New Mexico Oil & Gas Commission Adopts New Fracking Disclosure and Horizontal Well Rule, and Considers "Pit Rule" Amendments

    The New Mexico Oil Conservation Commission is considering three important changes to its rules. On November 15, 2011, the Commission adopted a new disclosure rule proposed by the New Mexico Oil and Gas Association which requires operators using hydraulic fracturing when completing a well to file a form with the Oil Conservation Division listing the fluids that were used in the frac job. The rule requires the disclosure of fluids utilized within 45 days of the completion of the well but exempts from disclosure chemical mixtures that are deemed proprietary. The Commission issued its final Rule on January 23, 2012.

    The Commission held a hearing on October 21-22, 2011 to consider rule changes and a new Special Rule for Horizontal Wells proposed by the Oil Conservation Division. The proposed changes will specify the ownership and consent requirements required to obtain an Application for Permit to Drill a horizontal well in a project area, well set back requirements, assignment of allowables and other issues concerning the pooling of project areas. The Commission issued its final Rule at its hearing held January 23, 2012.

    The Commission has scheduled a hearing April 16-20, 2012 to consider changes to the "Pit Rule" set forth in Rules 19.15.17 proposed by the New Mexico Oil and Gas Association and Independent Petroleum Association of New Mexico. A separate hearing is expected to be set on IPANM's proposed changed to Rule 19.15.29.8 which concerns the use of pits in select areas of Sierra and Otero counties.

For more information, contact Earl DeBrine at edebrine@modrall.com.