What does Biden’s executive order REALLY mean for New Mexico?

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Lucas
 Herndon
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Within minutes of President Joe Biden’s announcement of bold new climate and energy initiatives today, New Mexico’s desperate oil and gas lobby was hard at work trying to convince people we’re all doomed.

Their focus is on the portion of the executive order that puts a moratorium on selling off any NEW tracts of public lands for the purpose of drilling for oil. That moratorium is intended to give us, collectively, time to study the impacts of the RAMPANT degradation that the oil and gas industry has had on our public lands,  surrounding communities, and the environment at large since that hasn’t been done in, ya know, at least four years…

Anyway, it’s a good thing and frankly it’s long overdue. And trust us, we WISH it was going to stop drilling in the way NMOGA keeps tweeting that it will. The reality is though that the oil companies that make up NMOGA’s membership have bought up literally THOUSANDS of permits that will allow them to keep drilling for many years. Don’t believe us?

The CEO of Devon Energy even bragged about it, saying, “We have a deep inventory of approved federal drilling permits in hand that essentially cover all of our desired activity over the next presidential term.”

So yeah, the oil and gas INDUSTRY is going to be fine. As for claims that the federal moratorium will push companies out towards drilling in Texas, there’s two reasons that’s silly. The first is the aforementioned pre-bought permits already in hand for land in New Mexico, but the second is that even IF companies were trying to buy new permits, the federal government only charges 12.5% royalty rates vs the 25% Texas does on their land. Now don’t get us wrong, we openly call for both New Mexico and the Federal government to raise their leasing rates because they are woefully low for the impact being done to our environment, but for the time being the glorious forces of free market capitalism will keep companies eyes on cheaper public land leases on the New Mexico side of the border.

NMOGA’s disingenuity doesn’t stop with just the oil companies either. They’re trying to tug on the heartstrings of New Mexicans by trying to play up the impacts to communities in the Permian which have long suffered the boom and bust cycles of the uncaring oil and gas industry. But those communities are already hurting. And was it because of well reasoned, regulated government interference? No, it was the ungovernable consequences of foreign powers playing hardball with market forces. NMOGA loves to try and claim that Biden’s orders will affect Russia and OPEC, but the reality is that Russian and Gulf state’s oil policies are already and have been affecting US oil policy forever.

Finally, the myth that NMOGA is really perpetuating here is that their industry is healthy and vibrant and that this change hurts that. But in reality the oil and gas sector is and has been failing, EVEN BEFORE the downturn from Covid. The world is changing and while some countries like China have rapidly increased their consumption of natural gas or India consuming more petrol, neither of those trends show long term sustainability, especially as both they AND the rest of the world shift more and more toward renewables.

So if you’re fretting about New Mexico’s oil and gas workers or the state’s revenue being impacted by today’s announcement, don’t worry. The problems oil and gas have are their own making and would have (and have) affected New Mexico anyway. This is the first step in dealing with the reality many of us have been clamoring for for years; a New Mexico that isn’t reliant on oil and gas for its main source of revenue in the first place and that embraces renewable energy for both our own energy needs and as part the future economic model of our state.

 

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