Permian Basin operators face stricter regulations following New Mexico court ruling
A natural gas facility’s air permit was upheld in the Permian Basin despite an appeal from environmental groups calling for stricter state analysis of the site’s impacts before approval.
But the appellants did signal victory in that the New Mexico Court of Appeals in its ruling struck down portions of state law that allowed exemptions from air quality scrutiny for so-called “minor sources” of pollution.
This exemption allowed smaller facilities to bypass certain emission restrictions as they were believed not to contribute to the region’s overall air quality problems.
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The appeal saw Santa Fe-based WildEarth Guardians attempting to overturn an air quality permit and three construction permits issued by the New Mexico Environment Department (NMED) to 3 Bear Delaware Operating for its Libby Gas Plant in Lea County.
The group argued these permits were issued improperly as they did not fully consider the site’s impacts on air pollution in the region, particularly ground-level ozone – a cancer-causing chemical that creates smog.
WildEarth Guardians first challenged the permits in 2020, and they were upheld by the Environmental Improvement Board that year which the group appealed.
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Oral arguments were held in August and the court issued its decision Dec. 4.
Ozone pollution in southeast New Mexico’s Permian Basin region in both Eddy and Lea counties was recently found to have ozone concentrations higher than the National Ambient Air Quality Standard (NAAQS) of 70 parts per billion (ppb).
This necessitated state action to reduce such pollution, and the NMED enacted new rules last year aiming to increase gas leak detection and repair at facilities in the region.
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The Environmental Protection Agency was considering a “non-attainment” designation for the Permian in both New Mexico and Texas, a federal action that could restrict future oil and gas permitting.
The appeals court found that while the permits issued to 3 Bear Delaware Operating were aligned with applicable state law, it determined the Board, which governs NMED, erred in providing the “minor sources” exemption without proof from the permittee.
This would, in effect, require stronger air pollution analysis for future such permits issued by NMED and require more reporting from companies like 3 Bear when applying for air quality permits.
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In its ruling, the court found the Board’s presumption that minor sources do not contribute to ozone pollution was problematic because it did not require any evidence that the facility did not reach a significant impact level (SIL).
“These conclusions of law create an apparent irrebuttable presumption that no minor source of ozone precursor emissions can cause or contribute to a violation,” read the ruling. “We determine that the Board erred because there is no substantial evidence supporting its order in this regard and because they run against the grain of case law addressing the proper use of SILs.”
The ruling also found it “even more problematic” that the Board determined NMED lacked the authority to deny permits to minor sources of air pollution.
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WildEarth Guardians Legal Director Samantha Ruscavage-Barz said both the Permian and northwest Chaco Canyon area – the state’s two oil and gas regions – suffered from worsening air quality.
She said she hoped this ruling would force state agencies to take stronger action to address the air pollution resulting from fossil fuel production.
“It hasn’t helped that state regulators have kept issuing permits for many more new oil and gas facilities in recent years without considering the ozone impacts from expanding development,” she said.
“Although this decision doesn’t undo that legacy of harm, it provides the state with an opportunity to use its existing permitting process to begin to reign in this out-of-control public health threat.”
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Melissa Troutman, climate and energy advocate at WildEarth Guardians, said the ruling will mean stronger air pollution controls at the state level on oil producers in New Mexico.
“With this ruling, the State of New Mexico can no longer turn a blind eye to the impact of the oil and gas industry in driving the ozone pollution crisis in the Permian Basin,” she said. “We hope that the Environment Department will finally start taking steps to address the collective impact of smaller oil and gas sources in driving rampant ozone pollution.”
Adrian Hedden can be reached at 575-628-5516, achedden@currentargus.com or @AdrianHedden on X, formerly known as Twitter.
This article originally appeared on Carlsbad Current-Argus: New Mexico Appeals Court Urges Stricter Air Pollution Regulations
