New Mexico’s energy workers have almost single-handedly reshaped global oil markets. Oil field workers have pumped so much petroleum and natural gas from the Permian Basin, which runs through southeast New Mexico and southwest Texas, that America recently became a net oil exporter for the first time in decades.
Oil production in New Mexico has nearly tripled since just 2012 to a quarter of a billion barrels. This boom is just getting started. Oil production in the Permian is set to double again by 2023. It’ll account for 60 percent of the entire global increase in oil production. New Mexico is now the third largest oil producer in the country.
We’ve also become a top natural gas producer, accounting for about 4 percent of all domestic production.
Only one thing stands in the way of greater riches for New Mexicans — politicians who oppose the infrastructure needed to bring this oil and natural gas to market. Energy firms are rushing to build more pipelines. But State leaders increasingly oppose such infrastructure. Just last month, two Democratic members of our congressional delegation called for more burdensome regulations on New Mexico’s energy firms.
Such obstruction makes no sense. Building more energy infrastructure would enrich New Mexicans – and help us share our affordable, clean energy with the rest of the country.
The U.S. Geological Survey recently estimated the Permian Basin contains 46 billion barrels of oil and 281 trillion cubic feet of natural gas, making it the largest energy reserve in America.
We’ve been quick to develop it. Seemingly overnight, companies have transformed empty deserts into bustling micro-cities, with rigs, roughnecks, and truckers working all day and night.
The enormous wealth generated by our energy boom has benefited virtually all New Mexicans. Oil and gas support 100,000 local jobs. And the taxes, fees, and other government charges on energy operations have been transformational for the public budget, producing over $2 billion every year and accounting for a full third of the state’s general revenues.
Other states and nations are eager to purchase New Mexico-produced oil and gas. But they can’t do so unless we increase our pipeline capacity.
Currently, the infrastructure for turning the Permian bounty into commercial products — the rigs, roads, pipelines, and refineries — is relatively limited. Private developers are pouring investment into new infrastructure projects, including the recently opened Grand Prix Pipeline, which, once it hits full capacity, will transport up to half a million barrels of natural gas liquids every day from Lea County to Oklahoma and the Gulf Coast.
We need more investments like this. But they won’t materialize if politicians throw up roadblocks and push for onerous regulation on energy firms.
Revamping our energy infrastructure wouldn’t just funnel affordable energy to other parts of the nation — it’d also bring environmental gains to the rest of the world.
How so? For decades, many of America’s power plants ran on coal, a carbon-dense energy source.
But thanks to the recent production boom, natural gas prices have plummeted. Natural gas is now much cheaper than coal — and it’s also much cleaner, producing about 50 percent fewer emissions when burned.
New Mexico’s power plants have increasingly switched to natural gas. The fuel now accounts for a full third of our state’s electricity. Other states have witnessed a similarly dramatic shift.
Natural gas has helped drive U.S. carbon dioxide emissions to 20-year lows, even as global emissions jumped 50 percent since 1990. Sharing our natural gas widely could reduce emissions on a global scale.
New Mexico has emerged as one of the leading oil and gas producers not only in the United States, but in the world. Private industry can help New Mexicans reap the full rewards of our unprecedented energy bounty — as long as politicians get out of the way.
Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility.