Water flows to money in drought-stricken drilling regions

Water flows to money in drought-stricken drilling regions by Gayathri Vaidyanathan and Ellen M. Gilmer, July 30, 2012, E & E News
The process of horizontal drilling and hydraulic fracturing, or fracking, can use anywhere from 4.1 million gallons of water in the Barnett Shale basin around Fort Worth, Texas, to between 6 million and 12 million gallons in the drought-prone Eagle Ford Shale in southern Texas. … In some states, there isn’t much clarity around how much water can be removed from freshwater supplies over the coming decades before depleting resources. “How much can we really afford to divert for this purpose in a year? That’s a number I think state and regulatory agencies need to work hard to come up with,” said Jason Bates, spokesman for Colorado-based Western Resource Advocates. “We’re sort of flying blind here, and that’s not safe for anyone.” … “A continuing drought could cause our domestic production to decline and derail our ‘road to energy independence’ in a hurry,” said Chris Faulkner, CEO of Texas-based Breitling Oil and Gas. … Parts of Colorado, Wyoming and Utah are in an “exceptional” drought, according to the National Weather Service, but it has led to water shortages for drilling. In the West, scarce water for farmers, ranchers, municipalities and companies to drench the parched earth goes first to those who have held permits the longest. Because gas drillers have acquired water rights more recently, they are more likely to be cut off first. The farmer or rancher whose property was in the family for generations and has an aging document giving him or her first dibs on water is less worried about being cut off. With oil and gas elbowing their way in, a new marketplace is cropping up around water scarcity. Farmers are transferring their rights temporarily to oil companies in exchange for cash. “One of the sayings out here is that water flows to money,” said Bob Leake, regional engineer at the Utah Division of Water Rights. In such cases, the companies are allowed to extract a smaller amount of water than a farmer under transferred permits because water used in fracking is not returned to the water cycle, Leake said.