The dirty (not so) little secret about how much oil and gas “helps” our state
This is the third in a series of articles highlighting the New Mexico Oil and Gas Association. NMOGA lobbies on behalf of oil and gas interests, seeking less regulation and oversight for their industry and greater access to political power in the state. Last year, the Executive Director of NMOGA, Ryan Flynn, spoke at their annual meeting about the future of oil and gas in New Mexico as they moved into the election cycle of 2018, their goals to seize power, and the strength of their “opposition,” the citizens of New Mexico who have pushed back against the fossil fuel industry and their stranglehold on the state at all levels.
In a report out last week, the New Mexico Oil and Gas Association made some pretty bold claims about how much their industry does for the state; funding schools and bolstering the state’s economy in general. But there’s a pretty serious cloud over those numbers, and quite literally, over the state in the form of the wasted methane, and lost revenue, from New Mexico’s oil and gas producers.
While NMOGA has been quick to be their own loudest cheerleaders about the rally in oil prices, they have continued to wastefully burnoff methane as a “byproduct” rather than capturing and utilizing it. They ignore standards to fix physical leaks in pipelines and pumps resulting in significant losses.
And it’s not “just” about the environmental impacts of these serious oversights.
Leaks at oil and gas wells are dramatically eating into the amount of funding the state collects for education every year – to the tune of as much as $244 million in wasted gas and $27 million in state tax and royalty funding. That’s enough gas to heat every home in New Mexico and enough money to increase pre K enrollment by 50% for instance and provide 5,000 more New Mexico kids with access to quality early childhood education.
The report from NMOGA also made some bold claims about the oil boom currently happening on the global scale, which is being driven in large part by large-scale fracking operations in the Permian Basin of New Mexico. Their perspective is that from a fiscal point this means even more money for a state as large companies like Exxon plan to triple their extraction by 2025. But more extraction without addressing leaks and methane waste, that’s just even more money being lost in the state.
And, even in that report, they note that the continued growth is contingent on the price of oil hovering around $65 per barrel; something that Bloomberg said just this week would be hard to maintain after the US industry as a whole depletes its on-hand supply.
Well, as we’ve all seen before, those numbers can move pretty fast. And while Permian oil is the current standard that folks like NMOGA have hung their hats on, with the Trump administration’s recent opening of coastal drilling and arctic drilling opportunities, as well as OPEC artificially inflating oil prices by limiting manufacturing in the Middle East, New Mexico’s reliance on oil and gas companies, remain tenuous at best.
NMOGA’s director, Ryan Flynn, seemed less worried though. He commented in the release that “We can expect these trends to hold up for the foreseeable future if New Mexico remains a favorable place for oil and natural gas producers to do business.” But if “favorable” means that New Mexico continues to allow oil and gas companies to waste resources and literally burn off revenue for our state, what kind of future is foreseeable for us?