Mesa water is expensive, Oklahoma water isn't

From SC Gwynne in the Texas Monthly Feb 2008 issue (sub req'd):

So if Region C doesn't get its water from pipelines to East Texas, strict conservation, or reuse, where will it get its water? T. Boone Pickens thinks the answer to this question could be worth a lot of money. Never one to let an opportunity pass by, Pickens has come up with a scheme to pump water from the Ogallala Aquifer and sell it to the big suppliers in Region C. The Ogallala is pumped on a massive scale, irrigating corn, cotton, wheat, and sorghum crops in the areas around Lubbock and Amarillo and accounting for about 40 percent of all the water used in the state of Texas. Of course, it is being slowly depleted and sometime in the next century will run completely dry. But in the meantime, Pickens has been buying up groundwater rights in the area. His idea is to get one or more of the Metroplex's three big suppliers to finance the building of a pipeline for about $2 billion; once the pipes are up and running, he'll sell Region C the water in them.

This may sound like a perfect, if somewhat ecologically irresponsible, match of supply and demand, but in fact Pickens's water is extremely expensive compared with the alternatives. According to a recent engineering study, his water would cost some $2.60 per thousand gallons, more than three times what it would cost to get water from the new reservoir on lower Bois d'Arc Creek (one of the four East Texas reservoirs proposed for Region C). Pickens' scheme also costs more than piping water in from Toledo Bend. According to the main suppliers, there are only two sources of water more expensive than Pickens's--a large aquifer that stretches south and east of Dallas, called the Carrizo-Wilcox, and the Gulf of Mexico (though, due to its prohibitive cost, desalinated Gulf water is not yet in the picture).

But Pickens persists. His project relies on the near absence of state regulation of groundwater. This circumstance may be short-lived--most water experts expect more-stringent state groundwater regulation in the next 25 years--but for now groundwater from either Pickens or the Carrizo-Wilcox remains on the table for all three water suppliers.

"Boone's thing is certainly feasible," says Jim Oliver, the general manager of the Texas Municipal Water District. "Water from the Carrizo-Wilcox is also feasible. But their markup is incredible, and they want a whole lot more money than what we can build other reservoirs for. Boone is revising his model. But he is just going to have to get real."

A little further in is a interesting bit of history on the North Texas Municipal Water District attempt to buy excess water (pdf) from eastern Oklahoma, land of many rains and few people. Those discussions were terminated in 2002 (pdf).

But, the Tarrant Regional Water District has started negotiations to pump Kiamichi basin water just before it reaches the salty Red River (Flash). TRWD refers to this as 'Gulf-bound' water and thinks the project might be more acceptable because it captures water leaving Oklahoma instead of actually in Oklahoma. FAQ here (also Flash).