The oil business is booming throughout New Mexico, and local communities are eager to reap the benefits.
The industry generated about 172 million barrels of oil in 2017, surpassing its previous record of about 147 million barrels set in 2015, per records from the U.S. Energy Information Administration.
The growth doubled New Mexico’s oil output since 2011, boosting New Mexico to the third highest oil producing state in the country, records show.
New Mexico oil producers generated 17.2 million barrels in December 2017.
All that oil means big profits for the City of Carlsbad.
Finance Director for the City of Carlsbad Wendy Hammett said oil production caused a 30 percent spike in the city’s gross receipts tax, also known as sales tax, in the last year.
She said the increase was “primarily attributed” to the oil and gas industry.
“In a broad sense, I’d say it’s all of it,” she said. “It has a significant impact.”
Hammett said Carlsbad gained about $23 million in gross receipt tax revenue in fiscal year 2017, but FY18 saw a $7 million growth to a total of $30 million.
Such gains will fund future capital infrastructure projects, she said.
“The increased revenues that the city is receiving from oil and gas has a big impact on future project and capital funds,” she said. “We see an upward trend, month after month.
“Increased GRT (revenue) provides the City an opportunity to rebuild cash reserves for future infrastructure projects and other capital spending.”
And that trend means continuous growth for the entire state, said Ryan Flynn, executive director of the New Mexico Oil and Gas Association (NMOGA).