Published: October 27, 2008 04:59 pm      

Industry’s growth slows, benefits to continue

FORT WORTH — The huge signing bonuses are off the table. A few rigs are coming down. And the fruitful resources of the Barnett Shale gas play are beginning to show some cracks in their armor from the pressure of a worldwide economic calamity.

But don’t confuse the continued potential for what the Barnett can do for North Texans, immediately and in the future.

The big shale — and the clean fuel it holds for Americans — is solid as a rock, and remains in the public’s portfolio for financial recovery, according to a prominent geologist, a noted economist and local residents who have seen their households, their neighborhoods and their towns prosper from the boon.

The fast-moving development of the Barnett has been of great benefit to Cleburne and all of Johnson County, and “I hate to see that activity slow down,” said Cleburne Fire Chief Clint Ishmael.

The chief predicted a return to heavy production.

“The Barnett Shale is not going away,” he said.

Experts said production of the shale will continue to “hum” along with good jobs and paychecks, though not at the pace it did when natural gas demand was high and the national economy was relatively robust. When that vitality returns, and it might be soon, North Texans will likely rebound quicker than most Americans in other parts of the country, thanks to the Barnett Shale, they said.

“Everybody with gray hair in this industry has seen this before,” said Eric Potter, associate director and coordinator of energy research for the Bureau of Economic Geology, a part of the University of Texas system. “So it’s not a surprise for us,” said Potter, a former 25-year veteran with Marathon Oil Cooperation who specialized in exploration and exploration technology.

He said he had been “staggered” in recent months by how much energy companies were willing to pay property owners to lease their mineral rights in the Barnett, where signing bonuses reached $25,000 per acre and more.

It is unclear whether such high bonuses will ever return, but it is certain that drilling and production will bounce back at a brisk pace.

“These down cycles … they don’t last forever,” Potter said. “We’re dealing with a scarce commodity, gas and oil. So you know the price will rebound,” helping the local economy bounce back.

Economist Ray Perryman agrees.

“The Barnett Shale remains a very exciting and important part of the North Central Texas area,” Perryman said. “Activity is likely to be subject to intermittent periods of rapid activity, and other periods where things are not as brisk.”

For North Texans, who are relative newcomers to the perks of a natural gas boon, a temporary slowdown in production will probably cause alarm, much more so than in regions of the country, like West Texas, where residents are use to the ups and downs of the drilling industry.

Energy companies and their subcontractors have scurried to lease land and minerals, put up rigs and construct pipelines, at a pace in the Barnett that went far beyond the experts’ predictions. “Now we are in a period where we start moving back to the [predicted] trend,” Perryman said.

“The bottom line for the region,” he added, “is that there is an enormous quantity of a high demand product under the ground. At prices that are likely to prevail in the long run, it will make sense to extract it ... For the citizens, they are blessed with a great new industry.

“Ask the leaders of any region or country if they would like to have this resource, and you will get an overwhelmingly positive response.”

Vicki Wilkerson, manager of the Dollar General on North Main in Cleburne, said she is grateful for the Barnett Shale because it has meant a good job for her son, who works in the field, fracturing — also known as “fracing” — shale rock to help release the natural gas.

“It’s changed my son’s life, his economic life,” Wilkerson said.

The slowdown has meant reduced work hours for her son, “but he’s fracing this week. His hours have picked back up. So I’m hoping there will be a turnaround,” Wilkerson said.

At Sunny’s Café, in west Fort Worth, Dave Ross remained positive recently as he finished up breakfast. “You’re going to have to roll with the economy a little bit, whether you like it or not,” said Ross, who lives in Granbury and is an operations supervisor at the Comanche Peak Nuclear Power Plant.

Even in the downturn, he said, “I see a whole lot more people working and spending money in Hood and surrounding counties than they did three years ago.”

Another patron at Sunny’s, however, was not as optimistic about the future. Bob Gaddis, 80, remembers growing up during the waning years of the Great Depression, in the Texas Panhandle town of Borger where oil rigs once dotted the landscape. “They shut down all the rigs because oil was so cheap,” said Gaddis, a retired signal engineer for the Santa Fe railroad line.

Sipping his coffee in the back kitchen of the diner, Gaddis said he hopes such history will not repeat itself.