Rio Grande Sun (January 25, 2024) – Editorial Submitted By Jim Winchester, IPANM Executive Director

New Mexico Governor Michelle Lujan Grisham and her political appointees in the New Mexico Energy, Minerals, and Natural Resources Department announced last summer their intention to overhaul the New Mexico Oil & Gas Act. To overhaul or modernize some of the provisions certainly is an admirable idea, and the members of the Independent Petroleum Association of New Mexico (IPANM) are grateful to the administration for engaging in stakeholder discussions this past year. Regretfully, the proposals that came out of that discussion go too far and did not account for potentially devasting impacts on small producers and, by association, the Oil and Gas industry in New Mexico.

In this current session, HB133 Oil and Gas Act Reforms has been introduced to push through statutory changes through the New Mexico Legislature that formalize the administration’s new regulatory proposals. In short, HB133 takes a bulldozer to existing regulations in favor of extreme, overzealous environmental measures. The attacks against industry are multi-faceted. The administration wants to raise financial assurance bonds 40 times, increase civil penalties with unlimited monetary discretion, block the ability for smaller producers to acquire mid-to-end-of-life production wells, increase paperwork filing fees 5 times, adopt more restrictive gas capture rules than the already existing “strictest” state methane rules in the country, establish one half-mile setback zones around all wells, and restrict freshwater use to potentially unworkable levels.

Any one of these provisions, if accepted, has the potential to unleash the state’s activist regulators on select producers to the point of forcing them out of business. Those multi-generational, state-based companies who can survive may need to make the hard decision that oil and gas production in New Mexico is simply too burdensome, and head to other states.

For an administration that proclaims to be small business friendly, the extreme regulatory proposals in HB133 run counter to that claim. HB133 needs more analysis to determine the true impact on small New Mexico producers, overall Oil and Gas industry in New Mexico, and the 50 percent of New Mexico’s state budget that depends on Oil and Gas revenue. Urge your local legislators to kill the very destructive bill HB133.

Jim Winchester is the Executive Director of the Independent Petroleum Association of New Mexico

IPANM: HB133 Will Inflict Serious Damage To Small Producers