Residents, City Will Share Economic Toll Of Less Barnett Shale Production
FORT WORTH (CBSDFW.COM) – Chesapeake Energy's decision to scale back gas production and drilling on the Barnett Shale is expected to take a similar toll on city revenue in Fort Worth and on private citizens.
The decision means more gas will be left in the ground until prices go up. And no gas production means no royalty checks for property owners.
"We saw a check for maybe $300 and they promised us we were going to get more at least monthly or every other month," said Gema Guzman, who has several well sites in her neighborhood. "And we haven't seen any money at all."
What's affecting Guzman will affect the city of Fort Worth, too.
Gas production under city property earned Fort Worth $174 million during the tough economic times since 2005.
Then there are taxes.
If more gas companies follow Chesapeake's lead, the value for minerals under private property means there's less value for the city to tax.
Not to mention the gas company drilling crews that, at one time, flocked to Fort Worth to work on the Barnett Shale.
"Most of these folks are kind of nomadic," said Fort Worth Councilman W.B. "Zim" Zimmerman. "But they still spend money, pay sales tax, so it will potentially impact the revenue generation of the city."
Looking at the long-term effect, the only cure for the slump is if demand for natural gas pushes prices higher.
This is demand that Mayor Betsy Price says the city is trying to encourage.
"We're going to ask staff to take a look at what we can do to incentivize some of our contractors to use more natural gas in their fleet," Price said. "We're going to look at all the city vehicles fleet."
Price said she'll also ask delegations in Austin and Washington D.C. to push for natural gas powered electric plants.
In the meantime, Guzman says she'll enjoy the break from the noisy drilling in her neighborhood.
"That would be nice," she said. "It would be peaceful. It's been a little uncomfortable for everybody.
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