New Mexico Lawmakers Call on Congress to End Oil and Gas “Subsidies”


An estimated $ 121 billion in federal “grants” goes to the oil and gas industry in the Congressional budget reconciliation bill debated on the United States Capitol.

New Mexico environmentalists and some state lawmakers have called on the state’s two Democratic US senators, Martin Heinrich and Ben Ray Lujan, to support the elimination of these alleged subsidies that they say were perpetuating an accused industry contribute to pollution and climate change.

At a press conference on Friday, activists renewed their appeal to Heinrich and Lujan following a letter sent to senators in August asking them to work to end these federal benefits for the fossil fuel industry and support a transition to renewable energies.

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New Mexico Senator Antoinette Sedillo Lopez (D-16) from Albuquerque said oil and gas pollution was of particular concern in the oil-rich Permian Basin region of southeastern New Mexico, and that “subsidizing” the extraction of fossil fuels took money away from other public services.

She argued that the rental rates for public land paid by the industry are unduly low, comparing a 20 percent rate paid to the state by producers on the total income of a lease versus 25 percent charged to the state. Texas.

“The oil and gas in the ground belong to the ultimate rulers, the people. It doesn’t belong to companies, ”she said. “What we know now is that the drilling and combustion of oil and gas is a major contributor to climate change. It is not in the best interest of New Mexico or our planet to continue these subsidies. “

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New Mexico Senator Antoinette Sedillo Lopez (D-16)

Sedillo Lopez also argued that oil and gas developments are forcing the state to spend funds on maintaining roads affected by heavy oilfield traffic. She said Congress should follow through on commitments made by President Joe Biden ahead of the 2020 election to end oil and gas subsidies.

“Subsidizing fossil fuels also diverts public money from other uses,” she said. “I urge our senators to follow President Biden’s lead and eliminate these fossil fuel subsidies.”

Areas of New Mexico that rely heavily on oil and gas for local jobs and funding, cities like Carlsbad and Hobbs, could be supported in a move away from fossil fuels, Sedillo Lopez said, by emerging industries like renewable energies and carbon sequestration.

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“We could help slow climate change when we get involved in these technologies. These technologies can really help employ and transform southern New Mexico from a place of extraction to one that can be a solution to climate change, ”she said.

“Changing this environment would be transformative for this region and for our state. “

New Mexico Representative Andrea Romero (D-46) from Santa Fe said the environmental impact of oil and gas as a determinant of climate change is compounded by federal tax breaks for oil companies.

She said the industry is a major economic driver in New Mexico, but lawmakers should work to reduce the state’s reliance on growing pollution concerns.

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New Mexico Representative Andrea Romero (D-46)

“Helping the oil and gas industry right now seems so contrary to our values ​​as New Mexicans and Americans. In New Mexico, we are one of the worst emitters contributing to climate change, ”Romero said.

“We are in a very difficult position as legislators because it is a big money generator for our state. We should be fine and we should not be subsidizing this industry. “

The initial letter calling on Heinrich and Lujan to support the repeal of fossil fuel “subsidies” was signed by several New Mexico environmental groups and residents of the state.

He argued that New Mexico’s financial dependence on oil and gas revenues and the environmental damage associated with the extraction were both compounded by the tax breaks and other tax benefits afforded to the industry by the federal government.

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“Here in New Mexico, our communities are further suffering from the harms of fossil fuel extraction and the associated impacts of climate change,” the letter reads. “Fossil fuel subsidies exacerbate both of these problems. As the nation’s second-largest oil-producing state, New Mexico must be a leader in preventing the combined harms of climate change. “

Robert McEntyre, spokesperson for the New Mexico Oil and Gas Association, argued in a statement that New Mexico’s oil and gas industry was not unduly supported by the federal government.

He said the federal tax code provisions that provide for deductions and other benefits were intended to help oil and gas and other industries invest in local communities and support the country’s economy.

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“The oil and gas industry does not benefit from any special tax treatment from the federal government. This is a worn-out and blatantly false narrative, peddled only by those who want to block oil and gas development in favor of massive taxpayer payments to other companies, ”McEntyre said.

“Legitimate tax code provisions, like deductions, allow businesses in all sectors to invest in local communities and create jobs.”

McEntyre touted the contributions of oil and gas to New Mexico as an economic engine that he said would support the state’s continued growth.

“New Mexicans depend on the oil and gas industry for more than 134,000 jobs and $ 2.8 billion in revenue for our state budget and public schools,” he said.

“A deceptive campaign on how oil and natural gas works only serves to slander the most prosperous sector of our economy which continues to function in critical areas such as economic growth and financing education.”

Adrian Hedden can be reached at 575-618-7631, [email protected] or @AdrianHedden on Twitter.

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