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Western Values Project aims to provide members of the media, policy makers and the public with an honest, accurate and rhetoric-free source of information about energy development on public lands.

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Oil and Gas Production of Federal Minerals in New Mexico

oil_gas_production_NM

Source: Office of Natural Resources Revenue-Statistical Information

Federal oil production in New Mexico has increased every consecutive year since FY 2007 and, last year, production increased more than 41% over FY 2014 levels.

In contrast, gas production has generally decreased in New Mexico since FY 2006, likely because gas prices have decreased more than 60% since FY 2006.

Federal Well Types and Statuses in New Mexico for February 2016

federal_well_types_status_NM
Source: BLM FY 2015 Idle Well Report (IM No.2012-181)

Historically, in New Mexico, federal minerals have been chiefly-valuable for natural gas, rather than oil. Almost two-thirds of federal wells in the state are gas wells.

Acres Nominated for Leasing and Gas Prices

acres_nominated_gas_prices_NM
Sources: BLM Oil and Gas Statistics, Energy Information Administration

Because federal minerals in New Mexico are chiefly valuable for gas, industry interest in leasing and drilling is closely tied to natural gas prices. The chart above illustrates the direct relationship between the amount of federal acreage nominated for leasing in New Mexico and gas prices.

Further, the vast majority of oil and gas production in New Mexico comes from two areas: the Permian and San Juan basins. And BLM has already leased most of the federal minerals in those areas for oil and gas development, with 83 percent of the Carlsbad Field Office (Permian) roughly 79 percent of the Farmington Field Office (San Juan) currently leased. Thus, not only have prices declined, but the industry has already leased most of the productive federally-managed areas in the state.

State and Federal Leasing in New Mexico

state_federal_leasing_NM
Sources: BLM Oil and Gas Statistics, NM State Land Office

As shown above, state and federal leasing have steadily declined in New Mexico since FY 2003. These decreases are likely because the two major basins in the state—the Permian and San Juan Basins—are already almost entirely leased for development. On federal lands, 79% of BLM’s Farmington Field Office1 and 83% of BLM’s Carlsbad Field Office2, which overlap the San Juan and Permian Basins, respectively, are already under lease.

  1. See http://www.blm.gov/style/medialib/blm/nm/field_offices/farmington/farmington_planning/ffo_planning_docs/rmpa_mancos.Par.39210.File.dat/FMG_FinalAMS_20150317_508_reduced.pdf (March 2015) at p. 2-109.
  2. See http://www.blm.gov/style/medialib/blm/nm/field_offices/carlsbad/rmp/documents.Par.37491.File.dat/AMS_Compiled.pdf at p. 2-39.

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