Neighborhood metamorphosis (5/5)

By Lowell Brown and Peggy Heinkel-Wolfe
Denton Record-Chronicle
December 31, 2008

EDITOR’S NOTE: Behind the Shale is a five-part series exploring urban gas drilling and one Argyle-area neighborhood’s struggle against it.

Opponents, backers of gas wells take up life-altering battle

Jennifer Cole stared at the letter in her hands. No matter how many times she read it, it didn’t make sense, she recalled. The letter, which appeared in her mailbox just after Thanksgiving 2007, said that a Houston company planned to conduct seismic testing so it could drill on the land behind her Argyle-area home.

Cole recalled feeling baffled. The company that was supposed to drill there, Reichmann Petroleum, was tied up in bankruptcy. Even if Reichmann had emerged from its financial hole, the city of Denton still had a pending lawsuit against the company — a lawsuit that demanded compliance with city codes before workers could move as much as an anthill. Prodded by Cole and her neighbors on Britt Drive, the city sued the would-be driller in 2006 for building a planned well site behind Cole’s home without approved plans, among other alleged violations.

But Reichmann never held the leases for that well. A Denton County lawyer, Tom McMurray, held them during Reichmann’s involvement with the site, which kept the well out of the court proceedings. McMurray pooled the leases and, on June 4, 2007, sold them to Carrizo Oil and Gas Inc., a Houston-based energy company with a multimillion-dollar budget and wells scattered throughout the Barnett Shale region.

Reading the letter, Cole said, she felt a familiar dread spread over her — the one that consumed her thoughts and stirred her prayers the day a bulldozer first moved earth behind her home. She recalled picturing the gas rig, how it would loom over her backyard — and the workers, who would see her over the fence when she was home alone. Her husband’s gas grill flashed through her mind — the grill where her boys sometimes roasted marshmallows. There it was, sitting by her backyard fence. Sometimes it sparks, she thought.

Cole and her next-door neighbor, Jana DeGrand, had led their neighborhood’s fight against the well site for two years. It was wearing on her — the hours of research and worry, days spent staring blurry-eyed at a computer screen, searching for one ordinance or state law that would stop the drilling — but Cole resolved to continue.

Not for her, but for her two boys.

“If this is where I’m called,” she said, “this is what I have to do.”

Many residents who never before felt a call to activism have been thrust to the front lines of the Barnett Shale fight. Kathy Chruscielski became concerned about her own well water when a southwestward flank of drilling rigs marched into Parker County two years ago.

After researching both hydraulic fracturing and underground injection disposal, she was asked by neighbors what she’d learned and where she’d learned it. She didn’t want the leadership role, she said, but people kept turning to her for help and she couldn’t walk away.

Fort Worth artist Don Young was willing to speak to radio, television and newspaper reporters on behalf of many neighbors who were privately alarmed when drilling rigs were set up in the city’s most pristine prairie. He pointed to long-standing problems where drilling began several years before, cautioning Tarrant County residents to look at Wise and Denton counties, likening them to canaries in the coal mine.

In Wise County, Sharon Wilson kept a diary of poor practices she saw around her home on her blog, titled Bluedaze. A Wise County neighbor who’d told her story to the Texas Observer had been threatened, so Wilson said she tried to stay anonymous. But her blog grew increasingly popular — its site meter showing that certain people inside the industry, the Texas Railroad Commission and elsewhere were logging on every day to read what she had to say. Determined, those readers who disagreed with her opinions eventually revealed her identity.

Two months ago, Chruscielski, Wilson and Young joined Dish Mayor Calvin Tillman in a site visit with several staff members of the Oil and Gas Accountability Project. The Colorado nonprofit was visiting Texas to learn more about the impact of urban drilling and, in turn, the other four were learning how to get more action out of state regulators.

OGAP had kept up public pressure until the Colorado Oil and Gas Conservation Commission rewrote rules to better protect human health and the environment — rules that were adopted in December.

OGAP executive director Gwen Lachelt said the group intends to write a manual for other communities trying to get ahead of shale development, including the Fayetteville Shale in Arkansas, the Marcellus Shale in upstate New York and Pennsylvania, the Haynesville Shale in Louisiana, the Woodford Shale in Oklahoma and others.

Yet, like Franz Kafka’s protagonist in The Metamorphosis, local critics are frequently marginalized by the industry, even called names, in an attempt to starve them of their role in the broader conversation.

“We at the Powell Barnett Shale Newsletter try not to pay much attention to radical opponents of urban gas drilling,” managing editor Will Brackett wrote in July. “After all, publicity is exactly what they want and they seem to get plenty of it from the mainstream media, often to our chagrin.”

In the November 2007 issue, Gene Powell, founder of the newsletter, awarded Young his publication’s first Biggest Turkey in the Barnett Shale Award. Young says he can’t remember all the names he’s been called.

In a poignant self-description on her blog, Wilson describes how, in her journey to get the best deal for her mineral rights, she learned how her land would be used — and possibly abused. As she became more vocal, others increasingly marginalized her — until, as she writes, “without changing my core political beliefs, I became known as a radical, far-left lunatic with a political agenda.”

“If you are frustrated, angry, depressed, apathetic, horrified or just generally concerned about natural gas drilling in North Texas, mark your calendar …” Jana DeGrand read the e-mail and chuckled. It was July 30, 2008, and over the past three years she’d felt most of those emotions.

The e-mail invited DeGrand to the “Just Say Whoa!” rally in Fort Worth organized by the Coalition for a Reformed Drilling Ordinance. It came by way of Don Young.

DeGrand, whose neighborhood ordeal had consumed so much of her time, was ready to branch out.

“Don,” she replied. “I do feel that it is past time for communities across Texas to unite their efforts to reform this out of control industry. Has anyone looked into joining forces? I am willing to help.”

For a while, the industry appeared ready to answer some of the nagging doubts first articulated by opponents of urban drilling. Devon, Chesapeake and others formed the Barnett Shale Energy Education Council, which provides basic information on its Web site, www.bseec.org.

This year, Chesapeake Energy also published and distributed a glossy, 72-page magazine about the shale. The company rolled out an intensive campaign of television and billboard advertisements in the spring, admonishing residents to “get behind the Barnett Shale.” The campaign has since scaled back, amid news reports that actor Tommy Lee Jones was no longer participating. After hiring local news anchor Tracy Rowlett and trumpeting its planned Shale.tv, Chesapeake abruptly abandoned its plans for the Web-only broadcast, citing budget concerns. The concept lost its backing before any segment ever aired.

Although Jana DeGrand continued to follow happenings in the industry, she didn’t lose sight of her main objective: stopping the well in her neighborhood. She and Jennifer Cole continued digging, poring through deeds, contracts, anything they could use to thwart Carrizo’s bid for drilling permits. “The whole neighborhood — they’ve spoiled us,” said Cynthia Greer, another Britt Drive neighbor. “They have done so much research. So much research.”

DeGrand tried all kinds of ways to stop the drilling. In May, she’d sent a letter to four neighborhood mineral owners whose leases were expiring, urging them not to sign extensions. “Signing bonuses now range from $3,000 to more than $20,000 per acre,” she wrote. “It would be mutually beneficial to all of us if we work together.” She later explained the letter as an appeal to the recipients’ greed, in order for her to buy more time.

Later, DeGrand noticed that Carrizo’s state permit application listed the Whitespot well, named for landowners Steve and Vanessa White, as a single lease. In fact, the site was a pooled unit, comprising multiple leases, and the company had failed to submit plans showing unpooled and unleased mineral interests. The Texas Railroad Commission, which had issued a drilling permit in July, revoked it Oct. 3 after the company failed to amend its plans on time.

Later that month, DeGrand claimed in a letter to a railroad commission attorney that most of the mineral leases associated with Whitespot had expired. What’s more, she wrote, many of those who had signed might not want to renew. The man who had secured many of the leases, Jerry Pratt, was in court defending his business methods.

A one-time business partner, Robert Dunlap of Fort Worth, sued Pratt in October 2006, claiming Pratt had violated the terms of their partnership by not disclosing all of his dealings, withholding certain financial records and failing to reimburse Dunlap’s investment. Dunlap also alleged that Pratt’s many business aliases — NASA Energy Corp., NASA Energy Co., NASA Exploration Co., Command Capital Corp., Royalty Reserve Corp. — were a “sham,” saying in the lawsuit that Pratt ran all of the businesses from his Lantana home. Pratt settled the case this October, agreeing to pay Dunlap $700,000.

An attorney for Pratt, Eric C. Freeby of the Fort Worth law firm Brown Pruitt Peterson & Wambsganss P.C., declined to comment on the case. But in a letter to the railroad commission, Freeby said the lawsuit was “of no consequence” to the Whitespot permit and called DeGrand’s allegations unfounded.

Not long after sending the letter invoking Dunlap’s lawsuit, DeGrand received a letter from another of Pratt’s attorneys. Pratt would sue, the letter said, if she did not “cease and desist” all communications regarding him.

Known as a “strategic lawsuit against public participation,” a SLAPP suit is meant to intimidate, exhaust and silence critics. Widely considered an affront to the First Amendment, 26 states and one U.S. territory have adopted some kind of statutory protection against SLAPP suits. Courts in two other states also adopted such protections. Texas is not among them, as Oprah Winfrey learned after criticizing the Texas beef industry.

Although Carrizo often faces opposition to urban drilling, the Britt Drive neighbors’ level of intervention is unusual, company spokesman Michael Grimes said. Efforts to reach out to the neighbors have foundered — a reality Grimes partly blamed on the tumult preceding Carrizo’s involvement.

“Carrizo inherited the circumstances there,” he said. “In other places, we’ve been able to work through these issues.”

As officials in Austin considered Carrizo’s permit for the Whitespot well, Denton city officials worked to process the company’s application for a gas well plat, which showed the potential for four wells on the pad site. On Nov. 4, the Britt Drive neighbors made a final appeal to the City Council to deny the company’s plans.

Since they first spoke before the council in September 2006, many key officials had turned over, including the mayor, the city manager, the planning and development director and Ed Snyder, the city attorney who initiated the Reichmann lawsuit. Most critically to the neighbors, Quentin Hix had left his job as the city’s gas well inspector in April 2007 to manage the town of Copper Canyon. Denton never filled Hix’s position, choosing instead to shift his duties to the fire marshal’s office and other city departments. The change left the city without a coordinator for the departments that deal with gas drilling.

To Jennifer Cole, Hix stood alone among all the government representatives she and Jana DeGrand had appealed to. He was the one who listened, who at least tried to enforce the rules. Without him, she felt like the momentum for their cause had vanished. “It’s like starting the process over,” she said.

Despite their pleas, the city did not demand a water flow study. City planner Chuck Russell, who was handling the case, told the Coles that the law didn’t require one because the pad site was outside of a flood plain. An engineering review predicted that rainwater runoff would be “minimal” from the site because workers had added a compost berm and reserve pits.

Months before, Russell had reviewed Carrizo’s application and expressed concern about the wells’ proximity to homes. The application shows multiple houses within a 500-foot radius, including the Whites’, which is about 300 feet from the closest wellhead. But the city could not legally enforce its 500-foot setback rule in the subdivision, which is outside the city limits and only loosely falls under Denton’s jurisdiction, Russell said.

After subjecting Carrizo’s application to two rounds of review, the city approved the company’s plans Nov. 14. Now only state approval stood in Carrizo’s path.

DeGrand could only express her dismay. “Obviously,” she wrote Russell, “there is a complete lack of concern for the health and safety of our neighborhood.”

Steve White stood on the edge of a gaping pit, skipping stones across shallow water left over from the last rainstorm. The rectangular crater, which consumes the center of White’s 12-acre home site, was supposed to be gone months ago, replaced by horse stables, a barn and freshly planted trees. That was the plan, anyway, before his neighbors on Britt Drive interfered.

The pit was a temporary evil, set up to collect sludge from a gas well White thought would be drilled long before he moved his family into a custom-built home here just before Christmas 2007. Now, a year later, the well still isn’t drilled. “This has taken way longer than it should have,” he said, scanning the landscape for another stone to chuck.

To White, the neighbors’ talk of flooding is unfounded. His property is the one with a berm and detention pond. If anyone’s land is likely to flood, he said, it’s his.

His wife, Vanessa, sees her neighbors as well-meaning but misinformed. “It’s easier for them to think of us as the evil people on the hill and not get to know us for who we are,” she said. In her view, the delays in drilling only made matters worse for everyone. Each holdup allowed the dispute to fester like an open sore.

Vanessa White envisions a time when the well is drilled, the workers are gone and grass is budding where the gravelly pad once stood — a time when emotions are no longer raw and she can invite her neighbors over for a crawfish boil. In her dream, the neighbors are all friends willing to write off the past three years. “Wow,” they might say, shaking their heads, grinning, she says. “What a crummy way to get to know each other.”

Steve White isn’t so sure. He cuts off talk of a crawfish boil with a curt “Maybe.”

Gene and Jennifer Cole, mindful of the well that seemed ever more likely to drill behind them, put their home up for sale this year. People liked the house, but the pad site was a deal-breaker. They took it off the market after 30 days. “It hasn’t even drilled, and there’s still a stigma,” Jennifer Cole said. Still, the couple plans to find somewhere else to live temporarily during the drilling. They won’t have their two boys so close to it.

For the DeGrands, it’s hard to even think about moving. Everything about their home reminds them of family.

Aaron, their eldest son, died in a car wreck in January 2006. Darrin’s father, “Papa” Charlie, died nine months later.

Both were there alongside Jana and Darrin, clearing brush from their acre site when they bought it 12 years ago.

The neighbors struggle to come to terms with the thought that their efforts may be in vain. Jana DeGrand has talked about starting a Web site to share the things she’s learned, one that would save people hours of legwork and give them a sense of direction in their own battles with backyard gas wells. “But sadly,” she said, “even with that information I can’t say that it will help them.”

The ordeal has darkened Jennifer Cole’s views of the institutions she thought would protect her. She feels naive to have ever thought that she, a housewife and PTA volunteer, could beat back the gas industry, she said. Recently, a friend lamented about landowners not bothering to research their rights. “Maybe they don’t care,” Cole said, “because it doesn’t make a difference.”

At times, Cole seems resigned to the well’s arrival. After three years of prayer, of writing to her elected officials, of digging for a silver-bullet ordinance, she’s done all she knows to do.

There is no one left to appeal to.

There is nowhere else to go.

Postscript

Carrizo’s drilling permit for Whitespot remained pending Wednesday.

According to railroad commission spokeswoman Ramona Nye, the commission is asking the company to clarify which tracts are part of the pooled unit and to what extent, if any, the tracts are not leased. “Carrizo has responded to this request in part,” Nye said by e-mail.

“If Carrizo can provide some additional information required by the commission, the permit may be approved administratively, and no hearing would occur. If these issues cannot be resolved administratively, then a hearing would be required.”

LOWELL BROWN can be reached at 940-566-6882. His e-mail address is lmbrown@dentonrc.com.

PEGGY HEINKEL-WOLFE can be reached at 940-566-6881. Her e-mail address is pheinkel-wolfe@dentonrc.com.

Chapter 1: Neighbors along Britt Drive are approached by land men eager to drill in the Barnett Shale. Some are wary of the impact on their quality of life and question whether the amount of money offered is worth it.

Chapter 2: Urban drilling means these rough-and-tumble workplaces are closer to homes than ever. But its boom-or-bust nature creates a psychosocial environment for the Britt Drive neighborhood that fosters distrust of both sides.

Chapter 3: Cities are trying to preserve their authority to make rules for health, safety and welfare, but the industry is pushing back. Britt Drive neighbors watch one such battle unfold in their backyard.

Chapter 4: A doctrine of exemption allows the industry to develop oil and gas resources without having to study the environmental or health impacts of their work. Britt Drive neighbors worry about how drilling would affect their environment.

Chapter 5: Industry insiders sometimes marginalize gas drilling opponents, but the conversation about where to draw the line in urban drilling persists. The Britt Drive neighbors’ quest to keep drillers away grows increasingly desperate.