American Oil and Gas Reporter - January 2015 - 197

The Presidential Papers
annual natural gas production.
The San Juan Basin also contains oil.
In late 2014, 10 rigs were drilling oil wells
in the Mancos Shale/Dakota Sandstone
formations. This developing play is adding
to New Mexico oil production, and the activity is helping service companies maintain
their capabilities for the time when natural
gas development ramps up again.

and electric utility expansions, even when
actual drilling and production take place
on state or private leases.
In addition, there is great concern regarding federal issues, including the
BLM's proposed hydraulic fracturing
rule, requirements stemming from the
lesser prairie chicken's listing as a threatened species, and new EPA rules relating

to source based emissions. Although the
industry is working on all these issues,
constant diligence is required to ensure
that federal agencies' rules and regulations
are reasonable.
Critical Component
The oil and natural gas industry in
New Mexico continues to proactively

Protracted Permitting
Like most jurisdictions, New Mexico's
overall regulatory environment is an ongoing challenge. Addressing both new
and existing issues is always a big part
of NMOGA's activities. Nevertheless, we
are seeing good progress with the New
Mexico Oil Conservation Commission
and Oil Conservation Division, the state
of New Mexico's rule making and compliance entities for oil and natural gas
production.
The amount of time it takes the OCD
to process applications for permits to
drill has remained manageable, even as
drilling activity has grown rapidly during
the past few years. In addition, there has
been progress toward formulating new
rules to address issues such as produced
water handling, acid gas injection and
surface waste management. Rules addressing these items are on the 2015 regulatory agenda.
Federal agencies' pace and progress
remain a greater challenge. With rapid
development on federal land in both the
San Juan and Permian basins, the pace
of APD approval has been problematic.
Buzzing activity and funding cuts under
sequestration have challenged the U.S.
Bureau of Land Management in both
corners of the state.
Going into December, a funding bill
to increase resources for BLM offices
that deal with oil and gas management
had passed the U.S. Senate and was awaiting action in the House of Representatives.
In the meantime, NMOGA members are
working with the BLM to provide direct
funding to build capability to reduce processing times for APDs and off lease
rights of way.
Permitting delays often impact New
Mexico's entire oil and gas industry.
Along with the considerable volume of
drilling and production on federally managed lands, the state's "checkerboard"
land ownership pattern regularly requires
rights of way for roads, gathering systems
JANUARY 2015 197



American Oil and Gas Reporter - January 2015

Table of Contents for the Digital Edition of American Oil and Gas Reporter - January 2015

Contents
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