Striking the balance

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DRC file photo/David Minton
A crowd spills into the hallway April 29 during a Corinth City Council special session to decide if variances should be granted to XTO Energy for gas well development at the Lake Sharon Christian Center.
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Bone-colored tumbleweeds roll across the smooth, bright concrete parking lot toward the gas well as a volunteer steps down from his pickup and walks to the front doors of First United Methodist Church of Krum. He is one of several adults who will help prepare for an after-school program that day.

Most of the deal to uproot the old downtown church so they could set down roots at the new location, on FM1173, was brokered before she arrived, Pastor Christy Thomas says. The mineral lease was a pivotal move for both the Krum school district, its minerals also pooled in the well site, and the church. Until then, the congregation was struggling in this historically Mormon community to raise enough money to build a larger sanctuary.

Like many living above the Barnett Shale, Thomas won’t launch into a thoughtful discussion about the social and cultural effects of the boom without first discussing the financial interest the church holds in a natural gas well next door — right down to the extra-wide driveway that the energy company built so that churchgoers and truckers could share access.

“That’s a lot of concrete and that’s expensive, so that was a definite plus for us,” Thomas says.

Energy companies tout not only the millions in royalties and thousands of jobs they bring, but also their tax-paying and philanthropy, saying their presence benefits the North Texas economy. Local economists agree the Barnett Shale boom softened the region’s entry into the recent recession, says University of North Texas economics professor Terry Clower.

Last year, G&G Tractors closed on Denton’s south side, after decades of outfitting the county’s farmers. An Oklahoma company, Beck Oilfield Supplies, moved into the building. While plans for a retail mecca on Denton’s west side have languished, city leaders offered tax incentives to lure a local office of Schlumberger Ltd., an international oilfield services conglomerate, away from Gainesville.

Before the boom, local economists pointed to western Denton County as the next place in the fast-growing Dallas-Fort Worth area for big housing developments. But to support the rush to drill, Barnett Shale gas operators have bought up, leased or condemned thousands of acres of prime North Texas land to support well sites, production facilities and pipelines. Now, more than 1,200 miles of natural gas pipelines — with thousands of pieces of production equipment — crisscross Denton County, nearly all of it west of Interstate 35.

In places where an extraction industry needs lots of land, an area also risks becoming a mono-economy, as happened in Appalachia, says Suzanne Tallichet, a rural sociologist at Morehead State University in Kentucky and an expert on coal mining and communities.

The transformation of coal’s all-encompassing reach took a long time, she says. Before the Civil War, many Americans viewed Appalachia as a desirable place to live, and in the decades after the war, they tried to return to farming and the way of life they valued.

At the same time, logging and coal companies were buying huge swaths of land — entire mountains. People could no longer afford their agrarian lives. Public officials went along with the change, and people were forced to sell their land, beginning a cycle of dependency, Tallichet says.

With a regional annual economy of about $360 billion, even the most generous estimates of the Barnett Shale’s part — $11 billion in gross area product and 111,000 jobs — show little risk to the greater economy of Dallas-Fort Worth, Clower says, at least not the way Midland fell after the oil bust in the 1980s.

However, smaller towns and other outlying areas could have a harder time.

“Oil and gas still cycle,” Clower says.

Some of the research Clower has done in the U.S. and in Australia shows that small towns with few employers are more exposed to economic risk. But those that can adapt will survive.

“You can ride a wave like the Barnett Shale,” Clower says. “You have to use the money to reinvest and be ready to move on.”

A decade ago, Americans faced the prospect of running out of natural gas. Most natural gas came as a byproduct of oil drilling and production. Other easy-to-get reserves were tapped out. Talks had begun over building shipping ports capable of docking tankers filled with compressed natural gas, so the nation could import what it needed.

Breakthroughs in horizontal drilling and hydraulic fracturing changed that outlook. And Texas’ energy-producing infrastructure — a skilled workforce, idled drilling equipment, injection wells and, perhaps most important, sympathetic politicians — was primed to get at the mammoth natural resource known as Barnett Shale gas.

There was just one hitch. More than 6 million people, and the immeasurable amount of infrastructure that supports their daily lives, reside above the shale’s estimated 27 trillion cubic feet of gas.

Legislators and local officials have labored for a decade to make the two infrastructures coexist. Some experts say, historically, the chances for the region to come out ahead aren’t good, even before any down cycle begins.

In the early 1990s, researchers studied Third World countries with extraction industries, and then began studying communities in the U.S.

Centuries ago, mining spurred the development of other inventions and industry, and local communities benefited from those new economic linkages. Today, mining doesn’t have that robust effect on a local economy, in part because technology helps fewer workers complete tasks that once took many workers, according to the late Bill Freudenberg, a rural sociologist at the University of California, Santa Barbara.

What researchers found is that poor countries get poorer over time, he said.

They call it the resource curse.

When drilling began in the Barnett Shale in the 1970s, about 1,500 vertical wells were concentrated in rural areas, mostly in Denton and Wise counties. Now the Barnett Shale region has about 14,000 wells drilled in 23 counties. Some industry officials say only a fraction of the field’s potential has been tapped.

In regions that have been saturated by a singular activity, such as coal mining or poorly managed agriculture, researchers have discovered that a long-term recovery depends, in part, on the numbers, according to Daniel Bain, an environmental engineering professor at the University of Pittsburgh.

“There’s lots of good faith on the part of the actors in the industry to do things right,” Bain says.

In other words, if a only a small percentage of wells, such as one or two out of a thousand, cause problems in the environment, there is less to remediate. But the scale changes when extraction has saturated an area, he said.

Then, even when the percentage of problems in the activity stays small, the number of problems looms large, he said. Long-term recovery means remediating hundreds or thousands of places in the land that don’t function the way nature intended.

Once the scale has changed, he said, difficult problems emerge when basic elements and systems get out of balance. Salt, for example, accumulates.

“Salt changes the way water interacts with the environment,” Bain said.

Texas has seen salt damage. The state’s regulatory push for injection wells came after saltwater contamination in the oilfields during earlier booms. Land near Big Lake in West Texas, known as the “Texon Scar,” has been denuded for generations because of saltwater contamination.

Researchers have planted salt cedars on the Texon Scar, but very little else grows there except tumbleweeds — the non-native, salt-tolerant Russian thistle, which can remove more than 40 gallons of water from the soil while competing with crops.

Understanding that kind of effect on the land is fairly new, coming from different research disciplines, Bain said.

They call it the legacy effect.

In order to benefit from resource extraction over the long term, people need quality government, orderly development and effective protection of the environment, according to Simon Taylor, director of Global Witness. An investigative non-governmental organization, Global Witness has tackled the resource curse in Third World nations, bringing international awareness to such issues as conflict diamonds.

Political and business leaders must get a handle on the resource curse for shale gas areas, he cautions. If they cannot, he paints a bleak view of the future, pointing to the social unrest in the Niger Delta, for example.

“Although shale drilling is a recent phenomenon and not going for 50 years, there [in the Niger Delta], the entire population is utterly affected. Their water systems, their fishing, their farming — it’s all being conducted in a toxic waste dump,” Taylor said. “And the political unrest there is unbelievable. There’s sabotage.”

In Krum, tank farms and other production equipment sit between businesses, homes and even among historic buildings in old town. Krum hasn’t required screening with masonry walls and landscaping, or other kinds of aesthetic buffers seen in other cities.

In fact, compared with residents in other Barnett Shale communities, Krum residents have complained to environmental regulators very little. The first complaint lodged with the Texas Commission on Environmental Quality came in November, according to Alyssa Taylor, who heads the Barnett Shale inspections out of the agency’s office in Fort Worth.

By contrast, residents in Corinth, who have just one gas well site inside city limits, have been vocal in their efforts to contain natural gas facilities to certain areas of the city.

In Corinth, shrubs are sculpted like meatballs and blades of Bermuda can be found lined up like endless tidy rows of toy soldiers. Battles have been fought to bring down controversial stands of unconventional plantings of native Texas grasses. So, neighbors on Pottery Trail and other streets along Sharon Lake were stunned when, a year ago, XTO Energy applied to drill up to 22 wells at Lake Sharon Christian Center, a spiritual and natural retreat in the heart of this bedroom community of nearly 20,000 people.

Allan Biel is one of many Corinth residents who, on a Thursday night, would have been somewhere else, rather than waiting for a turn at the podium to address the City Council.

He had first come to a council meeting months earlier, as did many other residents, in a citywide push to deny the permits. Weeks later, he and other residents returned, calling for a moratorium and an overhaul of the city’s rules.

Now he was back again, after he and other residents read over new rules drafted after months of work by a special committee. Biel was worried about exemptions still possible within the city’s new gas drilling and production setbacks — rules that didn’t seem to alter the likelihood of drilling near Sharon Lake.

On this approach to the dais, Biel picked his words spontaneously but carefully, spending his three minutes to convey what he thought about the venture of gas drilling into the heart of his neighborhood. He and his neighbors had demanded quality government, orderly development and protection of the environment. Many weren’t sure they got it, and told the council to eliminate the exemptions. Others said they felt even the new 1,000-foot setback was too short. They asked for a mile.

Something altogether different came from Biel.

“My thoughts are this — all these companies want to have the citizens leave the state so they can do what they want,” Biel said. “Texas wants to push me out of my home.”

PEGGY HEINKEL-WOLFE can be reached at 940-566-6881. Her e-mail address is pheinkel-wolfe@dentonrc.com .

 


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