LITTLE ROCK — The damage inflicted by heavy truck traffic on Arkansas’ state highways related to natural-gas drilling in the Fayetteville Shale will cost $218.7 million to repair, or nearly seven times what the Arkansas Highway and Transportation Department has received from the increase in the severance tax on natural gas.
An evaluation of the deterioration of the state’s secondary highways in the Fayetteville Shale area found nearly 538 miles of roads damaged to some degree, according to a department report. Nearly a third of those, or about 177 miles, had “major structural damage with shoulder needs” and accounted for more than half of the cost - $114.9 million - to repair.
The total damage, if federal highways such as U.S. 65 are included, is substantially higher, said Dan Flowers, Highway Department director. That report is still being prepared, but Flowers said the initial damage estimate on those highways is $184 million.
“We have a major problem on our hands,” he said.
Based on the report, the Arkansas Highway Commission on Wednesday authorized the department to steer the agency’s revenue from the natural-gas severance tax to repairs for the highways damaged by the natural-gas activity. Through May, the department has received about $32 million in natural-gas severance-tax revenue.
Still, the cost of the damage is small compared with the expected $22 billion impact natural-gas-drilling activities in the Fayetteville Shale are projected to have in an eight-year period through 2012, according to a study by the Center for Business and Economic Research at the University of Arkansas at Fayetteville.
That is why one county judge called the drilling a “two-edge sword.”
For some people in Con-way County, the drilling jobs are “the best jobs they ever had,” said Conway County Judge Jimmy Hart.
“The downside is the roads. They’re taking it on the chin.”
The affected area encompasses parts or all of 10 counties in north-central Arkansas. In addition to Conway County, the counties affected are Cleburne, Faulkner, Independence, Johnson, Pope, Stone, Van Buren, White and Yell.
The exploration for natural gas began in 2004 and ramped up through the balance of the decade, Flowers said.
Unlike traditional drilling straight down, which occurred at the natural gas wells in west Arkansas, the newdrilling techniques require drilling down and then sideways to fracture the shale to extract the natural gas. Such drilling requires more than 2,000 loads of water, sand and other material per well.
The highways and other roads in the area, which were generally lightly traveled with the heaviest vehicle being a pickup, weren’t built to withstand such pounding. It is not only the weight but the increased traffic. Some highways in the region have seen their traffic counts more than double, according to the department’s analysis.
On Arkansas 356 between Arkansas 225 in Cleburne County and Morganton in Van Buren County, the average number of vehicles per day rose from 290 in 2005 to 1,400 last year.
Flowers called Arkansas 124 between Quitman in Cleburne County and Rose Bud in White County “the main drag” of the Fayetteville Shale. About 3,400 vehicles a day traveled the route in 2009, up from 2,200 four years earlier.
On Arkansas 25 at Quitman, which has a population of 714, about 10,000 vehicles traveled on it daily last year compared with 5,700 in 2005. In Rose Bud, population 719, the daily traffic grew to 3,400 vehicles last year from 2,200 in 2005.
The problem is the “volume of legal loads,” said Randy Ort, a Highway Department spokesman.
Of the 101 sites set up to count vehicles, 58 were on highways showing greater than-normal traffic growth in the five years, through 2009, covered by the report.
The department began monitoring road conditions in 2007. The next year, the department won permission to impose additional fees totaling $18,000 on each well in an attempt to help offset the road damage. The agency also imposed fees on trucks traveling on any highway that had a restriction on the weight that a vehicle may carry over them. But it hasn’t been enough.
“I don’t know if anyone envisioned the [extent of the] damage,” Ort said.
The repair costs were estimated by using “average structural improvement needs,” which considered the “current truck loads ... on these routes over a seven year period.”
Recouping the cost of the road damage wasn’t what Gov. Mike Beebe had in mind when he pushed the increase in the natural-gas severance tax through a special session of the Legislature in 2008. The tax went from three tenths of 1 cent per 1,000 cubic feet of gas to 5 percent of the sale price, minus the cost of treating and transporting the gas. The new rate took effect Jan. 1, 2009.
“The idea was that we needed some new source of income for highways,” recalled Matt DeCample, a spokesman for the governor. “The gas tax was declining. The severance tax was by no means the cure-all, but it is a source we could tap.”
DeCample added that “when it passed, we did want a small portion of it to be directed to the counties affected [by the Fayetteville Shale development]. We were already starting to see [the damage] and hear from the counties and county judges.”
Also Wednesday, the commission opened bids on 79 projects worth $61.3 million.
Front Section, Pages 1 on 06/03/2010