This week a federal judge (much to the consternation of radical environmentalists) voided the Biden Administration’s moratorium on oil and gas permitting on federal lands. The news so far in 2021 for New Mexico and the oil and gas industry had been mixed, but this decision, if it holds, could make 2021 a watershed moment for New Mexico’s most important industry.
- Prices had rebounded to above $70/barrel from below-zero in April of 2020 and with the economy expected to rebound from the artificial COVID shutdown, prices show no signs of coming down;
- New Mexico’s oil production continued to grow (and revenues jumped by $350 million) despite a reduction in the number of drilling rigs active in the state (from 114 down to 71);
- The Biden moratorium loomed as the major threat to the Industry, but that threat COULD be receding depending on the Administration’s interest in appealing AND whether Deb Haaland’s agency “slow-rolls” the permitting process on federal lands. This is of course the most notable immediate threat.
So, as long as Gov. Lujan Grisham continues her unstated policy of placating her environmental supporters through the Energy Transition Act and pushing for a “clean fuel standard” while not attacking the Industry directly, New Mexico’s oil and gas industry could be a growth industry both in terms of jobs AND in terms of tax revenues for the State for the foreseeable future.