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Trump's BLM Budget Request to Help Oil & Gas Programs
Carlsbad CurrentArgus (Feb. 12, 2020) - President Donald Trump requested $1.2 billion to fund the BLM in fiscal year 2021,
Gas Tax Bill, Opposed by IPANM, Goes Down
ABQ Journal (Feb. 10, 2020) - Legislators on a key House committee rejected a proposal Monday that called for sharply
Permian Roads Receive Millions in State Funds, Projects Underway
Carlsbad CurrentArgus (Infrastructure) Feb. 3, 2020 - Three of southeast New Mexico’s most notorious oilfield roads are in for major
Oil & Gas Industry Adds $3.1 Billion To State Revenues
The Albuquerque Journal (Jan. 16, 2020) — State revenue from oil and gas activity soared to a record $3.1 billion
Buffer Zone To Stay Around Chaco Culture National Historical Park...For Now
Farmington Daily Times (Dec. 24, 2019) - The fiscal year 2020 federal spending package will prevent any oil and gas leasing
EXECUTIVE DIRECTOR: Busy season for IPANM
Dear Members, In my 2+ years serving as your Executive Director, I’ve never seen a period of time that’s been
IPANM Takes BLM Rights-of-Way Bonding Concerns To Leaders
IPANM - Several discussions between IPANM and BLM New Mexico as well as BLM Headquarters in Washington D.C. have led
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
IPANM PRESIDENT: The Year 2020 Will Be A Rulemaking Year Filled With Challenges
Dear Members, Best wishes to you, your employees, family and friends this holiday season. I hope you can join us
Southeast Regional Update: Winter 2019
As everyone should be aware by now the State Land Office is pushing for approval of their new initiatives, including

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Independent Petroleum Association of New Mexico

IPANM Administrative Offices
P.O. Box 6101, Roswell, New Mexico, 88202
Bus. - 575-622-2566 | Fax. - 575-622-2566

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Independent Petroleum Association of New Mexico

IPANM Administrative Offices
P.O. Box 6101, Roswell, New Mexico, 88202
Phone 575-622-2566

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Website designed by Siarza Social Digital

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Carlsbad CurrentArgus (Feb. 12, 2020) – President Donald Trump requested $1.2 billion to fund the BLM in fiscal year 2021, with $199.3 million earmarked for the agency’s Energy and Minerals programs, as fossil fuels and renewable energy generated the highest revenue of all uses of BLM-owned land.

About $139 million will fund the BLM’s oil and gas programs, read a news release, while $29.5 million was appropriated for renewable energy to support wind, solar and geothermal energy development.

Trump’s BLM Budget Request to Help Oil & Gas Programs

 

ABQ Journal (Feb. 10, 2020) – Legislators on a key House committee rejected a proposal Monday that called for sharply increasing the gasoline tax as part of an effort to reduce pollution and improve New Mexico’s roads.
It would have been phased in over time, eventually pushing the gas tax from 17 cents a gallon to 47 cents.
Members of the House Appropriations and Finance Committee voted 14-1 to table the bill, a procedure that prevented it from advancing to the full House for consideration.

House panel blocks higher gasoline tax
ABQ JOURNAL EDITORIAL:  Gas Tax a Bad Idea

 

 

 

Carlsbad CurrentArgus (Infrastructure) Feb. 3, 2020 – Three of southeast New Mexico’s most notorious oilfield roads are in for major rebuilds in the coming years as the New Mexico Department of Transportation aims to use surplus state funds from oil and gas revenue to ensure workers in the industry can travel safely through the region. In a Monday meeting with Carlsbad area business leaders in Santa Fe, New Mexico Cabinet Secretary of Transportation Michael Sandoval said a $130 million project to update U.S. Highway 285 from the Texas State Line 22 miles north to Loving was fully funded.

Permian Roads Receive Millions in State Funds, Projects Underway

 

The Albuquerque Journal (Jan. 16, 2020) — State revenue from oil and gas activity soared to a record $3.1 billion in fiscal year 2019, up 41% from the $2.2 billion generated the year before, according to the latest annual report from the New Mexico Tax Research Institute.

Industry-generated income accounted for 39% of all general fund revenues, the highest share in recent history.

New Mexico Earned $3.1 Billion in Oil & Gas Revenue in FY 2019

 

Farmington Daily Times (Dec. 24, 2019) – The fiscal year 2020 federal spending package will prevent any oil and gas leasing activities on federal lands within 10 miles of Chaco Culture National Historical Park.  However, the 1-Year Moratorium on new leasing around Chaco Canyon is still scheduled to expire in September 2020.

The spending package, which includes a dozen bills, passed the U.S. Senate last week and was signed by President Donald Trump. The buffer zone is included in the Interior, Environment and Related Agencies appropriations bill.

IPANM continues to monitor this important issue and supports safe drilling of horizontal wells within the arbitrary “buffer zone”, as drilling and associated oil & gas activities have NO effect on the perseveration of Chaco Canyon National Historic Monument.

Farmington News: Federal Spending Plan Included Buffer Zone at Chaco

Dear Members,

In my 2+ years serving as your Executive Director, I’ve never seen a period of time that’s been so busy on the regulatory and rulemaking front. This newsletter alone is pretty overwhelming with updates on so many different issues. For that reason, I encourage you to take time carefully read through all of the updates so that you are up to speed on all of the necessary regulatory requirements and changes.

As we found out through recent meetings, the state’s regulators are not necessarily alerting operators to the changes. They feel the responsibility lies with the operators alone to proactively check their websites for updates. We have provided you lots of links in this newsletter to find the information necessary to have you prepared. As a warning, I get the impression the administration is gearing up to issue administrative penalties as soon as they get their new authority on January 1, 2020. Another good way to keep up to date is to continually check our Exclusive News webpage for operator updates.

On the federal front, I’d like to direct your ongoing attention to a series of important meetings IPANM has instigated regarding changes to BLM Rights-of-Way Bonding. We feel Washington D.C. is not aware of the dire implications of new implications of huge bonding levels being forced on operators, and we’re knee deep in a lobbying effort to get immediate changes. Our efforts have drawn the support of friends over at NMOGA, who are united with us in this effort.

The 2020 Session is a month away. You can keep up to date with daily updates to our Legislative Tracker on our website. The good news: It’s a 30-day session focused mostly on budget issues. The bad news: Expect bills attacking our industry. Our greatest threat continues to be an expected bill to ban fracking. It will not go anywhere, but will be damaging enough by the media and committee discussions. I recently presented on the dangers of a state or federal fracking ban at a national conference in Arizona. We need to continue to align with other industries to explain the dangers of fracking bans. A timely study just released highlights this threat in New Mexico.

But even these updates don’t include the extensive work done by our Methane Subcommittee and IPANM’s eight Methane Advisory Panel participants. My sincere thanks for their hours of work in Santa Fe these past few months. Let’s hope it yields fair Methane rules that take into special considerations the economics of marginal wells and independent producers.

I hope to see you all at our Christmas and New Year’s events. Blessings to you, your employees and families this Christmas season!

Regards,

 

–jim

 

 

IPANM – Several discussions between IPANM and BLM New Mexico as well as BLM Headquarters in Washington D.C. have led to a recommendation that operators in New Mexico tentatively hold off on updating BLM Rights-of-Way Bonding updates, despite recent directives and information from the BLM Farmington Field Office and Carlsbad Field Office.

IPANM spoke with U.S. Department of Interior Deputy Director Casey Hammond on Dec. 3, 2019 over a conference call to further discuss issues operators were having attempting to renew ROW bonds out of the Farmington Field Office.

Please see IPANM’s follow-up letter to the BLM for further updates and guidance on the situation as it currently stands:  IPANM’s Dec. 4, 2019 Letter to Dept. of Interior  RE:  ROW Bonding

IPANM Meets with BLM about ROW Bonding Issues in NW (October 31, 2019 Update)

 Feds appoint Spisak as new BLM New Mexico State Director

 

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.

Dear Members,

Best wishes to you, your employees, family and friends this holiday season. I hope you can join us in person at either our Southeast IPANM Christmas Party in Roswell on Dec. 18 or our IPANM New Year’s Happy Hour on Jan. 8, 2020. Feel free to invite prospective members, as these are great recruiting events. Of course, a special thanks to our sponsors for these fun events!

The upcoming year is shaping up to be extremely busy on the regulatory front for the two state agencies that have the most authority over Oil & Gas operations in New Mexico: the New Mexico Energy, Minerals and Natural Resources Department (EMRND) and New Mexico Environment Department (NMED). For that reason, I’ve worked closely with our Executive Board and Executive Director Jim Winchester to meet with both cabinet secretaries and key directors to outline the year ahead. Members need to be aware of many of the upcoming hearings and regulatory changes that are summarized in this newsletter.

I have also continued to serve as an industry representative on an advisory board to State Land Commissioner Stephanie Garcia-Richard. IPANM has been actively responding to a number of substantive actions directed at our industry on the part of the State Land Office. I continue to ask all members to reach out to me directly to report back on any issues you may be experiencing while conducting business with the State Land Office.

Finally, we are now just weeks away from the 2020 Legislative Session. We are preparing for another important session to protect, defend and promote our industry and independent producers. I encourage you to visit Jim or I while we work the hallways of the Roundhouse in Santa Fe from Jan. 21 to Feb. 20, 2020. Regardless of their party affiliation, we need to constantly remind elected leaders that this second consecutive billion-dollar state budget surplus is owed almost entirely to our industry.

As we wrap up 2019, I thank you for your support of IPANM and our many events and efforts. Please don’t forget to renew your membership and consider donating to our legal fund. I cannot underscore enough that we need your support to vigorously respond to multiple proposed new rules, each of which will disproportionately impact independent operators. Securing the necessary legal representation for these hearings is critical, and we need your support in 2020 to ensure your concerns are heard.

 

Regards,

Kyle
Kyle Armstrong, IPANM President

As everyone should be aware by now the State Land Office is pushing for approval of their new initiatives, including Pore Space Density, Proposed Cultural Properties Rule and the Disposal Wells Bonding amounts. Jim has already given the details for each initiative, I wanted to just touch base on some concerns for Operators in the SE.

 

 

Pore Space Density

  • Questionable legality since the laws about who owns the pore space is not clearly defined.
  • Will create hurdles between Operators and ranchers and private land owners, since they will certainly be interested in receiving payment for “damages” to their pore space as well.
  • SLO is trying (and succeeding) to get Operators to settle on a discounted amount from their valuation table, in return the SLO will not challenge a SWD application at the OCD hearing. This potentially creates a precedent that can be used against objections to this rule later.

Proposed Cultural Properties Rule

  • This can kill industry by extending the time is takes for any action on state lands.
  • Creates incentive for backdoor dealing with tribes.

Disposal Well Bonding amounts

  • Ridiculously high amount for Deep well Reclamation bond ($250,000).
  • Operators will prematurely plug wells that have value.

Don’t forget we will be having the IPANM Southeast Christmas Party on December 18th at the Liberty in Roswell. We will get a chance to meet Spur Energy Partners’ CEO Jay Graham!

I also want to pass along some sad news about a passing of a longtime member and Landman. John Michael Richardson passed away swiftly and unexpectedly on November 6th, 2019 from a sudden cardiac arrest. I hope everyone will keep him and his family in your prayers, he was truly a good man and he will be missed.