One of Joe Biden's first acts as president was to sign a 60-day moratorium on new oil and natural gas leases and drilling permits. It's one way the administration plans to tackle the "climate change crisis." But Americans are already feeling the negative effects of the decision.
New Mexico, one of the most productive oil and gas areas in the country, is worried about the moratorium. The natural energy industry's success impacts everything, down to education and government-funded programs.
Industry insiders have said this regulation means the entire regulatory process shuts down, including normal day-to-day activities "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," the Associated Press reported.
The majority of New Mexico's production takes place on federal lands. Oil and gas companies pay hundreds of millions in royalties each year to frack. The concern with the new order, however, is that energy companies could move to Texas where there is no reliance on federal lands to obtain energy.
“I think we’re going to see companies choosing not to invest in New Mexico and take their jobs and drilling to Texas just 3 miles away,” New Mexico Republican Party Chairman Steve Pearce said. “They can just scoot across the border where they don’t have federal lands.”
Royalties collected from fracking in the state had a price tag of $2.3 million in 2020, up 48 percent over 2019. The natural energy industry is responsible for 100,000 direct and related jobs in New Mexico.
A study conducted by the University of Wyoming found that New Mexico would lose $207.7 billion in GDP over the next 20 years if the Biden administration's rule remains in effect. That would result in a loss of "36,217 jobs, $22.1 billion in GDP, $9.8 billion in wages and $6.3 billion in tax revenue" over the course of four years under Biden, the Fairfield Sun Times reported.
Interestingly enough, Biden carried the state by 10 percentage points. The state remains heavily Democratic despite the Democrats' repeated calls to end fracking, the state's biggest industry.
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