Saturday, December 11, 2010

NM judge hears first pit rule challenge

For background, go to:

Pit Rule Appeal Hearings on December 10th

Some citizens attended the hearings. Some of the issues raised by industry lawyers were interesting. For example, OCD (Oil Conservation Division) is charged with protecting waste and one definition of waste is to obtain every last drop of hydrocarbon from a well or then there would be waste, industry claims. Another industry argument is that if there are competing concerns such as economic versus environment, then economic trumps. So, according to industry, the OCC (Oil Conservation Commission) and the OCD violated these by adopting the pit rule.

Such reasoning could lead to the conclusion that the regulatory charge of OCD is promote for the well interest owners' benefit the maximum amount possible extraction from wells and to not promulgate rules that could have adverse economic impacts, great or small, to those interests even if there were adverse impacts to the environment.

Another way to look at the apparent industry point of view, whatever is in the interest of the oil and gas industry is good for New Mexico. Evidently, the oil and gas industry has decided that the pit rule is not good, thus it is not good for New Mexico.

For a brief Associated Press article about the hearing, click here>>>>.

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