Oil CEO: Lea to become No. 1 oil producer in the nation
At least one oil-related executive thinks Lea County is poised for the No. 1 slot.
Addressing the third annual Energy-Plex Conference at the Lea County Event Center Tuesday, Michael Latchem, president and CEO of Lucid Energy, said, “Right now, Lea County is projected to be the No. 1 oil producing county in the lower 48 states by the end of 2021.”
Speaking from the Midstream Facilities Activity panel, Latchem cited current rig and permit activity for his projection, adding that in three or four years, Eddy County will be No. 2 in the nation.
The EnergyPlex Conference, hosted by the Economic Development Corporation of Lea County, drew about 250 participants for the one-day event.
The theme of the oil and gas portion of the conference centered around Latchem’s point of continued growth in the Permian Basin, which straddles the Texas-New Mexico line reaching well into the lower halves of Lea and Eddy counties.
Recognizing the regional infrastructure needs, District Engineer Tim Parker of the New Mexico Department of Transportation listed his top priorities for roads as the same as the last few years, but more funding from the recent session of the state Legislature offers more optimism for NM 285 south of Loving and NM 128 west of Jal.
New Mexico’s acting state director for the Bureau of Land Management, Tim Spisak, reported the amount of time the BLM takes to process applications for permits to drill has reduced significantly since 2016, from 238 days to 48 days now.
On the venting and flaring rule, Spisak said, “That’s a challenge. Each state has different regulations.”
He reviewed the current federal rule defaulting to state regulations, except where no regulations are available. In those cases, the rules that existed before November 2016 will be used.
The Carlsbad Resource Management Plan, expected to replace a 1988 plan, may be finalized later this year, perhaps as early as August, Spisak said.
Cabinet secretary Sarah Cottrell Propst of the New Mexico Energy, Minerals and Natural Resources Department reviewed new laws she had supported in this year’s New Mexico Legislature.
“One of those was Senate Bill
553. This is a bill we worked on with the oil and gas industry. We very much appreciate that partnership,” Propst said. “This law establishes a fee schedule for administrative filing in the oil conservation system.
“This is important because the fees will go into a dedicated fund to allow us to modernize our system.”
Propst also highlighted bills implementing fines for violations in the oilfield and establishing ownership and enforcement responsibilities for produced water.
Developing a set of rules regarding methane release currently is under way, with the NMEMNRD and the Environment Department working with interests in the oil and gas industry to find solutions, she said.
Claire Chase, chairwoman of the board of NMOGA, hailed the state’s largest budget in history, providing additional funding for education and health services throughout the state.
“That is all thanks to the revenue that we in this room are producing and sending to Santa Fe. And this is really only the beginning,” she said. “We could go on and on and on about all the things we’re doing.
“This is a moment in New Mexico history, a chance to improve life, led by people in this room and in this community, and the thousands more that are out there working in the field every day in this industry,” Chase continued. “We know that the future depends on this industry. … This is our potential, not our destiny.”
Chase warned of environmentalists and extremists who demand the banning of fracking and still think they will reap the benefits of the funding received from the oil and gas industry.
“This is our time to stand up and be counted,” she added. “Our future is really bright. We’re so excited about the opportunity we’re standing on right now.”
Tracee Bentley, president and CEO of the Permian Strategic Partnership, encouraged involvement in five areas of focus — public education, health care, housing, roads and workforce development.
“By 2022, the demand for oil and gas workers will have increased 96 percent from 2016. Currently, we have a gap of at least 15,000 oil and gas industry workers for our current needs,” Bentley said. “We are meeting those needs by paying overtime and utilizing the occasional workforce. As we know, no workforce should be temporary.”
The PSP has committed $100 million to the effort that Bentley agrees is a relatively small amount.
“The $100 million is a drop in the bucket compared to the infrastructure needs,” Bentley said. “We know that can’t build roads or build bridges, but what we can do is use our resources to leverage other resources.”
An example she offered involves applications for federal grants that could significantly supplement available funds for infrastructure improvements.
“There are some really exciting projects we’re working on right here in Hobbs and Lea County, so stay tuned,” Bentley concluded.
Scheduled for the afternoon session were panels discussing energy diversity in Lea County, describing community support for the energy industries and introducing oil and gas company executives.
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