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Pickens Expresses Confidence
In Ability To Sell Mesa Water  

By David Bowser           

            AMARILLO — T. Boone Pickens is optimistic that he'll be able to sell the water beneath his Texas Panhandle ranch. He says interest is increasing.

            Pickens, a Dallas businessman and Panhandle rancher, heads Mesa Water Inc., a company he established to sell ground water from Roberts County in the rural Texas Panhandle to thirsty cities downstate.

            "I think everything's going along about as well as you could expect," Pickens says. "We've got interest."

            He's in talks with the Brazos River Authority about using the river to move water downstate, and this month, the Dallas City Council refused to fund a $600,000 study in connection with the proposed Marvin Nichols Reservoir on the Sulphur River near Gilmer in East Texas.

            That project was initially estimated to cost about $1.7 billion. Pickens says today it would probably cost closer to $3 billion.

            "That has been roundly opposed by the people over in East Texas," Pickens says.

            Senate Bill 1, which addressed water planning in the state in 1997, established 16 water planning groups across the State of Texas. The water planning group for North Texas, which includes the Dallas-Fort Worth Metroplex, initially listed the Marvin Nichols Reservoir as a future water source.

            "That's been removed now because there's been such a ruckus caused by damming up the Sulphur River," Pickens says. "It would encompass something like 65,000 acres of surface water."

            A second water source, the Toledo Bend project, will take a long time to build and develop.

            A third water source, Mesa's plan to pipe ground water from the Panhandle to the Metroplex area, however, has received little criticism in North Texas, a sign Pickens sees as positive.

            "When you look at our competition, they're slowly but surely eliminating themselves," Pickens says. "Marvin Nichols is fading away in the sunset. Toledo Bend looks like it’s going to take a long time to put together."

            Major water projects take time to develop, and therein may lie Pickens' strength.

            "That's starting to be a pretty interesting factor," he says.

            When communities realize they need more water, they need it within a year or two.

            "It takes a lot longer than that to do it," Pickens points out.

            Major water projects can take decades to develop and implement.

            "We are ready to go," Pickens insists.

            The question is where will it go.

            "When you look back over at who has water," Pickens says, "Dallas is in pretty good shape for water."

            Because of the drouth of the 1950s, the leadership of Dallas responded and built a series of reservoirs around the city, but that water is for the City of Dallas, not the surrounding suburbs.

            "That water doesn't go to North Texas," Pickens points out. "That's North Texas Municipal Water Authority. They have Irving and Rowlett and Frisco and those towns around Dallas. They have a problem."

            It's not Dallas that has a problem with water, or lack thereof. It's the surrounding communities that have the problem, and it will show up by 2009, Pickens predicts.

            The Dallas suburbs that have been expanding rapidly for the last several decades are now looking at what could happen to them if they don't have enough water.

            "Marvin Nichols was the water that was going to help them the most," Pickens says.

            The Toledo Bend project was expected to bring about 600,000 acre-feet of water to the Metroplex over a 50-year period.

            "That also was about a $3 billion project," Pickens says.

            While the Dallas City Council seemed less than pleased with the Marvin Nichols and Toledo Bend projects, they did not criticize the Mesa project.

            "We're being looked at very seriously," Pickens says.

            Mesa Water is listed in the region's plan as a potential water supplier.

            Tom Kolius, a business development specialist for an Amarillo real estate company, says an increasing consideration is the timeline involved in producing water.

            "I think Mesa Water's pretty confident that it can do this pretty quickly," Kolius says.

            "We're permitted to do it now," Pickens says. "We still believe that if a deal is struck in '04, we could be producing by '09."

            The only thing slowing Pickens down is finding a buyer.

            "We have made an agreement in principle with the Brazos River Authority," Pickens says.

            He says it's a totally different prospect for sale than he's ever dealt with before.

            "We're working diligently with them to finalize that agreement," Pickens says. "What that might call for — underline ‘might’ because I'm not sure this is the route we want to go — but it could be that we would put a pipeline down to Possum Kingdom and put the water into the Brazos at Possum Kingdom."

            The water would go down the Brazos and could be withdrawn and moved to San Antonio by pipeline, or the water could go all the way down the Brazos to south of Houston and be taken to Houston. It could also be taken out and piped to the Metroplex.

            "My feeling is that it's more likely, if you're going to go into the Metroplex with it, you'd never put it in the Brazos," Pickens says.

            Mesa has engineering studies on a number of possible pipeline routes from Roberts County to various end points.

            One study, presented to a Texas House Natural Resources Committee hearing almost two years ago, calls for a 323 mile-long pipeline paralleling the CRMWA pipeline from Lake Meredith through Amarillo to Lubbock, then on down through West Texas.

            Pickens says Mesa proposed to go down through West Texas because there are more than 40 towns in the region that need additional water.

            "The CRMWA line is getting pretty old," Pickens points out. "It was put in, I believe, in 1968. That line is almost 40 years old."

            Pickens says he'd planned to parallel the CRMWA line, making it a redundant system and service some 42 towns along the way.

            "You'd go into Midland-Odessa, then out of Midland-Odessa to San Angelo, go just south of Lake Ivie, and you could tie into the Abilene line that comes into Lake Ivie and pump out of this line back up to Abilene north," Pickens says. "Then the line could actually go to San Antonio."

            To make that work, however, San Antonio would have to sign on for 150,000 acre-feet of water per year.

            "You have to have volume," Pickens says. "You have to really sell some water."

            The small towns along the route would take only about 50,000 acre-feet a year.

            San Antonio is growing fast, and while they use the Edwards Aquifer, they are at the mercy of the Lower Colorado River Authority.

            "There's always a water question in San Antonio," Pickens says.

            Another proposed pipeline could take water to the Metroplex.

            "The one we proposed to North Texas would be 328 miles long," Pickens says. "This has already been done, as far as building a pipeline 300 miles long."

            Pickens has also explored building a pipeline to reach El Paso.

            After laying all that out, however, he says he never heard from anybody wanting to buy his water.

            Yet, he remains optimistic that he will be able to sell his water as the need becomes more critical.

            It is a complex issue, and often an emotional one.

            While there has been concern in some areas that environmental activists may try to block Mesa's plans to transport water from the Panhandle to urban areas, Pickens says he doesn't think that will happen.

            "I don't believe so," Pickens says. "Environmentalists seem to have practically no interest in what we're doing."

            He notes that a lot of pipelines are being built. The problem is when habitat is damaged by a pipeline, but Pickens says a water pipeline from Roberts County to North Texas can be pretty selective.

            "One of the environmentalists told me that the problem they have with our deal is that we're helping the insatiable appetite of the Metroplex," Pickens says. "They have the highest water use per capita of any place in the state, and we're going to give them more water."

            Pickens says environmentalists like the Mesa deal because the water is all “new” water.

            "It's water that goes into the system," Pickens says. "Then some of that gets into the wetlands, and they like that. It's totally unused. It's stranded, surplus water."

            Pickens also has a good reputation for improving wildlife habitat at his ranch.

            "I haven't gotten one complaint from environmentalists," Pickens says.

            Using ground water from the Panhandle also simplifies some of the business dealings.

            "Surface water in Texas is owned by the state," Pickens points out. "Ground water is owned by the landowner."

            In other states, water laws vary, but one thing is for sure. The demand for water is rising and the supply is limited.

     


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