OTHER AND/OR THEIR RESPECTIVE GROUPS, TO THE EXTENT, ARISING OUT OF THE INDEMNIFYING PARTY’S OR THEIR RESPECTIVE GROUP’S NEGLIGENCE OR WILLFUL MISCONDUCT IN CONNECTION WITH PERFORMANCE UNDER THIS AGREEMENT.

(b) NOTWITHSTANDING PARAGRAPH 9.1, BAKER AND SUPPLIER SPECIFICALLY ACKNOWLEDGE AND AGREE THAT THE GOODS PROVIDED BY SUPPLIER HEREUNDER ARE INHERENTLY DANGEROUS AND BAKER AGREES TO INDEMNIFY AND HOLD HARMLESS SUPPLIER ITS PARENT, SUBSIDIARY AND AFFILIATED ENTITIES FROM AND AGAINST ANY CLAIMS, COSTS, CAUSES OF ACTION, FINES, PENALTIES OR OTHER LIABILITY TO THE EXTENT CAUSED BY BAKER’S NEGLIGENT USE OF THE PRODUCT(S) OR NEGLIGENT OR WILLFUL FAILURE TO PROVIDE ADEQUATE WARNING OR REASONABLE PROTECTIVE PROCEDURES AND EQUIPMENT WITH RESPECT TO THE USE OF THE PRODUCT(S).

9.2 Limitation of Liability. NOTWITHSTANDING ANY PROVISION HEREIN TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR, AND EACH PARTY RELEASES THE OTHER FROM LIABILITY ATTRIBUTABLE TO, ANY SPECIAL, ECONOMIC, INDIRECT, CONSEQUENTIAL, OR OTHER INCIDENTAL DAMAGES ARISING OUT OF THE PERFORMANCE OF THIS AGREEMENT, OR DEFAULT IN THE PERFORMANCE HEREOF, WHETHER BASED UPON CONTRACT, TORT (INCLUDING NEGLIGENCE, PRODUCT LIABILITY OR STRICT LIABILITY), OR WARRANTY.

9.3 Indemnification Procedure. In the event either Party learns of any claim, liability, demand or cause of action relating to this Agreement or the performance hereunder, which said Party shall determine, in its sole discretion, that the other Party may be liable therefor, said Party shall promptly notify the other Party. If indemnity is required by any of the terms of this Agreement, the indemnifying Party shall have the right to control all litigation and shall defend the other and pay all settlements, judgments, costs, and expenses (including without limitation court costs and reasonable attorneys’ fees), whether related or unrelated, similar or dissimilar to the foregoing, incident thereto. Each Party, if requested, agrees to cooperate with the other in any defense, and the indemnifying Party shall reimburse the other for all reasonable expenses incurred in connection therewith. The indemnified Party shall have

pg. 13

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

the right to counsel of its own choosing and at its sole expense participate in any such litigation. Notwithstanding the foregoing, however, neither Party shall effect settlement of or compromise any such claim or proceedings without having obtained the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed; provided that the indemnifying Party may settle or compromise any such claim if the settlement or compromise (a) requires solely the payment of money damages by the indemnifying Party, and (b) includes as an unconditional term thereof the release by the claimant or the plaintiff of the indemnified Party from all liability in respect of such claim. If the indemnified Party does not consent to a settlement which the indemnifying Party is willing to accept, then the indemnifying Party’s liability shall be limited to the amount for which the claim could have been settled provided, such settlement does not require the indemnified Party to forego any property rights other than the amount of payment of the proposed settlement.

9.4 Compliance with Law. Subject to the limitations of this Agreement, it is agreed that in the performance of this Agreement all matters shall be conducted in full compliance with any and all applicable federal, state, provincial and local laws, rules and regulations in the area(s) in which the matters are being conducted. Any performance obligation arising under this Agreement is contingent on the prior receipt of all necessary government authorizations. If either Party is required to pay any fine or penalty or is subject to a claim from the other Party’s failure to comply with applicable laws, rules or regulations, the Party failing to comply shall defend, indemnify and hold harmless the other Party for all damages, fees and/or fines for such failure to comply to the extent of the indemnifying Party’s allocable share of the failure to comply.

9.5 Antibribery. Supplier represents and warrants that it and all of its Affiliates and agents shall act in accordance with the principles described in the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, signed in Paris on December 17, 1997 (“the Convention”), and the Convention’s Commentaries (collectively the “OECD Principles”), and shall comply with all applicable laws implementing the OECD Principles (including the U.S. Foreign Corrupt Practices Act of 1977, as amended), as well as any applicable local laws related to anti-corruption, anti-kickbacks, and anti-money laundering. Supplier agrees not to take or fail to take any action that might cause Baker to be in violation of any such laws. In addition to the foregoing, Supplier represents and warrants that it and its Affiliates have not and shall not request, induce, make, offer, authorize, promise to make any payment or transfer anything of value, directly or indirectly, (a) to any governmental official or employee (including employees of government-owned or government-controlled corporations, agencies or bodies), (b) any official or employee of a public international organization, (c) to any political party, official of a political party or candidate, or (d) to any third party knowing, believing, or suspecting that such third party will give the payment, or any portion thereof, to any of the foregoing persons in order to obtain or retain business, or for any other improper purpose. In no event shall Supplier make payments to governmental officials or employees on behalf of Baker.

9.6 Code of Conduct/ Gifts, Entertainment and Travel. It is considered to be in conflict with Baker’s interest for its employees or any member of their immediate family to accept gifts, payments, extravagant entertainment, services, or loans in any form from anyone soliciting business, or who may already have established business relations with Baker. Gifts of nominal value and entertainment, meals, and social invitations that are customary and proper under the circumstances and that do not

pg. 14

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

place the recipient under any obligation are acceptable. Any gifts, payment of individual expenses, including, without limitation, trips, or conveyances to Baker employees shall be disclosed in writing to the Baker Ethics and Compliance Group.

9.7 Information Requests. Supplier shall maintain full and complete accounting records of activity performed and expenditures incurred by Supplier in connection with this Agreement in such a manner and detail as to permit verification of compliance with the provisions of Sections 9.4 through 9.6. Baker shall have the right to a third-party audit of such Supplier’s records for a period commencing on July 1, 2016 and ending two (2) years from the expiration or termination of this Agreement subject to the execution of a non-disclosure agreement reasonably acceptable to Supplier. This provision shall survive expiration or termination of this Agreement.

Notwithstanding anything to the contrary, neither Party shall be required to take or refrain from taking any action prohibited or penalized under the laws of the United States, including the U.S. antiboycott laws.

9.8 Economic Sanctions and Export Controls. Supplier agrees to fully comply with all economic sanctions and export control laws and regulations, including those regulations maintained by the U.S. Commerce Department’s Bureau of Industry and Security and the U.S. Treasury Department’s Office of Foreign Assets Control. In addition, Supplier shall not, directly or indirectly, sell, provide, export, re-export, transfer, divert, loan, lease, consign or otherwise dispose of any Baker equipment, product, services, software, source code, technical data or technology to or via any person, entity or destination, or for any activity or end-use restricted by the laws or regulations of the United States or any other applicable jurisdiction (including nuclear, missile, chemical or biological weapons proliferation, military, or money laundering activities) without first obtaining all required government authorizations.

10.    Nature of Agreement

10.1 Assignment. Either Party shall have the right to assign or transfer to any Person any of its rights or obligations under this Agreement without the prior written consent of the other Party, provided that the assigning Party shall remain liable to the other Party under the terms of this Agreement notwithstanding such assignment. This Agreement shall be binding on and inure to the benefit of the Parties and their respective successors and permitted assigns, including any successor upon a sale or change of control of a Party. This Agreement is intended solely for the benefit of the Parties and their respective successors and permitted assigns.

10.2 Relationship. Each of the Parties is an independent contractor with respect to the other and is not an employee of the other Party or any of the other Party’s Affiliates, and nothing in this Agreement is intended to constitute a partnership or a master and servant relationship between the Parties. Each of the Parties understands and agrees that this Agreement does not create an exclusive dealings arrangement and that each of Baker and Supplier may enter into similar arrangements with other companies with respect to similar or the same Product. Nothing in this Agreement shall be construed to create any duty to, or standard of care with reference to, or liability of a Party to, any person not a Party to this Agreement. Nothing in this Agreement shall be deemed to constitute any fiduciary or

pg. 15

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

special relationship or duty between the Parties and each Party may take actions hereunder that are for its own self-interest without any duty or, subject to the express terms of this Agreement, liability to the other Parties.

10.3 Entire Agreement; Amendment. This Agreement, including its appendices, exhibits and schedules, constitutes the entire Agreement between the Parties with respect to the subject matter hereof and supersedes any existing agreements between them whether oral or written, including the Original Agreement. The terms of this Agreement shall only be amended, modified or supplemented as set forth herein or in a writing signed by or on behalf of both or the Parties. In case of a conflict between this Agreement and a Purchase Order or Purchase Order confirmation contemplated hereunder, the terms of this Agreement shall govern. Acceptance of a Purchase Order or Purchase Order confirmation is insufficient to amend this Agreement unless a separate writing is duly executed by all the Parties specifically amending this Agreement.

10.4 Reformation. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any Party. Upon the determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that transactions contemplated hereby are fulfilled to the extent possible. In the event any such provision, clause, sentence or part of this Agreement cannot be modified to comply with the law, then said provision, clause, sentence or portion of the Agreement shall be deemed to be deleted from the Agreement and the remaining terms and conditions shall remain in full force and effect.

11.    Notices and Service

11.1 Addresses. All notices, requests, consents, directions and other instruments and communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if delivered in person, by courier or by overnight delivery service with proof of delivery addressed to the respective Party at the address set forth below, or if sent by facsimile or other similar form of communication (with receipt confirmed) to the respective Party at the facsimile numbers set forth below:

If to Baker, to:

Baker Hughes Oilfield Operations, Inc.

Attn: Jack Kardow

11211 FM 2920

Tomball, TX 77375

Fax: 281.357.2512

pg. 16

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

If to Supplier, to:

Hi-Crush Operating LLC

Three Riverway, Suite 1550

Houston, TX 77056

Attn: General Counsel

Fax: (713) 963-0088

or to such other address or facsimile number and to the attention of such other Person(s) as either Party may designate by written notice. Any notice mailed by over-night delivery service shall be deemed to have been given and received on the second Business Day following the day of mailing.

12.    General

12.1 Waiver. No failure or delay by either Party in exercising any of its rights under this Agreement shall be deemed to be waiver of that right, and no waiver by either Party of a breach of any provision of this Agreement shall be deemed to be a waiver of any subsequent breach of the same or any other provision.

12.2 Costs. The Parties shall bear their own costs of, and incidental to, the preparation, execution and implementation of this Agreement.

12.3 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original and all of which shall constitute the same instrument. The exchange of copies of this Agreement and of signature pages by facsimile transmission (whether directly from one facsimile device to another by means of a dial-up connection or whether otherwise transmitted via electronic transmission), by electronic mail in “portable document format” (“.pdf”) form, or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, or by a combination of such means, shall constitute effective execution and delivery of this Agreement as to the Parties and may be used in lieu of an original Agreement for all purposes. Signatures of the Parties transmitted by facsimile or other electronic transmission shall be deemed to be original signatures for all purposes. Minor variations in the form of signature pages of this Agreement, including footers from earlier versions of this Agreement, shall be disregarded in determining a Party’s intent or the effectiveness of such signature.

13.    Governing Law and Venue

13.1 Governing Law; Venue. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Texas, without giving effect to that state’s conflicts of laws principles or choice of law rules. The Parties agree that Houston, Harris County, Texas, shall be the exclusive forum and venue for resolving any disputed matter.

It is the intent of the Parties to exclude the application of the United Nations Convention on Contracts for the International Sale of Goods (1980). Nothing herein shall prohibit a Party from availing itself of a court of competent jurisdiction for the purpose of injunctive relief. The Parties acknowledge and

pg. 17

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

agree that the Parties may have available to them laws or remedies available under applicable local legislation; it is the intent of the Parties to have the terms of this Agreement apply in every instance, including, without limitation, the choice of law provisions.

[Signature Page Follows]

pg. 18

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.

BAKER:

BAKER HUGHES OILFIELD OPERATIONS, INC.

By: /s/ Authorized Person

Name: Authorized Person

Title: Authorized Officer

Date: October 8, 2013

SUPPLIER: HI-CRUSH OPERATING LLC

By: /s/ Robert E. Rasmus

Name: Robert E. Rasmus

Title: Co-CEO

Date: October 8, 2013

Exhibit 10.22

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT OF THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH THREE ASTERISKS (***).

EXHIBIT A

Product Specifications

EX-21.1

Exhibit 21.1

LIST OF SUBSIDIARIES OF HI-CRUSH PARTNERS LP
Name	Jurisdiction
Hi-Crush Operating LLC	Delaware
Hi-Crush Chambers LLC	Delaware
Hi-Crush Wyeville LLC	Delaware
Hi-Crush Railroad LLC	Delaware
D & I Silica, LLC	Delaware
Hi-Crush Finance Corp.	Delaware

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-191481) and Form S-8 (No. 333-187796) of Hi-Crush Partners LP (the “Partnership”) of (i) our report dated February 28, 2014 relating to the consolidated financial statements of the Partnership and (ii) our report dated March 13, 2013 relating to the consolidated financial statements of Hi-Crush Proppants LLC (Predecessor), both of which appear in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2013.

/S/ PRICEWATERHOUSECOOPERS LLP

Houston, Texas

February 28, 2014

EX-23.2

Exhibit 23.2

CONSENT OF JOHN T. BOYD COMPANY

The undersigned hereby consents to the references to our firm in the form and context in which they appear in (i) the Annual Report on Form 10-K of Hi-Crush Partners LP for the fiscal year ended December 31, 2013 and (ii) the Quarterly Reports on Form 10-Q of Hi-Crush Partners LP for the fiscal quarters ended March 31, 2014, June 30, 2014 and September 30, 2014. We hereby further consent to the use in such Form 10-K and Form 10-Qs of information contained in our reports setting forth the estimates of reserves as of December 31, 2013. We hereby further consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-191481) and Form S-8 (No. 333-187796) of Hi-Crush Partners LP of such information.

Respectfully submitted,

JOHN T. BOYD COMPANY

By: /s/ Ronald L. Lewis

Name: Ronald L. Lewis

Title: Managing Director and COO

February 1, 2014

EX-23.3

Exhibit 23.3

CONSENT OF PROPTESTER, INC.

The undersigned hereby consents to the references to our firm in the form and context in which they appear in (i) the Annual Report on Form 10-K of Hi-Crush Partners LP for the fiscal year ended December 31, 2013 and (ii) the Quarterly Reports on Form 10-Q of Hi-Crush Partners LP for the fiscal quarters ended March 31, 2014, June 30, 2014 and September 30, 2014. We hereby further consent to the use in such Form 10-K and Form 10-Qs of information contained in our reports summarizing the crush strength testing performed by us. We hereby further consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-191481) and Form S-8 (No. 333-187796) of Hi-Crush Partners LP of such information.

Very truly yours,

/s/ Authorized Person

PropTester, Inc.

Cypress, TX

February 1, 2014

EX-23.4

Exhibit 23.4

CONSENT OF STIM-LAB, INC.

The undersigned hereby consents to the references to our firm in the form and context in which they appear in (i) the Annual Report on Form 10-K of Hi-Crush Partners LP for the fiscal year ended December 31, 2013 and (ii) the Quarterly Reports on Form 10-Q of Hi-Crush Partners LP for the fiscal quarters ended March 31, 2014, June 30, 2014 and September 30, 2014. We hereby further consent to the use in such Form 10-K and Form 10-Qs of information contained in our reports summarizing the crush strength testing performed by us. We hereby further consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-191481) and Form S-8 (No. 333-187796) of Hi-Crush Partners LP of such information.

Very truly yours,

/s/ Authorized Person

Stim-Lab, Inc.

Duncan, OK

February 13, 2014

EX-23.5

Exhibit 23.5

CONSENT OF FREEDONIA GROUP, INC.

The undersigned hereby consents to the references to our firm in the form and context in which they appear in (i) the Annual Report on Form 10-K of Hi-Crush Partners LP for the fiscal year ended December 31, 2013 and (ii) the Quarterly Reports on Form 10-Q of Hi-Crush Partners LP for the fiscal quarters ended March 31, 2014, June 30, 2014 and September 30, 2014. We hereby further consent to the use in such Form 10-K and Form 10-Qs of information contained in our Industry Study #3048. We hereby further consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-191481) and Form S-8 (No. 333-187796) of Hi-Crush Partners LP of such information. It is specifically understood that appropriate attribution will be provided in any such report.

Very truly yours,

/s/ Authorized Person

The Freedonia Group, Inc.

February 1, 2014

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

(Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)

I, Robert E. Rasmus, certify that:

1. I have reviewed this Annual Report on Form 10-K of Hi-Crush Partners LP;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Robert E. Rasmus

Robert E. Rasmus

Co-Chief Executive Officer

February 28, 2014

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

(Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)

I, James M. Whipkey, certify that:

1. I have reviewed this Annual Report on Form 10-K of Hi-Crush Partners LP;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ James M. Whipkey

James M. Whipkey

Co-Chief Executive Officer

February 28, 2014

EX-31.3

Exhibit 31.3

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

(Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002)

I, Laura C. Fulton certify that:

1. I have reviewed this Annual Report on Form 10-K of Hi-Crush Partners LP;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Laura C. Fulton

Laura C. Fulton

Chief Financial Officer

February 28, 2014

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

(Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Annual Report on Form 10-K for the year ended December 31, 2013 of Hi-Crush Partners LP (the “Partnership”) as filed with the Securities and Exchange Commission on the date hereof (the “Report”) and pursuant to 18. U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, Robert E. Rasmus, Co-Chief Executive Officer of the Partnership, certify, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Robert E. Rasmus

Robert E. Rasmus

Co-Chief Executive Officer

February 28, 2014

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

(Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Annual Report on Form 10-K for the year ended December 31, 2013 of Hi-Crush Partners LP (the “Partnership”) as filed with the Securities and Exchange Commission on the date hereof (the “Report”) and pursuant to 18. U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, James M. Whipkey, Co-Chief Executive Officer of the Partnership, certify, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ James M. Whipkey

James M. Whipkey

Co-Chief Executive Officer

February 28, 2014

EX-32.3

Exhibit 32.3

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

(Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Annual Report on Form 10-K for the year ended December 31, 2013 of Hi-Crush Partners LP (the “Partnership”) as filed with the Securities and Exchange Commission on the date hereof (the “Report”) and pursuant to 18. U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, Laura C. Fulton, Chief Financial Officer of the Partnership, certify, that to my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Laura C. Fulton

Laura C. Fulton

Chief Financial Officer

February 28, 2014

EX-95.1

Exhibit 95.1

MINE SAFETY DISCLOSURES

The following disclosures are provided pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) and Item 104 of Regulation S-K, which requires certain disclosures by companies required to file periodic reports under the Securities Exchange Act of 1934, as amended, that operate mines regulated under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”).

Mine Safety Information

Whenever the Federal Mine Safety and Health Administration (“MSHA”) believes a violation of the Mine Act, any health or safety standard or any regulation has occurred, it may issue a citation which describes the alleged violation and fixes a time within which the U.S. mining operator must abate the alleged violation. In some situations, such as when MSHA believes that conditions pose a hazard to miners, MSHA may issue an order removing miners from the area of the mine affected by the condition until the alleged hazards are corrected. When MSHA issues a citation or order, it generally proposes a civil penalty, or fine, as a result of the alleged violation, that the operator is ordered to pay. Citations and orders can be contested and appealed, and as part of that process, may be reduced in severity and amount, and are sometimes dismissed. The number of citations, orders and proposed assessments vary depending on the size and type (underground or surface) of the mine as well as by the MSHA inspector(s) assigned.

Mine Safety Data

The following provides additional information about references used in the table below to describe the categories of violations, orders or citations issued by MSHA under the Mine Act:

• Section 104 S&S Citations: Citations received from MSHA under section 104 of the Mine Act for violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard.

• Section 104(b) Orders: Orders issued by MSHA under section 104(b) of the Mine Act, which represents a failure to abate a citation under section 104(a) within the period of time prescribed by MSHA. This results in an order of immediate withdrawal from the area of the mine affected by the condition until MSHA determines that the violation has been abated.

• Section 104(d) Citations and Orders: Citations and orders issued by MSHA under section 104(d) of the Mine Act for unwarrantable failure to comply with mandatory health or safety standards.

• Section 110(b)(2) Violations: Flagrant violations issued by MSHA under section 110(b)(2) of the Mine Act.

• Section 107(a) Orders: Orders issued by MSHA under section 107(a) of the Mine Act for situations in which MSHA determined an “imminent danger” (as defined by MSHA) existed.

The following table details the violations, citations and orders issued to us by MSHA during the year ended December 31, 2013:

Mine(1)	Section 104 S&S Citations(2)(#)	Section 104(b) Orders (#)	Section 104(d) Citations and Orders (#)	Section 110(b)(2) Violations (#)	Section 107(a) Orders (#)	Proposed Assessments(3) ($)		Mining Related Fatalities (#)
Wyeville, WI	9	—	—	—	—	$	2,212	—
(1) The definition of mine under section 3 of the Mine Act includes the mine, as well as other items used in, or to be used in, or resulting from, the work of extracting minerals, such as land, structures, facilities, equipment, machines, tools and minerals preparation facilities. Unless otherwise indicated, any of these other items associated with a single mine have been aggregated in the totals for that mine. MSHA assigns an identification number to each mine and may or may not assign separate identification numbers to related facilities such as preparation facilities. We are providing the information in the table by mine rather than MSHA identification number because that is how we manage and operate our mining business and we believe this presentation will be more useful to investors than providing information based on MSHA identification numbers.
(2) All citations have been terminated
(3) Represents the total dollar value of the proposed assessment from MSHA under the Mine Act pursuant to the citations and/or orders preceding such dollar value in the corresponding row.

Pattern or Potential Pattern of Violations

During the year ended December 31, 2013, none of the mines operated by us received written notice from MSHA of (a) a pattern of violations of mandatory health or safety standards that are of such nature as could have significantly and substantially contributed to the cause and effect of mine health or safety hazards under section 104(e) of the Mine Act or (b) the potential to have such a pattern.

Pending Legal Actions

During the year ended December 31, 2013, we had no legal actions instituted by or resolved before the Federal Mine Safety and Health Review Commission (the Commission); as of December 31, 2013, we had no pending legal actions. The Commission is an independent adjudicative agency established by the Mine Act that provides administrative trial and appellate review of legal disputes arising under the Mine Act. These cases may involve, among other questions, challenges by operators to citations, orders and penalties they have received from MSHA, or complaints of discrimination by miners under Section 105 of the Mine Act. The following provides additional information of the types of proceedings that may be brought before the Commission:

• Contest Proceedings: A contest proceeding may be filed by an operator to challenge the issuance of a citation or order issued by MSHA.

• Civil Penalty Proceedings: A civil penalty proceeding may be filed by an operator to challenge a civil penalty MSHA has proposed for a violation contained in a citation or order. The Partnership does not institute civil penalty proceedings based solely on the assessment amount of proposed penalties. Any initiated adjudications address substantive matters of law and policy instituted on conditions that are alleged to be in violation of mandatory standards of the Mine Act.

• Discrimination Proceedings: Involves a miner’s allegation that he or she has suffered adverse employment action because he or she engaged in activity protected under the Mine Act, such as making a safety complaint. Also includes temporary reinstatement proceedings involving cases in which a miner has filed a complaint with MSHA stating that he or she has suffered discrimination and the miner has lost his or her position.

• Compensation Proceedings: A compensation proceeding may be filed by miners entitled to compensation when a mine is closed by certain closure orders issued by MSHA. The purpose of the proceeding is to determine the amount of compensation, if any, due to miners idled by the orders.

• Temporary Relief: Applications for temporary relief are applications filed under section 105(b)(2) of the Mine Act for temporary relief from any modification or termination of any order.

• Appeals: An appeal may be filed by an operator to challenge judges’ decisions or orders to the Commission, including petitions for discretionary review and review by the Commission on its own motion.

XML

Asset Retirement Obligation (Tables)

12 Months Ended

Dec. 31, 2013

Asset Retirement Obligation [Abstract]

Reconciliation of Total Reclamation Liability for Asset Retirement Obligations

Although the ultimate amount of reclamation and closure costs to be incurred is uncertain, the Partnership maintained a post-closure reclamation and site restoration obligation as follows:

Balance at January 1, 2011	$	—
Additions to liabilities	804
Accretion expense	28
Balance at December 31, 2011	832
Additions to liabilities	651
Accretion expense from January 1 to August 15, 2012	16
Accretion expense from August 16 to December 31, 2012	56
Balance at December 31, 2012	1,555
Additions to liabilities	—
Accretion expense	118
Balance at December 31, 2013	$	1,673

XML

Goodwill and Intangible Assets - Intangible Assets Arising from Acquisition (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013
Finite-Lived Intangible Assets And Liabilities [Line Items]
Intangible assets, net	$ 38,191
Minimum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	1 year
Maximum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	18 years
Successor
Finite-Lived Intangible Assets And Liabilities [Line Items]
Intangible assets	41,878
Less: Accumulated amortization	(3,687)
Intangible assets, net	38,191
Supplier Agreements | Minimum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	1 year
Supplier Agreements | Maximum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	20 years
Supplier Agreements | Successor
Finite-Lived Intangible Assets And Liabilities [Line Items]
Intangible assets	21,997
Customer Contracts And Relationships | Minimum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	1 year
Customer Contracts And Relationships | Maximum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	10 years
Customer Contracts And Relationships | Successor
Finite-Lived Intangible Assets And Liabilities [Line Items]
Intangible assets	18,132
Other Intangible Assets | Minimum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	1 year
Other Intangible Assets | Maximum
Finite-Lived Intangible Assets And Liabilities [Line Items]
Useful life	3 years
Other Intangible Assets | Successor
Finite-Lived Intangible Assets And Liabilities [Line Items]
Intangible assets	$ 1,749

XML

Business Combination - Acquisition Accounting - Additional Information (Details) (USD $) In Thousands, except Share data, unless otherwise specified	0 Months Ended	7 Months Ended
	Jun. 10, 2013	Dec. 31, 2013
Business Acquisition [Line Items]
Working Capital Purchase Price Allocation And Other	$ 132,517
D&I Silica, LLC
Business Acquisition [Line Items]
Business acquisition, cash paid	95,159
Business acquisition, number of shares issued	1,578,947
Business acquisition, value of share issued	37,358
Revenue		66,071
Net Income		3,801
Preliminary purchase price	132,517
Acquisition related costs		$ 1,728

XML

Commitments and Contingencies - Schedule of future minimum operating lease payments (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Commitments and Contingencies Disclosure [Abstract]
2014	$ 7,009
2015	6,599
2016	5,640
2017	5,425
2018	4,881
Thereafter	7,420
Future minimum payments, total	$ 36,974

XML

Goodwill and Intangible Assets - Amortization Expense (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Goodwill and Intangible Assets Disclosure [Abstract]
2014	$ 5,127
2015	2,967
2016	2,938
2017	2,850
2018	2,850
Thereafter	21,459
Intangible assets, net	$ 38,191

XML

Initial Public Offering - Consolidated Net Assets Contributed to Partnership (Detail) (USD $)	Dec. 31, 2013	Dec. 31, 2012	Aug. 17, 2012
Assets:
Due from sponsor		$ 5,615,000
Liabilities:
Deferred revenue	0	1,715,000
Net Assets Contributed to Partnership – August 16, 2012			83,154,000
Partnership
Assets:
Cash			1,984,000
Accounts receivable, net			12,453,000
Inventories			4,085,000
Due from sponsor			4,606,000
Prepaid expenses and other current assets			26,000
Property, plant and equipment, net			69,623,000
Other assets			1,113,000
Total assets			93,890,000
Liabilities:
Accounts payable			1,397,000
Accrued liabilities			1,901,000
Deferred revenue			6,590,000
Asset retirement obligation			848,000
Total liabilities			10,736,000
Net Assets Contributed to Partnership – August 16, 2012			$ 83,154,000

XML

Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

Components of Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	December 31, 2013			December 31, 2012
	Successor			Successor
Buildings	$	2,107		$	417
Mining property and mine development	24,522			24,156
Plant and equipment	47,669			43,767
Rail and rail equipment	12,774			5,499
Transload facilities and equipment	30,265			—
Construction-in-progress	1,829			1,380
	119,166			75,219
Less: Accumulated depreciation and depletion	(5,824		)	(2,375		)
	$	113,342		$	72,844

Depreciation and Depletion Expense

Depreciation and depletion expense was as follows during the periods presented:

Predecessor Periods
Year ended December 31, 2011	$	449
Period from January 1 through August 15, 2012	1,089
Successor Period
Period from August 16 through December 31, 2012	$	863
Year ended December 31, 2013	3,399

XML

Quarterly Financial Data (Unaudited) - Combined Quarterly Results for Third Quarter (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended	7 Months Ended	12 Months Ended	5 Months Ended	8 Months Ended	12 Months Ended								1 Months Ended		3 Months Ended		1 Months Ended	3 Months Ended		1 Months Ended	3 Months Ended
	Dec. 31, 2013 Subordinated Units	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor	Dec. 31, 2012 Successor	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor	Dec. 31, 2013 Successor Common Units	Dec. 31, 2013 Successor Subordinated Units	Dec. 31, 2012 Pro Forma	Dec. 31, 2012 Pro Forma Common Units		Dec. 31, 2012 Pro Forma Subordinated Units		Aug. 15, 2012 Third Quarter Predecessor	Sep. 30, 2012 Third Quarter Successor	Sep. 30, 2013 Third Quarter Successor		Sep. 30, 2012 Third Quarter Successor Common Units	Sep. 30, 2013 Third Quarter Successor Common Units		Sep. 30, 2012 Third Quarter Successor Subordinated Units	Sep. 30, 2013 Third Quarter Successor Subordinated Units		Sep. 30, 2012 Third Quarter Pro Forma		Sep. 30, 2012 Third Quarter Pro Forma Common Units		Sep. 30, 2012 Third Quarter Pro Forma Subordinated Units
Quarterly Financial Data [Line Items]
Revenues		$ 46,776	$ 20,353	$ 28,858		$ 141,742			$ 75,634					$ 12,601	$ 12,643	$ 43,515	[1]							$ 25,244	[1]
Gross profit		33,440	13,906	21,713		67,203			55,154					9,536	9,811	17,557	[1]							19,347	[1]
Income from operations		28,254	11,173	18,771		50,834			47,025					7,918	9,189	12,498	[1]							17,107	[1]
Net income	$ 28,234	$ 25,020	$ 9,280	$ 18,508	$ 18,508	$ 58,562			$ 43,528					$ 7,069	$ 9,109	$ 15,040	[1]							$ 16,178	[1]
Earnings per unit (in USD per share)							$ 2.08	$ 2.08		$ 0.68	[2]	$ 0.68	[2]					$ 0.33	$ 0.52	[1]	$ 0.33	$ 0.52	[1]			$ 0.33	[1],[2]	$ 0.33	[1],[2]

[1] The results for the third quarter ended September 30, 2012 include those of our predecessor (July 1 to August 15) combined with the successor (August 16 to September 30)

[2] Earnings per unit was only calculated for periods subsequent to the August 16, 2012 initial public offering.

XML

Property, Plant and Equipment - Components of Property, Plant and Equipment (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013 Successor	Dec. 31, 2012 Successor	Jul. 13, 2012 Predecessor	Dec. 31, 2013 Buildings Successor	Dec. 31, 2012 Buildings Successor	Dec. 31, 2013 Mining property and mine development Successor	Dec. 31, 2012 Mining property and mine development Successor	Dec. 31, 2013 Plant and equipment Successor	Dec. 31, 2012 Plant and equipment Successor	Dec. 31, 2013 Rail and rail equipment Successor	Dec. 31, 2012 Rail and rail equipment Successor	Dec. 31, 2013 Transload facilities and equipment Successor	Dec. 31, 2012 Transload facilities and equipment Successor	Dec. 31, 2013 Construction-in-progress Successor	Dec. 31, 2012 Construction-in-progress Successor
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	$ 119,166	$ 75,219		$ 2,107	$ 417	$ 24,522	$ 24,156	$ 47,669	$ 43,767	$ 12,774	$ 5,499	$ 30,265	$ 0	$ 1,829	$ 1,380
Less: Accumulated depreciation and depletion	(5,824)	(2,375)
Property, plant and equipment, Net	$ 113,342	$ 72,844	$ 13,630

XML

Asset Retirement Obligation - Reconciliation of Total Reclamation Liability for Asset Retirement Obligations (Detail) (USD $) In Thousands, unless otherwise specified	5 Months Ended	7 Months Ended	12 Months Ended
	Dec. 31, 2012	Aug. 15, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward]
Balance at December 31, 2012		$ 832	$ 1,555	$ 832	$ 0
Additions to liabilities			0	651	804
Accretion expense	56	16	118		28
Balance at December 31, 2013	$ 1,555		$ 1,673	$ 1,555	$ 832

XML

Concentration of Credit Risk

12 Months Ended

Dec. 31, 2013

Risks and Uncertainties [Abstract]

Concentration of Credit Risk

Concentration of Credit Risk

The Partnership is a producer of sand mainly used by the oil and natural gas industry for fracing wells. The Partnership’s business is, therefore, dependent upon economic activity within this market. For the year ended December 31, 2013, sales to three customers accounted for 76% of the Partnership’s revenue. Sales to four customers accounted for 100% of the Partnership's revenue from inception through December 31, 2012.

Throughout 2013, the Partnership has maintained cash balances in excess of federally insured amounts on deposit with financial institutions.

XML

Business Combination - Acquisition Accounting - Supplemental Condensed Consolidated Statements of Operations Information on Unaudited Pro Forma Basis (Details) (D&I Silica, LLC, USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012		Dec. 31, 2013 Successor
Business Acquisition, Pro Forma Information [Line Items]
Revenues	$ 179,486	[1]	$ 196,794
Net income	$ 62,455	[1]	$ 68,413
Net income per limited partner unit:
Common units - basic and diluted (In USD per share)	$ 2.16	[1]	$ 2.37
Subordinated units - basic and diluted (In USD per share)	$ 2.16	[1]	$ 2.37

[1] The comparative period includes the combination of the Predecessor and Successor results before and after our IPO on August 16. These pro-forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred if the acquisition and IPO would have taken place on January 1, 2012.

XML

Significant Accounting Policies - Additional Information (Detail) (USD $)	1 Months Ended		12 Months Ended					12 Months Ended		5 Months Ended	12 Months Ended	16 Months Ended	7 Months Ended	12 Months Ended
	Jul. 31, 2012	Jan. 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Aug. 17, 2012	Aug. 15, 2012	Dec. 31, 2013 Minimum	Dec. 31, 2013 Maximum	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor	Dec. 31, 2013 Successor	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor	Feb. 28, 2014 Class B units	Dec. 31, 2013 Class B units Successor
Significant Accounting Policies [Line Items]
Amortization of deferred charges into interest expense										$ 105,000	$ 463,000		$ 364,000	$ 154,000
Capitalized interest												0	1,739,000	756,000
Impairment charges			0	0	0
Other intangible assets estimated useful life								1 year	18 years
Long-term take-or-pay supply agreements, expiration year								2014	2019
Received advance payment from a customer	8,250,000	16,500,000
Cash contribution under the obligation							6,590,000
Cash held by the Partnership							1,984,000
Cash contribution commitment from sponsor						4,606,000	4,606,000
Deferred revenue			$ 0	$ 1,715,000						$ 1,715,000	$ 0	$ 0
Potential dilutive subordinate units outstanding			0
Entity Common Stock, Shares Outstanding															3,750,000	3,750,000

XML

Subsequent Events (Detail) (Subsequent Event, USD $)	1 Months Ended
	Jan. 31, 2014
Subsequent Event
Subsequent Event [Line Items]
Quarterly distribution declared	$ 14,726,000
Distribution calculated based on minimum quarterly distribution	$ 0.51
Distribution paid on date	Feb. 14, 2014
Distribution record date	Jan. 31, 2014
Distributions were made to holders of incentive distribution rights	$ 0

XML

Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Schedule of Total Management and Director Fees Incurred

The total management and director fees incurred were as follows:

	Management Fee		Director Fees
Predecessor Periods
Year ended December 31, 2011	$	370	$	60
Period from January 1 through August 15, 2012	318		62
Successor Periods
Period from August 16 through December 31, 2012	$	140	$	—
Year ended December 31, 2013	—		—

XML

Goodwill and Intangible Assets - Additional Information (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Jun. 10, 2013	Dec. 31, 2012
Goodwill And Intangible Assets [Line Items]
Amortization of intangible assets	$ 3,687
Weighted average remaining life of intangible assets	13 years
D&I Silica, LLC
Goodwill And Intangible Assets [Line Items]
Goodwill acquired during period	33,745
Goodwill arising from acquisition	33,745	33,745	0
Amortization of intangible assets	$ 3,687

XML

Related Party Transactions - Schedule of Total Management and Director Fees Incurred (Detail) (USD $) In Thousands, unless otherwise specified	5 Months Ended	12 Months Ended	7 Months Ended	12 Months Ended	5 Months Ended	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2013	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor
Related Party Transaction [Line Items]
Management Fee	$ 1,028	$ 3,698	$ 318	$ 370	$ 140	$ 0
Director Fees			$ 62	$ 60	$ 0	$ 0

XML

Long-Term Debt - Components of Long-Term Debt (Detail) (Successor, USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Line of Credit Facility [Line Items]
Long-term debt	$ 138,250	$ 0
Partnership credit facility
Line of Credit Facility [Line Items]
Partnership credit facility	138,250	0
Less: current portion of long-term debt	0	0
Long-term debt	$ 138,250	$ 0

XML

Initial Public Offering - Reconciliation of Ending Predecessor Equity to Beginning Successor Equity (Detail) (USD $) In Thousands, unless otherwise specified	Aug. 17, 2012	Aug. 15, 2012
Initial Public Offering [Line Items]
Net liabilities of non-contributed sponsor entities	$ 9,522
Members’ capital attributable to entities contributed to the Partnership	44,604
Conversion of debts payable by Partnership entities to sponsor	23,916
Assumption of payables held by Partnership entities by sponsor	10,028
Cash contribution commitment from sponsor	4,606	4,606
Net Assets Contributed to Partnership – August 16, 2012	83,154
Predecessor
Initial Public Offering [Line Items]
Predecessor Members’ Capital – August 15, 2012		$ 35,082

XML

Business and Organization

12 Months Ended

Dec. 31, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business and Organization

Business and Organization

Hi-Crush Partners LP (together with its subsidiaries, the “Partnership”) is a Delaware limited partnership formed on May 8, 2012 to acquire selected sand reserves and related processing and transportation facilities of Hi-Crush Proppants LLC. The Partnership is engaged in the excavation and processing of raw frac sand for use in hydraulic fracturing operations for oil and natural gas wells. In connection with its formation, the Partnership issued (a) a non-economic general partner interest to Hi-Crush GP LLC (the “General Partner”), and (b) a 100.0% limited partner interest to Hi-Crush Proppants LLC (the “sponsor”), its organizational limited partner.

Through August 15, 2012, Hi-Crush Proppants LLC owned 100% of the sand reserves and related excavation and processing facilities located in Wyeville, Wisconsin (“Wyeville Plant”). On August 16, 2012, the sponsor contributed its ownership of Hi-Crush Chambers LLC, Hi-Crush Railroad LLC, Hi-Crush Wyeville LLC, Hi-Crush Operating LLC and $4,606 of cash to the Partnership (the “Contribution”). In addition, the sponsor agreed to (1) convert all $23,916 of consolidated net intercompany receivables due from the Partnership into capital and (2) assume via capital contribution $10,028 of outstanding accounts payable maintained by Hi-Crush Operating LLC as of the transaction date. In return, the Partnership issued 13,640,351 common units and 13,640,351 subordinated units to the sponsor. In connection with this transaction, the Partnership also completed an initial public offering through the sale of 12,937,500 of the common units by the sponsor.

The Partnership considers all contributed assets to be under common control with Hi-Crush Proppants LLC. As such, we are presenting the consolidated historical financial statements of Hi-Crush Proppants LLC as our historical financial statements as we believe they provide a representation of our management’s ability to execute and manage our business plan. The financial statement data and operations of Hi-Crush Proppants LLC are referred to herein as “Predecessor,” whereas operations following the IPO transaction on August 16, 2012 are referred to herein as “Successor”.

On January 31, 2013, the Partnership entered into an agreement with the sponsor to acquire an interest in Hi-Crush Augusta LLC, the entity that owns the sponsor’s Augusta raw frac sand processing facility, for $37,500 in cash and 3.75 million of newly issued convertible Class B units in the Partnership. The sponsor will not receive distributions on the Class B units unless certain thresholds are met and until they convert into common units. The preferred interest in Augusta entitles the Partnership to a preferred distribution of $3,750 per quarter, or $15,000 annually.

On June 10, 2013, the Partnership acquired an independent frac sand supplier, D & I Silica, LLC (“D&I”), transforming the Partnership into an integrated Northern White frac sand producer, transporter, marketer and distributor. The Partnership acquired D&I for $95,159 in cash and 1,578,947 common units (See Note 5 – Business Combination – Acquisition Accounting). Founded in 2006, D&I is the largest independent frac sand supplier to the oil and gas industry drilling in the Marcellus and Utica shales. D&I operates through an extensive logistics network of rail-served origin and destination terminals located in the Midwest near supply sources and strategically throughout Pennsylvania, Ohio and New York.

XML

Long-Term Debt - Additional Information (Detail) (USD $)	0 Months Ended	12 Months Ended	0 Months Ended		14 Months Ended	0 Months Ended		0 Months Ended								0 Months Ended		0 Months Ended									0 Months Ended		1 Months Ended
	Aug. 21, 2012	Dec. 31, 2013	May 09, 2013 Second Amendment Agreement	May 09, 2013 Second Amendment Agreement Term Loans	Jul. 20, 2012 Sponsor's subordinated promissory notes	Apr. 06, 2012 Sponsor Credit Facility	Dec. 31, 2013 Sponsor Credit Facility	Apr. 06, 2012 Sponsor Credit Facility Minimum Base rate	Apr. 06, 2012 Sponsor Credit Facility Minimum Euro Dollar Rate	Apr. 06, 2012 Sponsor Credit Facility Maximum Base rate	Apr. 06, 2012 Sponsor Credit Facility Maximum Euro Dollar Rate	Apr. 06, 2012 Sponsor Credit Facility Federal funds rate	Apr. 06, 2012 Sponsor Credit Facility LIBOR Rate	Apr. 06, 2012 Sponsor Credit Facility Tranche A - term loan	Apr. 06, 2012 Sponsor Credit Facility Tranche B - term loan	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility	Dec. 31, 2013 Hi-Crush Partners LP Credit Facility	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility Minimum	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility Minimum Base rate	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility Maximum	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility Maximum Base rate	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility Federal funds rate	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility LIBOR Rate	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility LIBOR Rate Minimum	Aug. 21, 2012 Hi-Crush Partners LP Credit Facility LIBOR Rate Maximum	Dec. 31, 2013 Hi-Crush Partners LP Credit Facility Letter of Credit	May 09, 2013 Hi-Crush Partners LP Credit Facility Second Amendment Agreement	Dec. 31, 2013 Hi-Crush Partners LP Credit Facility Second Amendment Agreement	Jul. 31, 2012 New Subordinated Promissory Notes	Dec. 31, 2013 Successor	Dec. 31, 2012 Successor	Dec. 31, 2013 Partnership credit facility Successor	Dec. 31, 2012 Partnership credit facility Successor
Line of Credit Facility [Line Items]
Initial principal amount					$ 52,167,000																								$ 14,981,000
Subordinated promissory notes cash interest					10.00%
Subordinated promissory notes PIK interest					12.00%
Date of payment of subordinated promissory note					Aug. 21, 2012																								Aug. 21, 2012
New subordinated promissory notes date																													2012
Four-years credit facility date						Apr. 06, 2012
Term of credit agreement						4 years										4 years
Drawing under revolving credit facility						62,500,000
Line of credit facility, maximum borrowing capacity						7,500,000								25,000,000	30,000,000	100,000,000												200,000,000
Sub-limits for letters of credit						5,000,000
Swing line borrowings						2,500,000
Interest rate basis points of credit facility								225.00%	325.00%	325.00%	425.00%	50.00%	100.00%						150.00%		250.00%	0.50%	100.00%	250.00%	350.00%
Tranche B term loan commitment fee						0.50%
Increase of the aggregate commitments																											100,000,000
Commitment fee on unused portion Credit Facility																		0.375%		0.50%
Increased interest rate in the event of default																2.00%
Minimum effective leverage ratio																3.00
Max effective leverage ratio																3.50
Minimum interest coverage ratio	2.50
Line of credit facility, current borrowing capacity			50,000,000
Line of credit facility, expiration date			Aug. 21, 2016
Line of credit facility, outstanding amount for four consecutive quarters			125,000,000
Debt service conversion ratio				1.50
Indebtedness amount																														138,250,000	0	138,250,000	0
Undrawn borrowing capacity																	$ 60,250,000									$ 1,500,000
Interest rate under Revolving credit facility							3.17%
Ownership interest in Partnership		100.00%

XML

Future Amortization Expense (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Accounting Policies [Abstract]
2014	$ 533
2015	533
2016	401
Intangible assets, net	$ 1,467

XML

Initial Public Offering (Tables)

12 Months Ended

Dec. 31, 2013

Initial Public Offering [Abstract]

Consolidated Net Assets Contributed to Partnership

The following table outlines the consolidated net assets contributed to the Partnership on August 16, 2012:

Assets:
Cash	$	1,984
Accounts receivable	12,453
Inventories	4,085
Due from sponsor	4,606
Prepaid expenses and other current assets	26
Property, plant and equipment, net	69,623
Deferred charges, net	1,113
Total Assets	$	93,890
Liabilities:
Accounts payable	$	1,397
Accrued liabilities	1,901
Deferred revenue	6,590
Asset retirement obligation	848
Total liabilities	10,736
Net assets contributed to the Partnership	$	83,154

Reconciliation of Ending Predecessor Equity to Beginning Successor Equity

The following is a reconciliation of the Predecessor’s equity as of August 15, 2012 and total net assets contributed to the Partnership on August 16, 2012:

Predecessor Members’ Capital – August 15, 2012	$	35,082
Net liabilities of non-contributed sponsor entities	9,522
Members’ capital attributable to entities contributed to the Partnership	44,604
Conversion of debts payable by Partnership entities to sponsor	23,916
Assumption of payables held by Partnership entities by sponsor	10,028
Cash contribution commitment from sponsor	4,606
Net Assets Contributed to Partnership – August 16, 2012	$	83,154

XML

Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Future Amortization Expense

The following is a summary of future amortization expense associated with deferred charges:

For the years ending December 31,
2014	$	533
2015	533
2016	401
Total	$	1,467

Estimated Useful Lives of Fixed Assets

Fixed assets other than plant facilities and buildings associated with productive, depletable properties are carried at historical cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows:

Computer equipment	3 years
Furniture and fixtures	7 years
Vehicles	5 years
Equipment	5-15 years
Rail spur and asset retirement obligation	33 years
Rail and rail equipment	15-20 years
Transload facilities and equipment	15-20 years

XML

Inventories - Components of Inventories (Detail) (Successor, USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Successor
Inventory [Line Items]
Raw material	$ 0	$ 124
Work-in-progress	3,699	3,280
Finished goods	12,431	4
Spare parts	135	133
Inventory, Net, Total	$ 16,265	$ 3,541

XML

Estimated Useful Lives of Fixed Assets (Detail)	12 Months Ended
	Dec. 31, 2013
Computer equipment
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	3 years
Furniture and fixtures
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	7 years
Vehicles
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	5 years
Equipment | Minimum
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	5 years
Equipment | Maximum
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	15 years
Rail spurs and asset retirement obligation
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	33 years
Rail and rail equipment | Minimum
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	15 years
Rail and rail equipment | Maximum
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	20 years
Transload facilities and equipment | Minimum
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	15 years
Transload facilities and equipment | Maximum
Property Plant and Equipment Estimated Useful Lives [Line Items]
Estimated useful lives of assets	20 years

XML

Business Combination - Acquisition Accounting (Tables)

12 Months Ended

Dec. 31, 2013

Business Combinations [Abstract]

Total Preliminary Purchase Price allocation to Net Assets Acquired

The total purchase price of $132,517 was allocated to the net assets acquired as follows:

Assets acquired:
Cash	$	204
Restricted cash	688
Accounts receivable	17,908
Inventories	10,372
Prepaid expenses and other current assets	809
Property, plant and equipment	39,242
Intangible assets	41,878
Goodwill	33,745
Other assets	113
Total assets acquired	$	144,959
Liabilities assumed:
Accounts payable	$	11,646
Accrued liabilities and other current liabilities	796
Total liabilities assumed	12,442
Fair value of net assets acquired	$	132,517

Supplemental Condensed Consolidated Statements of Operations Information on Unaudited Pro Forma Basis

The following tables summarize the supplemental condensed consolidated statements of operations information on an unaudited pro forma basis as if the acquisition had occurred at January 1, 2012. The tables include adjustments that were directly attributable to the acquisition or are not expected to have a future impact on the Partnership. The pro forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred should the transaction have been consummated at the beginning of the period, nor are they indicative of future results of operations.

Pro Forma Financial Information for the:
	Year Ended December 31, 2013		Year Ended December 31, 2012 (1)
	Successor		Pro Forma (1)
Revenues	$	196,794	$	179,486
Net income	$	68,413	$	62,455
Net income per limited partner unit:
Common units – basic and diluted	2.37		2.16
Subordinated units – basic and diluted	2.37		2.16
(1) The comparative period includes the combination of the Predecessor and Successor results before and after our IPO on August 16. These pro-forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred if the acquisition and IPO would have taken place on January 1, 2012.

Adjustments Utilized to Prepare Pro Forma Financial Information

The pro forma financial information includes the impact of the following pro forma adjustments:

Adjustments Utilized to Prepare the Pro Forma Financial Information for the:
	Year Ended December 31, 2013			Year Ended December 31, 2012
Debit / (Credit)	Successor			Pro Forma (1)
Acquisition related expenses	$	(4,775	)	$	—
Other general and administrative expenses	(117		)	(239		)
Interest expense on debt issued to fund acquisition	1,226			2,561
Depreciation and amortization expense	(8		)	3,947
Increase in weighted average common units outstanding	696,467			1,578,947

XML

Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in Goodwill and Intangible Assets

Changes in goodwill and intangible assets consisted of the following:

	Goodwill		Intangible Assets
Balance at December 31, 2012	$	—	$	—
Additions from D&I acquisition	33,745		41,878
Amortization expense	—		(3,687		)
Balance at December 31, 2013	$	33,745	$	38,191

Intangible Assets, Arising from Acquisition

Intangible assets arising from the acquisition of D&I consisted of the following:

	Useful life	December 31, 2013
		Successor
Supplier agreements	1-20 Years	21,997
Customer contracts and relationships	1-10 Years	18,132
Other intangible assets	1-3 Years	1,749
Intangible assets		41,878
Less: Accumulated amortization		(3,687		)
Intangible assets, net		$	38,191

Future Amortization Expense

As of December 31, 2013, future amortization is as follows:

Fiscal Year	Amortization
2014	$	5,127
2015	2,967
2016	2,938
2017	2,850
2018	2,850
Thereafter	21,459
	$	38,191

XML

Predecessor Consolidated Statements of Members Capital (Predecessor, USD $) In Thousands, unless otherwise specified	7 Months Ended	12 Months Ended		7 Months Ended	12 Months Ended		7 Months Ended	12 Months Ended
	Aug. 15, 2012 Total Members’ Capital	Dec. 31, 2012 Total Members’ Capital	Dec. 31, 2010 Total Members’ Capital	Aug. 15, 2012 Members’ Equity	Dec. 31, 2012 Members’ Equity	Dec. 31, 2010 Members’ Equity	Aug. 15, 2012 Accumulated Earnings	Dec. 31, 2012 Accumulated Earnings	Dec. 31, 2010 Accumulated Earnings
Increase (Decrease) in Partners' Capital [Roll Forward]
Beginning Balance	$ 10,287	$ 10,287	$ 310	$ 1,033	$ 1,033	$ 336	$ 9,254	$ 9,254	$ (26)
Cash distributions	(225)	(400)		(225)	(400)		0	0
Contribution of net assets on August 16, 2012		1,097			1,097			0
Net income	25,020	9,280		0	0		25,020	9,280
Ending Balance	$ 35,082		$ 310	$ 808		$ 336	$ 34,274		$ (26)

XML

Inventories (Tables)

12 Months Ended

Dec. 31, 2013

Inventory Disclosure [Abstract]

Components of Inventories

Inventories consisted of the following:

	December 31, 2013		December 31, 2012
	Successor		Successor
Raw material	$	—	$	124
Work-in-progress	3,699		3,280
Finished goods	12,431		4
Spare parts	135		133
	$	16,265	$	3,541

XML

Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Summary of Quarterly Financial Data

	First Quarter		Second Quarter		Third Quarter (1)		Fourth Quarter		Total
2013	Successor		Successor		Successor		Successor		Successor
Revenues	$	19,628	$	27,101	$	43,515	$	51,498	$	141,742
Gross profit	13,846		15,516		17,557		20,284		67,203
Income from operations	11,097		11,594		12,498		15,645		50,834
Net income	10,783		14,681		15,040		18,058		58,562
Earnings per unit – common units	$	0.40	$	0.53	$	0.52	$	0.63	$	2.08
Earnings per unit – subordinated units	$	0.40	$	0.53	$	0.52	$	0.63	$	2.08
2012	Predecessor		Predecessor		Pro Forma		Successor		Pro Forma
Revenues	13,532		20,643		25,244		16,215		75,634
Gross profit	8,756		15,149		19,347		11,902		55,154
Income (loss) from operations	7,067		13,269		17,107		9,582		47,025
Net income (loss)	6,137		11,814		16,178		9,399		43,528
Earnings per unit – common units (2)					0.33		0.35		0.68
Earnings per unit – subordinated units (2)					0.33		0.35		0.68

(1) The results for the third quarter ended September 30, 2012 include those of our predecessor (July 1 to August 15) combined with the successor (August 16 to September 30)

(2) Earnings per unit was only calculated for periods subsequent to the August 16, 2012 initial public offering.

Combined Quarterly Results for Third Quarter

The following table reconciles our pro forma quarterly results for the third quarter ended September 30, 2012, to our predecessor and successor period resulting during that quarter.

	Period from July 1 Through August 15, 2012		Period from August 16 Through September 30, 2012		Total
	Predecessor		Successor		Pro Forma
Revenues	$	12,601	$	12,643	$	25,244
Gross profit	9,536		9,811		19,347
Income from operations	7,918		9,189		17,107
Net income	7,069		9,109		16,178
Earnings per unit – common units			$	0.33	$	0.33
Earnings per unit – subordinated units			$	0.33	$	0.33

XML

Goodwill and Intangible Assets - Changes in Goodwill and Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Jun. 10, 2013
Intangible Assets
Amortization expense	$ (3,687)
Ending balance	38,191
D&I Silica, LLC
Goodwill
Beginning balance	0	33,745
Additions from D&I acquisition	33,745
Amortization expense	0
Ending balance	33,745	33,745
Intangible Assets
Beginning balance	0
Additions from D&I acquisition	41,878
Amortization expense	(3,687)
Ending balance	$ 38,191

XML

Quarterly Financial Data (Unaudited) - Summary of Quarterly Financial Data (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	7 Months Ended	12 Months Ended	5 Months Ended	8 Months Ended	12 Months Ended									3 Months Ended								1 Months Ended		3 Months Ended				1 Months Ended	3 Months Ended				1 Months Ended	3 Months Ended
	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor	Dec. 31, 2012 Successor	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor	Dec. 31, 2012 Pro Forma	Dec. 31, 2013 Common Units Successor	Dec. 31, 2012 Common Units Pro Forma		Dec. 31, 2013 Subordinated Units	Dec. 31, 2013 Subordinated Units Successor	Dec. 31, 2012 Subordinated Units Pro Forma		Mar. 31, 2012 First Quarter Predecessor	Mar. 31, 2013 First Quarter Successor	Mar. 31, 2013 First Quarter Common Units Successor	Mar. 31, 2013 First Quarter Subordinated Units Successor	Jun. 30, 2012 Second Quarter Predecessor	Jun. 30, 2013 Second Quarter Successor	Jun. 30, 2013 Second Quarter Common Units Successor	Jun. 30, 2013 Second Quarter Subordinated Units Successor	Aug. 15, 2012 Third Quarter Predecessor	Sep. 30, 2012 Third Quarter Successor	Sep. 30, 2013 Third Quarter Successor		Sep. 30, 2012 Third Quarter Pro Forma		Sep. 30, 2012 Third Quarter Common Units Successor	Sep. 30, 2013 Third Quarter Common Units Successor		Sep. 30, 2012 Third Quarter Common Units Pro Forma		Sep. 30, 2012 Third Quarter Subordinated Units Successor	Sep. 30, 2013 Third Quarter Subordinated Units Successor		Sep. 30, 2012 Third Quarter Subordinated Units Pro Forma		Dec. 31, 2013 Fourth Quarter Successor	Dec. 31, 2012 Fourth Quarter Successor	Dec. 31, 2013 Fourth Quarter Common Units Successor	Dec. 31, 2012 Fourth Quarter Common Units Successor		Dec. 31, 2013 Fourth Quarter Subordinated Units Successor	Dec. 31, 2012 Fourth Quarter Subordinated Units Successor
Quarterly Financial Data [Line Items]
Revenues	$ 46,776	$ 20,353	$ 28,858		$ 141,742	$ 75,634								$ 13,532	$ 19,628			$ 20,643	$ 27,101			$ 12,601	$ 12,643	$ 43,515	[1]	$ 25,244	[1]											$ 51,498	$ 16,215
Gross profit	33,440	13,906	21,713		67,203	55,154								8,756	13,846			15,149	15,516			9,536	9,811	17,557	[1]	19,347	[1]											20,284	11,902
Income (loss) from operations	28,254	11,173	18,771		50,834	47,025								7,067	11,097			13,269	11,594			7,918	9,189	12,498	[1]	17,107	[1]											15,645	9,582
Net income	$ 25,020	$ 9,280	$ 18,508	$ 18,508	$ 58,562	$ 43,528				$ 28,234				$ 6,137	$ 10,783			$ 11,814	$ 14,681			$ 7,069	$ 9,109	$ 15,040	[1]	$ 16,178	[1]											$ 18,058	$ 9,399
Earnings per unit (in USD per share)							$ 2.08	$ 0.68	[2]		$ 2.08	$ 0.68	[2]			$ 0.40	$ 0.40			$ 0.53	$ 0.53							$ 0.33	$ 0.52	[1]	$ 0.33	[1],[2]	$ 0.33	$ 0.52	[1]	$ 0.33	[1],[2]			$ 0.63	$ 0.35	[2]	$ 0.63	$ 0.35	[2]

[1] The results for the third quarter ended September 30, 2012 include those of our predecessor (July 1 to August 15) combined with the successor (August 16 to September 30)

[2] Earnings per unit was only calculated for periods subsequent to the August 16, 2012 initial public offering.

XML

Consolidated Balance Sheets (USD $)	Dec. 31, 2013	Dec. 31, 2012
Current assets:
Due from sponsor		$ 5,615,000
Current liabilities:
Due to sponsor	2,571,000
Deferred revenue	0	1,715,000
Successor
Current assets:
Cash	16,047,000	10,498,000
Restricted cash	690,000	0
Accounts receivable, net	31,581,000	8,199,000
Inventories	16,265,000	3,541,000
Due from sponsor	0	5,615,000
Prepaid expenses and other current assets	1,432,000	393,000
Total current assets	66,015,000	28,246,000
Property, plant and equipment, net	113,342,000	72,844,000
Goodwill and intangible assets, net	71,936,000	0
Preferred interest in Hi-Crush Augusta, LLC	47,043,000	0
Other assets	3,808,000	1,095,000
Total assets	302,144,000	102,185,000
Current liabilities:
Accounts payable	8,306,000	1,977,000
Accrued and other current liabilities	4,375,000	1,755,000
Due to sponsor	2,571,000	0
Deferred revenue	0	1,715,000
Total current liabilities	15,252,000	5,447,000
Long-term debt	138,250,000	0
Asset retirement obligation	1,673,000	1,555,000
Total liabilities	155,175,000	7,002,000
Commitments and contingencies	0	0
Partners’ capital:
General partner interest	0	0
Limited partner interest, 28,865,171 and 27,280,702 units outstanding, respectively	137,426,000	95,183,000
Total partners’ capital	146,969,000	95,183,000
Total liabilities and partners’ capital	302,144,000	102,185,000
Class B units | Successor
Partners’ capital:
Total partners’ capital	$ 9,543,000	$ 0

XML

Initial Public Offering - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	0 Months Ended
	Aug. 20, 2012	Aug. 17, 2012	Aug. 21, 2012	Sep. 30, 2012 Initial public offering	Aug. 17, 2012 Initial public offering
Initial Public Offering [Line Items]
Common units issued					11,250,000
Price per common units to the public					$ 17.00
Total net amount of sale of common units					$ 179,536
Underwriting discount					11,714
Capitalized transaction costs				3,383
Purchase of additional common units		1,687,500
Purchase of additional common units, value		26,930
Proceeds from sale of common units to public		206,466
Common units sold to public		12,937,500
Aggregate value of assets indemnified	$ 7,500
Long-term take-or-pay contract, rights and obligations, assignment date	May 01, 2013
Period following the IPO	3 years
Common units to be delivered pursuant to awards			1,364,035

XML

Successor Consolidated Statements of Partners' Capital (USD $) In Thousands, unless otherwise specified	Successor	Successor Public Common Unit Capital	Successor Sponsor Common Unit Capital	Successor Sponsor Subordinated Unit Capital	Successor Total Limited Partner Capital	Class B units Successor	Hi-Crush Augusta LLC	Hi-Crush Augusta LLC Successor	Hi-Crush Augusta LLC Class B units Successor	D&I Silica, LLC Successor	D&I Silica, LLC Successor Public Common Unit Capital	D&I Silica, LLC Successor Total Limited Partner Capital	Independent Director Successor	Independent Director Successor Public Common Unit Capital	Independent Director Successor Total Limited Partner Capital
Beginning Balance at May. 08, 2012	$ 0	$ 0	$ 0	$ 0	$ 0
Increase (Decrease) in Partners' Capital [Roll Forward]
Contribution of net assets on August 16, 2012	83,154	39,435	2,142	41,577	83,154
Net income	18,508	8,777	477	9,254	18,508
Cash distributions	(6,479)	(3,073)	(166)	(3,240)	(6,479)
Ending Balance at Dec. 31, 2012	95,183	45,139	2,453	47,591	95,183
Beginning Balance at Aug. 15, 2012
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income	18,508
Ending Balance at Dec. 31, 2012	95,183	45,139	2,453	47,591	95,183	0
Increase (Decrease) in Partners' Capital [Roll Forward]
Issuance of 5,522 common units to independent directors													100	100	100
Issuance of units in acquisition								57,900	57,900	37,358	37,358	37,358
Deemed distribution	(48,357)					(48,357)
Net income	58,562	28,989	1,339	28,234	58,562
Cash distributions	(53,777)	(26,310)	(1,346)	(26,121)	(53,777)
Secondary offering of units by sponsor	0	2,446	(2,446)
Ending Balance at Dec. 31, 2013	$ 146,969	$ 87,722	$ 0	$ 49,704	$ 137,426	$ 9,543

XML

Preferred Interest in Hi-Crush Augusta LLC - Additional Information (Details) (USD $)	1 Months Ended	0 Months Ended		12 Months Ended					0 Months Ended	1 Months Ended
	Jan. 31, 2014 Subsequent Event	Jan. 31, 2013 Hi-Crush Augusta LLC	Jan. 31, 2013 Hi-Crush Augusta LLC	Dec. 31, 2013 Hi-Crush Augusta LLC	Dec. 31, 2013 Hi-Crush Augusta LLC Quarterly Payment Distribution	Jan. 31, 2013 Hi-Crush Augusta LLC Quarterly Payment	Jan. 31, 2013 Hi-Crush Augusta LLC Annual	Jan. 31, 2013 Hi-Crush Augusta LLC Preferred units	Jan. 31, 2013 Hi-Crush Augusta LLC Class B units	Jan. 31, 2014 Hi-Crush Augusta LLC Subsequent Event Quarterly Payment	Dec. 31, 2013 Hi-Crush Augusta LLC Minimum Annual
Schedule of Equity Method Investments [Line Items]
Business acquisition, preferred stock acquired (In shares)								100,000
Business acquisition, cash paid		$ 37,500,000	$ 37,500,000
Business acquisition, convertible stock issued									3,750,000
Acquisition related costs				451,000
Preferred distribution					3,750,000	3,750,000	15,000,000			3,750,000	10,000,000
Number of quarterly distributions declared and paid					3
Quarterly distribution declared	$ 14,726,000
Date of quarterly distribution payment	Feb. 14, 2014									Feb. 11, 2014
Preferred units conversion date				Mar. 31, 2018
Percentage of conversion of common units				25.00%
Percentage of equity interest in which preferred interest will be converted				20.00%

XML

Long-Term Debt (Tables)

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Components of Long-Term Debt

Long-term debt consisted of the following:

	December 31, 2013		December 31, 2012
	Successor		Successor
Partnership credit facility	$	138,250	$	—
Less: current portion of long-term debt	—		—
	$	138,250	$	—

XML

Equity - Schedule of Net Income Attributable to Limited Partners (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013
Common Units
Distribution Made to Limited Partner [Line Items]
Distributions during the period	$ 21,174
Subsequent distributions declared (See Note 18)	7,769
Undistributed earnings	1,385
Limited partners’ interest in net income	30,328
Subsequent distributions declared (per unit)	$ 0.51
Subordinated Units
Distribution Made to Limited Partner [Line Items]
Distributions during the period	19,642
Subsequent distributions declared (See Note 18)	6,957
Undistributed earnings	1,635
Net income	$ 28,234
Subsequent distributions declared (per unit)	$ 0.51

XML

Commitments and Contingencies

12 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Partnership enters into sales contracts with customers. These contracts establish minimum annual sand volumes that the Partnership is required to make available to such customers under initial terms ranging from 3 to 6 years. Through December 31, 2013, no payments for non-delivery of minimum annual sand volumes have been made by the Partnership to these customers under these contracts.

D&I has entered into long-term supply agreements with certain of its suppliers which include requirements to purchase certain volumes and grades of sands, at specified prices. The quantities set forth in such agreements are not in excess of our current requirements.

Hi-Crush Operating LLC, a subsidiary of the Partnership, has entered into royalty agreements under which such entity is under a commitment to pay royalties on sand sold from the Wyeville Plant for which the Partnership has received payment.Royalty expense is recorded as the sand is sold and the royalty payment is paid based on sand volumes sold and paid for by the customer. Royalty expense is included in costs of goods sold. Royalty expense was $2,045 for the Predecessor’s year ended December 31, 2011. Royalty expense was $3,795 for the Predecessor period from January 1 through August 15, 2012. Royalty expense was $3,597 and $948 for the Successor year ended December 31, 2013 and the period of August 16 to December 31, 2012, respectively.

On July 13, 2012, the sponsor paid $14,000 in cash to terminate one of its existing royalty agreements, including $370 of outstanding obligations at the time. As a result of this payment, the Partnership is no longer required to make ongoing future royalty payments to the applicable counterparties for each ton of frac sand that is excavated, processed and sold to the Partnership’s customers. As part of this transaction, the Predecessor recorded an asset of $13,630, in property, plant and equipment.

The Partnership has long-term operating leases for rail access, railcars and equipment at its terminal sites, which are also under long-term lease agreements with various railroads. Rail car rental expense was $2,035 for the year ended December 31, 2013. As of December 31, 2013, future minimum operating lease payments are as follows:

Fiscal Year	Amount
2014	$	7,009
2015	6,599
2016	5,640
2017	5,425
2018	4,881
Thereafter	7,420
	$	36,974

From time to time the Partnership may be subject to various claims and legal proceedings which arise in the normal course of business. Management is not aware of any legal matters that are likely to have a material adverse effect on the Partnership’s financial position, results of operations or cash flows.

In May 2012, Hi-Crush Operating LLC, a subsidiary of the Partnership, entered into a supply agreement for frac sand with Baker Hughes Oilfield Operations, Inc. (“Baker Hughes”). On September 19, 2012, Baker Hughes provided notice that it was terminating the contract and on November 12, 2012, Hi-Crush Operating LLC formally terminated the supply agreement and filed suit in the State District Court of Harris County, Texas. On October 8, 2013, Hi-Crush Operating LLC entered into a settlement agreement with Baker Hughes pursuant to which Hi-Crush Operating LLC and Baker Hughes agreed to jointly dismiss the lawsuit between the parties and, in connection with the settlement, the parties entered into a six-year supply agreement that requires Baker Hughes to purchase minimum volumes of frac sand each month.

Following the Partnership’s November 2012 announcement that Hi-Crush Operating LLC had formally terminated its supply agreement with Baker Hughes in response to the repudiation of the agreement by Baker Hughes, the Partnership, our general partner, certain of its officers and directors and its underwriters were named as defendants in purported securities class action lawsuits brought by the Partnership’s unitholders in the United States District Court for the Southern District of New York. On February 11, 2013, the lawsuits were consolidated into one lawsuit, styled In re: Hi-Crush Partners L.P. Securities Litigation, No. 12-Civ-8557 (CM). A consolidated amended complaint was filed on February 15, 2013. That complaint asserted claims under sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended, or the Securities Act, and sections 10(b) and 20(a) of the Exchange Act in connection with the Partnership’s Registration Statement and a subsequent presentation. Among other things, the consolidated amended complaint alleges that defendants failed to disclose to the market certain alleged information relating to Baker Hughes’ repudiation of the supply agreement. On March 22, 2013, the Partnership filed a motion to dismiss the complaint. On December 2, 2013, the court issued an order dismissing the claims relating to the Partnership’s Registration Statement, but did not dismiss the claims relating to alleged misrepresentations concerning the Partnership’s relationship with Baker Hughes after the Partnership’s initial public offering. The Partnership and the remaining defendants in the lawsuit have filed answers to the complaint. The Partnership believes the case is without merit and intends to vigorously defend itself. The Partnership cannot provide assurance, however, as to the outcome of this lawsuit.

On December 20, 2013, Stephen Bushansky, a purported unitholder of the Partnership, filed a lawsuit, derivatively on behalf of the Partnership, against our general partner and certain of its officers and directors, in an action styled Bushansky v. Hi-Crush GP LLC, Cause No. 2013-76463, in the 215th Judicial District Court, Harris County, Texas. This lawsuit alleges that by failing to disclose Baker Hughes’ attempted repudiation of its supply agreement with Hi-Crush Operating LLC prior to the Partnership’s November 2012 announcement terminating the agreement, defendants failed to design and implement an effective system of internal controls to prevent the Partnership from violating federal securities laws. Plaintiff asserts a claim for breach of fiduciary duties of good faith, care, loyalty, reasonable inquiry, oversight and supervision. Plaintiff also asserts that the defendants aided and abetted in one another’s breaches of fiduciary duties and seeks relief from defendants on the theory of indemnity for all damages that occurred as a result of defendants’ alleged violations. On January 29, 2014, defendants filed a motion to dismiss, plea to the jurisdiction, or in the alternative, motion to stay based on the mandatory contractual forum selection clause in our partnership agreement. The Partnership believes the case is without merit and intends to vigorously defend itself. The Partnership cannot provide assurance, however, as to the outcome of this lawsuit.

XML

Equity (Tables)

12 Months Ended

Dec. 31, 2013

Equity [Abstract]

Schedule of Incentive Distributions Made to Common and Subordinated Unitholders

Our distributions have been as follows:

Declaration Date	Amount Declared Per Unit (a)			Record Date	Date Paid	Amount Paid
October 19, 2012	$	0.2375	(b)	November 1, 2012	November 15, 2012	$	6,480
January 17, 2013	$	0.4750		February 1, 2013	February 15, 2013	$	12,961
April 16, 2013	$	0.4750		May 1, 2013	May 15, 2013	$	12,961
July 17, 2013	$	0.4750		August 1, 2013	August 15, 2013	$	13,711
October 17, 2013	$	0.4900		November 1, 2013	November 15, 2013	$	14,144
January 15, 2014	$	0.5100		January 31, 2014	February 14, 2014	$	14,726
(a) For all common and subordinated units. No distributions were declared for our holders of incentive distribution rights or the holders of our Class B units.
(b) Represents a pro rata distribution of our minimum quarterly distribution for the period from August 16, 2012 through September 30, 2012.

Schedule of Net Income Attributable to Limited Partners

Net income attributable to our limited partner unitholders is as follows during the year ended December 31, 2013 (in thousands, except per unit amounts):

	Common Unitholders		Subordinated Unitholders
Distributions during the period	$	21,174	$	19,642
Subsequent distributions declared (See Note 18)	7,769		6,957
Undistributed earnings	1,385		1,635
Limited partners’ interest in net income	30,328		28,234
Subsequent distributions declared (per unit)	$	0.5100	$	0.5100

XML

Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (Unaudited)

Quarterly Financial Data (Unaudited)

	First Quarter		Second Quarter		Third Quarter (1)		Fourth Quarter		Total
2013	Successor		Successor		Successor		Successor		Successor
Revenues	$	19,628	$	27,101	$	43,515	$	51,498	$	141,742
Gross profit	13,846		15,516		17,557		20,284		67,203
Income from operations	11,097		11,594		12,498		15,645		50,834
Net income	10,783		14,681		15,040		18,058		58,562
Earnings per unit – common units	$	0.40	$	0.53	$	0.52	$	0.63	$	2.08
Earnings per unit – subordinated units	$	0.40	$	0.53	$	0.52	$	0.63	$	2.08
2012	Predecessor		Predecessor		Pro Forma		Successor		Pro Forma
Revenues	13,532		20,643		25,244		16,215		75,634
Gross profit	8,756		15,149		19,347		11,902		55,154
Income (loss) from operations	7,067		13,269		17,107		9,582		47,025
Net income (loss)	6,137		11,814		16,178		9,399		43,528
Earnings per unit – common units (2)					0.33		0.35		0.68
Earnings per unit – subordinated units (2)					0.33		0.35		0.68

(1) The results for the third quarter ended September 30, 2012 include those of our predecessor (July 1 to August 15) combined with the successor (August 16 to September 30)

(2) Earnings per unit was only calculated for periods subsequent to the August 16, 2012 initial public offering.

The following table reconciles our pro forma quarterly results for the third quarter ended September 30, 2012, to our predecessor and successor period resulting during that quarter.

	Period from July 1 Through August 15, 2012		Period from August 16 Through September 30, 2012		Total
	Predecessor		Successor		Pro Forma
Revenues	$	12,601	$	12,643	$	25,244
Gross profit	9,536		9,811		19,347
Income from operations	7,918		9,189		17,107
Net income	7,069		9,109		16,178
Earnings per unit – common units			$	0.33	$	0.33
Earnings per unit – subordinated units			$	0.33	$	0.33

XML

Segment Reporting - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2013 Segment
Segment Reporting [Abstract]
Number of operating segment	1

XML

Successor Consolidated Statements of Partners' Capital (Parenthetical) (Successor)	12 Months Ended
	Dec. 31, 2013
Independent Director
Issuance of common units to independent directors, common units	5,522
D&I Silica, LLC
Issuance of common units in acquisition of D&I Silica, LLC	1,578,947

XML

Consolidated Balance Sheets (Parenthetical) (Successor)	Dec. 31, 2013	Dec. 31, 2012
Limited partner interest, units outstanding	28,865,171	27,280,702
Class B units
Class B shares, units outstanding	3,750,000	0

XML

Preferred Interest in Hi-Crush Augusta LLC

12 Months Ended

Dec. 31, 2013

Investments, All Other Investments [Abstract]

Preferred Interest in Hi-Crush Augusta LLC

Preferred Interest in Hi-Crush Augusta LLC

On January 31, 2013, the Partnership entered into an agreement with our sponsor to acquire 100,000 preferred units in Augusta, the entity that owns our sponsor’s Augusta Plant, for $37,500 in cash and 3,750,000 newly issued convertible Class B units in the Partnership.

The transaction represented an exchange of ownership interests between entities under common control. As a result, the Partnership recorded an investment in the preferred interest equal to the total amount of the cash paid and our sponsor’s cost basis in the preferred units. Excess consideration exchanged over the cost basis was recorded as a deemed distribution to our sponsor, determined as follows:

Total consideration paid	$	95,400
Less: Cash paid	(37,500		)
Less: Sponsor’s cost basis in the investment	(9,543		)
Deemed distribution	$	48,357

In connection with this acquisition, the Partnership incurred $451 of acquisition related costs during the year ended December 31, 2013, as included in general and administrative expenses.

As a preferred unit holder in Augusta, the Partnership votes as a separate class from the common unitholders of Augusta and ranks senior to all other equity classes of Augusta. The preferred units entitle the Partnership to receive a distribution equal to $3,750 per quarter, beginning January 1, 2013, plus any unpaid arrearages from prior quarters. During 2013, Augusta declared and paid three quarterly distributions of $3,750. Income pertaining to the distributions is recognized during the period the distribution is received. On January 2014, Augusta declared its fourth quarterly distribution of $3,750, to be paid on February 11, 2014.

The preferred units in Augusta will automatically convert to common units in Augusta on March 31, 2018 unless (i) there are any arrearages in preferred unit distributions, (ii) the preferred units would not have received, on an as-converted basis, an annualized distribution of at least $10,000 over the preceding four quarters or (iii) the Partnership, with concurrence of the conflicts committee of the board of directors of our General Partner, elects to convert at an earlier time. The number of common units issued upon conversion will be equal to 25% of the then outstanding common units, such that, following the conversion, the Partnership would own 20% of the common units in Augusta.

XML

Document and Entity Information (USD $)	12 Months Ended
	Dec. 31, 2013	Jun. 28, 2013	Feb. 28, 2014 Common Units	Feb. 28, 2014 Subordinated Units	Feb. 28, 2014 Class B units
Document Information [Line Items]
Entity Registrant Name	Hi-Crush Partners LP
Trading Symbol	HCLP
Entity Central Index Key	0001549848
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Document Type	10-K
Document Period End Date	Dec. 31, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding			15,233,335	13,640,351	3,750,000
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float		$ 329,389,211

XML

Long-Term Debt

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

Long-term debt consisted of the following:

	December 31, 2013		December 31, 2012
	Successor		Successor
Partnership credit facility	$	138,250	$	—
Less: current portion of long-term debt	—		—
	$	138,250	$	—

Subordinated Promissory Notes

Between May 25, 2011 and July 20, 2012, the sponsor entered into various subordinated promissory notes with certain of its equity investors and their affiliates in an aggregate initial principal amount of $52,167. Borrowings under the subordinated promissory notes bore interest, at the sponsor’s option, at a rate of 10% for cash interest and 12% for paid-in-kind interest (“PIK interest”). Accruals for PIK interest increased the outstanding principal balance of these promissory notes. The balances of the PIK interest and subordinated promissory notes were paid in full on August 21, 2012 with the proceeds of the sale of the common units by the sponsor.

New Subordinated Promissory Notes

In order to fund a royalty termination payment (See Note 14—Commitments and Contingencies), the sponsor entered into new subordinated promissory notes in July 2012 with certain of its equity investors and their affiliates in an aggregate initial principal amount of $14,981. The balances of the PIK interest and subordinated promissory note, as retained by the sponsor, were paid in full by the sponsor on August 21, 2012 with the proceeds of the sale of the common units by the sponsor.

Sponsor Credit Facility

On April 6, 2012, the sponsor entered into a four-year $62,500 secured credit facility (the “Sponsor Credit Facility”) with Amegy Bank, N.A. and a syndicate of other financial institutions (collectively, the “Lending Banks”). The Sponsor Credit Facility consists of the following commitments on the part of the Lending Banks: (1) a $25,000 term loan, (2) a $30,000 advancing term loan commitment (“Tranche B”) and (3) a $7,500 revolving loan commitment (the “Revolving Commitment”). In addition, the Sponsor Credit Facility includes sub-limits for letters of credit and swing line borrowings of up to $5,000 and $2,500, respectively.

Borrowings under the Sponsor Credit Facility bear interest at a floating rate equal to, at the sponsor’s option, either (a) a base rate plus a range of 225 basis points to 325 basis points per annum or (b) a Eurodollar rate, which is based on one-month LIBOR, plus a range of 325 basis points to 425 basis points per annum. The base rate is established as the highest of (i) the U.S. prime rate last quoted by The Wall Street Journal, (ii) the federal funds rate plus 50 basis points or (iii) daily one-month LIBOR plus 100 basis points. The Revolving Commitment and the Tranche B term loan provides for a commitment fee of 0.5% on the unused portion.

After consummation of the IPO on August 16, 2012, our sponsor retained the Sponsor Credit Facility and related borrowings. In addition, as of August 16, 2012, the Sponsor Credit Facility was no longer guaranteed by the subsidiaries contributed to the Partnership. As such, the sponsor’s long-term debt is not reflected on the Partnership’s successor balance sheets.

On August 21, 2012, the sponsor entered into that certain consent and third amendment to the Sponsor Credit Facility, whereby the lending banks, among other things, (i) consented to the consummation of the initial public offering of the Partnership, (ii) released and discharged certain credit parties in connection with the initial public offering.

Partnership Credit Facility

On August 21, 2012, the Partnership entered into a credit agreement (the “Credit Agreement”) providing for a new $100,000 senior secured revolving credit facility (the “Credit Facility”) with a term of four years. In connection with our acquisition of a preferred interest in Augusta, on January 31, 2013, the Partnership entered into a consent and first amendment to the Credit Agreement whereby the Lending Banks, among other things, (i) consented to the amendment and restatement of the partnership agreement of the Partnership and (ii) agreed to amend the Credit Agreement to permit the acquisition by the Partnership of a preferred equity interest in Hi-Crush Augusta LLC. On May 9, 2013, the Partnership entered into a commitment increase agreement and second amendment to the Credit Agreement whereby the Lending Banks, among other things, consented to the increase of the aggregate commitments by $100,000 to a total of $200,000 and addition of lenders to the lending bank group. The Credit Facility is available to fund working capital and general corporate purposes, including the making of certain restricted payments permitted therein. Borrowings under the Credit Facility are secured by substantially all of the Partnership’s assets, including its preferred equity interest in Augusta.

Loans under the Credit Facility bear interest at a floating rate based upon the Partnership’s leverage ratio, equal to, at the Partnership’s option, either (a) a base rate plus a range from 150 to 250 basis points per annum or (b) a LIBOR rate, plus a range of 250 to 350 basis points. The base rate is established as the highest of (i) the U.S. prime rate, (ii) daily one-month LIBOR plus 100 basis points and (iii) the federal funds rate plus 0.50%. The unused portion of the Credit Facility is subject to a commitment fee calculated based upon the Partnership’s leverage ratio ranging from 0.375% to 0.50% per annum. Upon any event of default, the interest rate shall, upon the request of the lenders holding a majority of the commitments, be increased by 2.0% per annum for the period during which the event of default exists.

The Credit Agreement contains customary representations and warranties, affirmative covenants, negative covenants and events of default. The negative covenants include restrictions on the Partnership’s ability to incur additional indebtedness, acquire and sell assets, create liens, make investments and make distributions.

The Credit Agreement requires the Partnership to maintain a leverage ratio (as such term is defined in the Credit Agreement) of not more than 3.00 to 1.00, which may increase to up to 3.50 to 1.00 during specified periods following a permitted acquisition, and a minimum interest coverage ratio (as such term is defined in the Credit Agreement) of not less than 2.50 to 1.00. Under the second amendment, the Partnership agreed to a term out feature under which $50,000 of borrowings would convert to a term loan due August 21, 2016 if the outstanding borrowings under the revolver exceeded $125,000 for four consecutive quarters. If balances are outstanding on a term loan, the Partnership would be required to maintain a debt service coverage ratio (as such term is defined in the Credit Agreement) of not less than 1.50 to 1.00.

If an event of default (as defined the Credit Agreement) occurs, the agent would be entitled to take various actions, including the acceleration of amounts due under the Credit Facility, termination of the commitments under the Credit Facility and all remedial actions available to a secured creditor. As of December 31, 2013, we were in compliance with the covenants contained in the Partnership Credit Facility. 

As of December 31, 2013, we had $138,250 indebtedness and $60,250 of undrawn borrowing capacity ($200,000, net of $138,250 indebtedness and $1,500 letter of credit commitments) under our Credit Facility. The outstanding balance is due on December 31, 2016 and carries an interest rate of 3.17% as of December 31, 2013.

Subsidiary Guarantors

The Partnership has filed a registration statement on Form S-3 to register, among other securities, debt securities. Each of the current subsidiaries of Hi-Crush Partners LP (other than Hi-Crush Finance Corp., whose sole purpose is to act as a co-issuer of any debt securities), each a 100 percent directly or indirectly owned subsidiary of the Partnership (the “guarantors”), will issue guarantees of the debt securities, if any of them issue guarantees, and such guarantees will be full and unconditional and will constitute the joint and several obligations of such guarantors. The guarantors are our sole subsidiaries, other than Hi-Crush Finance Corp., which is our 100 percent owned subsidiary. The Partnership has no assets or operations independent of its subsidiaries, and there are no significant restrictions upon the ability of the Partnership or any of its subsidiaries to obtain funds from its respective subsidiaries by dividend or loan. None of the assets of our subsidiaries represent restricted net assets pursuant to Rule 4-08(e)(3) of Regulation S-X under the Securities Act of 1933, as amended (the “Securities Act”).

XML

Consolidated Statements of Operations (USD $) In Thousands, except Share data, unless otherwise specified	5 Months Ended	12 Months Ended	5 Months Ended	12 Months Ended	5 Months Ended	12 Months Ended	7 Months Ended	12 Months Ended
	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor	Dec. 31, 2012 Successor Common Units	Dec. 31, 2013 Successor Common Units	Dec. 31, 2012 Successor Subordinated Units	Dec. 31, 2013 Successor Subordinated Units	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor
Revenues	$ 28,858	$ 141,742					$ 46,776	$ 20,353
Cost of goods sold (including depreciation, depletion and amortization)	7,145	74,539					13,336	6,447
Gross profit	21,713	67,203					33,440	13,906
Operating costs and expenses:
General and administrative expenses	2,795	16,205					4,631	2,324
Exploration expense	91	47					539	381
Accretion of asset retirement obligation	56	117					16	28
Income from operations	18,771	50,834					28,254	11,173
Other income (expense):
Income from preferred interest in Hi-Crush Augusta LLC	0	11,250					0	0
Other income	0	0					6	0
Interest expense	(263)	(3,522)					(3,240)	(1,893)
Net income	$ 18,508	$ 58,562					$ 25,020	$ 9,280
Earnings per unit:
Earnings per unit, basic and diluted (in dollars per share)			$ 0.68	$ 2.08	$ 0.68	$ 2.08
Limited Partner Units Outstanding:
Weighted average limited partnership units outstanding, basic and diluted (in shares)			13,640,351	14,527,914	13,640,351	13,640,351

XML

Initial Public Offering

12 Months Ended

Dec. 31, 2013

Initial Public Offering [Abstract]

Initial Public Offering

Initial Public Offering

On August 16, 2012, we completed our initial public offering (“IPO”) of 11,250,000 common units representing limited partner interests in the Partnership at a price to the public of $17.00 per common unit. Total net proceeds paid to our sponsor from the sale of common units in our IPO were $179,536 after taking into account our underwriting discount of $11,714. Our sponsor received all proceeds from the IPO and incurred capitalized transaction costs of $3,383 through September 30, 2012. These capitalized transaction costs were retained by the sponsor. On August 16, 2012, our underwriters exercised their option to purchase an additional 1,687,500 common units for $26,930. As a result, total net proceeds were $206,466 from the sale of 12,937,500 total common units to the public.

The following table outlines the consolidated net assets contributed to the Partnership on August 16, 2012:

Assets:
Cash	$	1,984
Accounts receivable	12,453
Inventories	4,085
Due from sponsor	4,606
Prepaid expenses and other current assets	26
Property, plant and equipment, net	69,623
Deferred charges, net	1,113
Total Assets	$	93,890
Liabilities:
Accounts payable	$	1,397
Accrued liabilities	1,901
Deferred revenue	6,590
Asset retirement obligation	848
Total liabilities	10,736
Net assets contributed to the Partnership	$	83,154

The following is a reconciliation of the Predecessor’s equity as of August 15, 2012 and total net assets contributed to the Partnership on August 16, 2012:

Predecessor Members’ Capital – August 15, 2012	$	35,082
Net liabilities of non-contributed sponsor entities	9,522
Members’ capital attributable to entities contributed to the Partnership	44,604
Conversion of debts payable by Partnership entities to sponsor	23,916
Assumption of payables held by Partnership entities by sponsor	10,028
Cash contribution commitment from sponsor	4,606
Net Assets Contributed to Partnership – August 16, 2012	$	83,154

As a result of our IPO, our sponsor entered into or amended the following agreements:

Amended and Restated Agreement of Limited Partnership of Hi-Crush Partners LP

On August 20, 2012, the Partnership amended and restated its Limited Partnership Agreement to establish the organizational framework for a public master limited partnership. On January 31, 2013, the Partnership amended and restated its amended and restated Limited Partnership Agreement to, among other things, provide for the creation of the Class B units. See Note 11 – Equity.

Omnibus Agreement

On August 20, 2012, we entered into an omnibus agreement with both our General Partner and our sponsor. Pursuant to the terms of this agreement, our sponsor will indemnify us and our subsidiaries for certain liabilities over specified periods of time, including but not limited to certain liabilities relating to (a) environmental matters pertaining to the period prior to our IPO and the contribution of the Wyeville assets from our sponsor, provided that such indemnity is capped at $7,500 in aggregate, (b) federal, state and local tax liabilities pertaining to the period prior to our IPO and the contribution of the Wyeville assets from our sponsor, (c) inadequate permits or licenses related to the contributed assets, and (d) any losses, costs or damages incurred by us that are attributable to our sponsor’s ownership and operation of the Wyeville assets prior to our IPO and our sponsor’s contribution of such assets. In addition, we have agreed to indemnify our sponsor from any losses, costs or damages it incurs that are attributable to our ownership and operation of the contributed assets following the closing of the IPO, subject to similar limitations as on our sponsor’s indemnity obligations to us.

The omnibus agreement had provided that we would assign to our sponsor all of our rights and obligations under our long-term contract with one customer as of May 1, 2013, and our sponsor would have been obligated to accept such assignment and assume our obligations under such contract. In connection with our acquisition of a preferred interest in Augusta on January 31, 2013, our sponsor waived its right to require that we assign to our sponsor such contract. As such, the contract remains with the Partnership and will continue to be fulfilled by the Wyeville Plant for the remainder of its term. In addition, the omnibus agreement also grants us, for a period of three years from the effective date of the agreement, a right of first offer on our sponsor’s sand reserves and any related assets that have been or will be constructed on its current acreage in Augusta, Wisconsin in the event our sponsor proposes to transfer such reserves and assets to a third party other than in connection with a sale of all or substantially all of its assets.

Services Agreements

Effective August 16, 2012, we entered into a services agreement (the “Services Agreement”) by and among our General Partner, Hi-Crush Services LLC (“Hi-Crush Services”), a wholly-owned subsidiary of the sponsor, and the Partnership, pursuant to which Hi-Crush Services provides certain management and administrative services to our General Partner to assist in operating our business. Under the Services Agreement, the Partnership reimburses Hi-Crush Services and its affiliates, on a monthly basis, for the allocable expenses it incurs in its performance under the Services Agreement. These expenses include, among other things, salary, bonus, incentive compensation, rent and other administrative expense for individuals and entities that perform services for us or on our behalf. Hi-Crush Services and its affiliates are not liable to us for its performance of services under the Services Agreement except a liability resulting from gross negligence.

In addition, effective August 16, 2012, we entered into an agreement with our sponsor, pursuant to which the sponsor provides maintenance and capital spares to us in connection with the ongoing maintenance of our Wyeville facility. Our sponsor bills us for the approximate cost of such items.

Long-Term Incentive Plan

On August 21, 2012, the General Partner adopted the Hi-Crush Partners LP Long Term Incentive Plan (the “Plan”) for employees, consultants and directors of the General Partner and those of its affiliates, including the sponsor, who perform services for the Partnership. The Plan consists of restricted units, unit options, phantom units, unit payments, unit appreciation rights, other equity-based awards, distribution equivalent rights, and performance awards. The Plan limits the number of common units that may be delivered pursuant to awards under the plan to 1,364,035 units. Common units withheld to satisfy exercise prices or tax withholding obligations are available for delivery pursuant to other awards. The Plan is administered by the General Partner’s Board of Directors or a committee thereof.

XML

Significant Accounting Policies

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The more significant estimates relate to our estimates and assumptions for our mineral reserves and its impact on calculating our depreciation and depletion expense under the units-of-production depreciation method, assessing potential impairment of long-lived assets, estimating potential loss contingencies and estimated cost of future asset retirement obligations. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist of all cash balances and highly liquid investments with an original maturity of three months or less.

Restricted Cash

The Partnership must pledge cash escrow accounts for the benefit of the Pennsylvania Department of Transportation, Bureau of Rail Freight, Ports and Waterways (“Bureau”) to guarantee performance on rail improvement projects partially funded by the Bureau. The funds are released when the project is completed.

Accounts Receivable

Trade receivables relate to sales of raw frac sand and related services for which credit is extended based on the customer’s credit history and are recorded at the invoiced amount and do not bear interest. The Partnership regularly reviews the collectability of accounts receivable. When it is probable that all or part of an outstanding balance will not be collected, the Partnership establishes or adjusts an allowance as necessary using the specific identification method. Account balances are charged against the allowance after all means of collection have been exhausted and potential recovery is considered remote.

Deferred Charges

Certain direct costs incurred in connection with debt financing have been capitalized and are being amortized using the straight-line method, which approximates the effective interest method, over the life of the debt. Amortization expense is included in interest expense and was $463 for the year ended December 31, 2013, $105 for the period from August 16, 2012 to December 31, 2013, $364 for the period from January 1, 2012 to August 15, 2012 and $154 for the year ended December 31, 2011.

The following is a summary of future amortization expense associated with deferred charges:

For the years ending December 31,
2014	$	533
2015	533
2016	401
Total	$	1,467

Inventories

Sand inventory is stated at the lower of cost or market using the average cost method.

Inventory manufactured at our plant facilities includes direct excavation costs, processing costs, overhead allocation, depreciation and depletion. Stockpile tonnages are calculated by measuring the number of tons added and removed from the stockpile. Tonnages are verified periodically by an independent surveyor. Costs are calculated on a per ton basis and are applied to the stockpile based on the number of tons in the stockpile.

Inventory transported for sale at our terminal facility includes the cost of purchased or manufactured sand, plus transportation related charges.

Spare parts inventory includes critical spares, materials and supplies. We account for spare parts on a first-in, first-out basis, and value the inventory at the lower of cost or market. Detail reviews are performed related to the net realizable value of the spare parts inventory, giving consideration to quality, excessive levels, obsolescence and other factors.

Property, Plant and Equipment

Additions and improvements occurring through the normal course of business are capitalized at cost. When assets are retired or disposed of, the cost and the accumulated depreciation and depletion are eliminated from the accounts and any gain or loss is reflected in the income statement. Expenditures for normal repairs and maintenance are expensed as incurred. Construction-in-progress is primarily comprised of machinery and equipment which has not been placed in service.

Mine development costs include engineering, mineralogical studies, drilling and other related costs to develop the mine, the removal of overburden to initially expose the mineral and building access ways. Exploration costs are expensed as incurred and classified as exploration expense. Capitalization of mine development project costs begins once the deposit is classified as proven and probable reserves.

Drilling and related costs are capitalized for deposits where proven and probable reserves exist and the activities are directed at obtaining additional information on the deposit or converting non-reserve minerals to proven and probable reserves and the benefit is to be realized over a period greater than one year.

Mine development costs are amortized using the units-of-production (“UOP”) method on estimated measured tons in in-place reserves. The impact of revisions to reserve estimates is recognized on a prospective basis.

Capitalized costs incurred during the year for major improvement and capital projects that are not placed in service are recorded as construction-in-progress. Construction-in-progress is not depreciated until the related assets or improvements are ready to be placed in service. We capitalize interest cost as part of the historical cost of constructing an asset and preparing it for its intended use. These interest costs are included in the property, plant and equipment line in the balance sheet. The Partnership did not capitalize any interest for the period from August 16, 2012 to December 31, 2013. Capitalized interest was $1,739 for the period from January 1, 2012 to August 15, 2012 and $756 for the year ended December 31, 2011.

Fixed assets other than plant facilities and buildings associated with productive, depletable properties are carried at historical cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows:

Computer equipment	3 years
Furniture and fixtures	7 years
Vehicles	5 years
Equipment	5-15 years
Rail spur and asset retirement obligation	33 years
Rail and rail equipment	15-20 years
Transload facilities and equipment	15-20 years

Plant facilities and buildings associated with productive, depletable properties that contain frac sand reserves are carried at historical cost and are depreciated using the units-of-production method. Units-of-production rates are based on the amount of proved developed frac sand reserves that are estimated to be recoverable from existing facilities using current operating methods.

The sponsor was in a developmental stage from the date of formation until the Wyeville Plant was deemed to be operational on July 21, 2011.

Preferred Interest in Hi-Crush Augusta

The Partnership accounts for the preferred interest in Augusta acquired on January 31, 2013 as a cost method investment. The preferred interest is not allocated any of the periodic earnings or losses of Augusta, but may in the future convert to a 20% equity interest in that entity. In accordance with the cost method, distributions earned under the preferred interest are recognized as income on the date the cash is received by the Partnership. The preferred interest is reviewed for impairment if an event or change in circumstances occurs which may have a significant adverse effect on the fair value of the investment. No such events or changes in circumstances arose during the year ended December 31, 2013.

Impairment of Long-lived Assets

Recoverability of investments in property, plant and equipment, and mineral rights is evaluated annually. Estimated future undiscounted net cash flows are calculated using estimates of proven and probable sand reserves, estimated future sales prices (considering historical and current prices, price trends and related factors) and operating costs and anticipated capital expenditures. Reductions in the carrying value of our investment are only recorded if the undiscounted cash flows are less than our book basis in the applicable assets.

Impairment losses are recognized based on the extent that the remaining investment exceeds the fair value, which is determined based upon the estimated future discounted net cash flows to be generated by the property, plant and equipment and mineral rights.

Management’s estimates of prices, recoverable proven and probable reserves and operating and capital costs are subject to certain risks and uncertainties which may affect the recoverability of our investments in property, plant and equipment. Although management has made its best estimate of these factors based on current conditions, it is reasonably possible that changes could occur in the near term, which could adversely affect management’s estimate of the net cash flows expected to be generated from its operating property. No impairment charges were recorded during 2013, 2012 or 2011.

Goodwill and Intangible Assets

Goodwill represents the excess of purchase price over the fair value of net assets acquired. The Partnership performs an assessment of the recoverability of goodwill during the third quarter of each fiscal year, or more often if events or circumstances indicate the impairment of an asset may exist. Our assessment of goodwill is based on qualitative factors to determine whether the fair value of the reporting unit is more likely than not less than the carrying value. An additional quantitative impairment analysis is completed if the qualitative analysis indicates that the fair value is not substantially in excess of the carrying value. The quantitative analysis determines the fair value of the reporting unit based on the discounted cash flow method and relative market-based approaches. There was no impairment charge related to goodwill during the year ended December 31, 2013.

The Partnership amortizes the cost of other intangible assets on a straight line basis over their estimated useful lives, ranging from 1 to 18 years. An impairment assessment is performed if events or circumstances occur and may result in the change of the useful lives of the intangible assets. During the year ended December 31, 2013, the Partnership did not record any impairment charges or changes in the useful life of its intangible assets.

Revenue Recognition

Frac sand sales revenues are recognized when legal title passes to the customer, which may occur at the production facility, rail origin or at the destination terminal. At that point, delivery has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of sand deliveries are recorded as deferred revenue. Revenue from make-whole provisions in our customer contracts is recognized at the end of the defined cure period.

The majority of our frac sand is sold under long-term supply agreements, the current terms of which expire between 2014 and 2019. The agreements define, among other commitments, the volume of product that the Partnership must provide, the price that will be charged to the customer, and the volume that the customer must purchase at the end of the defined cure period, which can range from three months to the end of a contract year.

Transportation services revenues are recognized as the services have been completed, meaning the related services have been rendered. At that point, delivery of service has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of transportation services being rendered are recorded as deferred revenue.

Revenue attributable to silo storage leases is recorded on a straight-line basis over the term of the lease.

Deferred Revenue

In January 2011, the sponsor received $16,500 in an advance payment from a customer for a certain volume of product to be delivered over a one-year period starting in July 2011. Revenue was recognized as product was delivered and the deferred revenue obligation was recognized over the one-year period ended June 30, 2012. In July 2012, the sponsor received an $8,250 advance payment from a customer for a certain volume of frac sand to be delivered over the six-month period beginning in July 2012. As of August 15, 2012, the outstanding balance under this obligation was $6,590 while the cash held by the Partnership was $1,984. As a result, the sponsor made a cash contribution of $4,606 to align the cash balance with the outstanding balance under this advance. As of December 31, 2012, the balance was $1,715, and as of December 31, 2013, no deferred revenue balance was outstanding under this advance payment.

Asset Retirement Obligation

In accordance with Accounting Standards Codification (“ASC”) 410-20, Asset Retirement Obligations, we recognize reclamation obligations when incurred and record them as liabilities at fair value. In addition, a corresponding increase in the carrying amount of the related asset is recorded and depreciated over such asset’s useful life. The reclamation liability is accreted to expense over the estimated productive life of the related asset and is subject to adjustments to reflect changes in value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs.

Fair Value of Financial Instruments

The amounts reported in the balance sheet as current assets or liabilities, including cash, accounts receivable, accounts payable, accrued liabilities and deferred revenue approximate fair value due to the short-term maturities of these instruments.

The amount recorded on the balance sheet pertaining to the Partnership’s long-term debt outstanding at December 31, 2013 is considered a Level 2 financial instrument, as although there is no observable quoted price, the underlying floating rate of interest is based on a published benchmark interest rate that is observable at commonly quoted intervals. As of December 31, 2013, the carrying value of the debt approximated its fair value as it is subject to floating rate interest and there have not been any significant changes to the Partnership’s credit profile since the debt was issued in January 2013.

Net Income per Limited Partner Unit

We have identified the General Partner’s incentive distribution rights as participating securities and compute income per unit using the two-class method under which any excess of distributions declared over net income shall be allocated to the partners based on their respective sharing of income specified in the partnership agreement. Net income per unit applicable to limited partners (including subordinated unitholders) is computed by dividing limited partners’ interest in net income, after deducting any General Partner incentive distributions, by the weighted-average number of outstanding common and subordinated units. Diluted net income per unit includes the effects of potentially dilutive units on our subordinated and common units. Basic and diluted net income per common and subordinated unit are the same as there are no potentially dilutive subordinated units outstanding.

As the 3,750,000 Class B units do not have voting rights or rights to share in the Partnership’s periodic earnings, either through participation in its distributions or through an allocation of its undistributed earnings or losses, they are not deemed to be participating securities in their current form. In addition, the conversion of the Class B units into common units is fully contingent upon the satisfaction of defined criteria pertaining to the cumulative payment of distributions and earnings per unit of the Partnership as described in Note 11. Therefore, it is possible that the Class B units may never be converted into common units. As such, until all of the defined payment and earnings criteria are satisfied, the Class B units will not be included in our calculation of either basic or diluted earnings per unit.

Income Taxes

The Partnership and sponsor are pass-through entities and are not considered taxable entities for federal tax purposes. Therefore, there is not a provision for income taxes in the accompanying condensed consolidated financial statements. The Partnership’s net income or loss is allocated to its partners in accordance with the partnership agreement. The partners are taxed individually on their share of the Partnership’s earnings. At December 31, 2013 and 2012, the Partnership did not have any liabilities for uncertain tax positions or gross unrecognized tax benefit.

Recent Accounting Pronouncements

In February 2013, the Financing Accounting Standards Board (“FASB”) issued amended guidance on the recognition, measurement, and disclosure of certain obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. Such arrangements may include debt, other contractual obligations, and settled litigation and judicial rulings. The amended guidance is to be applied retrospectively to all prior periods presented. This guidance will be effective for the Partnership beginning January 1, 2014. The Partnership anticipates that the adoption of this amended guidance will not materially affect its financial position, result of operations or cash flows.

In December 2011 and January 2013, the FASB issued amended guidance on disclosures pertaining to certain assets and liabilities that are either offset in an entity’s financial statements or those that are subject to a master netting agreement or similar arrangement. The scope of these disclosures is limited to derivatives, repurchase agreements and securities lending transactions. The Partnership adopted this guidance effective January 1, 2013, and, as it only impacts disclosures, it did not affect the Partnership’s financial position, result of operations or cash flows.

XML

Asset Retirement Obligation

12 Months Ended

Dec. 31, 2013

Asset Retirement Obligation [Abstract]

Asset Retirement Obligation

Asset Retirement Obligation

Although the ultimate amount of reclamation and closure costs to be incurred is uncertain, the Partnership maintained a post-closure reclamation and site restoration obligation as follows:

Balance at January 1, 2011	$	—
Additions to liabilities	804
Accretion expense	28
Balance at December 31, 2011	832
Additions to liabilities	651
Accretion expense from January 1 to August 15, 2012	16
Accretion expense from August 16 to December 31, 2012	56
Balance at December 31, 2012	1,555
Additions to liabilities	—
Accretion expense	118
Balance at December 31, 2013	$	1,673

XML

Equity

12 Months Ended

Dec. 31, 2013

Equity [Abstract]

Equity

Equity

On January 30, 2013, the Partnership issued 2,761 common units to each of its independent directors, valued in the aggregate at $100 and reflected as general and administrative expense in the accompanying financial statements. In January 2014, the Partnership issued 4,149 common units to the independent directors of the General Partner and 4,366 common units to certain employees.

On June 10, 2013, the Partnership issued 1,578,947 common units to certain former members of D&I, representing the non-cash portion of the purchase price for the acquisition (See Note 5 – Business Combination – Acquisition Accounting).

As of December 31, 2013, our sponsor owned all 13,640,351 subordinated units and 3,750,000 Class B units, representing a 47.3% ownership interest in the limited partner units and 100% ownership of the Class B units of the Partnership. In addition, the sponsor is the owner of our General Partner.

Subordinated Class B Units

On January 31, 2013, the Partnership issued 3,750,000 subordinated Class B units and paid $37,500 in cash to the sponsor in return for 100,000 preferred equity units in the sponsor’s Augusta facility. Our sponsor will not receive distributions on the Class B units until converted into common units of the Partnership. The Class B units are eligible for conversion into common units once we have, for two consecutive quarters, (i) earned $2.31 per common unit, subordinated unit and Class B unit on an annualized basis and (ii) paid $2.10 per unit in annualized distributions on each common and subordinated unit, or 110% of the current minimum quarterly distribution for a period of two consecutive quarters, and our General Partner has determined, with the concurrence of the conflicts committee of the board of directors of our General Partner, that we are expected to maintain such performance for at least two succeeding quarters.

Allocations of Net Income

Our partnership agreement contains provisions for the allocation of net income and loss to the unitholders and the General Partner. For purposes of maintaining partner capital accounts, the partnership agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage ownership interest. Normal allocations according to percentage interests are made after giving effect, if any, to priority income allocations in an amount equal to incentive cash distributions allocated 100% to the General Partner.

Incentive Distribution Rights

Incentive distribution rights represent the right to receive increasing percentages (ranging from 15.0% to 50.0%) of quarterly distributions from operating surplus after minimum quarterly distribution and target distribution levels exceed $0.54625 per unit, per quarter. Our sponsor currently holds the incentive distribution rights, but may transfer these rights at any time.

Distributions

Our partnership agreement sets forth the calculation to be used to determine the amount of cash distributions that our common and subordinated unitholders and sponsor will receive.

Our distributions have been as follows:

Declaration Date	Amount Declared Per Unit (a)			Record Date	Date Paid	Amount Paid
October 19, 2012	$	0.2375	(b)	November 1, 2012	November 15, 2012	$	6,480
January 17, 2013	$	0.4750		February 1, 2013	February 15, 2013	$	12,961
April 16, 2013	$	0.4750		May 1, 2013	May 15, 2013	$	12,961
July 17, 2013	$	0.4750		August 1, 2013	August 15, 2013	$	13,711
October 17, 2013	$	0.4900		November 1, 2013	November 15, 2013	$	14,144
January 15, 2014	$	0.5100		January 31, 2014	February 14, 2014	$	14,726
(a) For all common and subordinated units. No distributions were declared for our holders of incentive distribution rights or the holders of our Class B units.
(b) Represents a pro rata distribution of our minimum quarterly distribution for the period from August 16, 2012 through September 30, 2012.

For purposes of calculating the Partnership’s earnings per unit under the two-class method, common units are treated as participating preferred units, and the subordinated units are treated as the residual equity interest, or common equity. Incentive distribution rights are treated as participating securities.

Distributions made in future periods based on the current period calculation of cash available for distribution is allocated to each class of equity that will receive the distribution. Any unpaid cumulative distributions are allocated to the appropriate class of equity.

Each period the Partnership determines the amount of cash available for distributions in accordance with the partnership agreement. The amount to be distributed to common unitholders, subordinated unitholders and incentive distribution rights holders is based on the distribution waterfall in the partnership agreement. Net earnings for the period are allocated to each class of partnership interest based on the distributions to be made. Additionally, if, during the subordination period, the Partnership does not have enough cash available to make the required minimum distribution to the common unit holders, the Partnership will allocate net earnings to the common unit holders based on the amount of distributions in arrears. When actual cash distributions are made based on distributions in arrears, those cash distributions will not be allocated to the common unit holders, as such earnings were allocated in previous periods.

Net income attributable to our limited partner unitholders is as follows during the year ended December 31, 2013 (in thousands, except per unit amounts):

	Common Unitholders		Subordinated Unitholders
Distributions during the period	$	21,174	$	19,642
Subsequent distributions declared (See Note 18)	7,769		6,957
Undistributed earnings	1,385		1,635
Limited partners’ interest in net income	30,328		28,234
Subsequent distributions declared (per unit)	$	0.5100	$	0.5100

During the year ended December 31, 2013 and the period from August 16 through December 31, 2012, no net income was attributable to our incentive distribution rights holders.

XML

Inventories

12 Months Ended

Dec. 31, 2013

Inventory Disclosure [Abstract]

Inventories

Inventories

Inventories consisted of the following:

	December 31, 2013		December 31, 2012
	Successor		Successor
Raw material	$	—	$	124
Work-in-progress	3,699		3,280
Finished goods	12,431		4
Spare parts	135		133
	$	16,265	$	3,541

XML

Preferred Interest in Hi-Crush Augusta LLC - Excess Cash Paid over Cost Basis Recorded as Deemed Distribution to Sponsor (Details) (Hi-Crush Augusta LLC, USD $) In Thousands, unless otherwise specified	0 Months Ended
	Jan. 31, 2013	Jan. 31, 2013
Hi-Crush Augusta LLC
Schedule of Equity Method Investments [Line Items]
Total consideration paid		$ 95,400
Less: Cash paid	(37,500)	(37,500)
Less: Sponsor’s cost basis in the investment		(9,543)
Deemed distribution		$ 48,357

XML

Business Combination - Acquisition Accounting

12 Months Ended

Dec. 31, 2013

Business Combinations [Abstract]

Business Combination – Acquisition Accounting

Business Combination – Acquisition Accounting

On June 10, 2013, the Partnership acquired D&I, an independent frac sand supplier, transforming the Partnership into an integrated Northern White frac sand producer, transporter, marketer and supplier. The Partnership acquired D&I for $95,159 in cash and 1,578,947 common units, valued at $37,358 as of June 10, 2013.

The acquisition was accounted for under the acquisition method of accounting whereby management assessed the net assets acquired and recognized amounts for the identified assets acquired and liabilities assumed.

The total purchase price of $132,517 was allocated to the net assets acquired as follows:

Assets acquired:
Cash	$	204
Restricted cash	688
Accounts receivable	17,908
Inventories	10,372
Prepaid expenses and other current assets	809
Property, plant and equipment	39,242
Intangible assets	41,878
Goodwill	33,745
Other assets	113
Total assets acquired	$	144,959
Liabilities assumed:
Accounts payable	$	11,646
Accrued liabilities and other current liabilities	796
Total liabilities assumed	12,442
Fair value of net assets acquired	$	132,517

The operations of D&I have been included in the financial statements of the Partnership prospectively from June 11, 2013 through December 31, 2013. During this period, D&I earned $66,071 in revenue and $3,801 of net income, as consolidated into the Partnership’s results of operations. In connection with this acquisition, the Partnership incurred $1,728 of acquisition-related costs, as included in general and administrative expenses.

The following tables summarize the supplemental condensed consolidated statements of operations information on an unaudited pro forma basis as if the acquisition had occurred at January 1, 2012. The tables include adjustments that were directly attributable to the acquisition or are not expected to have a future impact on the Partnership. The pro forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred should the transaction have been consummated at the beginning of the period, nor are they indicative of future results of operations.

Pro Forma Financial Information for the:
	Year Ended December 31, 2013		Year Ended December 31, 2012 (1)
	Successor		Pro Forma (1)
Revenues	$	196,794	$	179,486
Net income	$	68,413	$	62,455
Net income per limited partner unit:
Common units – basic and diluted	2.37		2.16
Subordinated units – basic and diluted	2.37		2.16
(1) The comparative period includes the combination of the Predecessor and Successor results before and after our IPO on August 16. These pro-forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred if the acquisition and IPO would have taken place on January 1, 2012.

The pro forma financial information includes the impact of the following pro forma adjustments:

Adjustments Utilized to Prepare the Pro Forma Financial Information for the:
	Year Ended December 31, 2013			Year Ended December 31, 2012
Debit / (Credit)	Successor			Pro Forma (1)
Acquisition related expenses	$	(4,775	)	$	—
Other general and administrative expenses	(117		)	(239		)
Interest expense on debt issued to fund acquisition	1,226			2,561
Depreciation and amortization expense	(8		)	3,947
Increase in weighted average common units outstanding	696,467			1,578,947

XML

Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Changes in goodwill and intangible assets consisted of the following:

	Goodwill		Intangible Assets
Balance at December 31, 2012	$	—	$	—
Additions from D&I acquisition	33,745		41,878
Amortization expense	—		(3,687		)
Balance at December 31, 2013	$	33,745	$	38,191

Goodwill

As of December 31, 2013, the Partnership had goodwill of $33,745 based on the allocation of the purchase price of its acquisition of D&I.

Intangible Assets

Intangible assets arising from the acquisition of D&I consisted of the following:

	Useful life	December 31, 2013
		Successor
Supplier agreements	1-20 Years	21,997
Customer contracts and relationships	1-10 Years	18,132
Other intangible assets	1-3 Years	1,749
Intangible assets		41,878
Less: Accumulated amortization		(3,687		)
Intangible assets, net		$	38,191

Amortization expense was $3,687 for the year ended December 31, 2013. The weighted average remaining life of intangible assets was 13 years as of December 31, 2013. As of December 31, 2013, future amortization is as follows:

Fiscal Year	Amortization
2014	$	5,127
2015	2,967
2016	2,938
2017	2,850
2018	2,850
Thereafter	21,459
	$	38,191

XML

Property, Plant and Equipment

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	December 31, 2013			December 31, 2012
	Successor			Successor
Buildings	$	2,107		$	417
Mining property and mine development	24,522			24,156
Plant and equipment	47,669			43,767
Rail and rail equipment	12,774			5,499
Transload facilities and equipment	30,265			—
Construction-in-progress	1,829			1,380
	119,166			75,219
Less: Accumulated depreciation and depletion	(5,824		)	(2,375		)
	$	113,342		$	72,844

Depreciation and depletion expense was as follows during the periods presented:

Predecessor Periods
Year ended December 31, 2011	$	449
Period from January 1 through August 15, 2012	1,089
Successor Period
Period from August 16 through December 31, 2012	$	863
Year ended December 31, 2013	3,399

XML

Equity - Distributions (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	0 Months Ended															1 Months Ended	0 Months Ended
	Nov. 15, 2012 Period 1	Oct. 19, 2012 Period 1		Feb. 15, 2013 Period 2	Jan. 17, 2013 Period 2		May 15, 2013 Period 3	Apr. 16, 2013 Period 3		Aug. 15, 2013 Period 4	Jul. 17, 2013 Period 4		Nov. 15, 2013 Period 5	Oct. 17, 2013 Period 5		Jan. 31, 2014 Subsequent Event	Feb. 14, 2014 Subsequent Event Period 6	Jan. 15, 2014 Subsequent Event Period 6
Distribution Made to Limited Partner [Line Items]
Declaration Date		Oct. 19, 2012			Jan. 17, 2013			Apr. 16, 2013			Jul. 17, 2013			Oct. 17, 2013				Jan. 15, 2014
Amount Declared Per Unit		$ 0.2375	[1],[2]		$ 0.4750	[1]		$ 0.4750	[1]		$ 0.4750	[1]		$ 0.49	[1]			$ 0.5100	[1]
Record Date	Nov. 01, 2012			Feb. 01, 2013			May 01, 2013			Aug. 01, 2013			Nov. 01, 2013			Jan. 31, 2014	Jan. 31, 2014
Date Paid	Nov. 15, 2012			Feb. 15, 2013			May 15, 2013			Aug. 15, 2013			Nov. 15, 2013			Feb. 14, 2014	Feb. 14, 2014
Amount Paid	$ 6,480			$ 12,961			$ 12,961			$ 13,711			$ 14,144			$ 14,726	$ 14,726

[1] For all common and subordinated units. No distributions were declared for our holders of incentive distribution rights or the holders of our Class B units.

[2] Represents a pro rata distribution of our minimum quarterly distribution for the period from August 16, 2012 through September 30, 2012.

XML

Related Party Transactions - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	0 Months Ended	5 Months Ended	12 Months Ended
	May 25, 2011 Member	Dec. 31, 2012	Dec. 31, 2013
Related Party Transactions [Abstract]
Number of equity members in the sponsor	2
Term of management services agreement	1 year
Number of days to terminate the agreement by delivering written notice	90 days
Percentage of Sponsor reimburses the Service Provider	95.00%
Service Provider's actual costs limited per year	$ 850
Management Fee		1,028	3,698
Partnership made payments		9,866
Payment made by sponsor		3,223
Due from sponsor		5,615
Due to sponsor			2,571
Payments for purchase of sand			$ 4,402

XML

Equity - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended		12 Months Ended		1 Months Ended	12 Months Ended	1 Months Ended	12 Months Ended	1 Months Ended	12 Months Ended		0 Months Ended	1 Months Ended		0 Months Ended
	Dec. 31, 2013	Jan. 31, 2013 Hi-Crush Augusta LLC Preferred units	Dec. 31, 2013 Increasing Percentage One	Dec. 31, 2013 Increasing Percentage Three	Aug. 15, 2012 Common Units	Dec. 31, 2013 Common Units	Aug. 15, 2012 Subordinated Units	Dec. 31, 2013 Subordinated Units	Jan. 31, 2013 Class B units Quarter	Dec. 31, 2013 Class B units	Jan. 31, 2013 Class B units Hi-Crush Augusta LLC Preferred units	Jan. 31, 2013 Independent Directors	Jan. 31, 2014 Independent Directors Subsequent Event	Jan. 31, 2014 Employee Stock Subsequent Event	Jun. 10, 2013 D&I Silica, LLC
Class of Stock [Line Items]
Limited partner interest, units outstanding								13,640,351		3,750,000
Ownership interest in Partnership	47.30%									100.00%
Units issued, shares					13,640,351		13,640,351		3,750,000			2,761	4,149	4,366	1,578,947
Stock issued during period, value												$ 100
Cash paid to the sponsor						$ 21,174		$ 19,642	$ 37,500
Business acquisition, preferred stock acquired (In shares)		100,000									100,000
Number of consecutive quarters in conversion term									2
Annual converted common unit earned, per unit									$ 2.31
Annualized distributions paid per unit									$ 2.10
Percentage of current minimum quarterly distribution									110.00%
Number of succeeding quarters expected to maintain performance in conversion term									2
Incentive cash distributions to General Partner	100.00%
Incentive distribution rights increasing percentages			15.00%	50.00%
Target incentive distribution levels per unit, per quarter	$ 0.54625

XML

Preferred Interest in Hi-Crush Augusta LLC (Tables)

12 Months Ended

Dec. 31, 2013

Investments, All Other Investments [Abstract]

Excess Cash Paid over Cost Basis Recorded as Deemed Distribution to Sponsor

The transaction represented an exchange of ownership interests between entities under common control. As a result, the Partnership recorded an investment in the preferred interest equal to the total amount of the cash paid and our sponsor’s cost basis in the preferred units. Excess consideration exchanged over the cost basis was recorded as a deemed distribution to our sponsor, determined as follows:

Total consideration paid	$	95,400
Less: Cash paid	(37,500		)
Less: Sponsor’s cost basis in the investment	(9,543		)
Deemed distribution	$	48,357

XML

Business Combination - Acquisition Accounting - Adjustments Utilized to Prepare Pro Forma Financial Information (Details) (D&I Silica, LLC, USD $) In Thousands, except Share data, unless otherwise specified	7 Months Ended	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012 Acquisition-related Costs		Dec. 31, 2013 Successor Acquisition-related Costs
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Acquisition related expenses	$ 1,728			$ (4,775)
Acquisition related costs, Pro Forma		0	[1]
Other general and administrative expenses		(239)	[1]	(117)
Interest expense on debt issued to fund acquisition		2,561	[1]	1,226
Depreciation and amortization expense		$ 3,947	[1]	$ (8)
Increase in weighted average common units outstanding		1,578,947	[1]	696,467

[1] The comparative period includes the combination of the Predecessor and Successor results before and after our IPO on August 16. These pro-forma results are for illustrative purposes only and are not intended to be indicative of the actual results that would have occurred if the acquisition and IPO would have taken place on January 1, 2012.

XML

Segment Reporting

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

The Partnership manages, operates and owns assets utilized to supply frac sand to its customers. As a result of its June 10, 2013 acquisition of D&I, the Partnership identified its production plant and terminal facilities as separate operating segments through the third quarter of 2013. These two operating segments were aggregated into one reportable segment as they sell the same products, source product from frac sand production facilities in the Midwestern United States, have similar customers, use similar distribution systems and have similar economic characteristics and regulatory environments. Through the fourth quarter of 2013, the Partnership continued to integrate the recently acquired terminal facilities, which resulted in a change in the way the chief operating decision maker allocates capital resources and assesses performance. As a result of this integration, the two previously identified operating segments were combined into one operating segment titled "Frac Sand Sales" for reporting purposes.

XML

Subsequent Events

12 Months Ended

Dec. 31, 2013

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

On January 16, 2014, we declared a cash distribution totaling $14,726, or $0.5100 per unit. This distribution was paid on February 14, 2014 to unitholders of record on January 31, 2014. No distributions were declared for our holders of incentive distribution rights.

XML

Business Combination - Acquisition Accounting - Total Preliminary Purchase Price allocation to Net Assets Acquired (Details) (D&I Silica, LLC, USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Jun. 10, 2013	Dec. 31, 2012
D&I Silica, LLC
Assets acquired:
Cash		$ 204
Restricted cash		688
Accounts receivable		17,908
Inventories		10,372
Prepaid expenses and other current assets		809
Property, plant and equipment		39,242
Intangible assets		41,878
Goodwill	33,745	33,745	0
Other assets		113
Total assets acquired		144,959
Liabilities assumed:
Accounts payable		11,646
Accrued liabilities and other current liabilities		796
Total liabilities assumed		12,442
Fair value of net assets acquired		$ 132,517

XML

Business and Organization - Additional Information (Detail) (USD $)			0 Months Ended					0 Months Ended			1 Months Ended		0 Months Ended	1 Months Ended
	Aug. 15, 2012	May 08, 2012	Jan. 31, 2013 Hi-Crush Augusta LLC	Jan. 31, 2013 Hi-Crush Augusta LLC	Dec. 31, 2013 Hi-Crush Augusta LLC Quarterly Payment	Jan. 31, 2013 Hi-Crush Augusta LLC Quarterly Payment	Jan. 31, 2013 Hi-Crush Augusta LLC Annual	Jan. 31, 2013 Hi-Crush Augusta LLC Class B units	Jan. 31, 2013 Hi-Crush Augusta LLC Class B units	Jun. 10, 2013 D&I Silica, LLC	Aug. 15, 2012 Initial public offering	Aug. 15, 2012 Common Units	Jun. 10, 2013 Common Units D&I Silica, LLC	Aug. 15, 2012 Subordinated Units
Capital Unit [Line Items]
Percentage of limited partner interest		100.00%
Sand reserves and related excavation and processing facilities owned	100.00%
Cash paid to the Partnership	$ 4,606,000
Net intercompany receivables due from the Partnership into capital	23,916,000
Outstanding accounts payable maintained	10,028,000
Number of shares issued											12,937,500	13,640,351		13,640,351
Business acquisition, cash paid			37,500,000	37,500,000						95,159,000
Business acquisition, convertible stock issued								3,750,000
Preferred distribution					$ 3,750,000	$ 3,750,000	$ 15,000,000
Business acquisition, number of shares issued									3,750,000	1,578,947			1,578,947

XML

Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	5 Months Ended	12 Months Ended	7 Months Ended	12 Months Ended
	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor
Operating activities:
Net income	$ 18,508	$ 58,562	$ 25,020	$ 9,280
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and depletion	863	3,399	1,089	449
Amortization of intangible assets	0	3,687	0	0
Amortization of deferred charges into interest expense	105	463	364	154
Accretion of asset retirement obligation	56	117	16	28
Loss on replacement of equipment	0	191	0	0
Unit based compensation to independent directors	0	100	0	0
Income from restricted cash	0	(2)	0	0
Interest expense converted into principal	0	0	3,083	2,421
Changes in operating assets and liabilities:
Accounts receivable	4,254	(5,474)	(8,698)	(4,026)
Prepaid expenses and other current assets	(368)	(230)	(4,549)	(294)
Inventories	362	(2,295)	(2,052)	(2,374)
Other assets	0	(2,234)	0	0
Accounts payable	(375)	(3,959)	2,814	3,156
Accrued liabilities and other current liabilities	(145)	1,824	2,161	816
Due to sponsor	0	2,571	0	0
Deferred revenue	(4,876)	(1,715)	(2,588)	9,178
Net cash provided by operating activities	18,384	55,005	16,660	18,788
Investing activities:
Cash paid for acquisition of preferred interest in Hi-Crush Augusta LLC	0	(37,500)	0	0
Cash paid for acquisition of D&I Silica LLC, net of cash acquired	0	(94,955)	0	0
Capital expenditures for property, plant and equipment	(2,239)	(6,260)	(80,075)	(50,169)
(Increase) decrease in restricted cash	0	0	30	(30)
Net cash used in investing activities	(2,239)	(138,715)	(80,045)	(50,199)
Financing activities:
Proceeds from issuance of long-term debt	0	138,250	63,985	48,692
Repayment of long-term debt	0	0	(1,250)	(5,000)
Affiliate financing, net	(5,615)	5,615	0	0
Loan origination costs	(143)	(829)	(1,462)	(1,924)
Distributions paid	(6,479)	(53,777)	(225)	0
Contributions received	4,606	0	0	697
Net cash provided by (used in) financing activities	(7,631)	89,259	61,048	42,465
Net increase (decrease) in cash	8,514	5,549	(2,337)	11,054
Cash:
Beginning of period	1,984	10,498	11,054	0
End of period	10,498	16,047	8,717	11,054
Non-cash investing and financing activities:
Increase (decrease) in accounts payable and accrued liabilities for additions to property, plant and equipment	1,012	(1,358)	9,345	1,544
Transferred basis of preferred interest in Hi-Crush Augusta LLC	0	9,543	0	0
Issuance of common units for acquisition of D&I Silica, LLC	0	37,538	0	0
Increase (decrease) in accounts payable for loan origination costs	(56)	0	1,238	0
Non-cash component of capital contribution by sponsor to the Partnership	81,170	0	0	0
Non-cash transfer of other assets and deferred charges to property, plant and equipment	0	0	0	277
Distribution to a related party	0	0	0	(400)
Contribution from an affiliate	0	0	0	400
Increase in property, plant and equipment for asset retirement obligation	0	0	0	804
Cash paid for interest, net of amount capitalized	$ 63	$ 2,974	$ 90	$ 0

XML

Basis of Presentation

12 Months Ended

Dec. 31, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The consolidated financial statements through August 15, 2012 include the consolidated results of operations and cash flows, as well as the financial position of the sponsor (the "Predecessor"). In early 2011, the sponsor acquired land in Monroe County, Wisconsin for the purpose of excavating sand for sale into the oil and natural gas markets. In June 2011, the sponsor completed its construction of the Wyeville Plant in order to process sand excavated from the Monroe County, Wisconsin site, with its first shipments occurring on July 21, 2011.

The consolidated financial statements from August 16, 2012 through December 31, 2013 include the consolidated results of operations and cash flows of the Partnership (the "Successor"). The consolidated financial statements include results of operations and cash flows for D&I prospectively from June 11, 2013. The balance sheet as of December 31, 2013 includes only the financial position of the Partnership, including the retained earnings of the Partnership’s operations from August 16, 2012 through December 31, 2013.

XML

Property, Plant and Equipment - Depreciation and Depletion Expense (Detail) (USD $) In Thousands, unless otherwise specified	7 Months Ended	12 Months Ended	5 Months Ended	12 Months Ended
	Aug. 15, 2012 Predecessor	Dec. 31, 2011 Predecessor	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor
Property, Plant and Equipment [Line Items]
Depreciation and depletion expense	$ 1,089	$ 449	$ 863	$ 3,399

XML

Commitments and Contingencies - Additional Information (Detail) (USD $)	0 Months Ended	12 Months Ended		7 Months Ended	12 Months Ended			5 Months Ended		12 Months Ended
	May 25, 2011	Dec. 31, 2013	Jul. 13, 2012	Aug. 15, 2012 Predecessor	Dec. 31, 2013 Predecessor	Dec. 31, 2011 Predecessor	Jul. 13, 2012 Predecessor	Dec. 31, 2012 Successor	Dec. 31, 2013 Successor	Dec. 31, 2013 Minimum	Dec. 31, 2013 Maximum
Long-term Purchase Commitment [Line Items]
Initial term of contracts	1 year									3 years	6 years
Payments realized for customers		$ 0
Royalty expense				3,795,000	3,597,000	2,045,000		948,000
Cash paid to terminate contract			14,000,000
Royalty agreement outstanding obligation			370,000
Property, plant and equipment							13,630,000	72,844,000	113,342,000
Rail car rental expense		$ 2,035,000

XML

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Use of Estimates

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The more significant estimates relate to our estimates and assumptions for our mineral reserves and its impact on calculating our depreciation and depletion expense under the units-of-production depreciation method, assessing potential impairment of long-lived assets, estimating potential loss contingencies and estimated cost of future asset retirement obligations. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents consist of all cash balances and highly liquid investments with an original maturity of three months or less.

Restricted Cash

Restricted Cash

The Partnership must pledge cash escrow accounts for the benefit of the Pennsylvania Department of Transportation, Bureau of Rail Freight, Ports and Waterways (“Bureau”) to guarantee performance on rail improvement projects partially funded by the Bureau. The funds are released when the project is completed.

Accounts Receivable

Accounts Receivable

Trade receivables relate to sales of raw frac sand and related services for which credit is extended based on the customer’s credit history and are recorded at the invoiced amount and do not bear interest. The Partnership regularly reviews the collectability of accounts receivable. When it is probable that all or part of an outstanding balance will not be collected, the Partnership establishes or adjusts an allowance as necessary using the specific identification method. Account balances are charged against the allowance after all means of collection have been exhausted and potential recovery is considered remote.

Deferred Charges

Deferred Charges

Certain direct costs incurred in connection with debt financing have been capitalized and are being amortized using the straight-line method, which approximates the effective interest method, over the life of the debt. Amortization expense is included in interest expense and was $463 for the year ended December 31, 2013, $105 for the period from August 16, 2012 to December 31, 2013, $364 for the period from January 1, 2012 to August 15, 2012 and $154 for the year ended December 31, 2011.

Inventories

Inventories

Sand inventory is stated at the lower of cost or market using the average cost method.

Inventory manufactured at our plant facilities includes direct excavation costs, processing costs, overhead allocation, depreciation and depletion. Stockpile tonnages are calculated by measuring the number of tons added and removed from the stockpile. Tonnages are verified periodically by an independent surveyor. Costs are calculated on a per ton basis and are applied to the stockpile based on the number of tons in the stockpile.

Inventory transported for sale at our terminal facility includes the cost of purchased or manufactured sand, plus transportation related charges.

Spare parts inventory includes critical spares, materials and supplies. We account for spare parts on a first-in, first-out basis, and value the inventory at the lower of cost or market. Detail reviews are performed related to the net realizable value of the spare parts inventory, giving consideration to quality, excessive levels, obsolescence and other factors.

Property, Plant and Equipment

Property, Plant and Equipment

Additions and improvements occurring through the normal course of business are capitalized at cost. When assets are retired or disposed of, the cost and the accumulated depreciation and depletion are eliminated from the accounts and any gain or loss is reflected in the income statement. Expenditures for normal repairs and maintenance are expensed as incurred. Construction-in-progress is primarily comprised of machinery and equipment which has not been placed in service.

Mine development costs include engineering, mineralogical studies, drilling and other related costs to develop the mine, the removal of overburden to initially expose the mineral and building access ways. Exploration costs are expensed as incurred and classified as exploration expense. Capitalization of mine development project costs begins once the deposit is classified as proven and probable reserves.

Drilling and related costs are capitalized for deposits where proven and probable reserves exist and the activities are directed at obtaining additional information on the deposit or converting non-reserve minerals to proven and probable reserves and the benefit is to be realized over a period greater than one year.

Mine development costs are amortized using the units-of-production (“UOP”) method on estimated measured tons in in-place reserves. The impact of revisions to reserve estimates is recognized on a prospective basis.

Capitalized costs incurred during the year for major improvement and capital projects that are not placed in service are recorded as construction-in-progress. Construction-in-progress is not depreciated until the related assets or improvements are ready to be placed in service. We capitalize interest cost as part of the historical cost of constructing an asset and preparing it for its intended use. These interest costs are included in the property, plant and equipment line in the balance sheet. The Partnership did not capitalize any interest for the period from August 16, 2012 to December 31, 2013. Capitalized interest was $1,739 for the period from January 1, 2012 to August 15, 2012 and $756 for the year ended December 31, 2011.

Fixed assets other than plant facilities and buildings associated with productive, depletable properties are carried at historical cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows:

Computer equipment	3 years
Furniture and fixtures	7 years
Vehicles	5 years
Equipment	5-15 years
Rail spur and asset retirement obligation	33 years
Rail and rail equipment	15-20 years
Transload facilities and equipment	15-20 years

Plant facilities and buildings associated with productive, depletable properties that contain frac sand reserves are carried at historical cost and are depreciated using the units-of-production method. Units-of-production rates are based on the amount of proved developed frac sand reserves that are estimated to be recoverable from existing facilities using current operating methods.

The sponsor was in a developmental stage from the date of formation until the Wyeville Plant was deemed to be operational on July 21, 2011.

Preferred Interest in Hi-Crush Augusta

Preferred Interest in Hi-Crush Augusta

The Partnership accounts for the preferred interest in Augusta acquired on January 31, 2013 as a cost method investment. The preferred interest is not allocated any of the periodic earnings or losses of Augusta, but may in the future convert to a 20% equity interest in that entity. In accordance with the cost method, distributions earned under the preferred interest are recognized as income on the date the cash is received by the Partnership. The preferred interest is reviewed for impairment if an event or change in circumstances occurs which may have a significant adverse effect on the fair value of the investment.

Impairment of Long-lived Assets

Impairment of Long-lived Assets

Recoverability of investments in property, plant and equipment, and mineral rights is evaluated annually. Estimated future undiscounted net cash flows are calculated using estimates of proven and probable sand reserves, estimated future sales prices (considering historical and current prices, price trends and related factors) and operating costs and anticipated capital expenditures. Reductions in the carrying value of our investment are only recorded if the undiscounted cash flows are less than our book basis in the applicable assets.

Impairment losses are recognized based on the extent that the remaining investment exceeds the fair value, which is determined based upon the estimated future discounted net cash flows to be generated by the property, plant and equipment and mineral rights.

Management’s estimates of prices, recoverable proven and probable reserves and operating and capital costs are subject to certain risks and uncertainties which may affect the recoverability of our investments in property, plant and equipment. Although management has made its best estimate of these factors based on current conditions, it is reasonably possible that changes could occur in the near term, which could adversely affect management’s estimate of the net cash flows expected to be generated from its operating property.

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Goodwill represents the excess of purchase price over the fair value of net assets acquired. The Partnership performs an assessment of the recoverability of goodwill during the third quarter of each fiscal year, or more often if events or circumstances indicate the impairment of an asset may exist. Our assessment of goodwill is based on qualitative factors to determine whether the fair value of the reporting unit is more likely than not less than the carrying value. An additional quantitative impairment analysis is completed if the qualitative analysis indicates that the fair value is not substantially in excess of the carrying value. The quantitative analysis determines the fair value of the reporting unit based on the discounted cash flow method and relative market-based approaches. There was no impairment charge related to goodwill during the year ended December 31, 2013.

The Partnership amortizes the cost of other intangible assets on a straight line basis over their estimated useful lives, ranging from 1 to 18 years. An impairment assessment is performed if events or circumstances occur and may result in the change of the useful lives of the intangible assets.

Revenue Recognition

Revenue Recognition

Frac sand sales revenues are recognized when legal title passes to the customer, which may occur at the production facility, rail origin or at the destination terminal. At that point, delivery has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of sand deliveries are recorded as deferred revenue. Revenue from make-whole provisions in our customer contracts is recognized at the end of the defined cure period.

The majority of our frac sand is sold under long-term supply agreements, the current terms of which expire between 2014 and 2019. The agreements define, among other commitments, the volume of product that the Partnership must provide, the price that will be charged to the customer, and the volume that the customer must purchase at the end of the defined cure period, which can range from three months to the end of a contract year.

Transportation services revenues are recognized as the services have been completed, meaning the related services have been rendered. At that point, delivery of service has occurred, evidence of a contractual arrangement exists and collectability is reasonably assured. Amounts received from customers in advance of transportation services being rendered are recorded as deferred revenue.

Revenue attributable to silo storage leases is recorded on a straight-line basis over the term of the lease.

Deferred Revenue

Deferred Revenue

In January 2011, the sponsor received $16,500 in an advance payment from a customer for a certain volume of product to be delivered over a one-year period starting in July 2011. Revenue was recognized as product was delivered and the deferred revenue obligation was recognized over the one-year period ended June 30, 2012.

Asset Retirement Obligation

Asset Retirement Obligation

In accordance with Accounting Standards Codification (“ASC”) 410-20, Asset Retirement Obligations, we recognize reclamation obligations when incurred and record them as liabilities at fair value. In addition, a corresponding increase in the carrying amount of the related asset is recorded and depreciated over such asset’s useful life. The reclamation liability is accreted to expense over the estimated productive life of the related asset and is subject to adjustments to reflect changes in value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The amounts reported in the balance sheet as current assets or liabilities, including cash, accounts receivable, accounts payable, accrued liabilities and deferred revenue approximate fair value due to the short-term maturities of these instruments.

The amount recorded on the balance sheet pertaining to the Partnership’s long-term debt outstanding at December 31, 2013 is considered a Level 2 financial instrument, as although there is no observable quoted price, the underlying floating rate of interest is based on a published benchmark interest rate that is observable at commonly quoted intervals.

Net Income per Limited Partner Unit

Net Income per Limited Partner Unit

We have identified the General Partner’s incentive distribution rights as participating securities and compute income per unit using the two-class method under which any excess of distributions declared over net income shall be allocated to the partners based on their respective sharing of income specified in the partnership agreement. Net income per unit applicable to limited partners (including subordinated unitholders) is computed by dividing limited partners’ interest in net income, after deducting any General Partner incentive distributions, by the weighted-average number of outstanding common and subordinated units. Diluted net income per unit includes the effects of potentially dilutive units on our subordinated and common units. Basic and diluted net income per common and subordinated unit are the same as there are no potentially dilutive subordinated units outstanding.

As the 3,750,000 Class B units do not have voting rights or rights to share in the Partnership’s periodic earnings, either through participation in its distributions or through an allocation of its undistributed earnings or losses, they are not deemed to be participating securities in their current form. In addition, the conversion of the Class B units into common units is fully contingent upon the satisfaction of defined criteria pertaining to the cumulative payment of distributions and earnings per unit of the Partnership as described in Note 11. Therefore, it is possible that the Class B units may never be converted into common units. As such, until all of the defined payment and earnings criteria are satisfied, the Class B units will not be included in our calculation of either basic or diluted earnings per unit.

Income Taxes

Income Taxes

The Partnership and sponsor are pass-through entities and are not considered taxable entities for federal tax purposes. Therefore, there is not a provision for income taxes in the accompanying condensed consolidated financial statements. The Partnership’s net income or loss is allocated to its partners in accordance with the partnership agreement. The partners are taxed individually on their share of the Partnership’s earnings.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In February 2013, the Financing Accounting Standards Board (“FASB”) issued amended guidance on the recognition, measurement, and disclosure of certain obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. Such arrangements may include debt, other contractual obligations, and settled litigation and judicial rulings. The amended guidance is to be applied retrospectively to all prior periods presented. This guidance will be effective for the Partnership beginning January 1, 2014. The Partnership anticipates that the adoption of this amended guidance will not materially affect its financial position, result of operations or cash flows.

In December 2011 and January 2013, the FASB issued amended guidance on disclosures pertaining to certain assets and liabilities that are either offset in an entity’s financial statements or those that are subject to a master netting agreement or similar arrangement. The scope of these disclosures is limited to derivatives, repurchase agreements and securities lending transactions. The Partnership adopted this guidance effective January 1, 2013, and, as it only impacts disclosures, it did not affect the Partnership’s financial position, result of operations or cash flows.

XML

Concentration of Credit Risk - Additional Information (Detail)	5 Months Ended	12 Months Ended
	Dec. 31, 2012 Customer	Dec. 31, 2013 Customer
Risks and Uncertainties [Abstract]
Number of customers	4	3
Percentage of revenue accounted by customers	100.00%	76.00%

XML

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Future Minimum Operating Lease Payments

As of December 31, 2013, future minimum operating lease payments are as follows:

Fiscal Year	Amount
2014	$	7,009
2015	6,599
2016	5,640
2017	5,425
2018	4,881
Thereafter	7,420
	$	36,974

XML

Related Party Transactions

12 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

On May 25, 2011, the sponsor entered into a management services agreement with Red Oak Capital Management LLC (the “Service Provider”) which is owned by two members who are also equity members in the sponsor. The agreement provides for certain management and administrative support services to be provided to the sponsor for a term of one year and that thereafter remains in place upon the same terms and conditions. Either party may terminate the agreement by delivering written notice within 90 days prior to the date of expiration of the initial term or any time after the expiration of the initial term, by delivering written notice 90 days prior to the desired date of termination. The sponsor reimburses the Service Provider 95% of the Service Provider’s actual costs limited to $850 per year. These fees are included in general and administrative expenses. Management fees incurred during the year ended December 31, 2013 are included as a portion of the management services expense from Hi-Crush Services, as discussed below.

The sponsor paid quarterly director fees to non-management directors that may be members and/or holders of the sponsor’s debt through the date of the IPO.

The total management and director fees incurred were as follows:

	Management Fee		Director Fees
Predecessor Periods
Year ended December 31, 2011	$	370	$	60
Period from January 1 through August 15, 2012	318		62
Successor Periods
Period from August 16 through December 31, 2012	$	140	$	—
Year ended December 31, 2013	—		—

During the year ended December 31, 2013 and period from August 16 through December 31, 2012, the Partnership incurred $3,698 and $1,028, respectively, of management service expenses from Hi-Crush Services under the Services Agreement discussed in Note 4.

In the normal course of business, our sponsor and its affiliates, including Hi-Crush Services, and the Partnership may from time to time make payments on behalf of each other. During the period from August 16 through December 31, 2012, we made payments of $9,866 to various suppliers, vendors or other counterparties on behalf of our sponsor. This balance was offset by $1,028 of management fees charged by our sponsor and $3,223 of net payments made by our sponsor on behalf of us. The balance of $5,615 which was maintained as a current asset under the caption “Due from sponsor” as of December 31, 2012, was repaid by our sponsor in February 2013.

As of December 31, 2013, an outstanding balance of $2,571 payable to our Sponsor is maintained as a current liability under the caption “Due to Sponsor.”

During the year ended December 31, 2013, we purchased $4,402 of sand from Hi-Crush Augusta LLC.