- Associated Press - Friday, November 18, 2016

SANTA FE, N.M. (AP) - A Texas-based oil company can’t use its well sites to dispose of contaminated water from oil wells until it agrees to a preliminary plan to clean up spills, the New Mexico State Land Office announced Friday.

State Land Commissioner Aubrey Dunn said the agency would deny site access to Siana Operating of Midland, Texas, until the company agrees to a preliminary cleanup plan that will determine the extent of ground pollution at wells in southeastern New Mexico. Siana representatives could not immediately be reached.

The State Land Office has been locked in litigation with Siana for months on accusations the company trespassed and spilled waste on state trust lands where it stopped making lease payments years ago.

Dunn says Siana reached a cleanup agreement with the state Oil Conservation Division that does not address the possibility of groundwater contamination, while ignoring requirements issued by the land office.

“Land Office staff developed a comprehensive site delineation plan in order to determine the extent of the environmental damage and possible groundwater contamination resulting from the company’s operations,” the State Land Office said in a statement. “The Land Office has not received a response from Siana regarding the agency’s delineation plan, but has become aware of the fact that Siana has negotiated a significantly less extensive delineation plan with the New Mexico Oil Conservation Division.”

Siana has been a major provider of wastewater disposal services in New Mexico, operating two wells that injected over 13 million gallons underground in 2014, with relatively small-scale oil and natural gas extraction operations at nine wells.

Wastewater from drilling operations is typically delivered by truck to disposal sites like Siana’s, where most oil is skimmed off before water is injected deep underground. Oil wells in southern New Mexico also draw up salt water from an ancient, underground aquifer.

The New Mexico Oil Conservation Division reached a settlement with Siana in June that provides a timeline for the company to pay a $19,000 fine and clean up spills at two clusters of wells outside Eunice, in the southeastern corner of New Mexico.

The settlement agreement with the Oil Conservation Division describes how Siana for months ignored warnings from state regulators on spills and continued to operate wells after its authority was revoked.

The State Land Office has said it is owed $284,000 in fees, cleanup costs and penalties.


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