Oilman will drill for water on his vast ranch
hydraulic fracturing operations has risen six-fold since the start of the shale oil revolution, from more than 5 billion gallons in 2011 to almost 30 billion last year. Energy research firm IHS Markit predicts that demand will double again by the end of this year.
Hughes, based in San Antonio, runs his father’s oil company, Dan A. Hughes Co., which operates all over the world, but largely in South Texas. He is also one of the country’s largest landowners, with 390,000 acres in Texas and Montana, including the 140,000-acre Apache Ranch, near Van Horn.
Hughes knew he had vast water reserves in the Capitan Reef aquifer under the desert mountains there and, not long ago, asked his staff to investigate ways to make money off the water.
In March, Hughes submitted an application to the Culberson County Groundwater Conserva- tion District, asking to drill seven wells on the ranch. Such activity would not have required a permit just to drill. But Hughes also wants to build a 60-mile pipeline northeast, to the heart of the Permian’s Delaware Basin.
Twenty oil and gas companies are interested, the application said, including some of the biggest names in the play: Anadarko Petroleum Corp. and EOG Resources, of Houston, and Midland’s Concho Resources.
Agua Grande argued to the district board that the Capitan Reef did not provide a significant quantity of water to the San Solomon Springs, which feed the Balmorhea State Park pool, and that the company’s pumping would not deplete rancher and farmer wells.
On Wednesday, the company also promised it would begin a voluntary well monitoring program, to watch aquifer levels.
About 50 concerned residents packed the meeting, Saathoff said, and spoke for about an hour. The board deliberated for about an hour and a half.
Saathoff said construction will start by year’s end, and Agua Grande should be selling water by the second quarter of next year.
“We shared concerns of the citizens as well,” he said. “We’re confident in our hydrology study. What we’re planning to withdraw will not adversely affect surrounding landowners. Hopes are high.” jordan.blum@chron.com wtwitter.com/jdblum23