Bill seeks to cancel pit waste rule

The Santa Fe New Mexican

A Republican legislator from northwestern New Mexico’s oil-and-gas-rich San Juan Basin is sponsoring a bill to rescind a controversial rule by the state Oil Conservation Division that tightened pit waste regulations.

Waste products produced during the drilling and pumping process are stored in pits. The OCD claims unlined pits have polluted groundwater.

Rep. Thomas C. Taylor, R-San Juan, sponsored the bill (HB 192), which says the “pit rules have no scientific basis, provide no environmental benefit and were adopted without legislative approval.”

The bill says the rules have cost the state about $140 million in lost tax revenues. “Rescinding these rules would replenish state revenues,” according to the bill, which is currently before the House Rules Committee.

Supporters of the pit rule say low demand and low oil prices have caused the decline in oil revenues.

The pit rule was approved by the Oil Conservation Division in 2008 following several weeks of testimony and some 5,000 pages of documents. The effort to finalize a pit rule was supervised by Mark Fesmire, the division director, a licensed petroleum engineer and attorney.

The rule regulates the siting, construction, monitoring and closure of pits used to store waste water and clay. The rule prohibits the use of unlined pits and increases the thickness of liners needed.

Gov. Bill Richardson proposed six changes to the rule in 2009 in answer to industry charges that the rule would increase the costs of production and discourage producers from operating in the state.