Officials of Amite and Wilkinson counties are preparing a plan for a water district they say will enhance hydraulic fracturing operations in their region while generating dollars for sorely needed road and bridge maintenance.
A central feature of the plan: Pipe five million gallons of treated sewage daily from McComb, Liberty, Gloster and other Southwest Mississippi communities for drilling companies to use in breaking up shell deposits thousands of feet below ground and extracting oil and natural gas they hold.
Water is a key tool of the deep-ground shell fracturing process. With the hydraulic pressure of water, sand and chemicals exerted through a horizontal bore hole, drillers fracture the rock to free trapped oil and liquified natural gas.
The piping plan, still in its infancy, is estimated to cost $10 million. It is modeled somewhat on a 30-mile above-ground pipeline designed to take millions of gallons of treated effluent from Meridian to Mississippi Power Co.’s Kemper plant. Once there, the treated waste water will cool equipment used for generating electricity at the coal-fired plant.
Like the water piped to Kemper, the water delivered for deep-well drilling will serve a dual purpose. It provides oil and gas companies a much needed resource and helps communities to dispose of treated effluent, said Michael Caples, a Butler Snow attorney who is helping Amite and Wilkinson counties plan for the water district.
Two other benefits noted by Caples: Providing the waste water will generate money for road construction and repairs in the region while helping to reduce the number of tanker trucks carrying water to and from the wells. Though Mississippi has a number of special-purpose water districts, the Amite-Wilkinson water district would be the first in the nation to exclusively serve hydraulic fracturing operations. “This will be the first time the public has tried to come up with a solution for water for shell fracturing,” Caples said. “All the other places it has been left up to the oil companies. It’s a way for the public to get involved and to keep funneling the money into Mississippi.”
Money the district generates will go to the budgets of the two counties to help maintain roads and bridges that will be used heavily once commercial fracking operations begin in earnest in Southwest Mississippi, a region considered the sweet spot for the billions of barrels of oil and natural gas deposits within the Tuscaloosa Marine Shale, or TMS, reserve.
Beyond furnishing the treated waste water, the district will identify surface water resources drilling companies can use, Caples said.
“Right now they are having a hard time sourcing water for development of the TMS,” he noted.
Without an inexpensive – and reliable – source of water, the TMS play may never take off, both industry experts and regulators have said.
If approved by the board of supervisors of the neighboring counties, the water district effort would begin with preparation of a water management plan. “It will look at where the water resources are available for shell fracturing, whether it’s surface water from lakes, the Mississippi River or flowing streams,” Caples said.
He emphasized the district would have no role in allocating water for deep-ground fracking. It could, however, seek water controlled by municipalities and rural water services, the Associated Press reported in a recent story.
Allocation is left up to the Mississippi Department of Environmental Quality, or MDEQ. “We’re still working with the companies” on water sourcing and allocations, said Richard Harrell, director of MDEQ’s Office of Pollution Control, the office charged with issuing water-use permits.
Surface water has been the primary source for fracking operations, according to Harrell. “They have been coming to us for water-resource draw permits,” he said of TMS well operators which include Encana Oil and Gas and Goodrich Petroleum.
“As the play grows,” Harrell said, “we don’t expect there will be enough surface water to supply all of their needs.”
Once that occurs, drillers will turn to below- ground water, Harrell said, and added MDEQ has already received permit requests for groundwater sourcing.
MDEQ also will decide whether Amite and Wilkinson counties can create their water district. The counties must submit a plan to the MDEQ Commission detailing how they plan to operate the district within the MDEQ’s regulatory framework.
Unlike some states, Mississippi citizens own all water resources and give responsibility to the MDEQ for allocating their use, Harrell said.
A long-established hierarchy gives drinking water “foremost” priority, he noted. “Industry and agricultural are next and fairly equal” in usage priority.
Harrell said the MDEQ is confident “that with reuse and recycling there is ample water for all users,” including the deep-ground fracking companies.
Andrew Whitehurst, water policy director for the conservation group Gulf Restoration Network, said it is good to see a water-use plan that lessens the burden on surface and groundwater resources. “Using recycled water is always better than taking it out of the streams and other resources,” he said.
The new water district would line the holding ponds to prevent seepage into the water table, said Butler Snow’s Caples. The water would be fully contained in the ponds and would have no discharge points, according to Caples.
This makes the ponds less of a concern than the 85-acre reservoir employed in Meridian’s furnishing of treated effluent to the Kemper plant, Whitehurst said. “If the ponds are built not to discharge and are lined, the post- treatment water from the sewer plants should stay in the ponds and not be a problem. The ponds will also be much smaller.”
In the meantime, with surface water, groundwater and recycled water the remaining options for fracking operations, the Gulf Restoration Network wants to see further signs the Department of Environmental Quality is going “be protective of groundwater,” Whitehurst said. “We’ll see. Do they really seem to have a plan or are they just doing all of this ad hoc?”
Caples said the plan is to use existing ponds, which have to be lined, or to put in new ponds. “The plan is to build centrally located storage areas and have distribution pipes that go to the various fields being developed,” he said.
The goal is to get the water closer to the wells. “They can use temporary pipes to pump” the recycled water the remaining two or three miles to the wells, Caples added.
Any reduction in the trucking of water is a positive for not only the drillers but the people living in the region as well, Caples noted.
Some wells use 12 million to 15 million gallons of water a day. A truck can haul only 6,000 gallons at a time, he said. “You are talking about 300 or 400 truckloads to dispose of water from one well.”
The water district will need a lot of capital at start up and will go to the bond market to get it. “The beauty of this is that we can negotiate these contracts with the oil companies that they are going to buy water from us,” Caples said. “We can take those contracts to the bond market.”
Caples said the yet-to-be-created district is still at least six to nine months away from selling bonds.
“We’re just planning and exploring,” he said, and emphasized no tax dollars are to be used.
Wilkinson County Chancery Clerk Thomas Tolliver is enthusiastic about the potential of a water district to spur commercial development of the Tuscaloosa Marine Shell region. He also welcomes its potential to cut down on truck traffic and to generate money to maintain the roads and bridges that will be put under tremulous stress once the oil and natural gas production takes off.
“I see it as a win-win,” said Tolliver, who doubles as president of the Wilkinson County Industrial Development Authority.
Oil and natural gas consultant Charlotte Batson, principal of Batson & Company, called the water district strategy and the assistance it could lend to development of the TMS “incredibly creative and far-sighted.”
She said she has not spoken directly to oil company executives about the plan but has received reports that they are “on board.”
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