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SpaceX leases land near Boca Chica site, looking into using gas wells for rocket fuel, contractors reveal

1 month 6 days 12 hours ago Friday, January 22 2021 Jan 22, 2021 January 22, 2021 6:45 PM January 22, 2021 in News - Local

Details of behind-the-scenes negotiations and plans for SpaceX to acquire a natural gas well were revealed Friday during a land dispute hearing at the agency that regulates drilling in Texas.

SpaceX is looking for a 806-acre oil and gas well in the vicinity of its Boca Chica launch site. SpaceX has been securing leases through an affiliated company, Lone Star Mineral Development, LLC.

The space exploration company is buying remaining leases for a well historically named La Pita, said attorney Tim George, who testified he was hired by Lone Star, an affiliate which works closely with SpaceX.

Lone Star Mineral Development was formed in June 2020 and has SpaceX CFO Bret Johnsen listed as a manager. Contractors hired by Lone Star appeared at an administrative law hearing at the Texas Railroad Commission to discuss an ongoing dispute between between Dallas Petroleum Group, LLC and Lone Star Mineral Development, and other parties. In dispute is a 24-acre tract, which is part of the La Pita site.

So far, Lone Star has acquired leases with 46 local property owners, said Ricci Susong, a land broker who testified he was hired by SpaceX and Lone Star Mineral Development. Leases took effect between June and October of 2020, and are set to last three years. Lone Star also has the ability to extend the lease, said Susong.

A portion of the 806-acre La Pita well sits hundreds of feet to the west of the SpaceX build site at Boca Chica. Another portion is in South Bay -- north of the build site. Another portion is described as 6.7 miles southeast of Port Isabel. A map shows that would be in the Gulf of Mexico.

"They want to put these wells back in service and use the, basically methane that they were producing as fuel for the rockets," said Kerry Pollard, a consultant and president of Pollard Petroleum Consulting, who testified he was hired by Lone Star Mineral Development. Tim George, an attorney working for Lone Star, also confirmed the plan during his testimony.

In the Texas Railroad Commission directory, the phone number listed for Lone Star redirects the caller to SpaceX customer service. SpaceX has not replied to a request for comment.

These plans go into motion as SpaceX ramps up production and testing of the Starship rocket. In December, SpaceX completed its first launch of Starship SN8. SN9 is now on the pad undergoing testing, with other models in production at the Boca Chica build facility.

SpaceX will also need to settle the ongoing land dispute.

"I was not able to get out to the property," said Matthew Williams, a manager at Dallas Petroleum Group, which has equipment on the 24-acre parcel in dispute. "I don't know what we're going to deal with when we get back on the property. But we're still the ones that are liable. We're still the listed operator on there. We had plans for these two wells."

Administrative Law Judge Jennifer Cook still hasn't ruled on the issue.

SpaceX will also need to determine if the well can produce enough natural gas. Pollard said a feasibility analysis has to be completed to determine the viability of the La Pita wells, before it can produce gas.

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