Gaslit: The last of a series of four by the Howard Center for Investigative JournalismArizona States Walter Cronkite School of Journalism and Mass Communication explains the flaring and venting of natural gases by oil and gas companies in over a dozen states.
COUNSELOR, New Mexico. Bright pink flags mark newly cleared land. Rubber water hoses snake along roadside and pump Jacks are visible at the horizon. These are all signs that the state’s growth as an oil-and-gas hub.
Despite the expansion of production in New Mexico, the state is working to reduce its global warming footprint by imposing new rules that require oil companies to reduce the amount methane-rich natural gases they release into the atmosphere. They also have to track their emissions more accurately.
According to the U.S. Energy Information Administration, New Mexico was ranked second in crude oil production behind Texas. It is also among the top natural gas producers in the country. Each year, New Mexico’s budget is pumped more than $2B by oil and gas companies.
Democratic Gov. Michelle Lujan Grisham, who campaigned for clean energy and is running to reelection in 2022, will have to walk a fine line between climate-conscious regulations as well as preserving an industry that is vitally important for her state’s economy.
Soon after taking office in 2019, governor ordered the Environmental and Energy, Minerals and Natural Resources, and Minerals and Natural Resources Departments to oversee the development and enforcement of strict regulations to reduce methane emissions. Methane is 80 times more powerful than carbon dioxide in the short term. Scientists believe that cutting methane emission is the best way to slow down global warming.
The state issued 6,970 drilling permits per year in the first three-years of Lujan Garcia’s administration. This is more than the Republican predecessor. Nearly 2,800 of the 51,000 active oil-and gas wells were completed under Lujan.
You’ve got the governor wanting it both ways, said Tom Singer, senior policy adviser for the Western Environmental Law Center. She loves the money. She is passionate about the oil and gas industry.
Three requests for an interview were not responded to by the governor’s office.
New Mexico is a place where regulation and growth are at odds. This includes the northwest San Juan Basin which has the largest natural gas reserves in the United States and the Permian Basin which borders Texas to the east and is the most prolific oil-and-gas region in the state.
It is evident most clearly along Route 550. From southwestern Colorado, the highway runs through the San Juan Basin, past small towns like Counselor, and along the eastern edge Navajo Nation.
A sign outside Counselor welcomes guests to what environmental activists call an Energy Sacrifice Zone. Unpaved roads that run parallel to the highway are dotted with oil and gas wells. They disrupt desert views of juniper brush and canyons, which are framed by mesas.
More than 21,000 active wells can be found in San Juan, Rio Arriba or Sandoval counties, northwest New Mexico. They are located in the Greater Chaco region, which is rich in Indigenous history.
Mario Atencio looks for the wells whenever he drives his pickup truck on the back roads that cross Route 550. He stopped at a patch that had been recently cleared and marked with pink flags during a tour of the region in October 2021. Federal government records reveal that plans for the site include at most two horizontal oil-and-natural gas drilling wells as well as a well pad, access road, and a pipeline corridor.
This is how it looks: Atencio stated that the front lines of the great battle against climate change are what Atencio described. It’s very quiet; it’s very lonely.
Atencio, a legislative assistant to the Navajo Nation Council knows the area well, having spent his childhood summers in Counselor with his family. After seeing the effects of oil and gas operations, Atencio became one of the state’s most prominent environmental justice organizers. He helped the Greater Chaco Coalition grow into a large network that includes nonprofits, tribal organizations, and other supporters.
The coalition was instrumental to convincing the White House temporarily to halt new federal oil-and gas leasing within a 10-mile buffer of the Chaco Culture National Historical Park. It is a UNESCO World Heritage Site. Oil and gas companies can still develop leases near Chaco and the federal government is moving forward to sell leases outside the buffer zone.
Atencio is skeptical that governors are pushing for more regulation of the oil-and-gas industry. This includes a goal of stopping 98 percent of natural gasoline from escaping operations by 2020.
“We have yet to hear any type of real investment in enforcement,” Atencio said of the new methane rules. Until that happens, he added, it’s just words on paper.
An Incomplete Picture
The new state regulations for natural gas waste reduction took effect in May 2021. Some environmentalists and community activists claim they allow too many exemptions that allow oil and gas companies to continue releasing harmful chemicals into the atmosphere.
According to a U.S. Energy Department report, operators may need to release natural gas in times of emergency or for regular maintenance. However, the industry can also dispose of gas that is too expensive to capture.
Methane is odorless and difficult to detect and can also leak from wellheads and pipelines. Flaring or venting, which are industry practices that combust natural gas or simply release it, pushes methane into the atmosphere. According to a state climate report 2019, nearly two-thirds (23%) of methane emissions from New Mexico are caused by the oil and gas sector.
Federal and state regulators depend on the data companies report. They also require accurate data for audits by the Oil Conservation Division. This division is part of the state energy department responsible for oil and gas regulation.
Scientists and policymakers believe it is impossible to reduce greenhouse gases if no one knows their full extent. In recent years, satellite data has been used to measure flaring volume in the oil and natural gas industry.
The Howard Center for Investigative Journalism used similar satellite data to analyze New Mexico flaring volume and compare them to state records. The analysis revealed that satellites recorded approximately 50 percent more flaring between 2014 and 2020 than what was reported to the state.
Susan Torres, spokesperson from the state Energy, Minerals and Natural Resources Department, stated the Oil Conservation Division is unable to validate how the satellite calculates and evaluates data. She noted that OCD is well aware of the importance of data collection and reporting and has made it a key component of our new waste rules.
New Mexico has been a methane hotspot for a long time.
2014 satellites detected a methane cloud the size of Delaware hovering above San Juan Basin. Scientists found that the primary source of methane in the area was the fossil fuel sector, despite other sources. According to a federally funded research study, about three quarters of all methane emissions from the basin were derived from oil, coalbed operations, and gas. According to the study, methane concentrations could be increased by topography and weather conditions in the basin.
A 2019 state climate report revealed that methane emissions account for nearly a third of New Mexico’s greenhouse gas emissions. This compares to 10 percent nationally.
The new rules in the states ban routine or nonemergency flaring and venting of natural gases. They also tighten reporting and gas capture requirements. To meet the 98 per cent gas capture goal by 2026, oil and gas companies will have to reduce the annual volume of gas flared or vented. This will take effect from April 2022.
The rules also expand the state’s enforcement power. The state legislature reinstated in 2020 the Oil Conservation Divisions authority for imposing fines up to $200,000 each time New Mexico’s Oil and Gas Act is violated. This power had been denied to regulators for 11 years. The Division can now deny drilling permits operators who fail to demonstrate how they will meet the state’s gas-capture goal. Operators will have to report on flaring and venting at the midstream, or processing, level for the first-time. Regulators claim that this will give regulators a more complete picture of oil-gas emissions and provide large data sets that were previously unavailable.
Adrienne Sandoval, director of the Oil Conservation Division in the state, said that the division had updated its internal computing system to prepare for better data collection.
Environmental activists who helped to draft the regulations aren’t sure if they go far enough, or if the Oil Conservation Division has sufficient resources to enforce them.
Operators may still vent or flare if flaring is not technically possible. The completion process may take several weeks.
Don Schreiber, a rancher in northwest New Mexico, claims that 122 gas wells are located around his property. Schreiber is a split-estate holder, meaning that he owns the land but not the minerals below it.
Although methane emissions are not visible to the naked eye Schreiber claims he has seen them through an Infrared camera more then a dozen times. He also recognizes other smells such as the paint-thinner smell of xylene leaking from his property’s wells.
I don’t know what routine venting or flaring is exactly, but Schreiber said that they vent all the while.
Mike Eisenfeld, energy program manager at the San Juan Citizens Alliance, an environmental non-profit, stated that the state’s natural resources and environmental departments are severely underfunded.
According to the state’s staff directory, which was confirmed by the division in its entirety, 11 inspectors are employed by the state, who are responsible of checking approximately 51,000 active wells.
Colorado is a neighbor with some of the most stringent rules in the oil and gas industry. It has twice the number of inspectors for nearly as many wells. The funding for the 2021 fiscal years of Colorado’s regulatory body, Oil and Gas Conservation Commission, was 50 percent higher than that received by its New Mexico counterpart.
Singer, who was part of an advisory panel for the new regulations, stated that the waste rule is comprehensive and thorough. It is up to you to make it happen.
The head of the Energy, Minerals and Natural Resources Department in New Mexico made numerous pitches to increase the budget for the next legislative session at the New Mexico Climate Summit, which was held at Santa Fe’s Capitol in October 2021.
Sarah Propst is the department cabinet secretary. She wants a $3.1 million increase in the budget for the Oil Conservation Divisions. This would include 25 more full-time employees and eight more inspectors.
The ultimate goal of the governor is to achieve net-zero emissions by 2050. This is the same goal President Joe Biden set in a 2021 executive directive for the federal government.
We are actually leading the country in a number of environmental policies, strategies, and statutory frameworks to reduce our emissions and increase our reliance upon renewable energy for a small state, Lujan Grisham said at the climate summit.
AJurisdictional Morass
The federal ownership of nearly a third the land in New Mexico makes it difficult to ensure compliance by the state’s oil and gas industry. The Bureau of Land Management manages nearly 4.3 Million acres of federal oil & gas leases, second only Wyoming.
According to the federal Office of Natural Resources Revenue (ONR), these royalties generated more than $2.3 billion in 2021. According to data from the revenue bureau, New Mexico was the second largest source of oil and natural gas revenue for the federal government after the Gulf of Mexico.
The Interior Department’s office collects royalties from mineral extraction on federal lands and tribal lands. This money is then distributed to state governments, funds, and government agencies. New Mexico was the largest recipient state, receiving more that $1.1 billion in 2021, nearly half of all state government disbursements.
Other than the federal BLM and state Oil Conservation Divisions, the state Environmental Improvement Board and federal Bureau of Indian Affairs play important roles in the New Mexico oil and natural gas industry.
Eisenfeld called it a jurisdictional morass.
Atencio stated that Counselor is a place where federal, state, and tribal lands are woven together like a checkerboard.
He said, “You’re dumping hundreds upon tons of volatile organic compound into the landscape, but we don’t know who it is.”
The Howard Center analyzed satellite data to find that New Mexico’s oil and gas operators used more than 138 million cubic feet of gas on federal lands. This is nearly half the gas that was produced in the state between 2012-2020, according to the Howard Center. A spokesperson for the BLM said that these volumes were fairly accurate, based upon data collected by federal regulators.
The Oil Conservation Division claims it enforces federal land laws as well as state laws. New Mexico, unlike Colorado, does not have a formal written agreement or Memorandum of Understanding with the BLM. This document outlines interagency cooperation.
Colorado’s memorandum requires the BLM to invite state regulators on-site inspections federal oil and gas operations. Federal and state regulators also need to consult one another regarding permitting and enforcement.
According to Richard Packer (BLM spokesperson), federal regulators are not authorized to enforce state laws, including rules regarding natural gas venting and flaring, without a formal agreement in New Mexico.
Packer explained in an email that instead of coordinating in quarterly meetings, federal and State regulators communicate in impromptu calls about environmental issues.
BLM employs more than seven-fold the number of oil and gas inspectors as New Mexico’s 85 oil and natural gas inspectors. Thirty eight of them work from Farmington, in San Juan Basin.
Economic Balancing Act
Eisenfeld has been an outspoken environmentalist in Farmington for 26 years. Farmington is a city that has strong economic and historical ties to the oil-and-gas industry.
He lives right down the street from Glade Run Recreation Area, north Farmington. Here, the BLM manages 19,000 acres, mountain biking paths, and wells. These wells lead to an arterial system that includes pump jacks, pipes, and pumps.
He said that oil and natural gas is the biggest contributor to the state’s budget. It has always been portrayed that oil and natural gas support is essential if you want your children to be educated well and your community to prosper.
According to the state legislative financing committee, New Mexico has more than $2 billion in oil and gas industry revenue annually through severance taxes or royalties.
“People are just so consumed with this idea that the only economic, economically viable thing for us is to sort of rely on fossil fuels, said Eisenfeld, who thinks an economic transition to renewables is long overdue.
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George Sharpe is an investment manager at Farmington’s oil and natural gas company. He grew up in Farmington and believes the industry is more important than critics think.
He said that the state does not receive the revenue directly from the activities it supports. He stated that renewable energy sources like wind and solar would require large investments to grow into a reliable energy source. Sharpe said that they just want to be able change things. It just doesn’t work that way.
Lujan Grisham acknowledged that the state’s oil and gas workforce needs to be restructured at the climate summit. This work is not linear, the governor said to a crowd that there are shifts within the employment structure.
Propst sought $30.1 million in order to build partnerships with clean-energy companies, train workers and support New Mexico’s outdoor recreation economy.
Janie Chermak, chair of University of New Mexico’s economics department, stated that the state’s ability to diversify its economy is key to reducing dependence on oil and gas. She noted that Texas and Colorado are two of its neighboring states that have done this.
New Mexico has the opportunity. But it’s difficult to do, said Chermak. It’s not feasible to just say oil and gas goes away.
This story was written by Maya Leachman. It was produced at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication by the Howard Center for Investigative Journalism. This initiative of Scripps Howard Foundation honors the late news industry pioneer Roy W. Howard, it was produced by. For more see https://azpbs.org/gaslit. Send us an email at [email protected], or follow us on Twitter @HowardCenterASU.
