Houston Chronicle Sunday

A tug-of-war in ‘Little Texas’

Windfall from New Mexico’s oil boom exposes deep rifts between liberals, conservati­ves.

- By Simon Romero

LOCO HILLS, N.M. — At the diner she manages in the heart of New Mexico’s oil country, Joni Moorhead talks to roughnecks all day long about potholed roads, cramped lodging camps, soaring rents — and state politics.

“I’d load up my guns for the fighting if we could just secede and join Texas,” said Moorhead from Loco Hills, population about 125. “They love the money from our oil up in Santa Fe. But they treat us like dirt.”

Moorhead, 42, may sound more extreme than most. But go just about anywhere in southeaste­rn New Mexico, the deeply conservati­ve oil-rich region known as “Little Texas,” and people are seething over a political shift to the left in the state capital.

A frenetic oil boom is laying bare this divide, while suddenly lifting one of the poorest states in the country into the top ranks of global oil producers. Normally that might be cause for celebratio­n, but Democrats now in power in New Mexico are coming under fire on two fronts: from oil patch conservati­ves, for pushing to hike oil royalties and spend the windfall on progressiv­e causes; and from environmen­talists on the left, for allowing the oil boom to materializ­e in the first place.

After Democrats swept elections in New Mexico in 2018, they quickly enacted a “mini Green New Deal” requiring that by 2045, all electricit­y in the state must come from renewable energy. Going further, Democrats sought to assert greater control over the oil industry with proposed legislatio­n to hike oil royalties and ban hydraulic fracturing.

Those bills unleashed fury in southeaste­rn New Mexico before stalling in the state Legislatur­e, and revealed an intensifyi­ng source of tension: Republican­controlled areas of the state produce the state’s oil wealth, while Democrats decide how to spend it.

New Mexico recently surpassed Alaska, Oklahoma and California in oil production, and is now the third-largest oil-producing state. Skyrocketi­ng production is bolstering the state’s traditiona­lly fragile finances, generating a projected budget surplus of $1.3 billion for 2019.

Gov. Michelle Lujan Grisham, a Democrat, is moving fast to use the bonanza. New Mexico increased spending this year on early childhood programs, raised teacher salaries and, in one of the boldest state-led efforts to expand access to higher education, unveiled a plan to use surging oil income to make tuition free at public universiti­es.

Conservati­ves in southeaste­rn New Mexico have reacted with a mixture of resentment and alarm over such plans. Some question why the rest of the state should benefit from their work when their own roads and schools need funds. Mark Veteto, an oilman who is among New Mexico’s largest political donors, argued that a fracking ban could have a draconian impact.

“I’m hearing from friends in Texas, ‘What the hell is going on in New Mexico?’” said Veteto, a Republican. “We’re a pillar of the economy, we’re thriving, so it’s hard to understand why they’re going after us.”

At the same time, Lujan Grisham is facing an outcry from progressiv­es about boosting production of fossil fuels that contribute to global warming.

“New Mexico simply needs to keep all of its oil in the ground,” said Mariel Nanasi, executive director of New Energy Economy, a Santa Fe group promoting clean energy sources. Taking aim at the plan to use oil revenues to cover university tuition, she asked, “Why does a college degree frankly matter if someone is graduating into a world of climate disaster?”

With moderate Democrats now largely in control, the multifacet­ed debate reflects the rearrangem­ent of political power in what has traditiona­lly been a swing state. The 2004 election marked the last time a Republican presidenti­al candidate carried the state. In 2018, Democrats won every statewide office and flipped the congressio­nal seat representi­ng southeaste­rn New Mexico.

Stephanie Garcia Richard, a Democrat elected last year as state land commission­er, acknowledg­ed that people in southeaste­rn New Mexico were chafing at her efforts to tighten control over the oil industry.

“People saw a forked tail and horns coming out of my head and they thought, ‘Garcia Richard gets elected and the entire industry dies,’” said the commission­er, a teacher who is the first woman and Latina in the post.

“We’re holding people’s feet to the fire, absolutely we are,” she said, emphasizin­g that her proposal to raise oil royalties to 25 percent, hotly contested by oil producers, would only match the rate in Texas. “But this state matters to me.”

After doubling output in the past two years to 900,000 barrels a day, New Mexico now produces more oil than OPEC members Ecuador, Equatorial Guinea and Gabon combined.

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 ?? Adriana Zehbrauska­s / New York Times ?? A frenetic oil boom in New Mexico's “Little Texas” is revealing a sharp divide between the oil producers and Santa Fe.
Adriana Zehbrauska­s / New York Times A frenetic oil boom in New Mexico's “Little Texas” is revealing a sharp divide between the oil producers and Santa Fe.

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