WATER the new Gold?

Photo courtesy baltimorediy.org

Lubbock - "A West Texas tycoon who shopped valuable water across the state for more than a decade has settled for selling to his neighbor.

Lubbock and 10 Panhandle cities have a purchase agreement for thousands of acres of water rights owned by famed corporate raider T. Boone Pickens, potentially solidifying the group as the state’s largest holder of groundwater rights and closing a combative and fascinating chapter in water marketing in Texas.

The Canadian River Municipal Water Authority confirmed the purchase of water rights beneath 211,000 acres in seven counties north of Amarillo for $103 million, increasing its groundwater holdings by 80 percent and an estimated 4 trillion gallons...

Mesa Water floated several inventive schemes to deliver its billion-gallon bounty to big, thirsty cities.

The company considered pumping the water into the Brazos River to send it downstream to San Antonio. A pipeline was proposed to send the water to Dallas in lieu of an embattled East Texas reservoir proposal. A little-noticed bit of legislation appeared to give a small, Pickens-dominated water district eminent domain powers to build such a pipeline until the Legislature clipped its wings."

Trading water rights is not exactly a new concept, but I doubt there are few people capable of doing it on such a grand scale as T. Boone Pickens. While I don't necessarily disagree with the idea of him seeing a way to make more money for himself and acting upon it, I do find myself concerned at the potential dangers this type of activity might encourage. In this case, it appears that this deal between Pickens' Mesa Water and the panhandle cities was beneficial for all parties; however, as one reader expressed in the comments, how much less could the water have cost had it still been owned by the actual land owners? As the commenter states, "we wouldn't have had to pay $400 - $500 per acre for those rights. The land that sits on top of it isn't even worth that!".

As this 2007 article points out, "Pickens wants to take the water from the Ogallala Aquifer and pump about 200,000 acre feet of groundwater annually to El Paso, Lubbock, San Antonio, or Dallas-Fort Worth - for a price, of course...This price would depend on how far the water needs to go. El Paso would pay around $1,400 per acre foot, while Dallas would pay $800 and San Antonio more than $1,000...Basically, an acre foot of water is the amount of water required to flood a plain of 1 acre to a depth of 1 foot. Generally speaking, 1 acre foot of water can support two families of four for one year."

Those prices are quoted from 2007. Fast-forward to 2011 and the drought we've experienced this summer, and imagine a bidding war between those cities/regions, and it's easy to see how water can get very expensive very quickly. Fortunately for us, as consumers, the situation didn't get that desperate (at least they haven't yet), and I like to think that Mr. Pickens, while certainly interested in financial gain, is a sensible person and not a heartless being and would not allow a bidding war to drive prices to the point that something so vital to our well-being as water becomes unaffordable. But the fact that water is that vital, most vital in fact, is what makes this such a dangerous game. What happens if a Lex Luthor character wants in the water business? I can't help but think that we have to be more responsible with our resources, especially water, or we could find ourselves answering that question, and Superman died a long time ago.