Half of New Mexico’s oil and gas production is on federal land and amounts to hundreds of millions of dollars in royalties each year.
Under Biden’s actions, roughly 50,000 jobs could be lost in the state, with potential losses of $3.5 billion, as most of the state’s core production comes from federal lands, said Pearce, who warned America would face “tremendous shortages.”
“How will New Mexico pay for its schools and roads? We keep hearing talk about wanting to work together, but we’d like to play a role in these discussions,” Janway told The Epoch Times.
“This should be a time for rebuilding,” he said. “Our greatest concern is that this 60-day freeze will become a long-term freeze. ... And for what? Oil companies will just move resources to Texas and keep drilling.”
A large part of the state’s budget is also funded by drilling on federal land, said Janway, who described how the state is already facing numerous challenges, as are most places across the country. Jobs in New Mexico have already fallen due to the lockdowns and a number of workers became unemployed after a dip in oil prices earlier this year.
The Epoch Times reached out to the Biden administration for comment but didn’t receive an immediate response.
“You can imagine with half of our production coming from federal lands that companies are just going to be moving out of the state,” said Pearce. “The oil in New Mexico has done a lot to make us energy self-sufficient.
“This was a very political decision to pay off supporters,” he added. “It’s one that reeks of bad judgment and bad economic policy. Forty cents out of every dollar comes from oil and gas.”
Industry groups said the order effectively brings all regulatory activity to a halt, from routine requests that arise during the normal course of business to requests for rights of way for new pipelines designed to gather more natural gas as part of efforts to reduce venting and flaring—practices that Democrats have targeted in their climate change agenda.
Trickle-Down Effect
Carla J. Sonntag, president and founder of the New Mexico Business Coalition (NMBC), said the oil and gas industry represents about 100,000 direct and indirect jobs in the state and is also the primary funder of education in New Mexico. Sonntag said her team communicates with some of the oil and gas operators in the state, who she said are certainly unhappy about Biden’s move. She warned about the effects on more than just the oil industry.“Even general businesses are very upset—they understand the impact on the state’s budget,” she told The Epoch Times.
“More importantly, if they are an industry that is related to oil and gas, if they’re a support industry providing services or supplies, they’re very concerned about how their business will continue,” she said.
The NBMC represents hundreds of New Mexico businesses and thousands of individuals who want to limit government dependence and expand the private sector. Sonntag noted that due to the large portion of land in New Mexico being federally owned, it’s reliant on federal leasing and opportunities to develop oil and gas. If they lose that ability in New Mexico, oil and gas companies will seek opportunities in other states.
If the support businesses aren’t able to operate in New Mexico, they will also look to leave the state, Sonntag said. She also said Biden’s freeze on oil won’t have the positive impact on the climate he says it will.
“We’re going to become more reliant on foreign energy, which puts us at risk,” she added. “But it’s also a bad move on the environmental progress that we’ve made because many of these foreign countries have lower environmental standards than the United States.”
“All around it is bad for the country—and it’s horrible for New Mexico,” she said.
“Any step toward fixing the broken federal oil and gas leasing program is a step in the right direction,” Mark Allison, director of the environmental group New Mexico Wild, told The Associated Press.
Meanwhile, another move by the Biden administration is sparking a similar furor among critics, namely the president’s decision to cancel the permit for the Keystone XL pipeline.