Monday, July 4, 2022

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Oil and Gas Giant Bucks Interior Department in NM's Permian Basin

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Thursday, October 5, 2017   

ALBUQUERQUE, N.M. -- The Interior Department wants to delay an Obama administration directive requiring energy companies to reduce methane emissions at drilling sites on federal lands. But one company with plans to drill in New Mexico says it will capture methane emissions with or without regulations.

XTO, a subsidiary of ExxonMobil, recently invested $6 billion in acreage in New Mexico's Permian Basin. The company said it's committed to reducing methane emissions from its production and midstream operations nationwide.

Jon Goldstein, director for regulatory and legislative affairs with the Environmental Defense Fund, said it shows that one of the biggest oil and gas producers in the U.S. is stepping up to make a positive impact.

"It's really a win-win,” Goldstein said. "What companies like XTO are showing is that this is the right thing to do for their business and that in rolling back these rules at the federal level, the Trump administration is really running in the wrong direction on this issue."

In proposing to delay the methane reduction rule until January 2019, the Interior Department said the Obama administration may have underestimated costs and overestimated benefits. Public comments will be taken on the issue for the next 30 days.

It's estimated that $330 million worth of methane gas is wasted by the oil and gas industry annually - enough to power about 1.5 million homes a year on federal and tribal lands. Goldstein said XTO's decision to comply with the previous administration's rules despite the uncertainty at the national level shows that doing so is cost-effective and attainable.

"What this is saying is, here's a company that's investing big time in New Mexico, and meanwhile they're also going to maximize the positive impact of that investment by reducing to the greatest extent possible their methane waste,” he said. “So that's going to mean millions more to the state in the form of tax and royalty payments."

Goldstein said lost revenue due to methane leaks could help fund New Mexico's education, roads, and bridges, and state leaders should require other gas and oil operators to follow XTO's lead.


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