Oil Wastes Taint Water Supply

As oil production drops, pollution problems mount in Texas and Oklahoma aquifers. DAY OF RECKONING

WHEN a Texaco pipeline broke and spilled a million gallons of crude oil, ruining six acres of his grassland and contaminating his groundwater, Rex Pigmon got mad. When the company offered the west Texas rancher $1,200 for the damage, he got a lawyer. Damage lawsuits like Mr. Pigmon's have become common in the oil-producing regions of Texas and Oklahoma. Nine decades of continuous drilling, production, and refining have left both states with extensive environmental damage that will take years - and millions of dollars - to clean up.

Six hundred and 50 miles north of Pigmon's Winkler County ranch, Lowell Brown surveys a large pit in northeastern Oklahoma. Filled with waste oil and trash, the pit has been abandoned for several years.

"Pollution control isn't anyone's priority," says Mr. Brown, leader of the Special Operations Unit to Prevent Pollution (SOUPP). Formed last fall by the chairman of the Oklahoma Corporation Commission, the agency that regulates the oil industry in Oklahoma, the team has begun cracking down on oil producers for pollution violations.

Half the residents of Oklahoma and Texas depend on groundwater. But thousands of abandoned, unplugged oil wells are scattered throughout the two states, threatening fresh water aquifers. Compounding the problem are aging oil-processing facilities. The Texas Water Commission estimates that 34 Texas oil refineries have groundwater contamination problems.

Abandoned waste pits are a common sight in both states - a reminder that some industry practices will take years to correct. "I don't mind that the state gets tax revenue from the oil and gas industry," says Brown's partner, Bobbie Adams, who has worked in the oil business for 12 years. "But it's the taxpayers that are subsidizing these operators by allowing them to operate this way and pollute the land."

Brown and Ms. Adams say saltwater contamination is perhaps the most pervasive problem. Saltwater, a byproduct of oil production, was disposed of for many years in open evaporation pits. The practice is now banned, but many saltwater pits leaked into fresh-water aquifers.

The town of Cyril, 60 miles southwest of Oklahoma City, recently had to pay for a pipeline to bring water from a nearby town because Cyril's water wells got too salty for human consumption.

The problems in Cyril are familiar: Past industry practices are causing expensive problems for today's landowners. And while the problems are increasing, the amount of oil being produced in Texas and Oklahoma is declining. Both states have a surfeit of "stripper" wells - old, marginal wells that produce less than three barrels of oil a day. Stripper wells account for nearly half of all Texas oil production.

Many older wells have been abandoned - creating a pollution hazard. Abandoned wells are essentially vertical pipelines that can allow salt water from deep formations to pollute shallow fresh-water aquifers. The Texas Railroad Commission, which regulates the oil industry in Texas, estimates the cost of plugging the abandoned wells may reach $300 million. Plugging Oklahoma's problem wells will cost at least $20 million. Both states are trying to find money to plug the abandoned wells, but declining oil re venues and the real estate crunch have limited state resources.

The pollution found by the SOUPP team since it started last September has put the oil and gas division of the Corporation Commission and its field inspectors on the defensive. Jack Davidson, who heads the division, says the SOUPP team isn't needed. "We are very capable of handling our own business," says Mr. Davidson, who joined the Corporation Commission after 35 years with Phillips Petroleum. "Whenever we get a report of pollution, we cause it to be corrected."

Jim Bennett disagrees. Head of the Oklahoma Wildlife Federation, Mr. Bennett has been a vocal critic of the Corporation Commission. "One of the major problems in Oklahoma is the denial by the people in charge of the oil and gas division ... that a problem does exist."

Exacerbating pollution problems in the oil field is a shortage of money and manpower. Oklahoma has 48 field inspectors to police some 156,000 oil, gas, and injection wells - an average of 3,250 wells per inspector. In Texas, the manpower shortage is even more acute. One hundred Texas Railroad Commission inspectors oversee 360,000 wells.

Meanwhile, Texas legislators face a $4.5 billion budget deficit. And though Texas oil companies pay more than $1 billion in wellhead taxes to the state's general revenue fund every year, Texas spends only $11.5 million a year to regulate the oil industry.

The lack of strict regulation has left landowners like Pigmon wondering how they will survive. Water has long been more valuable in the oil-producing regions of Texas and Oklahoma than oil. After the discovery of oil at Spindletop in Texas in 1901, a barrel of oil (42 gallons) sold for 3 cents. A cup of water cost 5 cents. Today a barrel of west Texas crude sells for about $19. The price of 42 gallons of drinking water, at the prevailing cost of 50 cents a gallon, is $21.

Pigmon, who has lost much of his fresh water to oil and salt contamination, doesn't have much to offer when asked how he would change oil-industry regulation. Taking off his straw cowboy hat, the rancher wipes the sweat from his sun-tanned face and says, "I don't know, but something has got to change - that's for sure. 'Cause without good water, I'm out of business."