Pore space bill could define ownership of underground pockets

By Staci Matlock: The New Mexican

Jack Chatfield has an easy-going drawl, a rancher’s calloused bear grip of handshake and he’s got an eye toward a new source of revenue.

The Mosquero man has been at the Roundhouse frequently in the last few weeks promoting pore space ownership – an idea catching on in the West.

The pore space between underground minerals could soon be a valuable, marketable property so it is important to establish who owns the rights, Chatfield said. Pore space could be used to sequester carbon dioxide, one of the greenhouse gases associated with climate change, and compressed air, used to turn wind turbines when wind isn’t blowing.

Legislators are considering two pore-space ownership bills that are facing opposition from some oil and gas developers. While a pore-space property right bill sailed through its first Senate committee last week, a House version stalled in its first hearing due to opposition, according to Chatfield.

“I think this is a matter of educating people,” Chatfield said. “This is a new idea and newness always takes awhile to get used to.”

Chatfield thinks the pore space should belong to surface property owners unless the rights have already been sold to someone else.

Sen. Clinton D. Harden, R-Clovis, is sponsoring the Senate pore-space bill (SB 208). He worked with the state Oil Conservation Division to revise the bill and address some of their concerns.

Mark Fesmire, head of OCD, said this is a “property rights law.”

Property can be likened to “a bundle of sticks that can be separated and severed,” Chatfield said.

Minerals, grazing, water, development rights, even wind, are other types of “property” that can be bought, sold or leased. “Truly in the future there will be other sticks in the bundle brought forth by technology,” Chatfield said.

Take pore space. Not long ago, it was simply the area between minerals usually filled with water, oil or natural gas. Technology now makes it possible to inject carbon dioxide thousands of feet underground. “As we begin to store carbon dioxide, compressed air and other substances beneath the surface of the earth, its value will begin to increase,” Chatfield said in written comments. “The manner in which we address the ownership of pore space will affect the way we deal with the ownership of property in New Mexico in the future.”

Fesmire said oil, gas and water don’t have to be pumped out for the pore space to be used.

The pore-space bill does not interfere with the rights of mineral owners to develop and mine oil and gas. SB 208 also would prohibit injection of carbon dioxide or compressed air into valuable oil and gas deposits without consent of the mineral owner. It also doesn’t change water law, storage, pumping or recharge, according to Chatfield.

The bill in part is based on an analysis of existing case law and statutes in various states regarding who owns pore space property rights by the Interstate Oil and Gas Compact Commission CO2 Sequestration task force. The report concluded that laws need to clearly spell out the surface owner as the person with the right to lease pore space while protecting other stakeholders from possible damage due to carbon sequestration.

Contact Staci Matlock at 470-9843 or smatlock@sfnewmexican.com.