Group: NM lacks adequate oil and gas enforcement

CBS News | Susan Montoya Bryan

May 17, 2012
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Group: NM lacks adequate oil and gas enforcement
ALBUQUERQUE, N.M. — A watchdog group called into question Thursday whether New Mexico can continue developing oil and natural gas in a responsible way without more state inspectors and adequate enforcement.

Production of those materials has been part of the economic backbone of the state for the better part of a century and continues to grow.

Earthworks' Oil and Gas Accountability Project released a report that shows the number of inspections conducted by the state Oil Conservation Division increased in 2011 but more than half of producing wells went unchecked.

One of the top energy producing states in the U.S., New Mexico has 12 inspectors. More than 50,000 producing wells come under their purview.

New Mexico also is limited when it comes to assessing civil penalties against operators that violate the law and reporting and tracking violations, the report states.

Gwen Lachelt, director of the accountability project, accuses the Oil Conservation Division of failing in its mission.

"With their failure, they guarantee irresponsible oil and gas development and put landowners, their water and the environment at risk," she said in a statement.

The agency has acknowledged that it's understaffed, but officials maintain their inspectors are doing a good job.

The report came as state regulators consider a request by the oil and gas industry to revamp the so-called pit rule, which governs how producers handle waste from drilling operations in pits, buried tanks, sumps and closed-loop systems.

The rule was first adopted by the Oil Conservation Commission in 2008 after dozens of hours of testimony from engineers, economists, environmentalists and ranchers.

Environmentalists argue the rule needs to stay intact to ensure water sources as well as wildlife and livestock are protected. However, the industry contends the regulations need to be amended so producers can remain competitive.

An industry group and environmentalists have filed appeals over the regulations. The cases are stalled in state district court, pending the outcome of this week's hearing before the commission.

The industry is proposing changes to siting requirements for temporary lined pits and their distance from water sources. The amendments also call for allowing drilling mud wastes to be buried on site as along as the level of salts and other contaminants are low enough and the distance to groundwater is adequate.

The industry is also asking the state to make it standard, rather than an exception, for one pit to be used for multiple wells.

On Thursday, soil scientist Bruce Buchanan testified on behalf of the New Mexico Oil and Gas Association on the migration of salts at pit sites and reclamation efforts.

Ranchers concerned about the proposed changes to the rule were expected to testify later in the day.

In its filings with the commission, the New Mexico Oil and Gas Association argued that the proposed revisions will continue to protect fresh water and public health.


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