Owning Water Rights

Owning Water Rights

FAQS ON WATER RIGHTS OWNERSHIP

We get a lot of questions about water. Most of the questions that come our way center around ownership and the demands on water by the oil and gas industry to frac wells. This article goes over a few thoughts about water ownership as it relates to the oil and gas industry.

The two main sources of water onshore in the US are groundwater and surface water.

Ground water 

Ground water is extracted or produced by drilling a well. Ground water can either be privately owned or publicly owned. Most privately owned groundwater is owned by the surface owner. And whether the surface owner drills the water well or contracts with a company to drill a water well, production limits can still be set by state regulatory agencies.  Ground water owned by the State (such as Wyoming) is usually allocated based on meeting needs of a community and/or prioritized by beneficial use (agriculture, biological, commercial, etc.)  

Surface water 

Surface water, such as rivers, streams and lakes, is owned by the states for the benefit of the public. In many cases, owners of the adjoining surface may be allowed to use water in rivers, streams and lakes, but not own it.

FracFocus* reported that most of the water used for fracking comes from rivers, lakes (surface water) and municipal suppliers.

Rystad Energy** reports that frac water demand nearly tripled between 2016 and 2019, as shown below. Thinking they might be revising their 2020 and 2021 projections.

Bluefield Research*** reports many horizontal wells are now requiring 15 million gallons of water to frac.  That is the same volume of water needed to fill 22.7 Olympic swimming pools. But how does that compare with other demands for water? 

As reported by Reuters, fracking by US oil and gas companies has increased the burden of the nation’s water resources. But it still only accounts for less than 1% of America’s total industrial water use according to a paper published by researchers at Duke University.

And FracFocus is reporting the same findings as shown below. 

   

We hope this answers some of your questions. Feel free to send us a note if you have additional questions.  And if you’re looking to lease or sell your water and want to have a conversation about listing, submit your information on our site at landgate.com/lease-water or give us a call at 855-867-3876. 

*fracfocus.org **rystadenergy.com ***bluefieldresearch.com

Dan_McCue

Article by LandGate VP of Land, Dan McCue

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