On the flip side, as witnessed by other small towns where a boon has taken place, the new rush will lead to a severe housing shortage. Additionally, small employers will have a tough time keeping up with the pay offered by the oil related industry.
According to the Railroad Commission, the Eagle Ford Shale trends across Texas from East Texas (Eagle Ford) to the Mexican border in South Texas, roughly 400 miles long and 50 miles wide. Eagle Ford is the town where the shale is on the surface as clay soil.
Eagle Ford Shale is a brittle shale formation with high concentrations of calcite and silica, making it easier to frac and not sensitive to water. Geologist say it has the perfect mineralogical makeup for shale gas play and oil play.
In the best parts of the shale that produce natural gas, the wells are producing at rates of up to 5 million cubic feet of gas per day. The best parts of the shale that produce oil, the wells are producing at rates of up to 1,000 barrels of oil per day. Most of the operators are drilling horizontal well laterals of 3,500 to 5,000 feet and are fracing the wells with slick water or acid in at least 10 different stages.
So how is the Eagle Ford Shale play affecting South Texas, more specifically, Live Oak and McMullen counties?
Coastal Bend College Dean of Institutional Advancement Glynis Strause said, in one word, “HUGE.”
She added, “The oil boom will translate into increased employment, increased retail sales, hotel occupancy, traffic on highways, restaurant sales and overall wealth increase for citizens of Live Oak and McMullen counties. Coastal Bend College is now prepared to offer on-site training in safety and OSHA compliance with the addition of a trailer that will house the equipment that will be used for training in the oil and oil service industry.”
On a school level, George West ISD Superintendent Ty Sparks said, “From the school’s perspective, it is still a little too early to tell how the Eagle Ford Shale play will impact our district. The funding we currently receive for operating our schools is based solely on student enrollment. It appears there has been some increase in activity for local businesses recently. However, at this time, the school district has not experienced enrollment growth directly related to this new activity. We anticipate that this could change if oil field related businesses relocate employees and their families within our district’s boundaries.”
From a real estate prospective, L.T. Davis with Davis Realty said, “I think that the current oil and gas play in the Eagle Ford Shale will have a five to 10-year impact on our economy at a minimum. We have seen a dramatic increase in demand for properties that have rail and highway access. Already several corporations have made major investments in our community for rail yards and pipe yards. Other companies have been looking for commercial lease sites along major highways for trucking yards, and support businesses for oil field operations. All of this has increased job opportunities and should expand the tax base for the county.”
Three Rivers Chamber Director Mike Pierson said the occupancy rate of local motels is at an all-time high. “It has been beyond anything we could have hoped for. We have one new motel under construction and another in the planning stage. Apartment and home rental property is at a 100 percent occupancy rate. We are blessed to see the American work ethic in our midst, individuals not asking for a handout but just offering us their hands and knowledge.”
Mary Margaret Campbell, executive director of Storyfest, is pleased the new area oil and gas businesses are forging a positive presence in the community by sponsoring Storyfest. “Pioneer Natural Resources, is sponsoring our Storytelling in the schools in Pawnee this year, and Harvest Pipeline, which is laying pipeline in the Eagle Ford Shale, has also come aboard as a sponsor,” Campbell said.
In McMullen County, Pct. 4 County Commissioner Max Quintanilla said, “Eagle Ford Shale has already helped the economy of McMullen County a whole lot and it will continue to help the economy in the near future. The boon is fattening the pockets of those leasing their property. The last drought left people with dusty pockets and now their pockets are green and this is a good thing.
“Right now a lot of the lines are not in but I have heard, in January, after hunting season, there will be a lot more drilling in McMullen County. They are estimating the play will last 10 years but I am taking a more conservative approach; I personally feel it will last a good five years. I am not an expert on this but I am going by past experience.”
Pct. 3 Live Oak County Commissioner Jim Bassett feels the potential for economic growth from the Eagle Ford Shale activity in Live Oak County and the surrounding area is tremendous. “The full impact may be slow to develop due to the lack of available drilling rigs. It is anticipated that county roads will need to be improved to accommodate increased commercial truck traffic. Hopefully, increased revenue from oil and gas production will be sufficient to pay for the needed road improvements.”
Of concern to Three Rivers Mayor James Liska is the amount of water required for fracing a well. “We need to be cautious of our natural resource of water. One thing the city is looking into is trying to provide effluent water for these wells. That way our ‘useful water,’ so to speak, will not go into the fracing of these wells. No amount of gas is worth not having water. However, all in all, this is an exciting time for our city and our county,” Liska added.
McMullen County Judge Linda Lee Henry said, “So far the Eagle Ford Shale play has increased traffic through the county and it is really hard on our roads. They are so torn up that we can’t keep up with them. However, as far as the economy, it is helping the town of Tilden and the ranchers that have leased their land because they are able to keep their cattle thriving. The mineral income has not shown up yet because the gas and oil companies have not been producing. We will have to wait on that but there are high hopes that is going to be a real boon to our economy.
“I have lived here all my life and I tend to be conservative on the issue. I believe in the old saying, ‘Don’t count your chickens before they hatch.’ I have seen oil boons come and go before, I suggest people be cautious and don’t spend money they don’t yet have. If you have extra money make improvements but don’t go in debt making improvements. This is how I grew up — take precautions.”
Other concerns include a shortage of apartments for short-term housing and limited availability of homes for families that plan to stay for a long term, said L.T. Davis.
“However, our schools should see an increase in students and the need for new teachers will increase. The cities and county should have an increase in available funds due to new oil and gas wells coming online and an increase in sales tax, hotel/motel tax and property taxes. I would also encourage the cities and county to look into the availability of grants that would help to improve roads, utilities and expand the use of the existing airport to make this area accessible to a larger geographic area and to promote a more business-friendly environment. Build it and they will come,” Davis added.
Railroad Commission records indicate as of Oct. 6, there have been 740 permitted and 210 completed wells on the Eagle Ford Shale.
Petrohawk drilled the first of the Eagle Ford wells in 2008, discovering in the process the Hawkville Field in La Salle County. The discovery well flowed at a rate of 7.6 million cubic feet of gas per day from a 3,200-foot lateral (first perforation 11,141 feet total vertical depth) with 10 frac stages.