Bill for Strategic Water Supply cuts oil and gas wastewater; $400 million from proposal

Senate Bill 294 is slated for two committees in the Senate before the last days of the session

By: - February 13, 2024 12:02 am
Liz Stefanics looks into an unseen crowd with two other senators sitting on either side of her.

Sen. Liz Stefanics (center) chair of the Senate Conservation Committee, will sponsor the bill developing teh Strategic Water Supply. (Photo by Austin Fisher / Source NM)

Gov. Michelle Lujan Grisham’s proposal to create a market for treated oil and gas wastewater and brackish water stripped down hundreds of millions of dollars and now only includes brackish water, according to a four-page bill brought forward Monday.

It’s unclear what the chances of the slimmed-down proposal will be as it faces two committees in the Senate, a floor vote and passage through the House to be made law. The bill has to go through all that before lawmakers end the 30-day session on Feb. 15.

Previously, the governor asked for $500 million issuance of severance tax bonds for treating oil and gas wastewater and water from deep aquifers that is often saltier or “brackish.” Treated oil and gas wastewater – called produced water – is not mentioned in the current proposal.

The ask has also shrunk to $100 million in severance tax bond sales in the committee substitute. The money from the bond sale would be appropriated to the New Mexico Environment Department to “enter into valid contracts…to acquire and manage treated brackish water.”

The bill says the state’s purchase of the water will be representative of “a fair market value,” and that the water project will not “impair the water rights or adversely impact landowners,” saying the state “will consult” with the state engineer, and tribal governments in New Mexico..

Any contractor has to demonstrate the technology can treat the water to state standards, the bill said.

The bill defines “brackish water” as water sourced from brackish aquifers with dissolved solids between 1,000 and 10,000 milligrams per liter. (For reference seawater often has 35,000 milligrams per liter total dissolved solids). There are at least 17 aquifers that meet this definition, according to the New Mexico Bureau of Geology and Mineral Resources.

The bill also offers a definition for “treated brackish water” requiring the use of mechanical and chemical water treatments to “remove or eliminate contaminants,” from brackish water.

The specifics of the “Strategic Water Supply” has been under wraps in the capital outlay process, which is a list of long-term construction projects across the state and individual lawmaker’s districts. Capital outlay projects are voted on in one package.

But after the measure was stripped from the package this weekend, lawmakers announced Monday the proposal would go under Senate Bill 294.

The date to introduce new legislation passed on Jan. 31, but SB 294 will be gutted and the Strategic Water Supply language substituted into it.

This process is using what is referred to in the Roundhouse as a “dummy bill,” which is a placeholder with generic language saying the proposal relates to “the public peace, health, safety and welfare.”

Some key lawmakers are sponsoring the proposal that could help it move through Senate committees.

Conservation committee chair Sen. Liz Stefanics (D-Cerillos) is joined by the Finance committee chair Sen. George Muñoz (D-Gallup) and its ranking member Sen. Bill Sharer (R-Farmington) as sponsors.

Stefanics asked for the amendment to be made public on the floor Monday.

The Senate Conservation Calendar has SB 294 on the agenda for Tuesday at 9 a.m. and is  also assigned to the Senate Finance Committee.

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Danielle Prokop
Danielle Prokop

Danielle Prokop covers the environment and local government in Southern New Mexico for Source NM. Her coverage has delved into climate crisis on the Rio Grande, water litigation and health impacts from pollution. She is based in Las Cruces, New Mexico.

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