Coalgate Oklahoma is booming. (Ada, Commerce: budget, debt, hotel)

[peggydavis]

Natural gas fuels economic development for Coalgate

Related Information

The Country Charm Inn has been having a facelift and expansion since drilling activity increased in the area. By Adam Wilmoth, For the Oklahoman






By Adam Wilmoth
Special Correspondent
COALGATE — Just three years after the largest employer in Coal County closed shop, southeast Oklahoma is bustling with economic activity unseen in decades.




"When Wrangler closed here in Coalgate, a lot of people thought this place would dry up and blow away,” City Manager Roger Cosper said. "The Ethan Allen plant also has reduced its number of employees in the county.”

Still, Coalgate's economy is booming. The community's sales tax collections more than doubled over the past two years. A new restaurant opened in Coalgate. A 12-room hotel is adding another 15 rooms; a new 60-room hotel is set to break ground this fall. Property values have soared over the past two years, and two new housing additions are under construction.

While manufacturing jobs have been moving out of Coal County, the local economy is turning to an industry common in Oklahoma, but not particularly familiar with that county and the surrounding areas.
The economic boom has been fueled by the natural gas industry. Over the past decade, the industry has discovered how to recover natural gas from the hard shale the lies deep below the state's surface. Technological improvements and higher commodity prices led to a massive drilling effort in one of the few parts of the state that did not benefit from previous oil and natural gas booms.
Increased activity in the county led Randy Elkins, his brother James and James' wife, Barbara, to open Esther's Kountry Grill in March.

"Business has been steady ever since we opened,” Randy Elkins said. "A lot of our business is because of the oil field. We've accommodated them by starting buffets earlier in the day because they don't have time to wait for their food to be ordered and served.”

Business is so strong Esther's is planning a new banquet hall adjacent to the existing business.

Elkins' restaurant could be seen as competition to Coalgate's existing restaurants, but Rebecca Washburn, owner of the Brandin' Iron Cafe, welcomed the additional business to town.
"That was a relief,” Washburn said. "We were strapped because we were one of the only restaurants here. When the oil and gas activity started, it was too much for us to handle. We couldn't take care of them all. More restaurants also create more variety, which helps the entire community.”

Washburn also owns Coalgate's County Charm Inn, which is undergoing an expansion that will more than double its capacity.
"When I built the hotel in 2000, people told me it would go under,” Washburn said. "It made its own payments from day one just off the local and tourism business. Now I can't accommodate the local people for weddings and funerals because all my rooms are booked by the oil field.”

Increased activity in the county has affected numerous other businesses in the area as well. Business is booming at Sonny's Grocery, owner Jack Bryant said.
"When it was hot this summer, they've been coming in and buying all the Gatorade and water and ice we have on the shelves,” he said.

The drilling boom also has created jobs throughout the area.
"For the last 40 to 50 years, it's been difficult for people to find jobs in this area,” said Mary Riley, vice president of the Coal County Chamber of Commerce. "The young men in the area would drive off to find pipeline jobs and oil rig jobs. Now all those people who drove away to get jobs can stay home and work in this area. That has had a dramatic effect on our locals, just having a job in town. And that means they're spending their money in Coalgate instead of going somewhere else.”

Not all the effects of increased natural gas drilling have been positive.

"The county doesn't have the money or the personnel to keep up with damage to the county roads,” said Eddie Burns, who has lived in Coalgate for 55 years. "That's the only negative I can say about it. But as for the economy, I'm tickled to death to see the economic benefit. I'm glad they're here, but our county roads are suffering. It's people who live in the country that are suffering for everybody else.”
The heavy trucks and their wear on county roads have attracted the attention of the county governments, Coal County Commissioner Mike Hensley said.

"We're trying to stay up with them and take care of them to the best of our ability with the increased funds we're receiving,” Hensley said. "The benefits will outweigh the negatives in the long run. Right now, some people are upset, but if they wait with us, we'll get the roads repaired.”

Natural gas companies also have helped commissioners rebuild and repair roads in the area, often using mud from drilling operations to resurface gravel roads.
"We are getting quite a bit of help from most of the oil companies,” Coal County Commissioners Johnny Ward said. "They've been pretty good about coming back and resurfacing and regraveling the roads. We're tying to work with them and show them some hospitality that we definitely appreciate them being here. Then they return the favor, recognizing we have school bus routes and mail routes being torn up. We have a pretty good partnership and working relationship with them.”

While the community is enjoying its newfound energy money, civic and business leaders already are preparing for the possibility that the oil and natural gas industry could quickly dry up again as it did about 25 years ago.

"We here at the city are treating this as a windfall,” Cosper said. "We haven't changed our budget much so if it goes away it's not going to wipe us out. We're certainly not dependent on the drilling money. We're using it for capital projects, paying off debt and those types of activities.”

And while the energy producers have made no promises about the future, most have said they plan to significantly increase their drilling activity over the next few years.
"It has certainly been a shot in the arm,” Cosper said.

[case44]

That's amazing news about Coalgate. It's nice to know that some small towns don't dry up and wither. They are proactive in finding new ideas, and that's a good thing.

[peggydavis]

It shows how fast things can change. In another thread people are talking about Ponca, but with some luck things can change there too.

It is good that the government in Coalgate is not taking this for granted and is using the extra money for debt paydown, and capitol projects. I hope the drilling companies come through with their promises to fix the roads.

[TheresaV]

My aunt actually just sent me that article, she lives in OKC and we have land in Lehigh. Do you know or have any information as to how the drilling is going in Lehigh. We have no way of knowing if they're drilling around us or not.

[peggydavis]

The main activity is north of Coalgate as far as I can tell, but if you are in Coal county that is a good sign. If you get a check in the mail, don't take it. That will be a lowball offer. The leases in the area are at least $1,000 per acre.


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