The annual New Mexico EnergyPlex Conference, hosted by the Economic Development Corporation of Lea County, was held June 26 at the Lea County Event Center in Hobbs, NM. The county, which is the second-highest oil and gas producing county in the United States, is home to many PESA members. Lea County is known as the EnergyPlex, home to traditional energies including oil and gas, and nuclear, as well as renewable energy such as wind and solar.
The nearly 250 attendees included representatives from both upstream and midstream oil and gas companies, as well as state and federal agencies and community members. Elected officials from the local communities and the county shared statistics and data related to the energy boom currently occurring in the area.
TRANSPORTATION & REGULATIONS
Tim Parker, District 2 Engineer for the New Mexico Department of Transportation, kicked off the event with a presentation outlining the transportation challenges in Southeastern New Mexico. The district includes 10 counties with 133 communities. No interstates run through the district. Construction projects totaling $112 billion are currently underway in the district. This includes work on Highway 82 between Artesia and Lovington, which is a vital road for oilfield traffic in the area.
The Acting State Director for the New Mexico Bureau of Land Management (BLM), Tim Spisak, outlined the priorities established by Secretary of the Interior David Bernhardt when he was appointed to the position in April. The BLM manages more than 700 million acres with 45 million acres of mineral estate in the portfolio.
New Mexico BLM is the agency’s leader in annual oil production with more than 120 million barrels per day of onshore oil production, which is half of the entire Bureau’s production. The agency plans to increase public access to federal lands, remove unnecessary regulations and speed up the permitting process. The permitting process has been reduced from 238 days in 2016 to just 48 days in 2019. In an effort to further ease delays in permitting, the agency’s Well Information System will be replaced in 2020.
PERMIAN PARTNERSHIP & MIDSTREAM
Tracee Bentley, President and CEO of the Permian Strategic Partnership (PSP), shared her group’s plans for Southeast New Mexico. The partnership is focused on five key areas: public education, housing, healthcare, roads and workforce development. Estimates show that 15,000 workers are needed to meet current job openings in the Permian Basin. PSP is working to help communities attract workers to not only fill oilfield jobs, but also the service and community positions needed to support these workers.
The Midstream Panel included Michael Latchem, President and CEO, Lucid Energy, and Todd Tanory, Vice President of Commercial and Business Development, DCP Midstream. There has been a 325% increase in the horizontal rig count with the recent uptick in production. Both presenters believe that Lea and neighboring Eddy County will become the number one and number two top oil producing counties in the U.S. in the coming months.
PRODUCTION & ENERGY TRANSITION
New Mexico Oil and Gas Association Board President Claire Chase shared statistics related to the incredible increase in production coming from Southeast New Mexico. In 2018, nearly 250 million barrels of oil were produced. That’s an increase of nearly 40% from 2017 and almost three times the amount produced in 2012.
Sarah Cottrell Propst, Cabinet Secretary, New Mexico Energy, Minerals and Natural Resources Department, discussed the Energy Transition Act that recently passed the state legislature. The bill calls for 40% renewables by 2025 and 50% by 2030. The agency is hosting public meetings related to methane as the organization works to establish sensible rules regarding its release and capture.
The conference ended with a panel discussion of oil and gas executives including Carman Mullins, Vice President, Permian Business Unit, XTO Energy; Oscar Quintero, President and General Manager – Permian Resources, NM Delaware Basin, Occidental Petroleum; and Chance Chase, President, Chase Energy Services. All panelists agreed that safety is the top priority and sharing best practices among companies provides the safest environment for employees. While Mullins expressed concern that the local workforce needs more automation training, Chase shared that the unpredictable political environment of the state makes long-term planning a challenge for companies. Quintero discussed Oxy’s plan to eventually be carbon neutral by utilizing carbon capture technology.