News
BBER Report Finds NM EMNRD’s Oil Conservation Division Has Potential To Add Millions To NM
February 2, 2022
FOR IMMEDIATE RELEASE
February 3, 2022
Media Contact: RaeAnn McKernan
[email protected]
UNM BBER Report Finds New Mexico Energy, Minerals & Natural Resources Department’s Oil Conservation Division Has Potential To Add Millions In Direct Economic Impacts For State
ALBUQUERQUE ? A preliminary analysis from The University of New Mexico’s Bureau of Business and Economic Research (UNM BBER) has found that the New Mexico Energy, Minerals & Natural Resources Department’s Oil Conservation Division (EMNRD OCD) could produce millions of dollars for the state through direct economic impacts and gross receipts taxes (GRT) with additional funding and more full-time staff.
Currently, the New Mexico oil and gas sector accounts for 21 percent of the (private industries only) gross state product (GSP) and over 30 percent of the state’s recurring tax revenues. While oil and gas production has doubled in the Land of Enchantment over the last few years, staffing at OCD has not kept pace with the expanding industry. Low funding and staffing levels at OCD, combined with the robust oil and gas sector, have led to significant backlogs in the processing of permits and applications for remediation and reclamation activities.
“This report underscores the importance of investing in the Oil Conservation Division in a significant way,” said Oil Conservation Division Director Adrienne Sandoval. “Whether permitting wells, managing reclamation, or enforcing the Oil and Gas Act, the division provides significant economic opportunity to New Mexico. I want to thank the University of New Mexico for this thorough report on the state of the OCD.”
BBER preliminary estimates suggest that funding additional full-time employees to assist with remediation and reclamation could add $426 million in direct economic impacts and $30 million in GRT. Additional funding to staff the processing of transport authorizations could move roughly $35 million in severance tax revenues into the current fiscal year by eliminating the current 36-day lag in processing times.
“This preliminary analysis is based largely on data and estimates developed by the OCD,” said BBER Acting Director Michael O’Donnell. “For the final report, BBER will gather additional data and information from other state agencies, industry representatives and experts, trade associations, or any other relevant entities. The data collected through this process will be used to add greater context to OCD’s operations and to further assess areas of economic opportunity.”
The report serves as a preliminary analysis of the role of EMNRD OCD and the direct and indirect economic and fiscal impacts it has in New Mexico. The full preliminary analysis is available at bber.unm.edu under research publications. The final report will be completed by mid-year 2022.
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About BBER
The University of New Mexico Bureau of Business and Economic Research (BBER) is the recognized expert in providing socioeconomic data and forecasting in New Mexico. With more than 75 years of experience, BBER’s research team provides economic forecasting as well as economic research services and data communication tools tailored to the needs of clients – public, private, nonprofit, and philanthropic – seeking to understand and shape public policy on the state, regional, and local levels.
BBER’s services and research help leaders in the Land of Enchantment to understand, forecast and identify trends and changing economic markets across the state of New Mexico in order to inform decision making.
Connect with BBER at bber.unm.edu or on LinkedIn, Twitter, Facebook, Instagram, and YouTube.
All media inquiries regarding BBER reports and data should be sent to RaeAnn McKernan ([email protected]) or Rachel Whitt ([email protected]).
About EMNRD
The Energy, Minerals and Natural Resources Department provides resource protection and renewable energy resource development services to the public and other state agencies.
http://www.emnrd.nm.gov
