State Land Office Accountability & Enforcement Program Plugs Over 130 Abandoned Oil and Gas Wells
SANTA FE, N.M. – Commissioner of Public Lands Stephanie Garcia Richard announced today that in the first two years of the agency’s Accountability and Enforcement Program, the initiative has resulted in 134 abandoned oil and gas wells being plugged on state lands – at no cost to taxpayers or the State of New Mexico. Commissioner Garcia Richard launched the program in November 2020 to ensure oil and gas companies that use state trust lands operate and close out responsibly. The savings to taxpayers are significant, as plugging oil and gas wells typically costs $50,000 to $100,000 or more, depending on the site.
The program aligns with Commissioner Garcia Richard’s commitment to providing appropriate oversight while ensuring industry pays what it owes to reclaim a site. A recent study by O’Donnell Economics and Strategy of Corrales showed that a full-fledged commitment to remediating oil and gas sites in New Mexico could generate $4 billion in wages, create 65,337 jobs, and boost state revenue by $541 million. A separate study commissioned by the State Land Office and conducted by the Center for Applied Research revealed that New Mexico is facing an $8.1 billion bonding gap on oil and gas Meanwhile, the State Land Office is coming off a record-shattering $2.4 billion revenue haul in fiscal year 2022 – much of it from oil and gas operations – amid the agency’s accountability and enforcement efforts.
“The State Land Office is open for business, but we’re also going to hold industry accountable to ensure taxpayers aren’t left holding the bag for the costs of cleaning up,” said Commissioner Garcia Richard. “To be clear, this accountability work is having zero impact on the agency’s ability to make money. In fact, it has been paired with the best fiscal year the State Land Office has enjoyed in its history, with multiple record-breaking months occurring since this program launched. The fact that the State Land Office is making billions of dollars a year in record profits demonstrates that revenue generation doesn’t need to come at the expense of our lands.”
“Over the last several years, we’ve made historic strides in bringing environmental compliance to the forefront,” added Commissioner Garcia Richard. “We’ve created a new satellite imagery program to identify spills and trespass, ramped up our royalty auditing to ensure what is due is actually paid, and established a new office focused on remediation and reclamation efforts. All of these tools will allow us to better manage our lands, and ensure that that the costs of cleanup are placed on the shoulders of the companies using state land, not taxpayers.”
The State Land Office has focused its efforts on sites that pose an environmental threat to the health of state lands, including the worst methane offenders. The Accountability and Enforcement Program, which is part of a broader agency oversight effort, includes:
- Ensuring clean-up of oil and produced water spills by responsible parties
- Obtaining surface reclamation, specifically of site infrastructure including wells, pads, pits, tanks, pipelines, and roads
- Recovering royalty payments for oil and gas production in trespass
- Reviewing oil and gas leases to ensure required bonds are in place
- Evaluating business leases, salt water disposal easements, and other activities for compliance shortfalls
The State Land Office first contacts the companies responsible for lease operations to give them an opportunity to clean up and remediate the site as required. If the company does not comply, the State Land Office then takes legal action.
To date the agency has filed 21 enforcement lawsuits, identified over 800 leases without required bonds in place, and secured the full reclamation of over a dozen oil and gas lease sites and 132 wells plugged by the companies legally responsible for that work.
“We will continue using all available tools to protect our state lands, and to ensure that parties who cause damage are held accountable,” said Ari Biernoff, General Counsel at the State Land Office. “It’s important to stress that while many companies do act responsibly, this program helps us identify ones that don’t. That’s part of our commitment to our beneficiaries, including public schools, and to future generations.”
Commissioner of Public Lands Stephanie Garcia Richard has overseen the New Mexico State Land Office since 2019. In that time the agency has raised more than $5 billion for New Mexico public schools, hospitals, and universities. Over 13 million acres of state trust land are leased for a variety of uses, including ranching and farming, renewable energy, business development, mineral development, and outdoor recreation. The State Land Office has a dual mandate to use state trust land to financially support vital public institutions, while simultaneously working to protect the land for future generations.