New legislation in New Mexico brings more water management opportunities

New Mexico’s HB 546 Bill will relieve pressure on the scarce freshwater resources of the southwestern state. The legislation could also impact...
New Mexico’s HB 546 Bill will help relieve pressure on the scarce freshwater resources of the southwestern state. The legislation could also impact water-intensive industries and drive economic diversification.
Some of the main takeaways from the Produced Water Act, made up of the first five sections of the bill, are that it:
  • Voids contracts signed on or after July 1 that require freshwater to be used for oil and gas operations where produced, treated or recycled water is available, and operators choose to use it
  • Clarifies that ownership and liability follow produced water whenever it is transferred between parties
  • Gives the New Mexico Environment Department (NMED) financial authority and regulatory jurisdiction over produced water intended for beneficial use
These stipulations incentivize increased water recycling for oil and gas activities in New Mexico, where water management is a growing concern as disposal practices ramp up in line with increased production in the Permian Basin. According to the state’s Oil Conservation Division, as of November 2018, 750 of New Mexico’s 833 disposal wells are located in the Permian.
“The disposal of produced water in high-pressure, deep, underground injection wells causes induced seismicity,” NMED Secretary James Kenney told Water in Oil. “HB 546 provides another way for operators to manage their produced water.”
The bill also paves the way for treated produced water to be used for industrial, agricultural, conservational and recreational purposes. The NMED will handle permitting for beneficial use projects, which Kenney emphasized might not be sanctioned for months due to the need to engage with public stakeholders to determine technological needs and limitations. Addressing feedback from the public about policy concerns may also cause delays.
Directing treated produced water to industries with lower-quality water needs would be advantageous for the arid state, Jeri Sullivan Graham, research professor at the University of New Mexico’s Center for Water and the Environment and president of the New Mexico Desalination Association, told Water in Oil. “If you can find a way to substitute produced water for freshwater use, such as … for some industrial purpose, then that freshwater could be kept for purposes such as drinking or irrigation.”

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