December 14, 2020

Why energy companies are drilling for a greenhouse gas in New Mexico

Margaret Wright

Oil pump in southeast New Mexico.

Trapped underground in the sandstone of northeastern New Mexico sits one of the largest naturally occurring carbon dioxide reservoirs in the nation called the Bravo Dome. 

The 1,400 square mile gas field in rural Harding and Union counties is one of a handful of its kind in the United States. They make up a small but critical piece of the nation’s oil drilling operations — one that has bipartisan support and could increase under the Biden administration. 

Most of the carbon dioxide extracted from places like the Bravo Dome is piped to oil fields where it’s injected into wells to force out the last dregs of oil in a process called enhanced oil recovery.

However, carbon dioxide extraction raises scores of environmental and climate issues — including the potential for massive releases of a greenhouse gas into the atmosphere. And the companies that drill for the gas in New Mexico have questionable records when it comes to dealing with landowners. 

Why drill for CO2?

Democrats and Republicans alike have supported enhanced oil recovery, or EOR, in which carbon dioxide and water are pumped into wells to help extract remaining oil to the surface. It works somewhat like fracking, but without all the chemicals. 

The more common way politicians discuss EOR is through the lens of carbon capture, utilization and storage. Also known as CCUS, this is a host of technologies often pitched as a mechanism for decarbonizing the energy sector by capturing carbon dioxide emissions at the source and making sure the gas gets stored back underground, rather than going into the atmosphere.

EOR has been common in Permian basin oil operations. In fact, pipelines carry carbon dioxide from the Bravo Dome and the McElmo Dome to the Texas side of the Permian. However, most of the carbon dioxide used doesn’t come from capture at coal plants and the like — it comes from natural sources where the gas would otherwise remain underground. 

This carbon dioxide-enhanced recovery can be profitable for oil companies, especially with incentivizations from federal tax credits. The process can be a boon for the areas where the carbon dioxide originates, too. 

The companies that control Bravo Dome operations in New Mexico’s Union and Harding counties make up large amounts of the local governments’ tax bases. 

In Union County, over 20 percent of tax revenues came from energy company Oxy’s operations at the Bravo Dome.

Harding County relies on the carbon industry even more — 70 to 80 percent of its tax base comes from the drilling, depending on the year. 

In 2019, carbon dioxide property taxes came in at over $1 million, according to Harding County Assessor Phillip J. Trujillo. Taxes from Bravo dome production and equipment were more than $200,000. 

That money is a major revenue source for Harding County and it especially helps local school districts, Trujillo said. 

“It’s a big part of our economy,” he said. “If they weren’t in existence here, we’d be hurting. We’re a poor county to begin with.”

Energy companies have records of mistreating land, people 

The energy companies involved with natural-source carbon dioxide production have a track record of questionable dealings with New Mexicans and the environment.

Mary Libby Campbell has a small ranch operation with about 250 head of cattle in rural Harding County. She said her father had agreements with Oxy for carbon dioxide operations on the land, but they’d expired. 

Still, Campbell said, the energy company was on her ranchland a few years ago, well after she said agreements with the company had expired.

“They were parking their vehicles on our pasture land, and of course ruining that land,” Campbell said. “Once they use the land in a bad way, it takes a long time for it to come back.”

Campbell is a conservation-minded rancher, and she has worked for years to restore her land. She’s not against drilling for carbon dioxide — Campbell said she thinks EOR is a cleaner and safer form of fracking — but she wound up filing suit against Oxy over the damages to her land. 

In court, she faced an uphill battle. She recalled the judge saying, “Look they’ve got more money than God. What do you wanna do here?” 

Campbell said she and some of the others involved in the lawsuit didn’t want to settle with Oxy, but they didn’t get their way. “I did not have a good outcome with our lawsuit,” she said.  

Oxy didn’t respond to a request for comment. However, it isn’t the only company that favored its bottom line over New Mexicans when it comes to carbon drilling. 

For example, in 2013, a group of landowners sued the Hess Corporation, alleging the energy company underpaid royalties for carbon dioxide operations over a period of eight years. 

While Hess never admitted any wrongdoing in court, it settled with the landowners for $3.75 million plus interest.

On top of the carbon dioxide extraction itself, New Mexico has been home to issues relating to transportation of the gas. In 2013, Kinder Morgan proposed a $1 billion carbon dioxide pipeline running over 200 miles through central New Mexico. 

Many landowners decried the project, known as the Lobos pipeline, and experts said it risked compromising human health, the environment, cultural sites and the water supply. 

After months of debate, Kinder Morgan dumped the project in 2015, citing economic reasons. The company declined to discuss its carbon dioxide operations. 

In New Mexico and Colorado, carbon dioxide producers have also sued government entities to try getting out of paying taxes. 

Even carbon proponents like Campbell say the companies could show more decency for the people and environment. 

“They did not show any respect for the land whatsoever,” Campbell said. “Or for me either.”

The existential questions of climate impact 

Perhaps the most pressing issue with carbon dioxide drilling is how it plays into climate change — both how the gas itself causes climate change and the fact that it enables continued usage of fossil fuels. 

While proponents of EOR say it is a climate solution that puts carbon dioxide into the ground to stay, many environmentalists say this description is a red herring and that carbon dioxide drilling, like at the Bravo Dome, must stop. 

Mike Eisenfeld, energy and climate program manager for the San Juan Citizens Alliance, said EOR isn’t a climate-conscious technology in the slightest. He said he’s skeptical of EOR in general and called Democrats’ support of the technology a “heartburn.” 

“It’s like this constant quest to increase production of oil and gas,” he said. “This is a potential huge source of carbon emissions.”

While most of the carbon dioxide shot into wells during EOR stays underground, some of it can escape and add to the greenhouse gases that’re warming the planet. 

Plus, there’s a potential for a massive release of carbon dioxide. In 1982, an incident at a carbon dioxide dome in Colorado, Sheep Mountain, released thousands of tons of carbon dioxide into the atmosphere over the course of a week. 

While EOR is often discussed as a way to use carbon dioxide emissions captured from sources such as coal plants, most of the gas used to recover oil isn’t from those places. It’s from places like the Bravo Dome, where it would stay underground absent human intervention. 

For environmentalists and climate advocates, it’s critical that every bit of carbon dioxide that’s in the ground stays there. 

“We should not be bringing these carbon dioxide emissions,” Eisenfeld said, “and the carbon dioxide in the first place, into the atmospheric equation.”