New Mexico’s far-left legislative majorities in the legislature and two-term stronghold on the governorship have achieved extreme policies thanks to the billions garnered from the oil and gas boom.
The Legislative Finance Committee (LFC) released a July 21 report showing revenue at $8.99 billion through March for Fiscal Year 2023, running from July 1, 2022, to June 30, 2023. That figure is up $1.9 billion or 27 percent.
However, the IHS Markit and Moody’s Investors Service reports show a projected decline in oil and gas production after peaks between 2028-2033.
“This could mean the start of a decline in New Mexico’s now-booming oil and gas production, dropping from a forecast 2 million bopd in 2030 to as low as about 500,000 bopd by 2050, according to the presentation,” reported the Carlsbad Current-Argus.
New Mexico’s Chief Economist Leo Delgado said, “You can see New Mexico is currently on the upslope of that oil production trendline with production expected to increase in the next couple of years,” adding, “You see that it’s on the upslope, but it does start to plateau in the early 2030s before it starts to gradually decline.”
He noted that New Mexico’s wells are “highly-productive” in “the first few months of operations, but taper off quicky, meaning more wells must be drilled and put into service,” the report noted.
“New Mexico has some very productive wells, very high-yield wells, very conducive well economics, low break-even points,” he said. “In order to maintain those levels of production, that activity must continue.”
“The expectation is production will slow. It will be at a much slower pace and that’s where we start to see New Mexico production still at elevated levels but at a declining rate year over year when we look at the long-term,” he continued, according to the Current-Argus.
With anti-energy Democrats currently in charge of the state, their eco-left, job-killing policies cause the projected decline and thus their cash cow for high-ticket investments, including taxpayer-funded “free” college and “universal” free daycare.