SHREVEPORT, LA. — Chris Moreno lost his job managing a print shop two years ago, just after his wife became pregnant and they'd started building a house on 40 acres near the shores of Caddo Lake.
He fretted he'd have to relinquish his humble piece of paradise, where he indulged his country boy's passion for hunting raccoons and catching catfish.
But now fortune has smiled on Moreno: He's poised to become a millionaire, all because of that 40 acres he bought eight years ago for $45,000.
Landowners here in the piney three-state junction known as Ark-La-Tex recently learned that in this energy-starved era, they may be sitting on the largest natural gas field ever found in the continental U.S. The discovery of the Haynesville Shale, which lies mainly beneath Louisiana but branches into Texas and Arkansas, was disclosed in March by energy companies, which had been quietly buying up drilling rights for months before telling the public.
The news has triggered a flurry of speculation as frantic as anything seen here since a gusher on a Texas hill named Spindletop in 1901 ushered in the modern oil industry. Hordes of landmen, leasing agents for the energy companies, have descended on Shreveport, the unofficial capital of Ark-La-Tex, dangling gaudy sums before landowners in hopes of getting permission to drill beneath their properties. Firms that earlier this year were leasing land for $200 an acre are now paying upward of $20,000 an acre, leaving thousands of homeowners dreaming of plasma TVs and sports cars.
The windfall is changing lives for people like Moreno, 38, whose big worry has become whether to take the money now or hold out in hopes of getting even more. Energy companies have offered him $750,000 upfront to drill his land, as well as 25% of whatever the wells yield, which could bring him an additional $900,000 a year. But the bids keep getting larger, so he's waiting. Chesapeake Energy Corp., one of the major players in the Haynesville Shale, recently told investors that it thought the deposit was the world's fourth-largest.
"They're throwing so much money around, it's easy to lose your mind," Moreno said. "Where do I draw the line? I do feel like my luck has changed overnight."
Never mind that only a few dozen wells have been drilled and the rest could come up dry. The mere promise of a big strike in natural gas, which has soared in price, has already brought hundreds of millions in investment dollars to Shreveport, a riverboat gambling hub. That's turned Ark-La-Tex into a particularly vivid example of how America's thirst for energy is creating wealth in a few lucky pockets of the country, even as high oil and gas prices drag the overall economy down.
Michael Long, a Shreveport councilman and third-generation veteran of booms and busts in this rollicking region, where fortune has often shifted with the price of oil, said now he knows how his Irish grandfather must have felt when he headed here with his four brothers a century ago in search of instant riches.
"This Haynesville fever has extended pretty far, pretty fast," Long said. "A lot of landowners are sitting there thinking, OK, I'm ready to make my million dollars."
The Haynesville Shale comes after the Barnett Shale, a similar natural gas find in the Dallas-Fort Worth area that has been extraordinarily productive and profitable. The Barnett Shale has spurred drilling in shopping mall parking lots and suburban subdivisions, and generated tens of thousands of jobs and more than a billion dollars a year in state and local taxes.
The Barnett and Haynesville formations are geologically similar, and companies have shown they can now extract gas from previously unreachable places, leading experts to predict that the Haynesville Shale will make fast fortunes in Shreveport and bring decades of lucrative royalty payments.
"This is already the biggest thing ever to happen to this area," said Bill Pittman, a former landman who's started a website, MyOilPro.com, to advise property owners. "It's life-altering."
Bank tellers share stories of customers walking in with wide smiles and $800,000 checks. Companies have complained of spies sneaking around their test wells at night, trying to glean how much gas they're pulling up. An energy executive claimed rivals were hiring exotic dancers to go door to door to entice landowners. A popular rumor, knocked down by law enforcement but still spreading, was that Department of Homeland Security officials had warned that something fishy had to be happening because too much money was changing hands.
For the Shreveport-Bossier YMCA, the Haynesville Shale is the biggest stroke of luck since Elvis Presley sang a benefit concert before 10,000 screaming teenagers in 1956, raising enough money for a new swimming pool.