Raúl Torrez | Attorney General

AG Balderas Sues President Trump and Department of Interior for Millions in Unpaid Oil & Gas Royalties

FOR IMMEDIATE RELEASE: April 26, 2017

Contact: James Hallinan (505) 660-2216

President Trump is illegally blocking $4.9 million a year in royalty payments New Mexico is owed

Albuquerque, NM – Today, New Mexico Attorney General Hector Balderas and California Attorney General Xavier Becerra filed suit against Donald Trump’s Department of Interior for blocking approximately $18 million in royalties a year that should be paid to states producing oil, gas and coal. Depending on the year, New Mexico could account for as much as 27% of these payments and could receive as much as $4.9 million in additional payments a year if President Trump’s administration hadn’t illegally rolled back a 2016 Department of Interior (DOI) rule on oil, gas, and coal valuation. Additionally, the federal government will lose roughly $60 million a year in additional royalties due to the President’s illegal action.

“At a time of extreme budget crisis in New Mexico and at the federal level, President Trump is depriving New Mexico children and families of millions of dollars a year it is owed in royalties through his illegal action,” Attorney General Balderas said. “I will stand up to President Trump to get the desperately needed funds we are owed for our oil and gas production, and I am thankful to partner with California Attorney General Xavier Becerra in this action. Ensuring a fair return on New Mexico’s energy resources is critical in these times of severe budget constraints in order to properly fund education in our state.”

The 2016 rule, which President is attempting to roll back, updates DOI’s methods of valuing coal, oil and natural gas on federal lands for the purpose of determining royalties due from energy developers and ensuring taxpayers are adequately compensated for the use of these public resources. The rule updated regulations that had not been revised since the 1980s and which failed to account for dramatic changes in the energy industry and marketplace. The 2016 rule was issued in accordance with all procedural requirements — it was proposed in January of 2015, finalized in July 2016 after consideration of numerous public comments, and went into effect in January 2017.

After industry parties filed a suit in December 2016 challenging the rule, President Trump’s DOI announced in February 2017 that it was “postponing the effectiveness” of the rule, even though it was already in effect. DOI’s decision to unilaterally “postpone” an effective rule — without conducting public outreach, following required procedures, or explaining its reason — exceeds its authority and is not consistent with the rule of law. New Mexico and California seek to have the postponement overturned and the rule reinstated, so that our citizens will receive proper compensation for the use of these publicly owned fossil fuels.

Please see attached for a copy of the suit that was filed this afternoon.
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Raul Torrez

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