Oil and gas methane waste debated at Carlsbad public hearing, State prepares tougher rules

Adrian Hedden
Carlsbad Current-Argus

Denton McCullough doesn’t recognize the city he’s called home for more than a decade.

The retired Carlsbad resident said since oil and gas began booming, the formerly quiet ranching community morphed into something else.

He complained of heavy industrial traffic, of temporary residents uncaring of the negative impact they could have.

But McCullough’s biggest concern was the industry’s impact on the environment, especially the air.

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He worried that the growing oil and gas developments in Eddy County and throughout southeast New Mexico could emit dangerous chemicals like methane into the air.

“I am concerned with the health and environmental impact caused by methane emissions. I am also concerned with the loss of income to the state,” he said. “I look around my community and I fear we are at risk of making Carlsbad a thriving place to live. We are trading that for too much traffic and exorbitant living expenses.

“Our area is growing too quickly with non-permanent residents who will leave when the oil field dries up. What will be left for those of us who call this home?”

More:Environmentalists challenge oil and gas industry-led methane policy in New Mexico

McCullough brought his concerns before state officials during a public hearing Wednesday at the Walter Gerrells Performing Arts and Exhibition Center.

The New Mexico Environment Department (NMED) and the Energy, Minerals and Natural Resources Department (EMNRD) held the meeting to gauge public opinion as NMED and EMNRD collaborate to adopt stricter state regulations for methane emissions from oil and gas operations.

This chart shows reported methane emissions declines in the San Juan and Permian basins.

Industry supporters clash with environmentalists

Carlsbad residents, activists and elected officials presented a mixture of opinions pertaining to the State of New Mexico’s plan to adopt more stringent regulations related to methane emissions and air pollution caused by oil and gas operations.

More:Oil and gas industry, environmentalists spar over methane emissions in New Mexico

Supporters of the industry questioned if the regulations were needed, pointing to data that suggested emissions had declined in the Permian Basin while production grew by more than 100 percent.

But many others in attendance voiced concerns that with the economic growth came a growing air pollution problem that must be addressed immediately and in force.

Artesia Mayor Raye Miller said regulations must not discourage more growth in the oil and gas industry, as he argued that American oil and gas operations have stricter emissions standards that foreign markets.

More:New Mexico senators Udall, Heinrich seek to block rollback of methane rule

“I appreciate the fact that you all are looking to keep a healthy industry. If you enact regulations that would reduce production, that barrel will be replaced by a foreign barrel,” Miller said.

“Every barrel produced around the world results in more emissions than that of an American barrel of oil.”

New Mexico State Rep. Phelps Anderson (R-66), who represents parts of Chaves, Lea and Roosevelt counties, said state regulators must include feedback from the industry and adopt market-driven solutions while crafting the new regulations.

More:New Mexico cracking down on oil and gas methane waste, Heinrich and Udall call for action

He questioned if new state laws were even necessary as the oil and gas industry was committed, Anderson said, to cutting emissions and subsequent pollution.

“I urge you not to adopt past failed rulemaking procedures of a whip and hammer. We should build it upon something else,” he said. “That word is innovation. These people are dedicated to help America meet a national security issue. I believe the control of methane is being achieved without the new strategy.”

State Rep. Cathrynn Brown (R-55), representing the eastern part of Eddy County, pointed to an about $2 billion state budget surplus fuel mostly by oil and gas revenue.

More:State, oil and gas industry question reports of under-reported fracking in Permian Basin

She said such a powerful economic driver should not be hindered by stronger regulations.

New Mexico Rep. Cathrynn Brown (District 55) speaks Aug. 7 in Carlsbad during a public meeting on New Mexico's methane strategy.

“There are a lot of people who like to badmouth the oil and gas industry. But I know this is the industry that pays for what we do in state government. If we didn’t have this industry, we’d be in a world of hurt,” Brown said.

“I believe the industry is striving to reduce emissions. I see this resource as a gift. It is something we can use to bring the state up. We need to take advantage while still protecting our environment.”

More:NMED: Methane emissions in New Mexico highest in oil and gas regions

Keep it in the ground?

NMED Cabinet Secretary James Kenney denied allegations that the state’s decision to strengthen methane regulations could threaten oil and gas’ growth.

He said that while the State administration is working to diversify New Mexico’s energy economy to not rely as heavily on oil and gas, the benefits from extraction cannot be denied.

“We are very supportive of the oil and gas industry. We do believe the diversification of our energy economy is important, but not at the expense of any one sector,” he said. “This is not a keep-it-in-the-ground effort.”

More:Study: Methane emissions flat nationwide, slight increase from oil and gas

New Mexico Environment Department Cabinet Secretary James Kenney on Aug. 7, 2019 at the Walter Gerrells Performing Arts Center. Kenney was in Carlsbad to attend a public meeting on the state's methane strategy.

NMED and EMNRD planned to begin drafting the State’s methane rule in November, after hearing from stakeholders and community members throughout New Mexico.

The initiative was part of Gov. Michelle Lujan Grisham’s directive issued in January to create a Climate Change Task Force and calling on state agencies to seek ways to reduce pollution and impacts on climate change.

Methane is the second most prevalent greenhouse gas emitted in the U.S., said Sandra Ely, environmental protection division director with NMED and its Air Quality Bureau.

More:Oil and gas industry continues to respond to climate, pollution concerns

And in New Mexico, she said data shows 62 percent of methane emissions come from the oil and gas industry, compared to 30 percent nationwide.

Right now, we’re looking at the biggest piece of the pie,” Ely said. “We’re looking at how to reduce methane emissions from oil and gas, and still have a vibrant industry.”

To that end, the State planned to create a Methane Advisory Panel (MAP) to discuss various aspects of oil and gas operations such as tank battery or pipelines, to find new ways to reduce gas releases.

More:Emissions down in the Permian Basin? State of New Mexico inspects 98 oil and gas facilities

Adrienne Sandoval was hired in April as the director of New Mexico's Oil Conservation Division.

Adrienne Sandoval, director of the Oil Conservation Division – an arm of EMNRD – said about 36 billion cubic feet of methane and other volatile organic compounds (VOCs) were reportedly released last year through venting or flaring, based on data reported by the industry to the State.

She said the industry would likely exceed that in 2019.

“We do understand that that number is under-reported, and it is actually much higher,” Sandoval said. “When gas is vented and flared, the state does not collect royalty taxes on it. New Mexico is no longer able to use that as a revenue stream.”

More:New Mexico ranked last for methane emission prevention

VOC emissions are permitted by State, but Ely said many operators are exceeding permitted levels.

She said 91 million pounds of VOC’s were currently permitted in Eddy County, and 58 million pounds in Lea County.

“We are committed to enforcing the rules that are on the books,” she said. “We need to do a better job to bring those emission sources back down to the permitted levels.”

More:Activists, industry debate impact of venting methane rule

Protecting local economies

Carlsbad Mayor Pro Tempore Eddie Rodriguez appealed to the State to be mindful of the benefits growth in the oil and gas industry brought to Carlsbad.

He said southeast New Mexico, through its oil and gas boom, is providing for the rest of the state which is a point of pride for the people of Carlsbad.

"I’m here to protect everything we have. We take great pride in the fact that we’re providing for the rest of the state, just like a father takes pride in providing for his kids,” Rodriguez said.

“The Permian Basin and the community of Carlsbad is very interested in putting in place a methane rule. It was a campaign promise that we’re not going to get away from.”

More:New Mexico State Land Commissioner joins Earthworks on tour of Eddy County oil and gas sites

Carlsbad City Councilman Eddie Rodriguez on Aug. 7, 2019 in the Walter Gerrells Performing Arts Center.

But Rodriguez called on the state to be fair in enacting new regulations and to be careful to not impede oil and gas’ growth in the Permian.

“We just want there to be something created, maybe something that doesn’t make both sides completely happy,” he said. “We have the majors, but we have more small operators than anything else. The oil and gas industry has proven that it can, by its own volition, lower emissions."

Gerry Washburn, superintendent of Carlsbad Municipal Schools said oil and gas also provides significant funding for public schools throughout New Mexico.

More:Oil and gas leads New Mexico to earn more than $1 billion from state land

He worried stronger regulations could damage this relationship as companies could leave New Mexico for other oil-producing states like Texas.

“I see we have an opportunity to positively impact education using what we get from oil and gas. I do not want to see that opportunity squandered,” Washburn said.

“When we have opportunities like we have now, as we develop regulations I would urge you to make regulations that would keep New Mexico the beautiful place that it is.”

Adrian Hedden can be reached at 575-628-5516, achedden@currentargus.com or @AdrianHedden on Twitter.