The U.S. Census Bureau has long pegged Loving County’s population at less than 100, making it one of the country’s emptiest counties. Now, the West Texas community swells with more than 1,000 daily workers.
In the past five years, South Texas’ La Salle County, population 7,100, has gained some 1,300 residents, thousands of transient laborers and has built at least 20 hotels.
Not long ago, Karnes County, an hour southeast of San Antonio, was home to some of Texas’ poorest communities. But since 2009, the county’s sales tax collections have exploded by a factor of 21, and it has minted dozens — if not hundreds — of new millionaires.
These types of stories, which Texas Tribune reporters traveled across the state’s shale regions to tell, are becoming common in Texas. That’s thanks to a surge in oil and gas production that has poured billions of dollars into local economies and created hundreds of thousands of jobs, providing lifelines to Texans who had struggled to find work in years past. The industry almost singlehandedly lifted Texas from the country’s last recession.
But the excitement and opportunities come with challenges and even tragedy: Rent and food prices are skyrocketing in the rapidly growing regions; the water-intensive energy production process is straining scarce resources; oilfield traffic is tearing up roads and killing drivers at high rates; and toxic compounds from drill sites may be making some residents sick. The swift changes have dropped huge responsibilities onto the plates of often-unprepared local officials, who must find solutions to boomtown problems while deciding how to invest new wealth.
“You take what is coming at you and you just hope and pray,” said Ray Kroll, the city development manager in Karnes City.
Spurred by technological advances like hydraulic fracturing, Texas has reached production numbers unseen in more than three decades. It’s pumping more than twice the oil it did three years ago, accounting for more than a third of all domestic production, even as production surges elsewhere in the country. Meanwhile, Texas accounts for about a quarter of all U.S. natural gas production, and the state’s output is the highest it has been since 1975.
West Texas’ Permian Basin, which first cemented Texas’ reputation as a state rich in fossil fuels, is now home to the most lucrative shale fields in the country. That has breathed new life into towns that rode the boom-and-bust cycles of the past.
South Texas is also driving much of the growth. The mad dash to the region’s Eagle Ford Shale has given many communities their first taste of a boom.
But these booms come with unsettling questions: How long will the bonanza last? And will an eventual drop in oil prices decimate local economies — as has happened throughout Texas’ history?
Estimates of the boom’s longevity keep getting pushed back — five years, 10 years, now 25 years. Experts say this boom is different than years’ past, thanks to new technology and a more stable global fossil fuels market. “When people look back on this in 20 years, we’ll consider this the golden age,” James LeBas, a tax and fiscal consultant for the Texas Oil and Gas Association, told lawmakers last summer.
The growth can’t last forever, as a recent four-month tumble in oil prices shows. As oil-producing nations weigh their options, economists say the conditions may not hit Texas as hard as states like North Dakota. That’s partly because Texas crude is closer to refineries and is less expensive to to transport. Still, Texas production could slow – at least in the short run. But opinions about what price will stop new drilling and choke back wells vary by firm and location within each shale play.
Longtime Permian Basin residents hardly need another reminder that what goes up typically comes down.
After oil prices plummeted in the 1980s, many folks in West Texas slapped this message onto their car bumpers: “Please God, Just Give Me One More Oil Boom. I Promise Not to Blow It Next Time.”
This is their chance.
Ivan Pierre Aguirre
Martin Do Nascimento