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Oversight on fracking and Texas drilling could cost taxpayers millions

Voters in Denton passed an ordinance in November and became the first Texas city to ban fracking.

Hydraulic fracturing, commonly known as “fracking,” is the process of extracting natural gas from shale rock layers deep within the earth. The injection of highly pressurized fluids into the shale area creates new channels within the rock where natural gas is extracted at higher than traditional rates.

The Star-Telegram reported that fracking has helped Texas to more than double its oil production in the past three years.

“The productivity of oil and natural gas wells is steadily increasing in many basins across the United States,” federal energy analysts said in a research memo.’ The United States has surpassed Saudi Arabia and Russia to become the world’s biggest oil producer, with Texas and North Dakota accounting for more than half of American drilling.”

Denton sits atop the Barnett Shale, one of the largest natural gas fields in the country.  There are currently 277 active wells within the city limits according to city records.

Richard Burleson, of Burleson LLP, wrote an op-ed in the Houston Chronicle which defined the adverse financial effects the city of Denton could incur because of the fracking ban.

“A recent report from The Perryman Group estimates that if fracking were barred, it could potentially cost Denton $251.4 million in economic activity and 2,000 jobs over the next 10 years; slash tax revenues by $5.1 million to the city; and reduce revenues to the Denton Independent School District by $4.6 million. That money would have to be made up somewhere in order to maintain essential city services. The guess here is that it would ultimately have to come out of residents’ pockets.

If Denton enacts a ban, it could embolden other cities in Texas to unwisely attempt the same – or, as we’ve seen in Colorado, lead to ballot initiatives seeking to halt fracking statewide. Those efforts could start us down a slippery slope that would have the practical effect of crippling a Texas state economy that is the envy of the region the country and the world.”

Breitbart Texas reported that litigation costs are expected to be another major drain on Denton’s finances.

“Here, the owners of mineral rights on property in Denton who are now unable to use, sell, or lease those rights have arguably been damaged by the government’s regulation. Their claims are helped by the fact that there is case law precedent directly stating that fracking is necessary in order to get any production out of wells in the Barnett Shale, where Denton is located. A 2008 Texas Supreme Court opinion stated that “development in the Barnett Shale in north Texas…is entirely dependent on hydraulic fracturing,” and another opinion from the Court in 2011 similarly held that “wells in the Barnett Shale require fracture stimulation in order to produce.”

Featured photo courtesy of Wikipedia

 

Lauren Thompson

Lauren Thompson is a native Texan and graduated from Texas A&M University in 2011. She is a passionate advocate for government transparency, limited government and conservative principles. In her spare time she likes to blog about national security and counter-terrorism strategy, and she hopes to obtain her master’s degree in International Affairs. Her work has been featured by The Wall Street Journal, The Blaze, Fox News, and Life News. You can follow her on Twitter at @aggielt11

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Categories: Budget and Finance, Courts & Law, Energy & Environment, Government Transparency, Must Read, News, Policy, Politics, Property Rights, Waste, Fraud and Abuse
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