The Woodford Shale, A Major New Unconventional Oil And Gas Play

With the advent of new horizontal drilling and frac techniques, the Woodford Shale exhibits the potential to become a major new oil and gas play in the Midcontinent and West Texas areas of the Unitied States. Look at the numbers given for the potentially recoverable volumes of oil and gas. Can we "drill our way" out of America's dependence on foreign oil? GP

Special Focus: NORTH AMERICAN OUTLOOK-UNCONVENTIONAL RESOURCES

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Reservoir characteristics and production potential of the Woodford Shale
With enough oil and gas to potentially become a major unconventional hydrocarbon reservoir, the Woodford is a viable play.
John B. Comer , Indiana Geological Survey, Bloomington, Indiana

The Woodford Shale is an attractive target for unconventional oil and gas development because it is a mature source rock that is widely distributed throughout the southern midcontinent, and because it locally produces oil and gas from naturally fractured intervals in conventionally completed wells. 1 In addition, drilled intervals yield oil shows from cuttings and cores, and produce a gas response on mudlogs, confirming that the Woodford Shale contains anomalously high oil and gas. Finally, the Woodford play that has developed in Oklahoma (279 wells drilled from 2004 to 2007 with cumulative production of nearly 64 Bcf gas and 66,538 bbl oil/condensate)2 confirms the commercial viability of the Woodford and provides incentive for additional exploration and development.

The following provides a regional overview of the oil and gas producing potential of the Woodford Shale in the US southern midcontinent. The article focuses on the Anadarko and Permian Basin depocenters and adjacent provinces, where organic-rich Woodford facies are thickest, and where conventional oil and gas production and infrastructure are extensive, Fig. 1. Of particular importance are source rock properties, especially Total Organic Carbon (TOC) and thermal maturity, and lithologic properties, especially silica content and type. Also, the geographic distribution of lithofacies, organic hydrogen content and thickness are important in deciding where to drill, and they allow volumes of oil-in-place and gas-in-place to be estimated. 3

Fig. 1 . Map showing geologic provinces with Woodford Shale in the (A) Anadarko Basin and (B) Permian Basin. 3

SOURCE ROCK PROPERTIES
Hydrocarbon source rocks (> 0.5 weight percent TOC) are attractive targets for unconventional drilling because their hydrocarbons are indigenous and their hydrocarbon charge does not depend on the fortuitous and inefficient processes of expulsion from a fine-grained source bed, secondary migration through porous and permeable carrier beds, and accumulation in an adequately sealed reservoir.

Source rocks that contain the highest concentrations of organic hydrogen generate the most hydrocarbons. These are typically beds of lacustrine and marine origin that contain Type I and Type II kerogen and generate both oil and gas during thermal maturation.
Oil-to-rock correlation studies document that the Woodford Shale is a prolific oil source, 4-13 and estimates indicate that as much as 85% of the oil produced in central and southern Oklahoma originated in the Woodford. 13 The Woodford Shale contains high concentrations of marine organic matter, 14-19 with mean organic carbon concentrations of 4.9 percent weight for the Permian Basin (Texas and New Mexico), 5.7 percent weight for the Anadarko Basin (Oklahoma and Arkansas) and 5.2 percent weight for both regions combined, Fig. 2. Organic carbon concentrations range from less than 0.1 percent weight in some chert beds 15 to 35 percent weight in black shale, 18 and the organic matter is mostly oil-prone Type II kerogen. 1,14,15,18 Across the region, the Woodford Shale exhibits a wide range of thermal maturities from marginally immature to metamorphic (Ro = 0.37-4.89 %). 15,20

Fig. 2 . TOC concentrations (weight percent) and statistics for geologic provinces in the southern midcontinent. Mean organic carbon concentration exceeds 2.0 weight percent in each of the provinces listed.

STRATIGRAPHY
The Woodford Shale is mostly Late Devonian, but ranges in age from Middle Devonian to Early Mississippian. 21-24 Age-equivalent strata include the Chattanooga Shale, Misener Sandstone, Sylamore Sandstone, the middle division of the Arkansas Novaculite, upper part of the Caballos Novaculite, Houy Formation, Percha Shale and the Sly Gap Formation. 21,24-30 These units were deposited over a major regional unconformity and represent diachronous onlapping sediments. 21,31-35 In the southern midcontinent, these units are the stratigraphic record of worldwide Late Devonian marine transgression. The Woodford is stratigraphically equivalent to several North American Devonian black shales with active and potential unconventional oil and gas production, including the Antrim Shale (Michigan Basin), Ohio Shale (Appalachian Basin), New Albany Shale (Illinois Basin), Bakken Shale (Williston Basin) and Exshaw Formation (Western Canada Basin).

WELL LOG CHARACTERISTICS
The Woodford is identified primarily by high radioactivity on the gamma-ray log and by its stratigraphic position between carbonates, Fig. 3. The Woodford exhibits low sonic velocity, low resistivity and low neutron-induced radiation. Three subdivisions (the lower, middle and upper units) are commonly recognized in the Woodford, and can be correlated regionally based on well log signatures. 36 The lower unit immediately overlies the regional unconformity, has the lowest radioactivity, and contains more carbonate, silt and sand than the other two units. The middle unit has the highest radioactivity, is the most widespread lithofacies, and consists of black shale with high concentrations of organic carbon, abundant pyrite, resinous spores and parallel laminae. The upper unit has intermediate radioactivity and consists of black shale with few resinous spores and mostly parallel laminae.

Fig. 3 . Characteristic well logs for the Permian Basin and Anadarko Basin regions. (A) Permian Basin, Winkler County, Texas.36 (B) Anadarko Basin, Major County, Oklahoma. 37

LITHOLOGY AND FACIES DISTRIBUTION
The most widespread and characteristic Woodford Shale lithology is black shale. Other common lithologies include chert, siltstone, sandstone, dolostone and light-colored shale, with hybrid mixtures between them. 14,15,21-23,38 Optimum reservoir lithologies are siliceous and include the cherts, siltstones, cherty black shales and silty black shales that are dense and brittle and, when fractured, retain open fracture networks. Production potential is greatest where these lithologies are organic-rich, thermally mature and highly fractured. Naturally-fractured Woodford Shale reservoirs, which have produced hydrocarbons for many decades, are completed in organic-rich chert intervals. 1 Figure 4 displays photomicrographs of cherty black shale in a naturally-fractured Woodford reservoir with bitumen-filled fractures from an oil-producing zone. Figure 4A was taken at a depth of 3,056 ft and has 4.5% TOC, and Figure 4B was taken at 3,065 ft and has 7.8% TOC. The association of chert and fractures in producing reservoirs suggests that the best unconventional wells are likely to be completed in the cherty facies.

Fig. 4 . Photomicrographs of core from Texaco No. 1K Drummond, Marshall County, Oklahoma, 11-6S-6E, North Aylesworth field. 1 White elliptical bodies are recrystallized Radiolaria. Photographed in transmitted plane polarized light.

The Woodford facies distribution is the result of Late Devonian paleogeography and depositional processes. During the Late Devonian, the southern midcontinent lay along the western margin of North America in the warm dry tropics near 15° south latitude. 14,39 Woodford deposition began as sea level rose, drowning marine embayments in what are now the deepest parts of the Delaware, Val Verde, Anadarko and Arkoma Basins, and advancing over subaerially eroded, dissected terrane consisting of Ordovician to Middle Devonian carbonate rocks. The broad epeiric sea that formed had irregular bottom topography and scattered, low-relief land masses which supported little vegetation and few rivers.

Oceanic water from an area of coastal upwelling flowed into the expanding epeiric sea and maintained a normal marine biota in the upper levels of the water column. Net evaporation locally produced hypersaline brine, and strong density stratification developed that restricted vertical circulation and resulted in bottom waters depleted in oxygen. Pelagic debris from the thriving biomass settled to the anoxic sea floor where organic- and sulfide-rich mud accumulated. The slow, continuous settling of pelagic debris was interrupted periodically by frequent storms and occasional earthquakes that triggered turbid bottom flows that supplied silt and mud to proximal shelves and basin depocenters, and caused resedimentation throughout the epeiric sea.

This depositional model explains why quartz grains and chert have very different distributions. Quartz grains represent terrigenous detritus transported from exposed older sources. Chert is biogenic and represents siliceous microorganisms (mostly Radiolaria) that bloomed in the nutrient-rich, upwelled water of the ocean and recrystallized after deposition on the sea floor. Detrital quartz is most abundant in areas near land, especially along the northwestern shelf and in the northwestern part of the Anadarko Basin, and in basin depocenters where turbid bottom flows finally converged. Chert beds increase in abundance and thickness toward the open ocean and are common along the continental margin and in distal parts of the major cratonic basins (Delaware, Anadarko, Marietta, Ardmore and Arkoma). The most distal allochthonous beds in the central area and core area of the Ouachita Tectonic Belt are almost pure radiolarian chert. High concentrations of radiolarian chert coincide with high concentrations of organic carbon along distal highs, such as the Central Basin Platform, Pecos Arch and Nemaha Uplift, and along the craton margin in the Arbuckle Mountain Uplift, Marietta and Ardmore Basins, western Arkoma Basin and frontal zone of the Ouachita Tectonic Belt. Where thermally mature, the organic-rich cherts and cherty black shales in these areas are optimum exploration targets.

THERMAL MATURITY
Thermal maturity follows Woodford structure, with the highest maturities in the deep basins and in orogenic belts, and the lowest maturities along structural highs, Fig. 5. 14,15,18,20,40-43 The Woodford Shale reaches its highest thermally maturity in the Anadarko, Delaware and Arkoma Basins where it is most deeply buried, and in the Ouachita Tectonic Belt where stratigraphically equivalent beds have been locally metamorphosed. Intermediate maturities occur in shelf settings, and the lowest maturities occur on structural highs such as the Central Basin Platform, Pecos Arch, Nemaha Uplift, Arbuckle Mountain Uplift and the frontal zone of the Ouachita Tectonic Belt. In deep basins, the Woodford Shale is in the gas generation window, whereas in the shelf and platform settings, the Woodford is in the oil generation window. 14,15

Fig. 5 . Map showing thermal maturity of Woodford Shale and age-equivalent units in (A) Anadarko and (B) Permian Basin regions. 3 Patterns are based on vitrinite reflectance (%Ro).

POTENTIAL PRODUCTION TRENDS
Potential production trends have been qualitatively ranked based on the probability that brittle or naturally fractured, thermally mature organic-rich beds of Woodford Shale are present in the subsurface, Fig. 6. The trends are designated as areas of probable, possible, local and poor success as follows. Probable success areas are those where organic-rich Woodford Shale is in the gas generation stage of thermally maturity and where large volumes of gas are likely to reside. Possible success areas are those where organic-rich Woodford beds are in the oil window and where the formation is shallow enough for economic drilling and for open fracture networks to persist. Local success areas are those in shelf settings where the Woodford Shale is relatively thin, but thermally mature and at a relatively shallow depth. Poor success areas are those where the formation is exposed at the surface or is shallow and unconfined, and where Woodford Shale or equivalent units have been metamorphosed or have very low organic carbon content.

Fig. 6 . Map showing hydrocarbon production potential and estimated volumes of oil-in-place and gas-in-place for Woodford Shale and age-equivalent units in the (A) Anadarko and (B) Permian Basin regions. 3

ESTIMATION OF RESOURCE POTENTIAL
The resource potential estimations assume that oil and gas in the Woodford Shale are indigenous, and were calculated based on organic carbon concentration, organic hydrogen concentration, organic matter type, thermal maturity and facies volumes (thickness times area), Fig. 6. 3 While this is not an assessment of recoverable oil and gas, it does estimate total gas-in-place and oil-in-place through mass balance calculations based on the concentration of organic hydrogen in the source beds. 3 The data suggest that total in-place gas in the Woodford Shale is on the order of 830 Tcf and total in-place oil is on the order of 250 Bbbl in the southern midcontinent. These volumes include 130 Bbbl of oil-in-place in the Anadarko Basin region, and 230 Tcf of gas-in-place and 120 Bbbl of oil-in-place in the Permian Basin region.

In the Anadarko Basin region, the estimated gas potential is 600 Tcf in the area of probable success, an area that includes the Anadarko and Arkoma Basins. The estimated gas potential is 0.24 Tcf and the estimated oil potential is 70 Bbbl in the area of possible success, encompassing the Nemaha Uplift, Marietta and Ardmore Basins, Arbuckle Mountain Uplift, southern flank of the Anadarko Basin, and frontal zone of the Ouachita Tectonic Belt in Oklahoma. About 4.4 Tcf of gas-in-place and 60 Bbbl of oil-in-place are estimated for the area of local success, which includes most of the northern and central Oklahoma Platforms.

In the Permian Basin region, the estimated gas potential is 220 Tcf in the area of probable success, which includes the Delaware and Val Verde Basins. The estimated gas potential is 0.11 Tcf and the estimated oil potential is 35 Bbbl in the area of possible success, encompassing the Central Basin Platform and northern flank of the Pecos Arch. About 9 Tcf of gas-in-place and 84 Bbbl of oil-in-place are estimated for the area of local success, which encompasses much of the shelf and platform provinces and most of the Midland Basin.

Although estimates of the volume of undiscovered hydrocarbons are inherently problematic because of the assumptions that must be made to complete the calculations, the mass balance approach yields orders-of-magnitude for in-place oil and gas, and provide a consistent means to compare and rank different areas of interest as to their hydrocarbon production potential.

CONCLUSIONS
The Woodford Shale is a major unconventional energy resource with the potential for producing significant volumes of both oil and gas. Intuitively, its status as a world-class oil source rock indicates that the formation should contain large residual concentrations of hydrocarbons, and analytical data from numerous studies confirm this inference. The inherent inefficiency of hydrocarbon expulsion is the primary reason why source rocks like the Woodford retain large volumes of oil and gas and are attractive targets for unconventional exploration. Given the ubiquity and magnitude of oil and gas shows, local production from naturally fractured reservoirs, recent unconventional production from the Woodford Shale in Oklahoma, successes in unconventional resource recovery from analogous formations, and current oil and gas prices, the Woodford Shale in the southern midcontinent is a compelling exploration target.

Optimum locations for exploration are where organic-rich beds are currently in the oil or gas generation window. Optimum reservoir facies are those comprising brittle lithologies capable of maintaining open fracture networks. The best reservoirs are likely to be completed in mature organic-rich cherts and cherty black shales but other lithologies, such as sandstone, organic-rich siltstone, and silty black shale, can also be expected to produce locally. Areas having the greatest production potential and most prospective lithologies are the Anadarko Basin in Oklahoma, Marietta and Ardmore Basins in Oklahoma, Arkoma Basin in Oklahoma and Arkansas, frontal zone of the Ouachita Tectonic Belt, Delaware Basin in Texas and New Mexico, Central Basin Platform in Texas and New Mexico and the Val Verde and Midland Basins in Texas.

ACKNOWLEDGEMENTS
The author is indebted to Indiana Geological Survey colleagues Kimberly H. Sowder, Barbara T. Hill and Renee D. Stubenrauch, who drafted the figures and formatted the photographs for this article. Also, IGS staff scientists Margaret V. Ennis, Nancy R. Hasenmueller, Maria D. Mastalerz, and Charles W. Zuppann reviewed the article and offered constructive criticisms. IGS editor Deborah A. DeChurch proofread the manuscript. Publication is authorized by John C. Steinmetz, State Geologist and Director of the Indiana Geological Survey.

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THE AUTHOR
John B. Comer is a Senior Scientist at the Indiana Geological Survey with an academic appointment at Indiana University. He earned a BA from Ohio Wesleyan University, an MS from The University of Wisconsin-Milwaukee and a PhD from The University of Texas at Austin, all in geology. During his 36-year career, he worked as a research scientist in the geochemistry group at the Amoco Production Company Research Center in Tulsa, an assistant and associate professor at Tulsa University and the Geochemistry Section Head at the Indiana Geological Survey. Dr. Comer has conducted research in organic, inorganic and environmental geochemistry, clastic sedimentation, sedimentary petrology and the deposition and diagenesis of organic-rich rocks. He is an active member of AAPG, SEPM and GSA and has authored more than 120 scholarly papers and technical reports in geology and geochemistry.

Boone Pickens Thinks Water Is The "New Oil"

We've seen Boone Pickens on television now with his sincere-sounding advertisements touting his plan to save America from our "addiction to foreign oil". The following is a recent article in Business Week Magazine describing his plans to pump groundwater from the Ogallala Formation in West Texas, and transport it via a pipeline to the populous Dallas/Fort Worth areas of North Texas and sell it to local water utilities.

He is also proposing the rapid development of wind turbines generating electricity, and of course this must be transmitted to areas which need abundant electricity, such as North Texas. What better place to build electrical transmission lines than along a pipeline corridor? Then of course there is natural gas from underground wells, and Mr. Pickens controls a lot of that, which also needs transporting in pipelines.

These ideas all sound good, but one thing stands in his way, beside financing, which he hopes taxpayers and consumers will be generous enough to pay. A major hurdle he faces is enacting the power of eminent domain, or the ability to force landowners to allow him to build his pipelines and electrical towers. To achieve that, he needs public support. This is where his "patriotic" television advertising comes in. He has learned from Al Gore how to manipulate public opinion to get what he wants, from the people and from the government. Is this a good thing? How much will it cost consumers and taxpayers? You can bet it will not be inexpensive. Is it good for the environment? He would like us to think so.
Peter

Business Week
Cover Story June 12, 2008,
There Will Be Water
T. Boone Pickens thinks water is the new oil—and he's betting $100 million that he's right
by Susan Berfield
Roberts County is a neat square in a remote corner of the Texas Panhandle, a land of rolling hills, tall grass, oak trees, mesquite, and cattle. It has a desolate beauty, a striking sparseness. The county encompasses 924 square miles and is home to fewer than 900 people. One of them is T. Boone Pickens, the oilman and corporate raider, who first bought some property here in 1971 to hunt quail. He's now the largest landowner in the county: His Mesa Vista ranch sprawls across some 68,000 acres. Pickens has also bought up the rights to a considerable amount of water that lies below this part of the High Plains in a vast aquifer that came into existence millions of years ago.

Pickens hopes to run a water pipeline over 250 miles and 650 tracts of private property from the Texas Panhandle to thirsty Dallas (photo by Nancy Newberry)

If water is the new oil, T. Boone Pickens is a modern-day John D. Rockefeller. Pickens owns more water than any other individual in the U.S. and is looking to control even more. He hopes to sell the water he already has, some 65 billion gallons a year, to Dallas, transporting it over 250 miles, 11 counties, and about 650 tracts of private property. The electricity generated by an enormous wind farm he is setting up in the Panhandle would also flow along that corridor. As far as Pickens is concerned, he could be selling wind, water, natural gas, or uranium; it's all a matter of supply and demand. "There are people who will buy the water when they need it. And the people who have the water want to sell it. That's the blood, guts, and feathers of the thing," he says.

In the coming decades, as growing numbers of people live in urban areas and climate change makes some regions much more prone to drought, water—or what many are calling "blue gold"—will become an increasingly scarce resource. By 2030 nearly half of the world's population will inhabit areas with severe water stress, according to the Organization for Economic Cooperation & Development. Pickens understands that. And while Texas is unusually lax in its laws about pumping groundwater, the rush to control water resources is gathering speed around the planet. In Australia, now in the sixth year of a drought, brokers in urban areas are buying up water rights from farmers. Rural residents around the U.S. are trying to sell their land (and water) to multi- national water bottlers like Nestlé (BW—Apr. 14). Companies that use large quantities of the precious resource to run their businesses are seeking to lock up water supplies. One is Royal Dutch Shell, which is buying groundwater rights in Colorado as it prepares to drill for oil in the shale deposits there.

Into this environment comes Pickens, who made a good living for a long time extracting oil and gas and now, at 80, believes the era of fossil fuel is over. So far he has spent $100 million and eight years on his project and still has not found any city in Texas willing to buy his water. But like many others, Pickens believes there's a fortune to be made in slaking the thirst of a rapidly growing population. If he pumps as much as he can, he could sell about $165 million worth of water to Dallas each year. "The idea that water can be sold for private gain is still considered unconscionable by many," says James M. Olson, one of America's preeminent attorneys specializing in water- and land-use law. "But the scarcity of water and the extraordinary profits that can be made may overwhelm ordinary public sensibilities."

(The extent of the underground Ogallala Acquifer shown in blue)

THE BIGGEST PUMP WINS
Pickens, an Oklahoma native, geologist, and someone who calls himself the luckiest guy in the world, is the quintessential entrepreneur. He started as a wildcatter in 1956; three decades later his Mesa Petroleum was the largest independent exploration company in the U.S. But that's not how Pickens made a name for himself—it was his hostile bids, one after the other through the 1980s, for oil companies far more powerful, far wealthier than his own. Pickens thought they could do more for their shareholders. He never took over any of them. He did, however, push them into deals they might not have considered otherwise, which helped reshape the oil industry. He did, sometimes, make hundreds of millions when he sold his stakes. And shareholders did, often, benefit. He was briefly the most famous businessman in America, a corporate raider who always wished people would call him a shareholder activist.

By the mid-1990s, though, Pickens had fallen. After a brutal and expensive fight with Unocal, he gave up his raiding. He lost control of Mesa Petroleum after a series of financial and managerial miscalculations. He went through an expensive divorce from his second wife and retreated to his ranch. It was in the midst of this that he acquired a newfound regard for water as a commodity that should be bought, sold, and traded for the benefit of those who own it and those who can afford it.

In 1996 a local water utility made its first big purchase of groundwater rights in the Panhandle. The utility, known as the Canadian River Municipal Water Authority (CRMWA), bought nearly 43,000 acres of water, some of it just south of Pickens' ranch, for $14.5 million. (Property owners in Texas, and elsewhere, can sell their water separately from the land above it.) That Roberts County would become the stomping ground for the Panhandle water wars was perhaps inevitable. Underneath it lies one of the world's largest repositories of water, moving slowly among layers of gravel, sand, and silt. The Ogallala Aquifer stretches from Texas to South Dakota and contains a quadrillion gallons of water—enough to cover the U.S. mainland to a depth of almost two feet. Yet the extensive irrigation necessary to grow corn, cotton, and wheat in west Texas has left the Ogallala nearly depleted in some places. It is not an aquifer that is easily or quickly replenished. But the land in Roberts County is unsuited for agriculture, and so the Ogallala there is largely untapped.

Since the early 1900s, groundwater use in Texas has been governed by what's quaintly called the rule of capture, otherwise described as the biggest pump wins. It lets landowners pump as much water as they can, even if doing so drains neighboring properties. This put Pickens in an uncomfortable position: If he didn't sell his water to CRMWA, the utility could potentially suck some of it right out from under his ranch. So he tried. But "they told me to kiss off," he says. Kent Satterwhite, who was then assistant general manager, says: "Boone was fairly insistent that we buy his water. It made him mad that we didn't have the money to buy it." That was the first of several contretemps between Pickens and various local water authorities. Pickens next approached the city of Amarillo, which also had begun to acquire water rights in Roberts County. It wasn't interested, either, though it did purchase water from several other nearby landowners. "Amarillo was pissed off at me," says Pickens, who has a long and fraught history with the city. When Amarillo turned him down, Pickens felt surrounded. "I had to find a buyer for my water," he says, "or I was going to be drained."

LANDOWNERS DIVIDED
There's a saying in Texas: "Whiskey's for drinking. Water's for fighting." Pickens decided to fight. In 1999 he created a company called Mesa Water and began to accumulate water rights so he could strike a deal with another city altogether. The hell with Amarillo. Pickens was confident he could sell his water: The population of Texas was expected to jump 40% by 2020, mostly in urban areas one dry season away from drought.
Pickens' decision to get into the water business was regarded by some in the Panhandle as nothing more, or less, than a shrewd move by a man who knows the value of commodities. The economy of the High Plains region is based on people taking out the natural resources and selling them. If water that can't be used for farming ends up in the taps of city residents hundreds of miles away, that's fine. Pickens says he's buying stranded, surplus water that needs to be rescued. Kim Flowers, who runs an 8,300-acre ranch in Roberts County, speaks for many landowners when she says: "People can do with their water as they wish as long as they're not wasting it."

In all, Pickens, CRMWA, and Amarillo have spent about $150 million to buy up nearly 80% of the water rights in Roberts County, undermining and outbidding one another along the way. One unsurprising effect of their competition is that the price of an acre of water has in some places doubled, to $600. That's something in which Pickens takes pride. Much as he did in the 1980s, when he went after big oil companies he believed weren't doing right by their shareholders, Pickens now talks about creating value for Roberts County landowners. They make money from selling their water while continuing to live, run cattle, and hunt on their property. "I told them I was going to raise the value of the land, and I accomplished that. The landowners are all tickled to death. I made our water worth something. And anybody with any sense would sell it."

Not all Roberts County landowners wanted to do business with him, though. Pickens intended to pull water from an aquifer that is pretty much the sole source for the Panhandle, and that isn't refilled quickly, and sell it to a place like Dallas, whose water use is the highest of any city in Texas. This seemed ludicrous, even reckless, to some. C.E. Williams runs the Panhandle Groundwater Conservation District, which is responsible for managing the competing demands on the region's share of the Ogallala. He puts it this way: "As a district, we cannot pick and choose where the water goes. But personally I am concerned. I have a son who is an irrigated farmer, and I have grandkids, and I want to make sure that they can conduct commerce when they want to."

Pickens has a way of dismissing the complexity of a situation, sometimes even the possibility of an opinion contrary to his own. In this case, any opposition to his plan from anyone who is not a Roberts County landowner, who is not essentially a shareholder in this venture, he deems irrelevant. Williams, he points out, doesn't himself have any property. "Water is a commodity," he says. "Heck, isn't it like oil? You have to come back to who owns the water. The groundwater is owned by the landowner. That's it." When it comes to potential buyers, Pickens cares about only one thing: how much they're willing to pay. "Do I care what Dallas does with the water? Hell no."

Republican State Representative Warren Chisum is a Roberts County rancher who owns 12,000 acres next to Pickens and sold his water to Amarillo in 2001. He would seem to be a natural ally. He's not. "My water will remain local," he says. "It's controversial to ship it out of the Panhandle. When we run out, we're done. The long-term value is to keep it here. That's contrary to what Pickens wants to do. It's his water. But he won't be here in 50 years."

In 2002, Pickens began approaching several of Texas' sprawling cities, all of which share one defining feature: Their populations are growing so quickly that they are constantly in need of new supplies of water. But with water, as with so much else, location is critical. And Pickens' water is far, far away from anyplace that might buy it. Pickens knew he'd have to build a pipeline, and to do so at anything resembling a reasonable cost, he'd need the power of eminent domain—the right of a government entity to force the sale of private property for the public good. Water utilities have that right. If Dallas agreed to buy Pickens' water, it could extend such authority to him. But Dallas deemed Pickens' price too high and declined to do a deal. So Pickens and his executives tried to create a Fresh Water Supply District—a government entity that would have that power. But they couldn't get it through.

Over the next several years, Pickens continued accumulating water rights and began to lease other land, this time with the idea of creating the world's biggest wind farm. "One of the great wind areas is right up where we are," says Robert L. Stillwell, Pickens' general counsel. "You can set it right on top of where the water is." And since, one day anyway, Dallas may well buy both, Mesa could use a single right-of-way for the water pipeline and the electric lines. In Roberts County there would be real economic benefits from the wind farm. "The wind is meant to sweeten the deal," says Representative Chisum. "The big money for Pickens is in the water."
It had been a decade since Pickens first realized the potential value of the water deposited eons ago in the sand below the High Plains. Now it was time to employ the one resource he hadn't yet used: his lobbying clout.

POWERFUL LOBBYING
In January, 2007, the Texas Legislature convened in the grand statehouse in Austin. The 80th session turned out to be very productive, and one person who kept busy during that time was J.E. Buster Brown, a former state senator and one of the most powerful lobbyists in town. Among Brown's clients is Mesa Water. "My job is primarily defensive," Brown says of his work for Pickens. "I'm watching to make sure there is no legislation passed that creates obstacles to Pickens doing what he wants to do. I'm supposed to make sure nothing bad happens."
Brown did more than that: He helped win Pickens a key new legal right. It was contained in an amendment to a major piece of water legislation. The amendment, one of more than 100 added after the bill had been reviewed in the House, allowed a water-supply district to transmit alternative energy and transport water in a single corridor, or right-of-way. "We helped move that along," says Stillwell. "We thought it would be handy and helpful to everyone."
After the bill passed, Tom "Smitty" Smith, Texas director of Public Citizens, an advocacy group, says several legislators were drinking coffee and reading through it. "Uh-oh," one said. They'd just realized the amendment would help Pickens build his pipeline. "Many legislators were watching for this play," Smith says, "and it still snuck by." State Senator Robert Duncan, a Republican who represents Lubbock, says: "It probably should have raised our suspicions, but we were moving a lot of bills. And it would have been hard to hold up this one even if we'd discovered the amendment."

Pickens still needed the power of eminent domain if he was going to build his pipeline and wind-power lines across private land. And by happy coincidence, the legislators passed a smaller bill that made that all the easier. The new legislation loosened the requirements for creating a water district. Previously, a district's five elected supervisors needed to be registered voters living within the boundaries of the district. Now, they only had to own land in the district; they could live and vote wherever. The bill, as it happens, was put forth by two legislators from Houston; Brown says he and Mesa had nothing to do with it. "That wasn't our bill," says Brown. "I wish I could take credit for it."

Pickens moved quickly to take advantage of the new rules. Over the summer of 2007, he sold eight acres on the back side of his ranch to five people in his employ: Stillwell, who resides in Houston, two of his executives in Dallas, and the couple who manage his ranch, Alton and Lu Boone. A few days later, Mesa Water filed a petition to create an eight-acre water-supply district with those five as the directors and sole members. On Nov. 6, Roberts County held an election to decide whether to form the new district. Only two people were qualified to take part: Alton and Lu Boone. The vote was unanimous. With that, Pickens won the right to issue tax-free bonds for his pipeline and electrical lines as well as the extraordinary power to claim land across swaths of the state.

No one at Mesa regards Roberts County Fresh Water Supply District No. 1 as an unusual arrangement. "We're no different from any other water or electricity supplier," says Stillwell, meaning they, too, would use the power of eminent domain only as a last resort and for the public good. As for the suggestion that he wouldn't have qualified to be a board member under the old rules, Stillwell says: "It doesn't matter that I'm on the board. It would have been another me, just a local me."

"WE'RE NOT HAPPY"
Pickens was ready to reach out to landowners along the route. In April, 2008, Mesa sent out some 1,100 letters to people along the 250-mile proposed right-of-way, from Miami, Tex., to a town called Jacksboro, just short of Dallas. The letters included a Texas landowners' bill of rights, information on the condemnation procedure, a map of the route, and a list of open houses they could attend for more information.

One stifling evening in May, about 50 people showed up at the Twin Lakes Community Activity Center just outside Jacksboro. When the ranchers arrived, more than a dozen of Mesa's public-relations consultants, hydrologists, and land men were waiting for them. Standing behind tables laid out with pens, cups, hats, and bags with the District No. 1 logo, the officials were available to answer questions about the 250-foot-wide corridor Mesa would use to construct, maintain, and possibly expand the pipeline and electric lines. While this arrangement allowed everyone to get information specific to their property, it also precluded any public questioning of the Mesa standard-bearers. This did not go unnoticed by the ranchers. "We're not happy," said one. "Pickens is pushing his power trip on us. I can't fight his money. But if he asked first, I might have thought better of it." Another said: "Land goes way back for a lot of people here. If you tell people you want their land, Texans raise their guns." At the end of the evening, most of the pens and hats and cups still lay on the tables.

Pickens isn't bothered that by his invoking the right of eminent domain, Mesa has inflamed landowners up and down the route. "It always does," he says. Mesa expects to acquire the land it needs in the next 18 months and pay about $30 million for it; Pickens wants to begin construction on the $1.2 billion pipeline right afterward. It should take about three years to complete. If all goes according to plan, Mesa will be able to pump enough water to satisfy the needs of some 1.5 million Texans every day.

Pickens hopes to strike a deal with Dallas or the urban areas around it before Mesa starts building the pipeline. "Eventually they will need it," he says. So far, though, the talks might best be characterized as preliminary. "We continue to meet with Pickens' staff and engineers to get a better understanding of the proposal and so they can understand what our needs are," says Mike Rickman, assistant general manager of the North Texas Municipal Water District, which supplies water to 13 cities north and east of Dallas. "Mesa has a lot of water. But how much will it cost to buy it and deliver it?" Rickman says that at some point he would have to consider the consequences for the Ogallala: "Does it make sense to take water from an arid portion of the state? We don't want to harm our neighbors out there."

In Roberts County, people hold on to the hope that pumping from the Ogallala can be controlled. In 1998, as Pickens and local water utilities began buying up water rights, the groundwater conservation district placed some restrictions on the rule of capture that it calls the 50-50 rule: Anyone who receives a new permit to pump can draw down the aquifer by only 50% over the next 50 years. Later, an additional limit of 1.2% per year was set. These essentially manage the depletion of the Ogallala under Roberts County; there, it is replenished at a rate of only 0.1% a year. Williams, who put the rules into place, says: "It's like taking dollar bills out of your bank account and putting nickels back in. Even with a big bank account, there's an end. That's pretty much what's happening in the Ogallala."

Pickens has promised to abide by the 50-50 rule. "I don't have any concerns about depleting the aquifer. All I'm doing is selling surplus water," he says. "I'm not about to drain all the water out of Roberts County. I have my ranch there. But I could sure take it down 50% and not hurt anybody. And it could make a lot of people a lot of money."