American Oil and Gas Reporter - September 2018 - 112

a particularly scarce and valuable resource.
The customary industry practice is to
dispose of flowback and produced water
in licensed Class II underground injection
control wells, Flynn says, but that practice
is being reconsidered.
In July, the U.S. Environmental Protection Agency announced it had entered
a memorandum of understanding with
the State of New Mexico to consider produced water treatment and possible beneficial reuse. "NMOGA has been working
on this agreement for more than a year,"
Flynn reports. "We are not interested in
taking credit for any of it, but it is
gratifying to see that effort come to
fruition. The big picture is how we can
remove impediments and allow operators
to unlock this valuable resource."
The MOU between EPA and New
Mexico seeks to form a "collaborative
work group to clarify and understand existing regulations and permitting frameworks" as applied to produced water. It
says the work group is to "identify those
existing and potential technologies for
increased treatment and possible uses of
produced water." The water work group
is to meet on a quarterly or an ad hoc
basis and conclude within two years.
The document defines produced water
as "fluid from a hydrocarbon bearing strata
brought up during extraction that may include formation water, injection water and
chemicals added down hole." The MOU
does not differentiate between produced
water and well completion flowback. Under
its definitions, recycled water is generated
from an oil or gas well, "significantly treated" and used again before UIC well disposal.
Renewable water is produced from a well,
significantly treated and then added to the
hydrologic cycle rather than injected in a
disposal well. Re-used water is minimally
treated and used again in an oil or gas well
before ultimate UIC disposal.
The MOU instructs the work group to:
* Synthesize existing produced water
regulatory and permitting frameworks;
* Identify gaps in data and policy regarding produced water useage;
* Identify possible uses of renewable
water, re-used water and recycled water;
and
* Identify any process or other improvement opportunities for such uses.
"While underground injection certainly
has its utility and place, alternatives are
available that treat oil and gas wastewater
for re-introduction into the hydrologic
cycle, says EPA spokesman David P. Ross.
"This is especially important in arid areas
suffering from drought like New Mexico."
"The technology available for treatment
of produced water has come a long way,"
Flynn notes. "Now, industry can eco-

nomically bring what was considered a
waste product up to drinking water standards. This MOU can help update the
regulations for water discharge and allow
treated water to go where it is needed,
such as the agricultural industry."
Spill Rule, Horizontal Wells
NMOGA was also instrumental in
getting the state to update rules governing
oil spills that were promulgated during
the administration of Governor Bill
Richardson, Flynn recounts, and which
he describes as "incredibly vague, lacking
clarity or substance."
NMOGA has no problem with the principle of a fair and reasonable spill rule, he
emphasizes. "The industry recognizes that
having responsible regulations is critical
to maintaining our social license to operate,"
Flynn acknowledges. "We also need fair
and consistent application of those rules."
The revision to the state Oil Conservation
Division rule clarifies operator responsibilities for initial spill response, site characterization, remediation, closure, reclamation and enforcement. Industry representatives worked with the OCD to develop
a rule that both parties deemed stronger
and would raise industry standards, Flynn
reports, adding that the OCD completed
the revisions and adopted them in April.
Meanwhile, earlier this year, the division
also amended its horizontal well rules,
Flynn observes, characterizing the revisions
as realistic and practical. The changes deal
with sections of OCD's spacing, drilling
and reporting rules by consolidating horizontal well regulations under a single section
and clarifying definitions for "affected persons" and "royalty interest owners."
New Mexico's drilling rules were written when vertical wells were the industry
norm, Flynn indicates. "We worked with
OCD to modernize the rules to mirror
existing technology and what the industry

is doing today," he reports.
The OCD also announced plans to
accelerate its abandoned well plugging
program to address 60 abandoned wells-
41 on state land and 19 on private land-
during the current fiscal year. State Land
Commissioner Aubrey Dunn in January
challenged the OCD to increase the pace
of its well plugging program to address
the 600 wells abandoned on state lands,
press accounts note.
Governor's Race
Looking ahead to this year's gubernatorial election, Flynn indicates he is encouraged by the quality of the candidates,
both of whom represent New Mexico in
Congress. Republican Steve Pearce hails
from the Hobbs area and Democrat
Michelle Lujan Grisham is from Albuquerque. "Both of them are very qualified
and represent their constituents well,"
Flynn describes. "We will work with
whoever is elected governor."
With Republican Governor Susana
Martinez term-limited to leave office this
year, the next governor will inherit an
oil-powered state budget that media accounts say is on pace to enjoy a $600
million surplus. "Thanks to the hard work
of the oil and gas industry, whoever wins
the governor's race can hit the ground
running," Flynn comments.
Both Pearce and Lujan Grisham have
been invited to address the NMOGA annual meeting, Flynn says. "This is a good
opportunity for the candidates to meet
members of one of New Mexico's most
important industries," he relates.
With a membership than tops 1,000
members, this year's meeting will be
well attended, Flynn predicts. "We cap
meeting attendance at 1,200 people," he
details, adding "we anticipate a sold-out
meeting. Anyone who has attended will
tell you it is special."
r

Chairman Expresses Pride In
NMOGA's Accomplishments
TYLER, TX.-Since his election as
chairman of the New Mexico Oil and
Gas Association last year, Ken Waits has
both witnessed and helped direct some
dramatic changes in a group that represents
one of the state's largest industries.
"Of the things we have accomplished
at NMOGA this year, I am most proud
of the great team we have built," Waits
observes. "The future of NMOGA and
the oil and gas business in New Mexico
have never been brighter."
Waits adds that the association, under

112 THE AMERICAN OIL & GAS REPORTER

the leadership of NMOGA Executive Director Ryan Flynn, "has really beefed up
its public relations and communications
with the people of New Mexico. The oil
and gas industry contributes more than
100,000 jobs and more than one-third of
the revenue for the state budget."
A third effort involves Waits' work
with the state's elected leadership to improve permitting at the Bureau of Land
Management's Carlsbad, NM, regional
office. "We worked closely with Governor
Susan Martinez, Congressman Steve

American Oil and Gas Reporter - September 2018

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