New Mexico Senate Bill 23, which could increase oil and gas royalty rates on state trust lands in the Permian Basin, has cleared its first committee. The bill, sponsored by Sen. George Muñoz, Sen. Liz Stefanics, and Rep. Matthew McQueen, aims to bring in up to $75 million in revenue for the state’s land grant permanent fund. The legislation would only apply to new leases and would not impact existing ones, with the increase in revenue not expected until fiscal year 2028.
Supporters of the bill argue that it will bring New Mexico in line with Texas in terms of royalty rates and provide much-needed funding for public education. However, opponents fear it could harm the state’s oil and gas industry and lead to producers moving out of state. The State Land Office estimates that less than 1% of prime leasing parcels in the Permian Basin will be affected by the legislation.
Sen. Muñoz emphasizes the importance of updating royalty rates to reflect the true value of the resource being leased and current market values. He believes that increasing rates is essential for maximizing the economic potential of New Mexico’s oil and gas regions. If passed, the bill could have significant implications for the state’s revenue and support for public institutions.
Note: The image is for illustrative purposes only and is not the original image associated with the presented article. Due to copyright reasons, we are unable to use the original images. However, you can still enjoy the accurate and up-to-date content and information provided.
