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New Mexico oil boom


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Just a few short months ago folks here claimed that the new administration had killed the petroleum industry in New Mexico. They had dealt a huge blow to the oilfields in the West and would damage the economy. Particularly in New Mexico.

It looks like they were wrong. New Mexico oil is booming and we just surpassed North Dakota as the #2 producer in the nation. Only Texas producea more oil than we do.

(Those Texans are drilling fools!)

The state took in more money (from royalties) than it ever has even in a pandemic that stopped drilling and crashed oil prices. This has allowed our state to actually increase the budget despite tax revenues being the lowest in decades. 

(Less taxes + More royalties = Balanced budget)

Despite all the windbagging and misinformation things are booming in the oil patch. Rigs everywhere. The night sky glows orange from the gas flares. You can't find a place to sleep east of the mountains. Demand is off the scale and gas prices are high. Life is freaking good man!

https://www.kob.com/new-mexico-news/north-dakota-oil-production-slips-to-no-3-behind-new-mexico/6242305/?cat=500

 

Edited by Bedrock Bob
Did I mention wind generation is booming too?
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North Dakota's oil production did slip since the collapse of oil prices made shale "oil" unprofitable. The United States is still the largest miner of petroleum products worldwide by a large margin.

Since the economic collapse of the oil shale fields oil companies are staying away from those more risky investments. That collapse started long before COVID or the leasing pause and has more to do with the slim margins typical of shale deposits. When the oil price went down those shale oil miners had to stop pumping at a loss.

I see where New Mexico has increased production about 10% over the last year but their rate of annual increase in production slowed way down after 2018 - the oil industry in New Mexico was already in a slowdown before COVID or the federal leasing pause. That 10% increase is to be expected since the oil companies have to pump more oil to make up for the North Dakota, Canadian and East coast U.S. shale oil shortfall.

People just want their oil products and don't cut back because some fields became  unprofitable. The oil has to come from somewhere. New Mexico just rose in position because the shale fields are not producing like they were previously.

The executive order pausing the leasing of federal oil interests had no effect in Texas because Texas doesn't have federal lands with oil deposits. New Mexico mines half their oil deposits under private lands (east of the mountains) and the federal oil leases that are there have been in full production for several years. About a third of New Mexico's annual revenue comes from oil and gas extraction taxes. North Dakota relies just as heavily on taxes on oil and gas production on federal lands to fund their State and county governments. North Dakota sued the administration for the leasing pause along with 12 other oil producing states.

I think the misconceptions here are due to the mainstream press trying to make drama around an  issue in an industry few in their profession understand. I didn't see any claims that the leasing pause would cause disruption within the oil/gas trade but if you watch TV "news" it sure seemed they were trying to push that idea.

In any case none of this matters today. The lease pause was ordered in January and it was lifted by the courts in June. New oil leases are now being offered by the BLM. Less than six months of a pause in the federal oil leasing system didn't cause much disruption at all in the oil industry but it sure gave those CNN and FOX news watchers something to get excited about.  :rolleyes:

Edited by clay
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58 minutes ago, clay said:

North Dakota's oil production did slip since the collapse of oil prices made shale "oil" unprofitable. The United States is still the largest miner of petroleum products worldwide by a large margin.

Since the economic collapse of the oil shale fields oil companies are staying away from those more risky investments. That collapse started long before COVID or the leasing pause and has more to do with the slim margins typical of shale deposits. When the oil price went down those shale oil miners had to stop pumping at a loss.

I see where New Mexico has increased production about 10% over the last year but their rate of annual increase in production slowed way down after 2018 - the oil industry in New Mexico was already in a slowdown before COVID or the federal leasing pause. That 10% increase is to be expected since the oil companies have to pump more oil to make up for the North Dakota, Canadian and East coast U.S. shale oil shortfall.

People just want their oil products and don't cut back because some fields became  unprofitable. The oil has to come from somewhere. New Mexico just rose in position because the shale fields are not producing like they were previously.

The executive order pausing the leasing of federal oil interests had no effect in Texas because Texas doesn't have federal lands with oil deposits. New Mexico mines half their oil deposits under private lands (east of the mountains) and the federal oil leases that are there have been in full production for several years. About a third of New Mexico's annual revenue comes from oil and gas extraction taxes. North Dakota relies just as heavily on taxes on oil and gas production on federal lands to fund their State and county governments. North Dakota sued the administration for the leasing pause along with 12 other oil producing states.

I think the misconceptions here are due to the mainstream press trying to make drama around an  issue in an industry few in their profession understand. I didn't see any claims that the leasing pause would cause disruption within the oil/gas trade but if you watch TV "news" it sure seemed they were trying to push that idea.

In any case none of this matters today. The lease pause was ordered in January and it was lifted by the courts in June. New oil leases are now being offered by the BLM. Less than six months of a pause in the federal oil leasing system didn't cause much disruption at all in the oil industry but it sure gave those CNN and FOX news watchers something to get excited about.  :rolleyes:

It gave the Nuggetshooter windbags plenty to postulate about as well.

Instead of the desperation and economic hardship that they swore was going to happen we have the opposite. A booming economy, a booming oil industry and more good paying jobs than ever before.

Compare and contrast this with the latest claims that the sky is falling. I think it will become clear that there is no crisis. Just folks that don't know enough about the industry to sort out the lies they are repeating. 

All these stories serve political motives. None are accurate. None are grounded in real world experience. It is just guys that don't know better repeating lies they have been told by their political influencers. 

The sad fact is that these lies and misinformation get so much traction here. It seems they actually think that by perpetuating this nonsense it makes them a "real man" or a "real miner". It's like a fairy tale fantasy they expect everyone to buy into.

 

 

 

 

 

 

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1 hour ago, Bedrock Bob said:

It gave the Nuggetshooter windbags plenty to postulate about as well.

Instead of the desperation and economic hardship that they swore was going to happen we have the opposite. A booming economy, a booming oil industry and more good paying jobs than ever before.

Compare and contrast this with the latest claims that the sky is falling. I think it will become clear that there is no crisis. Just folks that don't know enough about the industry to sort out the lies they are repeating. 

All these stories serve political motives. None are accurate. None are grounded in real world experience. It is just guys that don't know better repeating lies they have been told by their political influencers. 

The sad fact is that these lies and misinformation get so much traction here. It seems they actually think that by perpetuating this nonsense it makes them a "real man" or a "real miner". It's like a fairy tale fantasy they expect everyone to buy into.

 

 

 

 

 

 

Er... Thanks for the confession Bob.

I thought you were writing about the oil industry being up in arms over the pause on federal leases. I didn't realize you were referring to specific unnamed forum posters and unnamed "political motives". If you had put that out there in your original post I would have passed on by.

That's not a subject I have any interest in pursuing. I'm outta here.

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39 minutes ago, clay said:

Er... Thanks for the confession Bob.

I thought you were writing about the oil industry being up in arms over the pause on federal leases. I didn't realize you were referring to specific unnamed forum posters and unnamed "political motives". If you had put that out there in your original post I would have passed on by.

That's not a subject I have any interest in pursuing. I'm outta here.

Me too.
."Nuggetshooter windbags"???

:laught16:

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1 hour ago, clay said:

Er... Thanks for the confession Bob.

I thought you were writing about the oil industry being up in arms over the pause on federal leases. I didn't realize you were referring to specific unnamed forum posters and unnamed "political motives". If you had put that out there in your original post I would have passed on by.

That's not a subject I have any interest in pursuing. I'm outta here.

After so much BS has been stated as fact and then turned out to be completely false sometimes you have to set the record straight.

This is one of those times. 

I don't believe in confession Clay. And you aren't a priest.  Don't confuse your incorrect  assumptions about my motives as insight. Nor as a reason for someone to confess to you.

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Some people are not happy about New Mexico's oil boom... 

New Mexico deserves stronger rules for cleaner air

New Mexico is ground zero for oil and gas development in the country. Every year, these industries release more than 337,500 tons of smog-forming pollution and 1.1 million tons of methane — an incredibly powerful climate change pollutant. :nono:

That’s why the New Mexico Environment Department’s rule to slash oil and gas pollution is so important. By enacting stronger rules New Mexico can significantly reduce air and methane pollution from the most prominent offenders — clearing the air for our state to meet Governor Lujan Grisham’s ambitious climate goals.

Send a powerful message to the EIB demanding strong rules that cut harmful pollution from oil and gas now.

https://act.edf.org/uqTxfFZ

Edited by Dakota Slim
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4 hours ago, Dakota Slim said:

Some people are not happy about New Mexico's oil boom... 

New Mexico deserves stronger rules for cleaner air

New Mexico is ground zero for oil and gas development in the country. Every year, these industries release more than 337,500 tons of smog-forming pollution and 1.1 million tons of methane — an incredibly powerful climate change pollutant. :nono:

That’s why the New Mexico Environment Department’s rule to slash oil and gas pollution is so important. By enacting stronger rules New Mexico can significantly reduce air and methane pollution from the most prominent offenders — clearing the air for our state to meet Governor Lujan Grisham’s ambitious climate goals.

Send a powerful message to the EIB demanding strong rules that cut harmful pollution from oil and gas now.

https://act.edf.org/uqTxfFZ

Indeed there are some who are not happy about the oil boom. We have those type of people here too Slim. Their opinion is certainly a part of our collective voice.

We also have the other extreme that believes there should be total deregulation. But neither extreme represents the majority of New Mexicans. We generally support the industry but we want them to be more responsible too.

The best place to stop pollution from oil and gas is where the most is being produced. So oil producing States need to enact strict rules and enforce them. That is just good management.

The oil companies are on board with the proposed new rules. They are working with the State pretty good because they realize their profits depend on it. They also realize that more rules are going to be enacted whether they like it or not. This is a process that has been happening for many years and will continue. 

Of course they fight extreme regulation as they should. But they have supported the new rules and are certainly willing to meet half way. And the State is too. Neither the State nor the oil companies are echoing the messages from the far right or the far left. So far this has been all about business.

There is a lot of money on the table here and both "sides" know it. They are cooperating to try and extract the precious resources with as little damage as possible. And that is a very good thing.

New Mexico has passed some of the most restrictive rules on the petroleum industry in the country. Still we have a thriving industry and everyone is raking in the cash. So the process seems to be working.

They need more rules in a lot of areas. And little by little the industry is becoming a lot more environmentally responsible. I think the oil companies realize that they must do this in order to sustain their business long term.

I honestly don't expect to see too much fireworks over this round of proposed regulations. There usually isn't. Most are just common sense measures that can be taken to reduce the amount of gas that escapes from the various processes.

https://www.kob.com/albuquerque-news/new-mexico-hearing-begins-for-next-round-of-oil-gas-rules/6244038/

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