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January 22, 2021 5:15 PM, EST

Elon Musk’s SpaceX Plans to Drill for Natural Gas Near Texas Launchpad

SpaceX's Starhopper rocket sits at the company's launch site in Texas in September 2020.SpaceX's Starhopper rocket sits at the company's launch site in Texas in September 2020. (Veronica G. Cardenas/Bloomberg News)

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Elon Musk recently moved to Texas, where he launches some of his rockets and is building a battery factory. Now, for good measure, he plans to drill for natural gas in the state.

The billionaire’s SpaceX intends to drill wells close to the company’s Boca Chica launchpad, it was revealed during a Jan. 22 hearing before the Railroad Commission of Texas, the state’s energy regulator.

Production has yet to start because of a legal dispute between the SpaceX subsidiary Lone Star Mineral Development and another energy company. Tim George, an attorney representing Lone Star, said at the hearing that SpaceX plans to use the methane it extracts from the ground “in connection with their rocket facility operations.”

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While it’s unclear what exactly the gas would be used for, SpaceX plans to utilize super-chilled liquid methane and liquid oxygen as fuel for its Raptor engines. The company’s Starship and Super Heavy vehicles are tested at Boca Chica, and orbital launches are planned for the site.

George declined to answer further questions and hung up when called for comment. SpaceX didn’t immediately respond to a request for comment.

Formed in June 2020, Lone Star bought the 806-acre La Pita oil lease from Houston-based Sanchez Energy, which was later renamed Mesquite Energy Inc. after exiting bankruptcy. Financial terms for the deal weren’t disclosed, but the SpaceX subsidiary’s drilling plans have been called into question amid a dispute with Dallas Petroleum Group, which claims ownership of some inactive wells sitting on the same land.

Dallas Petroleum took the dispute to the Railroad Commission in August. Two months later, it sued three companies — Sanchez Midstream Partners LP, Sanchez Midstream Partners GP LLC and Sanchez Oil & Gas Corp. — in state court in Brownsville, Texas.

That lawsuit prompted SpaceX’s land-acquisition arm Dogleg Park LLC to intervene in November. In a filing to the court, Dogleg said Dallas Petroleum locked SpaceX out of the property and asserted ownership claims for the “sole purpose of extorting money from SpaceX.”

Dallas Petroleum Group denies the allegations and maintains it has ownership of both the wells and the 24 surrounding acres.

Musk said in December he relocated to Texas to focus on SpaceX’s Starship vehicle and Tesla Inc.’s new Gigafactory, which is being built near Austin. On Jan. 21, the billionaire tweeted that he plans to donate $100 million toward a prize for the best carbon-capture technology. His past comments have suggested that he wants to use the tech to produce synthetic carbon-neutral rocket fuel. Until then, fossil fuels will power SpaceX rockets.

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