‘Old’ vs. ‘New’ Will Play Out on a Huge Scale
Decades ago all across the great State of Texas, and most other American states as well, “land men” as leasing agents for the big oil companies were then known, fanned out across vast tracts of surface property, securing long-term or permanent rights to sub-surface assets for small lease payments and larger royalties in the event salable minerals below the surface were developed. Thus, as those property owners sold or died off the land secured by subsequent owners was deeded on the basis of surface rights, but no rights at all as to that which lay beneath. By the 1980s, it was thought that the big Texas oil fields had just about played out. However, over the last few years a new technology, called “fracking,” rapidly emerged and caused a gigantic leap in Texas oil and gas productivity from both old fields which are being aggressively reworked and entire new fields. This is done by injecting a mixture of water, sand and chemicals at very high pressures deep into subterranean rock formations. This causes the rock to shatter, thus releasing hydrocarbon deposits which can be recovered. As a consequence, oil and gas production throughout the state has skyrocketed.
Now comes the sticky part. In most areas of Texas, the sub-surface owners are either large oil companies or other remote interests. They have every right to “frack” and drill wherever they can best recover that to which they have ownership or lease rights. But, in many cases, that can be right in the middle of a county, a town, a neighborhood or even an actual yard in which the surface owners reap not a dime from the activity, but put up with all of the noise, smells, mess, dangers and complications. And so those surface owners are starting to contest these intrusive rights in meaningful ways. In some cases, there has been lots of anecdotal evidence that fracking has tainted local wells or municipal water supplies and, in other cases, there has been migration of methane and other toxic chemicals which cause fire and explosion hazards. However, as yet the science is still undecided. Therefore, opponents of fracking are having to deal with the problem on a community-by-community basis. One such contest is currently underway in the North Texas city of Denton, where the opponents have, thus far, won round one.
Denton sits atop the gigantic Barnett Shale formation, which arguably holds the largest oil and gas deposits in the continental U.S. So, what happens there is being closely watched by industry and opponents alike. The city council just adopted a temporary fracking ban, through September, after which it could become permanent. Of course only thus far un-fracked wells would be banned and those already injected can remain in production, but the implications are serious for both sides. Industry asserts that there is no hard evidence that fracking causes water contamination or harmful substance migration and that the country needs to properly develop these vast reserves for national security and economic reasons. Moreover, while the exercise of their rights may be “inconvenient,” they have a legal right to recover their property.
Opponents say the practice is a nightmare for those caught in the middle of it and that their rights to a peaceful life, protection from health hazards and preservation of their property values deserve consideration too. Needless to say, this is just one small battle that will emerge as the debate spreads and becomes more heated. The money involved is fantastically high, as are the feelings of those who have been steamrolled by this rapid technological evolution. Old money and oil interests will be pitted against new property owners and the fight promises to be that for which Texans have always been famous – an old-fashioned winner-take-all slugfest. And, as the old-timers would say, “This ole fight not only ain’t done yet, it ain’t hardly even begun!”