Selling water from a pond for fracing a well-anyone know the pitfalls?

I've been approached about selling water for $0.25/barrel from an existing pond for one particular frac job. The agreement seems too open ended to me-doesn't specify amount and time frame, though I've been told the amount and approximate dates. I won't sign that agreement.

Are there other pitfalls to be aware of? Supposed to be no trucks to damage roads etc, but I know the devil's in the details.

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Phillip,

If your 200+acre feet is off-channel in Texas it is exempt. My guess is that to impound 200+ acre feet you probably have a watershed of 800 acres. My second guess is that it is on channel. If it is on a flowing/intermitent/perennial stream, you probably need a water rights permit simply to impound it.

If it is on a flowing/intermittent/perennial stream and you want to benefit from fracturing use of the water, you or the person using the water needs a permit in Texas.

I'm also guessing you are subject to dam safety regulations:

http://www.tceq.state.tx.us/compliance/field_ops/dam_safety/damsafe...

I can suggest a couple of good water lawyers if you want legal clarity on your situation.
Can anyone tell me how it comes about that one would be able to sell frac water? I have a large natural water shed on my property and can very easily capture large quantities of water for there use. I am located in Many, La.
Thanks
slowroller, the main criteria for selling water is that there has to be drilling going on in the immediate area. i dont know the reason behind it, but they do not generally run the the transport lines more than 5 miles at a stretch.
as far as getting in the loop, so to speak, i would do one of a couple of things. if there are rigs in your area, within five miles, i would go to the site and ask to see the company man. this person could supply you with contact information to the company handling the water. also if you see people running the temporary transport lines in your area, stop and talk to them. likely they could supply you with the contact information you would need.
kj
www.shalebiz.com is a new marketplace site folks can list their available pond water for sale for companies to contact you. 
Chad,

You are free and clear to construct ponds in Texas, and store up to 200 acre feet of water, provided the water is for domestic, livestock, and/or wildlife uses. Water up to 200 acre feet and for these uses is exempt. Ponds that are off-channel are also exempt.

http://www.tceq.state.tx.us/files/gi-228.pdf_4467322.pdf

In general, if the water is from a flowing stream/creek or river, and you construct a pond on or divert water from the stream/creek or river, you need a permit if it is not one of the exempt uses listed above, or your water use even in an exempt purpose, exceeds 200 acre feet per year.

The regulations become a bit more tricky when you take an exempt on-channel pond, and then sell water for a non-exempt use (mining/hydraulic fracturing). In those cases, in Texas, someone should have a permit to withdraw or divert the water. There are a few different ways to go about this, some more difficult than others. From a landowners perspective, it may be to your advantage to sell/rent "access" to the water, with the company utilizing the water required to obtain the neccessary authorizations to actually withdraw the water.

In the eastern part of the Texas, there has been historically little contention over water, as except in extreme droughts, water has generally been available. In the Eagleford area, where water is generally less available, expect more contention.

One other comment that may be of interest here: Louisiana is requiring registration of all wells used for fracturing water supply. In Texas, individual groundwater districts make the rules regarding notification and permitting. I'm not aware of specific ground water district restrictions in the Haynesville play, but I expect that the Eagleford counties may be a different story.
dbob, i certainly do appreciate your comments. i got as far as talking to an environmental engineer a couple of times about permitting the construction of a pond. it is a completely different set of rules for companies than it is for individuals. i was amazed to find out in a commercial scenario, this permitting process can take a year or more. talk about needing to plan ahead...
if a person has an existing pond fed by natural run off, (tx. rules of capture), wouldn't that person be free and clear to market the water? as far as that goes, couldn't a land owner build berms to redirect the water and still be within his legal limits?
i would encourage anyone interested in selling water to pursue it. whether or not your water qualifies as a source for their needs can easily be determined by them. it doesn't cost anything to ask, and all they can say is no, and give you a reason why your water doesn't qualify as a source for them.
kj
King John

Correct, if its just catching run-off and isn't on a flowing stream, you are free and clear to sell the water. Building berms, etc to catch more water shouldn't require a permit from TCEQ, as long as its not on a flowing stream.

1-yr or more is probably right for a larger permit (several fracs worth of water) although on a regional basis you can get authorization for smaller amounts of water essentially on a frac by frac basis.

Enforcment by TCEQ on the water withdrawal issue is limited, but there were a couple of complaints recently to TCEQ about Polysot Creek just outside of Cherino. It will be interesting to see how those proceed.
Why does "Texas Water Code 1988, Sect. 11.142" not apply to diffused water (run off into a pond)?
It states:
"There is an important limitation on the use of stored diffused surface water. Since 1953, it may be used ONLY for domestic and livestock purposes, and a permit from the Texas Water Commission is required if the reservoir exceeds the storage limits, if the dam is on a stream, OR if the water is to be put to other uses (Templer 1976)."
good article on water rights in Texas

http://texaswater.tamu.edu/waterlaw.texas.htm
Here is an interesting read on Texas law. don't know if it is accurate. Diffused water law is included, here is the exerp and the link. I dont' have a clue, just researching the idea. It LOOKS like people need to be careful in selling the water in a pond without SOMEONE getting a permit. Notice that last sentence. THIS POST IS NOT A LEGAL OPINION

A Texas statute (Texas Water Code 1988, Sect. 11.142)
There is an important limitation on
the use of stored diffused surface water. Since 1953, it may be used only for
domestic and livestock purposes, and a permit from the Texas Water Commission
is required ifthe reservoir exceeds the storage limits, if the dam is on
a stream, or if the water is to be put to other uses (Templer 1976).

http://digitalcommons.unl.edu/cgi/viewcontent.cgi?article=1049&...

Someone with a bigger brain than mine should research this.
Just to let you know I know someone selling water from their pond for .50 a barrel in the Haynesville Shale and have a provision that the pond cannot get below a certain level. Don't let Chk. or other drilling co. get to you without checking things out!

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