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N.M. Legislature should address overreliance on oil and gas

January 16, 2021

Albuquerque Journal:

When the Legislature convenes Tuesday to determine the state spending that helps drive our economy – among other things – it must grapple with two hard truths.

One, new analyses suggest that the oil and gas downturn is not a temporary dip tied to the COVID pandemic but further evidence that the industry is in decline.

And two, as New Mexico’s over-reliance on oil and gas revenue has implications for our economy, state finances and the environment, it can and must be addressed to ensure a prosperous future for all New Mexicans.

A new report finds that the top oil companies have faced declining profits for most of the past 10 years and that the oil and gas sector has lost much of the muscle it once had on Wall Street.

This report, from the Institute for Energy Economics and Financial Analysis (IEEFA), concludes that years of over-production have been unprofitable and unsustainable, and the oil and gas industry in New Mexico is unlikely to rebound to historic levels. It recommends the state “comprehensively and aggressively overhaul its economic development programs to encourage greater diversification of its industrial and commercial base.”

 [Jerry Oritz y Pino and Liz Thomson]

More: NM should diversify economy and repeal some tax breaks

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