These are still uncertain times in the oil business.
Prices, which looked like they were in a consistent upward curve from January and February’s lows in the upper 20 dollars a barrel, straight through the 30s and on past $40, dropped again into into the upper 30s, before resuming an upward trend a little more than a week ago. For American oil producers, the suggestion that $40 may now be a stable base for even more price rises is as enticing as it is potentially dangerous. $40 a barrel, a predictable, safe $40 a barrel is pretty close to the floor for profitable pumping operations, at least for some American producers.
This uncertainty has a lot to do with what’s been the big story of Rio Rancho, NM, a small city with a population of a little over 90,000, the third-largest city in the state: a place where it now seems certain oil exploration will not take place for the foreseeable future.
For several months over the swing from 2015 to 2016, though, the idea was very much alive that land on the western edge of town might make a fine place to drill for oil.
In describing what happened to his proposal that Sandoval County approve a change in zoning for two acres of empty land from residential to general use, to test the theory that there was a rich pocket of oil under Rio Rancho, Bob Gallagher, the lead local representative of the wannabe drillers, says he thought Rio Rancho was a pro-business city, but found out that it isn’t.
Instead, he told our guest today reporter Antonio Sanchez of the Rio Rancho Observer, the area is full of NIMBY people. “In fact,” he said, “I go further than ‘not in my backyard’ and call them ‘B.A.N.A.N.A.’s’ — build absolutely nothing anywhere near anything.”
Gallagher told Sanchez, a chance to bring significant economic activity to Rio Rancho was defeated by “politics and emotions.”
Which is another way of saying, from a completely opposite point of view, that in this case, democracy worked.
Or at least, it did this time, in part because the financial status of the oil explorers was reaching the vanishing point. SandRidge energy developers had lost 97% of its stock value over the year 2015 which left them without the legs for a long fight and made it easier for all sides to let the deal walk away.
“Gallagher faults NIMBYs and BANANAs” – Rio Rancho Observer
“SandRidge withdraws zoning change request” – Rio Rancho Observer
“SandRidge zone change goes back to county P&Z” – Rio Rancho Observer
“Planning board rejects zoning for SandRidge” – Rio Rancho Observer
“Planning staff: Deny zone change for SandRidge” – Rio Rancho Observer
“Zone change hearing for oil driller continued to Jan. 28” – Rio Rancho Observer
“Gallagher ‘back’ in oil business” – Rio Rancho Observer
“Oklahoma company proposes to explore for oil near Rio Rancho” – Rio Rancho Observer