February 16, 2021

Produced water bill dies in committee

New Mexico State Capitol (CC BY-ND 2.0) by Mr.TinDC

A bill that would have made it illegal for oil and gas operators to spill produced water died in the Senate Judiciary Committee Monday. Produced water is the toxic flowback water generated in oil extraction. 

SB 86, sponsored by Democratic Senators Antoinette Sedillo Lopez of Albuquerque and Liz Stefanics of Cerrillos, sought to address many of the issues the state is now facing in managing scarce freshwater supplies and increasing volumes of produced water.

“This bill does two things,” Sedillo Lopez told legislators. “First, it compels industry to reduce the volume of and reuse its waste by prohibiting freshwater use in fracking when produced water can be used instead. And second, it fulfills the original intent of the Produced Water Act of 2019 by mandating safeguards to protect public health, the environment and freshwater from this waste stream.”

Norm Gaume, a water expert and former director of the Interstate Stream Commission, and who currently sits on the Produced Water Research Consortium’s technical steering committee, spoke in support of the bill.

“The consortium is addressing none of the issues discussed here that are covered by this bill,” he said. 

Gaume noted that there are significant disparities between operators in produced water spills. 

“The tenth-ranked producer reported 5.12 toxic wastewater spills per million barrels of oil and gas. WPX Energy Permian LLC reported 4.71 toxic wastewater spills per million gallons of oil and gas,” Gaume said, referencing Oil Conservation Division data. “Contrast that with EOG Resources, the top ranked producer [in the state], with a spill rate of 0.26 wastewater spills per million gallons of oil and gas.”

RELATED: ‘Dereliction of duty’: 1.6 million gallons of produced water spilled so far in 2020

He also emphasized that most spills reported by oil and gas operators in the state are preventable. 

“Operators attribute three of every four spills to equipment failure, corrosion, human error, or overflow of tanks and kits,” he said. “New Mexico law and rules now rely on oil and gas operators’ voluntary efforts and expenditures to prevent negligent and preventable spills. These voluntary efforts to reduce spills are not working.”

The committee chair, Democratic Sen. Joseph Cervantes of Las Cruces, did not allow public comment in favor of the bill, but did allow a panel of oil and gas lobbyists to present their opposition to the bill. 

Cervantes said that the explanation of the bill by Sedillo Lopez and two expert witnesses counted as the public speaking in favor of the bill.

Lobbyists for Chevron, COG Operating, Marathon Oil and the New Mexico Oil and Gas Association spoke in opposition to the bill, arguing that the legislation would conflict with the 2019 Produced Water Act and would threaten oil and gas operations in the state.

“Two years ago, experts and stakeholders came before this body in collaboration to encourage innovation and investment in an area that had become the leading dilemma facing companies: what to do with the ratio of produced water to barrels of oil. This bill seeks to undo that collaborative, technical, comprehensive work,” said one lobbyist. 

RELATED: Oil Conservation Commission agrees to hear proposal for produced water spills

Albuquerque Democratic Sen. Daniel Ivey Soto and Cervantes both raised concerns with the complexity of the bill and its language.  

“If you want to make spills a violation of the Oil and Gas Act, you could have done that…by including spills as one of the things that would be a violation,” Ivey Soto said. “I think that could have been a fairly straightforward and simple bill to pass. And that is not all that this bill does.”

Senate President Pro Tem Mimi Stewart, D-Albuquerque, said she thought the Legislature should allow the Produced Water Act of 2019 to be implemented longer before attempting to change the laws regarding produced water. 

“I mean, we’ve only finished the rulemaking for these produced water operations a few months ago,” she said. “We don’t have one state agency who thinks we need to be doing this now. I believe the industry —they really need to focus on recycling their waste and to reduce their freshwater consumption.”

“I do think this is a danger to the industry, and it’s not supported by any of our agencies. So I just have a hard time moving forward,” she said. 

The bill was tabled by a unanimous vote.