NM killing goose that lays golden eggs


What is the No. 1 source of ed­u­ca­tion and state gov­ern­ment fund­ing in New Mex­ico? What is our No. 1 in­dus­try for em­ploy­ment, high-pay­ing jobs and tax rev­enue? What is the spe­cific source of the cur­rent $1.1 bil­lion bud­get sur­plus?

If you said that the oil and gas in­dus­try is the “Golden Goose,” you would be cor­rect. So why is the gover­nor try­ing to place nat­u­ral gas pro­duc­tion on the en­dan­gered species list?

Since the be­gin­ning of the year, we’ve seen the new ad­min­is­tra­tion de­clare war on oil and gas pro­duc­ers, and at the same time pro­pose a 13 per­cent bud­get in­crease. That’s like ex­pect­ing to win the lottery ev­ery year!

Un­for­tu­nately, the gover­nor has an­nounced plans to in­sti­tute a Meth­ane Rule, and the first or­der of busi­ness for her new Oil Con­ser­va­tion Com­mis­sion mem­bers is to undo a pre­vi­ous de­ci­sion to up­date the Blanco/Mesa Verde Pool Rule. The Pool Rule al­lows ex­ist­ing gas wells to be re­worked to pro­duce nat­u­ral gas from mul­ti­ple gas strata pock­ets.

If the Pool Rule were left in place, it would re­duce the num­ber of new wells drilled and give op­er­a­tors an in­cen­tive to re­fur­bish old, leaky wells. This bril­liant strat­egy would also min­i­mize the amount of new sur­face dis­tur­bance from in­creased well lo­ca­tions. This wasn’t acceptable to the Santa Fe spe­cial in­ter­ests.

In a rushed and con­trived man­ner, a new OCC com­posed of “act­ing” of­fi­cials — with­out any oil and gas reg­u­la­tory ex­pe­ri­ence — car­ried out a po­lit­i­cal in­jus­tice on the peo­ple of New Mex­ico. No pub­lic com­ment was al­lowed or ev­i­dence pro­duced. Op­po­nents of the pool rule even ad­mit­ted that they didn’t file their mo­tions prop­erly. The re­sult of these two ac­tions is that the strug­gling north­west econ­omy is be­ing placed un­der even more pres­sure, and the state bud­get will suffer right along with us.

Re­cent ev­i­dence clearly in­di­cates that oil and gas pro­duc­ers have achieved suc­cess in cap­tur­ing more meth­ane than ever be­fore, due to tech­no­log­i­cal ad­vances that have been de­vel­oped by the in­dus­try. Ac­cord­ing to the EPA, meth­ane emis­sions have fallen by 47 per­cent in the San Juan Basin and 6 per­cent in the Per­mian Basin from 2011-2016, and emis­sions dropped by an­other 6 per­cent be­tween 2016 and 2017. New Mex­ico state reg­u­la­tors re­ported a de­crease of more than 50 per­cent of meth­ane be­ing vented or flared in 2017.

To­tal emis­sions fell by nearly 830,000 met­ric tons, ac­cord­ing to the EPA’s green­house gas re­port­ing pro­gram. That low­ered over­all re­leases in both basins from a com­bined 13.78 met­ric tons in 2016 to 12.95 met­ric tons last year. As the statis­tics point out, over­all meth­ane emis­sions have fallen dra­mat­i­cally over the past 8 years while pro­duc­tion has in­creased sub­stan­tially dur­ing that same time pe­riod.

Re­vers­ing com­mon-sense de­ci­sions means the pro­duc­tion re­turns on the re­main­ing life of the well will not cover the cost of the retro­fit. Within 15 months, the pro­posed emis­sion stan­dards would ef­fec­tively force thou­sands of eco­nomic and pro­duc­tive wells to shut down pre­ma­turely. It would force wells into tem­po­rary aban­don­ment and a manda­tory shutin, and would de­prive the state and our schools of these rev­enues.

The state can best con­trib­ute to a re­duc­tion in meth­ane emis­sions by in­cen­tiviz­ing the in­dus­try with the Pool Rule and by pro­vid­ing for stream­lined per­mit­ting pro­cesses and rights of way to en­sure max­i­mum gas cap­ture by fur­ther re­duc­ing vent­ing and flar­ing.

It is trou­bling to see the dis­con­nect of our eco­nomic de­pen­dence on oil and gas rev­enue and the abil­ity of gov­ern­ment of­fi­cials to re­sist pan­der­ing to spe­cial in­ter­est groups in Santa Fe.

At­ten­tion to the state’s eco­nomic well-be­ing will just have to wait un­til the next bud­get short­fall. Hope­fully our goose won’t be com­pletely cooked by then.

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