Aug. 19--The gas wells enter the earth's surface for more than a mile, then make an abrupt turn for another few thousand feet to tap gas under urban developments.

Along the way, steel surface casing prevents contamination of fresh water in the ground, steel tubing allows the oil or gas to travel to the surface, and steel production casing acts as a protective layer underground.

But the steel pipe used in these wells is becoming more expensive and harder to get for oil and gas companies, putting a drag on production and driving up the cost and time it takes to plan the wells.

And the effect on North Texas could be significant, particularly because gas drilling in the Barnett Shale requires the complex rigs that snake into the ground horizontally.

"When you've got something that costs that much money for each well, definitely it's making people think twice before they make the final decision to go ahead and drill," said Alex Mills, president of the Texas Alliance of Energy Producers.

The rising cost of materials and the consolidation of steel pipe suppliers have collided with growing drilling demand, which has been spurred by oil and gas price increases. And many new wells require more pipe than the ones before the recent boom.

"The deeper you go, the more drill pipe you need," said Michelle Michot Foss, chief economist and head of the University of Texas Center for Energy Economics. "Generally, as prices rise, people start going after the riskier stuff."

The riskier stuff includes methane coal beds and shale -- layers of clay that are harder to extract gas from.

Barnett Shale

Projects in the Barnett Shale, one of the country's biggest natural gas plays, use horizontal drilling, in which drill pipes turn inside the rock to tap into natural gas.

The technique is what is making the Barnett Shale such a profitable resource.

Jeff Tillery, an analyst with Tudor, Pickering, Holt and Co., said supply of the steel pipe is the lowest he's ever seen.

Distributors are keeping less than four months' supply today, compared with six months in 2006.

Oil and gas companies buy steel pipe from distributors, which get their supply from steel mills.

The steel mills make the pipe using either scrap steel or iron ore, both of which have seen significant price increases, driven by demand from developing nations such as China.

And that's driven up the price of steel pipe for oil and gas rigs.

Additionally, manufacturers miscalculated the expansion in the number of rigs.

Roland Balkenende, U.S.