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Federal oil and gas leases in New Mexico attacked despite billions in revenue

Adrian Hedden
Carlsbad Current-Argus

A sale of federally-owned land in southeast New Mexico this week could see thousands of acres designated for oil and gas extraction in the oil-rich Permian Basin.

Scheduled for Oct 28 and 29, the U.S. Bureau of Land Management’s (BLM) quarterly sale in New Mexico continued its efforts to encourage energy production on federal land as part of President Donald’s Trump’s agenda of maintaining America’s energy independence.

The sales were panned by environmentalists for perceived impacts to public land while others questioned if taxpayers received proper returns for the parcels amid an historic market downturn and lower price market and the COVID-19 pandemic.

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The Department of Interior, which oversees the BLM, reported New Mexico received the largest fiscal impact from DOI-managed lands in fiscal year 2019, with $18.4 billion contributed to the state’s gross domestic product (GDP), marking an $11.3 billion growth over the previous three fiscal years.

Activities on New Mexico federal lands generated $24 billion in economic output, the report read, marking a $12.8 billion increase since FY 2016.

About $98,000 jobs were supported by federal land use in New Mexico, read the report, which marked a growth of 32,195 jobs during the same time frame.

More:New Mexico eyeing stricter regulations, more fines on oil and gas spills

Energy and minerals activity was listed as the largest contributor to New Mexico’s economy via federal lands, supporting 62,900 jobs, with $16.6 billion in value added and about $21 billion in economic output, the study read.

Nationwide, DOI-managed lands produced 1.06 billion barrels of crude oil and 4.8 trillion cubic feet of natural gas in FY 2019, the report read, the first time federal lands produced more than 1 billion barrels of oil while a fifth of the U.S.’ energy was generated on federal land.

“The Trump Administration agenda for public lands management has been a major boon for communities throughout the country,” said Secretary of the Interior David Bernhardt. “Especially this year, public lands have been a critical place of refuge for the American people and will continue to support the economic vitality of our country.”

More:New Mexico's oil and gas collapse could last years amid calls for economic diversification

But to opponents of selling public land to private industry, the multi-billion-dollar profits could be coming at the expense of some of New Mexico’s most sensitive habitats and ecosystems.

A Monday study from the Center for Western Priorities found the Trump administration planned to lease another 400,000 acres of public land to oil and gas companies by the end of 2020.

In New Mexico, that means leasing about 7,000 acres in the October sale, many of which are near Carlsbad Caverns National Park.

More:Study: New oil and gas drilling techniques could increase radiation levels nearby

The underground cave system at Carlsbad Caverns is made up of several karstic aquifers that feed into groundwater supplies for nearby communities.

Oil drilling near the system could threaten to contaminate the water, the report read, and imperil supplies for an area already struggling with decades-long drought conditions.

“The parcels continue a pattern of Trump administration lease sales threatening our national parks—the crown jewels of our public lands that form the heart of valuable conservation networks—with new oil and gas drilling just outside their boundaries,” the study read.

More:Study shows billions of government relief dollars to oil and gas amid COVID-19

The study also pointed to about 23,000 acres being offered in Utah in the BLM’s December lease sale near the Lower Green River and Pariette Wetlands, both areas identified by the federal government as areas of critical environmental concern (ACECs).

Also in December, the BLM in Colorado planned to sell leases to the industry on about 47, acres of public land which the Center argued were unlikely to be used for extraction but could be used by oil and gas companies to prevent other use.

The Colorado sale could threaten the survival of the greater sage grouse, along with pronghorn, mule deer and elk, the report read, along with up to 198 species of birds.

More:New Mexico releases new oil and gas emissions rules, calls for hearing to put into law

“Now is not the time to risk our valuable and threatened public lands or the outdoor recreation industries that they support. As the oil industry continues to struggle, it will be unable to adequately remediate any damage done to sensitive landscapes exposed to drilling,” the report read.

“Oil and gas leases of public lands that overlap with sensitive habitat or near iconic national parks have no place in the Interior Department’s upcoming lease sales, which could be the last under the Trump administration. It’s time for those sales to be stopped, or at the very least for parcels with significant wildlife and conservation conflicts to be pulled.”

On Oct. 23, U.S. District Judge Rudolph Contreras for the District of Columbia ordered the BLM to review the environmental impacts of 27 oil and gas leasing decisions in New Mexico, Colorado, Utah, Wyoming and Montana in response to a January lawsuit filed by the Western Environmental Law Center and WildEarth Guardians.

More:Oil and gas wastewater investments continue in Permian Basin, group calls for stricter rules

Earlier in October, the BLM requested a remand to review its decisions for about 1.8 million acres leased to oil and gas in response to the lawsuit, and Contreras' order effectively granted that motion.

Contreras wrote in his decision that the leases were to be remanded pending review of their compliance with the National Environmental Policy Act, which the plaintiffs contended was not conducted by the federal government when approving of the sales.

“This is a powerful victory for the climate, our health, and future” said Jeremy Nichols, WildEarth Guardians climate and energy program director. “Finally, the Trump administration is admitting it can’t legally sell public lands to the oil and gas industry and ignore the consequences for our climate and future.”

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