A New Day at IPANM

UPDATE & REMINDER: State’s New Penalty Authority takes effect Jan. 1, 2020

IPANM (Dec. 8, 2019) – IPANM is reminding operators that New Mexico’s Oil Conservation Division (OCD) will have new authority to fine operators beginning on Jan. 1, 2020. For that reason, operators need to address lingering violations, or they could face fines in 2020.

UPDATE:  Per a recent meeting between IPANM Board President Kyle Armstrong and Executive Director Jim Winchester, OCD has outlines the main areas they will be looking to enforce compliance. These include, but are not limited to:

  • Spills & Open Spill Remediation Efforts that have not be closed or reported closed
  • Illegal Dumping
  • Venting & Flaring Violations and/or reporting inaccuracies and/or going beyond set venting/flaring deadlines
  • Paperwork Issue: OCD indicated numerous “C-” reports are out of date with operators
  • Unreported or outdated C-115 and C-104 Forms
  • Out of date Financial Assurance Reporting: OCD says operators are responsible for making sure all new bonding is up to date.
  • Don’t wait for notification or warning letters.  New wellsite bonding levels were due last summer.

What you also need to know to prepare for the new authority:

  • New penalty provisions go into effect and maybe enforced effective January 1, 2020. It is IPANM’s understanding that these new authorities will allow OCD to notify operators on January 1st of unresolved past violations and issue a letter instructing compliance within 30 days. If no action is taken to address the violations within 30 days, OCD will have the option to assess daily fines retroactive to the date of notification.
  • This new authority represents a major paradigm shift in regulatory enforcement in New Mexico. IPANM has learned that New Mexico District Offices are reviewing well files and earmarking violators and violations to begin issuing violations at the beginning of the year.
  • It is imperative that operators get their well sites into compliance before January 1, 2020.  Each member should check individual wellsite data using the OCD Online Wellsite search portal.
  • IPANM recommends members be pro-active at your wellsites, as opposed to taking an approach to wait and fight any violations that are are issued after Jan. 1, 2020.
  • IPANM will push for rule clarification of when and how penalties will be enforced. However, the current OCD draft language leaves a great deal of the penalty discretion in the hands of the OCD.

For more information, and to find out how IPANM is representing independents during the upcoming Administrative Penalties rulemaking hearing, please see our recent update to members.