New Mexico 2025 Regular Session

New Mexico House Bill HB257 Compare Versions

Only one version of the bill is available at this time.

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28	28	HOUSE BILL 257
29	29	57
30	30	TH LEGISLATURE
31	31	-
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33	33	STATE
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35	35	OF
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37	37	NEW
38	38
39	39	MEXICO
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41	41	-
42	42	FIRST SESSION
43	43	,
44	44
45	45	2025
46	46	INTRODUCED BY
47	47	Matthew McQueen and Kristina Ortez
48	48	AN ACT
49	49	RELATING TO THE OIL CONSERVATION DIVISION; PROVIDING THAT THE
50	50	DIVISION MAY MAKE RULES AND ORDERS REGULATING THE TRANSFER OF
51	51	OIL AND GAS WELLS, INCLUDING LIMITATIONS ON CERTAIN TRANSFERS.
52	52	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
53	53	SECTION 1. Section 70-2-12 NMSA 1978 (being Laws 1978,
54	54	Chapter 71, Section 1, as amended) is amended to read:
55	55	"70-2-12. ENUMERATION OF POWERS.--
56	56	A. The [oil conservation ] division [of the energy,
57	57	minerals and natural resources department ] may:
58	58	(1) collect data;
59	59	(2) make investigations and inspections;
60	60	(3) examine properties, leases, papers, books
61	61	and records;
62	62	(4) examine, check, test and gauge oil and gas
63	63	.230061.1 underscored material = new
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90	90	wells, tanks, plants, refineries and all means and modes of
91	91	transportation and equipment;
92	92	(5) hold hearings;
93	93	(6) provide for the keeping of records and the
94	94	making of reports and for the checking of the accuracy of the
95	95	records and reports;
96	96	(7) limit and prorate production of crude
97	97	petroleum oil or natural gas or both as provided in the Oil and
98	98	Gas Act; and
99	99	(8) require either generally or in particular
100	100	areas certificates of clearance or tenders in connection with
101	101	the transportation of crude petroleum oil or natural gas or any
102	102	products of either or both oil and products or both natural gas
103	103	and products.
104	104	B. The [oil conservation ] division may make rules
105	105	and orders [for the purposes and with respect to the subject
106	106	matter stated in this subsection ]:
107	107	(1) to require dry or abandoned wells to be
108	108	plugged in a way so as to confine the crude petroleum oil,
109	109	natural gas or water in the strata in which it is found and to
110	110	prevent it from escaping into other strata; pursuant to Section
111	111	70-2-14 NMSA 1978, the division shall require financial
112	112	assurance conditioned for the performance of the rules;
113	113	(2) to prevent crude petroleum oil, natural
114	114	gas or water from escaping from strata in which it is found
115	115	.230061.1
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143	143	into other strata;
144	144	(3) to require reports showing locations of
145	145	all oil or gas wells and for the filing of logs and drilling
146	146	records or reports;
147	147	(4) to prevent the drowning by water of any
148	148	stratum or part thereof capable of producing oil or gas or both
149	149	oil and gas in paying quantities and to prevent the premature
150	150	and irregular encroachment of water or any other kind of water
151	151	encroachment that reduces or tends to reduce the total ultimate
152	152	recovery of crude petroleum oil or gas or both oil and gas from
153	153	any pool;
154	154	(5) to prevent fires;
155	155	(6) to prevent "blow-ups" and "caving" in the
156	156	sense that the conditions indicated by such terms are generally
157	157	understood in the oil and gas business;
158	158	(7) to require wells to be drilled, operated
159	159	and produced in such manner as to prevent injury to neighboring
160	160	leases or properties;
161	161	(8) to identify the ownership of oil or gas
162	162	producing leases, properties, wells, tanks, refineries,
163	163	pipelines, plants, structures and all transportation equipment
164	164	and facilities;
165	165	(9) to require the operation of wells with
166	166	efficient gas-oil ratios and to fix such ratios;
167	167	(10) to fix the spacing of wells;
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196	196	(11) to determine whether a particular well or
197	197	pool is a gas or oil well or a gas or oil pool, as the case may
198	198	be, and from time to time to classify and reclassify wells and
199	199	pools accordingly;
200	200	(12) to determine the limits of any pool
201	201	producing crude petroleum oil or natural gas or both and from
202	202	time to time redetermine the limits;
203	203	(13) to regulate the methods and devices
204	204	employed for storage in this state of oil or natural gas or any
205	205	product of either, including subsurface storage;
206	206	(14) to permit the injection of natural gas or
207	207	of any other substance into any pool in this state for the
208	208	purpose of repressuring, cycling, pressure maintenance,
209	209	secondary or any other enhanced recovery operations;
210	210	(15) to regulate the disposition, handling,
211	211	transport, storage, recycling, treatment and disposal of
212	212	produced water during, or for reuse in, the exploration,
213	213	drilling, production, treatment or refinement of oil or gas,
214	214	including disposal by injection pursuant to authority delegated
215	215	under the federal Safe Drinking Water Act, in a manner that
216	216	protects public health, the environment and fresh water
217	217	resources;
218	218	(16) to determine the limits of any area
219	219	containing commercial potash deposits and from time to time
220	220	redetermine the limits;
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249	249	(17) to regulate and, where necessary,
250	250	prohibit drilling or producing operations for oil or gas within
251	251	any area containing commercial deposits of potash where the
252	252	operations would have the effect unduly to reduce the total
253	253	quantity of the commercial deposits of potash that may
254	254	reasonably be recovered in commercial quantities or where the
255	255	operations would interfere unduly with the orderly commercial
256	256	development of the potash deposits;
257	257	(18) to spend the oil and gas reclamation fund
258	258	and do all acts necessary and proper to plug dry and abandoned
259	259	oil and gas wells and to restore and remediate abandoned well
260	260	sites and associated production facilities in accordance with
261	261	the provisions of the Oil and Gas Act, the rules adopted under
262	262	that act and the Procurement Code, including disposing of
263	263	salvageable equipment and material removed from oil and gas
264	264	wells being plugged by the state;
265	265	(19) to make well price category
266	266	determinations pursuant to the provisions of the federal
267	267	Natural Gas Policy Act of 1978 or any successor act and, by
268	268	regulation, to adopt fees for such determinations, which fees
269	269	shall not exceed twenty-five dollars ($25.00) per filing. Such
270	270	fees shall be credited to the account of the [oil conservation ]
271	271	division by the state treasurer and may be expended as
272	272	authorized by the legislature;
273	273	(20) to regulate the construction and
274	274	.230061.1
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302	302	operation of oil treating plants and to require the posting of
303	303	bonds for the reclamation of treating plant sites after
304	304	cessation of operations;
305	305	(21) to regulate the disposition of
306	306	nondomestic wastes resulting from the exploration, development,
307	307	production or storage of crude oil or natural gas to protect
308	308	public health and the environment; [and ]
309	309	(22) to regulate the disposition of
310	310	nondomestic wastes resulting from the oil field service
311	311	industry, the transportation of crude oil or natural gas, the
312	312	treatment of natural gas or the refinement of crude oil to
313	313	protect public health and the environment, including
314	314	administering the Water Quality Act as provided in Subsection E
315	315	of Section 74-6-4 NMSA 1978; and
316	316	(23) to regulate the transfer of oil and gas
317	317	wells, including limitations on transfers when:
318	318	(a) the transferor, the transferee or an
319	319	entity that owns more than a twenty-five percent interest in a
320	320	transferor or transferee is: 1) the subject of one or more
321	321	notices of violation of the Oil and Gas Act; 2) the subject of
322	322	an enforcement action under the Oil and Gas Act relating to
323	323	spills or releases; or 3) out of compliance with natural gas
324	324	capture or reporting requirements;
325	325	(b) the transferee fails to provide
326	326	adequate financial assurance as required by the division;
327	327	.230061.1
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355	355	(c) the transferee lacks sufficient
356	356	financial capacity based on known or projected production to
357	357	manage liabilities associated with the oil and gas wells; or
358	358	(d) the division issues a written
359	359	finding that the limitations on transfer are necessary for the
360	360	purposes of mitigating risk to the state from potential
361	361	inactive or abandoned oil and gas wells ."
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363	363	.230061.1