New Mexico Receives Millions In Oil And Gas Revenues After Months Of Activist Delay Tactics
After months of delay brought on by protests by environmental groups, the State of New Mexico has finally received revenues from a Bureau of Land Management oil and gas lease sale last fall.
Last September, the BLM held a lease sale in Roswell, New Mexico, for oil and gas companies to bid for the opportunity to develop in the Permian Basin, the fastest growing shale oil region in the country. The sale generated $145.6 million in revenue, and almost half of the revenue, $69.9 million, was allotted to New Mexico. The payment, however, was delayed for months because of protests by activist groups Wild Earth Guardian and Center for Biological Diversity, which are opposed to oil and natural gas development.
Today, a spokesperson for the New Mexico Department of Finance and Administration confirmed to Western Wire that the payment has been received by the state.
“While this is welcomed news for our state at a time when budgets are tight, it’s utterly disappointing to see radical special interest groups repeatedly hijack these lease sales at the expense of our schools, public safety, and healthcare,” New Mexico Oil & Gas Association spokesperson Robert McEntyre said in a statement to Western Wire.
According to the New Mexico Legislative Finance Committee, oil and natural gas revenues make up 15 percent of the total general fund revenue most years, depending on economic conditions.
Lawmakers from both sides of the aisle had expressed concerns about the ramifications of delayed payments on the state budget.
“New Mexico’s children, elderly, disabled, as well as our health and education programs are being held hostage by these professional lawyer activists groups,” U.S. Rep. Steve Pearce (R-N.M.) wrote in an April 5 statement. “We face difficult financial decisions as we near the end of the fiscal year, and need these funds for our schools, roads, hospitals, and other important infrastructure projects.”
Two Democrats in the state legislature warned New Mexico’s congressional delegation about the consequences of a delayed payment.
“Should this delay extend beyond the close of the 2017 state fiscal year (June 30, 2017), it would have a significant, detrimental impact to the state’s general fund reserves and could negatively impact New Mexico’s bond ratings,” Rep. Patricia A. Lundstrom and Sen. John Arthur Smith wrote in a March letter. Lundstrom chairs the State House Appropriations and Finance Committee and Smith leads the Senate Finance Committee.
“Delayed receipt of these funds would reduce projected fiscal year 2017 ending reserves to $25.3 million, or 0.4 percent of appropriations,” the letter continued. “Due to the recent significant volatility in New Mexico’s revenues and uncertainty regarding economic conditions. 0.4 percent reserves is an unacceptably slim margin.”