Liquidity: Privatization and the Rise of Big Water - The Ripple Effect: The Fate of Freshwater in the Twenty-First Century - page 219

divorces. In 1996, he was forced to resign from the company he had founded in 1956.
Angered and humiliated, he let Amarillo for Dallas, where he started over again, build-
ing up an energy hedge fund called BP Capital Management. The one constant for Pick-
ens throughout the tumult was his ranch, Mesa Vista, in the Canadian River Valley.
By the 1990s he had built a house there, installed electricity, and expanded his hold-
ings to twenty thousand acres. Echoing Maurice Strong, who insisted he had decided to
develop the giant aquifer beneath his Baca Ranch in Colorado only as an afterthought,
Pickens declared to me, “I never thought twice about the water” that lay beneath Mesa
Vista. At least that was the case until 1997, he said, “when I first saw the possibilities.”
hat year the Canadian River Municipal Water Authority (CRMWA), a local utility,
bought the rights to forty-three thousand acres of water for $14.5 million. “I could not
believe that number,” Pickens said, amazed that people would pay so much for mere
water. “I thought it must be a misprint.” Two years later, Pickens's ranch neighbor, a
thirty-two-year-old money manager named Salem Abraham , assembled a seventy-one-
thousand-acre parcel and offered Pickens the chance to join in selling the property's wa-
ter rights. He declined, but when Abraham sold the water to Amarillo for $20 million,
netting a $10 million profit, Pickens was once again stunned.
For a resource specialist, the implications were obvious. Demographers predict the
Texas population will leap as much as 43.5 percent by 2030, mostly in urban areas. Texas
is the nation's top producer of cattle and cotton and is a leading producer of many other
crops. And Texas has suffered a string of drought years, most notably in the early 1950s
and again in the mid-2000s.
The former wildcatter had a new mantra: “The hydrocarbon era is over. Water is the
new oil!”
• • •
Texas water law distinguishes between surface water and groundwater. Surface water is
owned by the state. As in much of the West, Texas property owners can buy and sell
the right to groundwater separately from the land above it. But unique to Texas is a law
known officially as the rule of capture and unofficially as “pump or perish,” by which
landowners are allowed to pump as much groundwater as they like, even if it drains ad-
jacent properties. The law, which dates to the early twentieth century, has been contro-
versial and environmentally destructive, but numerous attempts to undo it have failed.
The property Abraham sold Amarillo wrapped around the south, east, and west of
Pickens's ranch . Pickens told me he had no choice but to sell the water from beneath his
ranch: “If they started pumping, I'd get drained.”