Cover Story June 12, 2008, 5:00PM EST

There Will Be Water

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, to a town called Jacksboro, just short of Dallas. The letters included a Texas landowners' bill of rights, information on the condemnation procedure, a map of the route, and a list of open houses they could attend for more information.

One stifling evening in May, about 50 people showed up at the Twin Lakes Community Activity Center just outside Jacksboro. When the ranchers arrived, more than a dozen of Mesa's public-relations consultants, hydrologists, and land men were waiting for them. Standing behind tables laid out with pens, cups, hats, and bags with the District No. 1 logo, the officials were available to answer questions about the 250-foot-wide corridor Mesa would use to construct, maintain, and possibly expand the pipeline and electric lines. While this arrangement allowed everyone to get information specific to their property, it also precluded any public questioning of the Mesa standard-bearers. This did not go unnoticed by the ranchers. "We're not happy," said one. "Pickens is pushing his power trip on us. I can't fight his money. But if he asked first, I might have thought better of it." Another said: "Land goes way back for a lot of people here. If you tell people you want their land, Texans raise their guns." At the end of the evening, most of the pens and hats and cups still lay on the tables.

Pickens isn't bothered that by his invoking the right of eminent domain, Mesa has inflamed landowners up and down the route. "It always does," he says. Mesa expects to acquire the land it needs in the next 18 months and pay about $30 million for it; Pickens wants to begin construction on the $1.2 billion pipeline right afterward. It should take about three years to complete. If all goes according to plan, Mesa will be able to pump enough water to satisfy the needs of some 1.5 million Texans every day.

Pickens hopes to strike a deal with Dallas or the urban areas around it before Mesa starts building the pipeline. "Eventually they will need it," he says. So far, though, the talks might best be characterized as preliminary. "We continue to meet with Pickens' staff and engineers to get a better understanding of the proposal and so they can understand what our needs are," says Mike Rickman, assistant general manager of the North Texas Municipal Water District, which supplies water to 13 cities north and east of Dallas. "Mesa has a lot of water. But how much will it cost to buy it and deliver it?" Rickman says that at some point he would have to consider the consequences for the Ogallala: "Does it make sense to take water from an arid portion of the state? We don't want to harm our neighbors out there."

In Roberts County, people hold on to the hope that pumping from the Ogallala can be controlled. In 1998, as Pickens and local water utilities began buying up water rights, the groundwater conservation district placed some restrictions on the rule of capture that it calls the 50-50 rule: Anyone who receives a new permit to pump can draw down the aquifer by only 50% over the next 50 years. Later, an additional limit of 1.2% per year was set. These essentially manage the depletion of the Ogallala under Roberts County; there, it is replenished at a rate of only 0.1% a year. Williams, who put the rules into place, says: "It's like taking dollar bills out of your bank account and putting nickels back in. Even with a big bank account, there's an end. That's pretty much what's happening in the Ogallala."

Pickens has promised to abide by the 50-50 rule. "I don't have any concerns about depleting the aquifer. All I'm doing is selling surplus water," he says. "I'm not about to drain all the water out of Roberts County. I have my ranch there. But I could sure take it down 50% and not hurt anybody. And it could make a lot of people a lot of money."

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Berfield is an associate editor at BusinessWeek .