An Eddy County solar farm will meet the needs of Chevron’s Permian Basin oil and gas operations after the fossil fuel giant won a bid for a section of State Trust land for the project.
The New Mexico State Land Office has announced the lease of 326 acres in Eddy County, about 25 miles south of Carlsbad near Whites City, for a $140,000 offer that will see Chevron work with Algonquin Power and Utilities to develop the Hayhurst Solar Project in New Mexico.
Hayhurst will include approximately 55,000 solar panels and generate 20 megawatts (MW) of solar power to support Chevron’s electrical loads in southeastern New Mexico – an area known to provide the bulk of oil and gas production. state gas.
The second phase of the project would generate 11 MW of solar power after Chevron obtained approval from a local utility, according to a press release from the State Land Office.
The Land Office estimated that the project would generate up to $7 million in revenue for the state of New Mexico.
New Mexico State Lands Commissioner Stephanie Garcia Richard said the project is part of the office’s broader program to increase renewable energy in New Mexico, reduce pollution and the impact of state on climate change.
She said Chevron’s use of renewables would mark the start of a trend for mining operations to shift to low-carbon energy sources.
“We have spent the past three years working tirelessly to restore our public lands and ensure better stewardship by our tenants,” said Garcia Richard. “By partnering with Chevron, we are paving the way for other oil and gas companies to successfully transition from using natural gas or electricity to power their equipment.
Renewables were becoming more affordable for energy companies, she said, leading to growing interest in projects like Hayhurst.
“The increased interest in the use of renewable energy in the extractive industries further proves the reliability and cost-effectiveness of solar power and why increasing our renewable energy production in New Mexico is essential to healthy long term of our land and our state,” Garcia Richard mentioned.
Eddy County Commissioners recently voted to issue an industrial tax bond for the project and related transmission at their Dec. 21 meeting.
The bonds, valued at $40 million, would help fund the project and provide property tax exemptions for up to 30 years, and would not impact county finances, Chevron officials said.
County Executive Allen Davis said the project would create jobs and economic development in the area as the solar facility is built and that Chevron could help maintain ongoing operations of the facility. business.
He said the electricity generated would be used for Chevron’s operations but could also be available for the local grid.
“It would entail construction work for several months next year,” Davis said. “It would lower their (Chevron’s) operating costs and extend the life of their assets there. There is a lot of production in this immediate area.
New Mexico’s efforts to increase renewable energy in its most active fossil fuel region followed recent federal actions to accelerate such projects across the country – part of President Joe Biden’s signature program to fight against climate change and pollution problems.
On Wednesday, the Biden administration announced a memorandum of understanding between the US departments of the Interior, Agriculture, Energy and Defense as well as the US Environmental Protection Agency prioritizing “clean energy” projects for federal review.
Inter-agency coordination teams will be established under the Memorandum of Understanding to expedite decision-making and environmental reviews of projects on federal public lands.
Assistant Secretary of the Interior Tommy Beaudreau said the move would help the federal government meet the administration’s goal of a carbon-free energy sector by 2035 and allow 25 gigawatts of solar power, wind and geothermal by 2025.
One gigawatt equals 1,000 megawatts and is enough to power about 750,000 homes.
“The Department of the Interior plays a pivotal role in achieving this administration’s clean energy and climate goals — from conducting environmental reviews for clean energy projects on our nation’s public lands. , conducting meaningful consultations with tribal nations, and assessing potential species impacts,” Beaudreau mentioned.
“This MOU will help inform the specialized expertise in the Bureau of Land Management permitting process and we look forward to working with our sister agencies to support a clean energy future.”
Adrian Hedden can be reached at 575-618-7631, [email protected] or @AdrianHedden on Twitter.