New Mexico Receives Nearly Half A Billion In Energy Revenues
An oversized check for nearly half a billion dollars was presented to the State of New Mexico on Tuesday as the Bureau of Land Management acknowledged the portion of September oil and gas lease sales that would head to the state after a record-breaking $972.5 million dollar 3rd quarter sale in September.
The check, for $486,000,000, represents the portion the state receives from federal oil and gas lease sales. In total, the New Mexico has received revenues exceeding $1 billion in 2018 from BLM’s mandated quarterly lease sales.
Kate MacGregor, Deputy Chief of Staff for Policy for the U.S. Department of the Interior, was joined by Keith Gardner, Chief of Staff for Gov. Susana Martinez, and Tim Spisak, Acting State Director for BLM New Mexico, in presenting the “biggest” check the agency has ever presented at the BLM field office in Carlsbad.
“Oil and gas development in southeastern New Mexico is a windfall for our area in driving growth and job creation, but its benefits are felt across the state as evidenced by the revenue from this massive lease sale. New Mexico has a $1.1 billion budget surplus for next year and 80 percent of that is from oil and gas,” John Waters, executive director of the Carlsbad Development Department told Western Wire.
“Add to that the infrastructure built around the state using severance taxes produced by this industry, and there isn’t a corner of this large state that doesn’t benefit in a major way,” he added.
BLM New Mexico administers public lands and mineral resources in New Mexico, Oklahoma, Texas, and Kansas. The Carlsbad Field Office was BLM’s busiest in 2018, processing more applications for permit to drill (APDs)—1,533—than applications for the entire state of Wyoming, that came in second place at just over 1,200.
New Mexico’s lease sale kicked off a raft of 4th quarter offerings from Nevada, Montana, Wyoming, Utah, BLM Eastern States, and Colorado this week.
New Mexico lead all sales in the number of parcels up for sale in December, but Utah’s lease sale saw 139,000 acres covering 96 parcels receive the second highest sale total so far, at $2.8 million in bids.
EnvergyNet.com has been the online lease sales provider for BLM lease sales exclusively since 2017. The agency moved to online sales for BLM quarterly lease auctions after multiple protests in many different states during the Obama administration that used disruption and other tactics to prevent mandated lease sales by the bureau.
The 4th quarter sales have seen similar protests in New Mexico and Utah.
“We’re here because the U.S. government is our enemy,” the protesters shouted in New Mexico last week, according to E&E News. “Keep in mind their goal in life is to completely eliminate us.”
Utah’s BLM lease sale drew additional protests this week, as activists from the Sierra Club, the Center for Biological Diversity, and the Southern Utah Wilderness Alliance gathered in Salt Lake City.
The remaining states with completed lease sales had much smaller offerings, but still drew bids this week.
Nevada’s sale offered 2 parcels containing nearly 4,000 acres and received bids of $7,866. Wyoming featured 3 parcels on 720 acres and drew $2,400 in bids.
Montana’s 9,900 acres over 21 parcels saw $520,479 in competitive bids.
Two remaining sales in Colorado—23 parcels on 8,347 acres—and 24 parcels and approximately 2,500 acres in the BLM Eastern States lease sale are open for bidding through the end of today.
But New Mexico’s lease sale haul, highlighted by the check presentation from BLM to New Mexico state officials, offers a peek at what may come, with the announcement December 6th that the Permian Basin’s vast natural resources had previously been underestimated, according to the U.S. Geological Survey (USGS).
The new report touted the largest estimated continuous oil and gas resource potential, focusing on the Wolfcamp Shale and Bone Spring Formation in the Delaware Basin, which forms a part of the Permian Basin. The productive basin is shared across southeast New Mexico and neighboring Texas.
Interior officials estimate “46.3 billion barrels of oil, 281 trillion cubic feet of natural gas, and 20 billion barrels of natural gas liquids,” according to the USGS assessment. The estimate for continuous (unconventional) oil is made up of undiscovered, technically recoverable resources.”
MacGregor noted the effect the burgeoning basin play has had on “rural prosperity” but also said that that prosperity was tied to multiple-use doctrine, not just energy development.
Ken McQueen, Secretary of the New Mexico Energy, Minerals and Natural Resources Department, hailed the BLM lease sale revenues, as it heads to education and infrastructure within the state.
“We’re just glad to have this really unexpected bonus into the state government,” McQueen said Tuesday. “The fact that most of these leases are in Eddy and Lea counties is just an indication of what’s to come. This is an indication of billions of investments to come.”
When asked about the new USGS estimates, McQueen said “the stage has already been set,” as the state’s natural resources—oil and gas—“will continue to be the largest contributor to the state budget for years to come. It’s important to safeguard that resource.”