Annual Report 3 - New Mexico - Energy, Minerals and Natural ...

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The Surface Owners’ Protection Act was adopted in 2007. Under the act:
Surface owners who do not own the mineral rights below their property must be notified 30 days prior to
beginning any drilling-related operations.
Surface owners must receive a description of proposed oil and gas operations so they can evaluate the
potential impacts to their property.
Oil and gas operators must compensate landowners for the use of their property, and pay for any damages
caused by activities like drilling and road building.
The act also requires oil and gas operators to clean up after themselves when they are finished.
Previous law required no prior notice of operations to the surface owner. By passing the Surface Owners’ Protection
Act, New Mexico became the only state to require companies to provide landowners with extensive information
about pending oil and gas drilling. New Mexico also became the only state to mandate compensation for such a
broad range of damages and use, including loss of agricultural production and income, reduced land value, lost use,
and access to the surface owner’s land. Combined with the duty to reclaim the land once oil and gas operations have
ceased, this is the most complete set of surface owner protections in the country. This act made the responsibilities of
land owners and of the oil and gas well operators more clear and provided a vehicle for more effective communication.
OCD’s Environmental Bureau led a task force of members from the industry, the public, other government entities
and other interested parties to create a rule to replace the existing pit rule. Pits are used to contain fluids resulting
from drilling and other oil and gas operations to prevent those fluids from contaminating ground water or harming
wildlife. Topics considered included standards for pit installations and closures, the lining of pits, soil testing,
fencing and netting, and best practices. This rule became effective in 2008. The division conducted training sessions
throughout the state. Later the pit rule was revised to grandfather in certain types of tanks to minimize conversion
costs to the industry.
In 2008, OCD and the Oil Conservation Commission restructured and revised their rules to make them easier to
read and to use. The changes included restructuring the rules under 33 headings accurately reflecting the subject
matter, adopting consistent use of terms throughout the rules, changing rules related to OCD forms to reflect current
requirements and practices and corrections to information that had become inconsistent due to updates over the
years.
Last, a rule to protect the unique nature of the Galisteo Basin was adopted by the Oil Conservation Commission.
ENFORCEMENT: The division refined its enforcement rules with changes that went into effect over
several years. These rules provide a means for well operators and OCD to consistently determine whether an
operator is compliant or non-compliant with division rules in the areas of well inactivity, financial assurance,
operatorship and meeting the requirements of division orders. Information that determines current and future noncompliance
is displayed on OCD’s web site and updated daily to allow all parties to take early action and to provide
assurance that enforcement is equitable.
ENERGY, MINERALS AND NATURAL RESOURCES DEPARTMENT