Task Force Report on Eagle Ford Shale

Texas Railroad Commissioner, David Porter, released the latest report from the Eagle Ford Shale Task Force outlining their assessment of how the oil field has affected eight issues, including area employment, infrastructure, water quality and economic benefits. The report, released on March 12, 2013, was produced by a task force represented by local business and elected leaders and representatives of environmental groups, energy producers, landowners, mineral rights owners and other related to oil and gas production in the south Texas region. This report is important, as the rapid growth of exploration in the area has far-reaching impact for many sectors of public and private interests.

The report showed that wages in the area increased 18% from 2010 to 2011, reaching an average of $117,000 per year across the 38,000 jobs in the 14-counties of the region. The task force projects that hiring will remain strong for some time.

The area’s growth has increased in truck traffic by 86%, putting a strain on local and state agencies to keep up with increased demand for better roads and traffic safety. Additional pipelines are required to displace truck trips, which will also reduce traffic accidents.

While water quality is always a concern, the report showed that the Commission has not received a single report where hydraulic fracturing has contaminated ground water supplies. In addition, experts has stated that the underground aquifers in the area are capable of supplying all the anticipated water needs for this type of oil and gas exploration.

Since the Railroad Commission has jurisdiction over oil and gas production in the state, the Commission has directed more resources to the Eagle Ford Shale region to handle regulatory matters. They have also called upon the Department of Public Safety to monitor waste haulers and other carriers to insure proper permitting and load weights.

Of course, the largest impact to the region is economic. The rapid increase in drilling permits (from 26 in 2008 to 4,145 in 2012) indicates the simultaneous increase in capital investments. One cited analyst report estimated that the total capital expenditure in the region will reach approximately $28 billion in 2013. The increase in oil and gas production has produced large windfalls for state ($358 million in 2011) and local ($257 million) governments.

The growth in the area has also created a huge demand for healthcare professionals. The report estimated that the Eagle Ford Shale region needs approximately 3,850 physicians, registered nurses, dentists and pharmacists.

Local school districts are facing a more interesting challenge. While they are growing to meet the needs of an increased population, many have transitioned from being “property poor” districts into “property wealthy” districts. This transformation means that some will be required to return monies to the state in the form of recapture.