GROUNDWATER SALES, TRADING AND SPECULATION IN THE TEXAS PANHANDLE

The last significant undeveloped reserves of Ogallala groundwater in the Texas Panhandle are located in and around Roberts County. Estimated reserves are 27.62 million acre-feet. Average depth to water is 200 feet; the estimated average saturated thickness is 300 feet. Present water quality is good, with concern of salt water intrusion should large amounts of water be withdrawn.

Large scale purchases of groundwater rights began in the early 1980’s, when a regional electric company, Southwestern Public Service Co. (SPS), purchased about 100,000 acres of groundwater rights in southwest Roberts County. The average sales price was $85 per acre. A proposed nuclear power plant would have used the water. SPS later sold 40,000 acres of groundwater rights to the Canadian River Municipal Water Authority (CRMWA), which provides water from Lake Meredith to its member cities in the Texas Panhandle. In 1999, the City of Amarillo purchased 72,000 acres of groundwater rights adjacent to SPS and CRMWA holdings at an average price of $315 per acre. In 2000, Mesa Water began securing purchase options on groundwater rights from county landowners for $350 per acre. In December 2000, Mesa applied for permits to develop approximately 170,000 acre of Roberts County groundwater rights. Mesa has proposed exporting the water such cities as Fort Worth, San Antonio, and El Paso. An additional group in Roberts County has secured agreements with landowners to market groundwater to prospective buyers. Their current offered price is $0.75 per 1000 gallons at the wellhead. They have agreements with landowners controlling over 200,000 acres.

The Panhandle Groundwater Conservation District has set a management standard requiring 50% of current saturated thickness to remain in place after 50 years (2050). The District will manage these proposed projects with a combination of production permits, well spacing requirements, export fees, and depletion rules.