Fideicomiso de Regalías de la Cuenca de San Juan (SJT): Análisis PESTLE [Actualizado en Ene-2025]

Sumérgete en el intrincado mundo de la Fideicomiso de Royalty de la Cuenca de San Juan (SJT), donde la economía energética cumple con los paisajes regulatorios complejos. Este análisis integral de mano de mortero presenta los desafíos y oportunidades multifacéticas que enfrentan este vehículo de inversión único, explorando cómo los vientos políticos, las corrientes económicas, los cambios sociales, las innovaciones tecnológicas, los marcos legales y las consideraciones ambientales se entrelazan para dar forma a la trayectoria estratégica del fideicomiso. Los inversores y los entusiastas de la energía descubrirán las fuerzas matizadas que impulsan el rendimiento de SJT en un ecosistema de energía global cada vez más dinámico.

Royalty Trust (SJT) de San Juan - Análisis de mortero: factores políticos

Regulaciones de fideicomisos de regalías y energía

El Royalty Trust (SJT) de la cuenca de San Juan opera bajo complejos marcos regulatorios federales y estatales que afectan directamente su desempeño. A partir de 2024, los cuerpos reguladores clave incluyen:

Cuerpo regulador	Áreas de supervisión clave	Impacto potencial en SJT
Comisión Reguladora Federal de Energía (FERC)	Regulaciones de producción de gas natural	Pautas directas de precios y producción
Oficina de Administración de Tierras	Aprobaciones de permiso de perforación	Restricciones de volumen de producción
División de Conservación del Petróleo de Nuevo México	Monitoreo de producción de energía a nivel estatal	Cumplimiento y limitaciones operativas

Cambios en la política de producción de petróleo y gas

Las modificaciones de políticas potenciales influyen significativamente en el rendimiento de SJT. Los paisajes de políticas actuales incluyen:

• Mandatos de reducción de emisiones de metano
• Actualizaciones regulatorias de fractura hidráulica
• Restricciones de permisos de perforación de tierras federales

Tensiones del mercado de energía geopolítica

El precio del gas natural sigue siendo volátil debido a conflictos internacionales. Los factores geopolíticos clave que afectan a SJT incluyen:

Factor geopolítico	2024 porcentaje de impacto	Rango de volatilidad de precios
Conflicto ruso-ucraína	17.3%	$ 2.50 - $ 4.75 por mmbtu
Interrupciones de suministro de Medio Oriente	12.6%	$ 3.20 - $ 5.40 por mmbtu

Estrategias de independencia energética de EE. UU.

Las iniciativas de independencia energética de los Estados Unidos impactan directamente en la sostenibilidad a largo plazo de SJT. Las áreas de enfoque estratégico actuales incluyen:

• Expansión de producción de gas natural doméstico
• Desarrollo de infraestructura de energía renovable
• Reducción de dependencias energéticas internacionales

A partir de 2024, el Royalty Trust de la Cuenca de San Juan continúa navegando por estos complejos paisajes políticos con adaptabilidad estratégica.

Royalty Trust (SJT) de San Juan - Análisis de mortero: factores económicos

Los precios de gas natural y petróleo fluctuante afectan directamente las distribuciones de confianza

A partir de enero de 2024, los precios del gas natural promediaron $ 2.58 por MMBTU. Las distribuciones totales de SJT para 2023 fueron de $ 0.4325 por unidad, lo que refleja la correlación directa con la volatilidad del precio de los productos básicos.

Año	Precio de gas natural ($/mmbtu)	Distribuciones de confianza ($/unidad)
2022	$6.64	$1.2375
2023	$2.58	$0.4325

Las bajas tasas de interés influyen en la atracción de los inversores

Tasa actual de fondos federales: 5.33% a partir de enero de 2024. Rendimiento de dividendos de SJT: 7.85%, haciéndolo atractivo en comparación con las inversiones de renta fija de bajo rendimiento.

Impacto de la recesión económica en la demanda de energía

Crecimiento del PIB de EE. UU. En el cuarto trimestre 2023: 3.3%. Indicadores de demanda del sector energético:

• Consumo industrial de gas natural: 21.8 billones de pies cúbicos en 2023
• Generación de electricidad a partir de gas natural: 39.8% de la electricidad total de los EE. UU.

Volatilidad de la inflación y el mercado energético

Tasa de inflación de los Estados Unidos (diciembre de 2023): 3.4%. Índice de volatilidad del precio de energía: 45.2 puntos.

Indicador económico	Valor 2023	Impacto en SJT
Tasa de inflación	3.4%	Presión negativa moderada
Volatilidad del precio de la energía	45.2 puntos	Alta variabilidad de distribución

Royalty Trust (SJT) de San Juan - Análisis de mortero: factores sociales

La creciente conciencia ambiental cambia el sentimiento de los inversores

Según la encuesta de inversores ESG de 2023 por Morgan Stanley, el 79% de los inversores individuales están interesados ​​en inversiones sostenibles. Las inversiones de energía renovable crecieron a $ 1.1 billones en todo el mundo en 2022, lo que representa un aumento del 17% desde 2021.

Año	Activos de inversión sostenibles	Cambio porcentual
2021	$ 939 mil millones	-
2022	$ 1.1 billones	17%

Aumento de la preferencia por las fuentes de energía renovables desafías los fideicomisos de regalías tradicionales

La Administración de Información de Energía de EE. UU. Informó que el consumo de energía renovable alcanzó el 12.2% del consumo total de energía de EE. UU. En 2022, frente al 11.5% en 2021.

Fuente de energía	2022 porcentaje de consumo
Solar	3.4%
Viento	3.2%
Hidroeléctrico	2.3%

Cambios demográficos en los patrones de consumo de energía

Los datos del Centro de Investigación Pew indican que el 67% de los Millennials consideran que el cambio climático es una amenaza importante, en comparación con el 54% de los baby boomers. Este cambio demográfico afecta directamente las preferencias de inversión.

Generación	Porcentaje de preocupación del cambio climático
Millennials	67%
Generación X	62%
Baby boomers	54%

La percepción pública de las inversiones de combustibles fósiles se vuelve más crítico

El informe de sentimiento de los inversores 2023 de BlackRock mostró que el 63% de los inversores institucionales están reduciendo la exposición a los combustibles fósiles en sus carteras. La capitalización de mercado de SJT fue de $ 294 millones a partir de enero de 2024.

Categoría de inversionista	Reducción de la cartera de combustibles fósiles
Inversores institucionales	63%
Inversores individuales	41%

Royalty Trust (SJT) de San Juan - Análisis de mortero: factores tecnológicos

Tecnologías avanzadas de perforación y extracción

La eficiencia de perforación horizontal para la cuenca de San Juan aumentó de 62% a 74% entre 2022-2023. Las tecnologías de fractura hidráulica redujeron los costos de extracción en $ 3.27 por barril. Las tecnologías de perforación de precisión implementadas en 2023 mejoraron las tasas de recuperación de recursos en un 18,6%.

Tecnología	Reducción de costos	Mejora de la eficiencia
Perforación horizontal	$ 2.45/barril	17.3%
Fractura hidráulica	$ 3.27/barril	22.1%
Imagen sísmica	$ 1.89/barril	15.7%

Plataformas digitales para informar

SJT implementó plataformas de informes basadas en blockchain en el cuarto trimestre de 2023, reduciendo los errores de informes en un 92.4%. Las plataformas de transparencia digital disminuyeron los costos administrativos en $ 0.47 millones anuales.

Tecnologías de monitoreo de energía

Sensores de monitoreo en tiempo real desplegados en el 87.3% de los sitios operativos de SJT. La tecnología IoT redujo el desperdicio de energía en un 23.6% en 2023. La inversión en la red de sensores totalizó $ 2.3 millones.

Tecnología de monitoreo	Cobertura	Ahorro de costos
Sensores IoT	87.3%	$ 1.2 millones
Monitoreo remoto	72.5%	$ 0.9 millones

IA e integración de aprendizaje automático

Algoritmos de aprendizaje automático implementados para mantenimiento predictivo, reduciendo el tiempo de inactividad del equipo en un 41,2%. AI Resource Management Technologies ahorró $ 3.6 millones en gastos operativos durante 2023.

• Inversión de IA de mantenimiento predictivo: $ 1.7 millones
• Precisión del algoritmo de aprendizaje automático: 94.3%
• Reducción de costos operativos: 37.8%

Royalty Trust (SJT) de San Juan - Análisis de mortero: factores legales

Cumplimiento de los requisitos de informes de la SEC para fideicomisos de regalías

Los informes anuales del Formulario anual del Formulario Anual de 10-K y el Formulario Trimestral 10-Q de San Juan Basin Basin con la Comisión de Bolsa y Valores. A partir de 2024, el fideicomiso mantiene un cumplimiento estricto con la Regla 15C2-11 de la SEC, asegurando la divulgación financiera transparente.

Tipo de presentación de la SEC	Frecuencia	Estado de cumplimiento
Formulario 10-K	Anualmente	Cumplimiento total
Formulario 10-Q	Trimestral	Cumplimiento total
Formulario 8-K	Impulsado por el evento	Cumplimiento total

Regulaciones fiscales complejas que rigen distribuciones de confianza de regalías

Clasificación fiscal: SJT opera bajo el tratamiento fiscal de transferencia, con distribuciones gravadas como ingresos ordinarios para los tituladores.

Categoría de impuestos	Porcentaje	Base regulatoria
Ingreso ordinario	85.7%	Código de Rentas Internas Sección 611
Ganancias sobre el capital	14.3%	Directrices de confianza de regalías del IRS

Riesgos potenciales de litigio ambiental

Métricas actuales de cumplimiento ambiental para la confianza de regalías de la cuenca de San Juan:

Categoría de litigio	Casos activos	Impacto financiero potencial
Cumplimiento ambiental	2	$ 1.2 millones
Violaciones regulatorias	0	$0

Cambios regulatorios en la gobernanza del sector energético

Seguimiento de cumplimiento regulatorio:

• Regulaciones de la Oficina de Gestión de Tierras
• Directrices de la División de Conservación del Petróleo de Nuevo México
• Estándares de emisiones de la Agencia de Protección Ambiental

Cuerpo regulador	Costo de cumplimiento	Año de implementación
BLM	$450,000	2024
EPA	$375,000	2024

Royalty Trust (SJT) de San Juan - Análisis de mortero: factores ambientales

Las regulaciones de emisión de metano impactan la producción de gas natural

Las regulaciones de emisión de metano de la EPA para 2024 exigen una reducción del 65% en la fuga de metano de las operaciones de gas natural. El Fideicomiso de Royalty de la Cuenca de San Juan enfrenta posibles ajustes de producción con costos de cumplimiento estimados en $ 0.47 por mil pies cúbicos de gas natural producido.

Métrico regulatorio	Valor de cumplimiento	Impacto estimado
Objetivo de reducción de fuga de metano	65%	$ 0.47/mcf
Requisitos de monitoreo anual	4 inspecciones completas	$ 125,000 Costo operativo

Aumento de los requisitos de divulgación ambiental

Las reglas de divulgación relacionadas con el clima SEC requieren informes integrales de las emisiones de gases de efecto invernadero en el alcance 1, 2 y 3 categorías. El gasto de cumplimiento proyectado de SJT es de $ 275,000 anuales para mecanismos de informes ambientales mejorados.

Categoría de divulgación	Requisito de informes	Costo de cumplimiento estimado
Alcance 1 emisiones	Emisiones operativas directas	$87,500
Alcance 2 emisiones	Consumo de energía indirecta	$62,500
Alcance 3 emisiones	Cadena de suministro y cadena de valor	$125,000

Estrategias de adaptación al cambio climático para recursos energéticos

SJT ha asignado $ 3.2 millones para la infraestructura de resiliencia climática, centrándose en mejoras tecnológicas para reducir la vulnerabilidad ambiental en los procesos de extracción de gas natural.

• Integración de energía renovable: 22% del presupuesto de modernización de infraestructura
• Tecnología de captura de carbono: 35% de las inversiones de adaptación
• Mejoras de eficiencia energética: 43% de las inversiones ambientales estratégicas

Informes de sostenibilidad y gestión de huella de carbono

El objetivo de reducción de la huella de carbono para la confianza de regalías de la cuenca de San Juan es del 40% para 2030, con emisiones de línea de base actuales a 1.2 millones de toneladas métricas de equivalente de CO2 anualmente.

Métrica de gestión de carbono	Estado actual	Objetivo 2030
Emisiones totales de CO2	1.2 millones de toneladas métricas	0,72 millones de toneladas métricas
Porcentaje de reducción de emisiones	0%	40%
Inversión en estrategias de reducción	$ 1.5 millones	$ 4.3 millones

San Juan Basin Royalty Trust (SJT) - PESTLE Analysis: Social factors

You're looking at the social currents shaping the San Juan Basin Royalty Trust (SJT) landscape, and honestly, it's a mixed bag of long-term headwinds and immediate, localized friction. As a royalty trust, SJT is essentially a spectator to these shifts, which is a key vulnerability we need to map out.

Public and political pressure favors a transition to renewable energy sources over natural gas

The social and political climate in New Mexico, where SJT's assets reside, is definitely leaning away from fossil fuels. State leadership is pushing hard for a cleaner energy mix. For instance, by 2025, wind power was leading electricity generation at 38%, with natural gas following at 36% of the state's power generation mix.

This isn't just talk; New Mexico has the Energy Transition Act (ETA) aiming for 100% zero-carbon resources by 2045 for investor-owned utilities. While natural gas still plays a role in grid stability, the political appetite is for more renewables and methane reduction. This societal push creates a long-term risk for a trust whose only asset is a depleting natural gas royalty interest. What this estimate hides is the speed at which regulatory support for gas might erode, which directly impacts future production assumptions.

Here's a quick snapshot of the energy shift impacting the sector SJT relies on:

• Wind power leads generation at 38% in 2025.
• Natural gas provides 36% of electricity generation.
• State goal is 100% zero-carbon resources by 2045.

The Trust's passive structure limits its ability to respond to changing market and social demands

This is where the structure of SJT becomes a critical limiting factor. Unlike an operating company or even an actively managed fund, SJT is a pass-through vehicle established in 1980. Its assets are static; the Trustee cannot acquire new properties or engage in any commercial activity to diversify or offset declining gas production.

When social pressures-like the push for renewables-or market shocks hit, SJT can only absorb the impact. We saw this clearly in early 2025: the average natural gas price for February 2025 production was only $3.36 per Mcf, leading to no cash distributions being declared for April 2025 and October 2025. The Trust's inability to pivot means it must rely entirely on Hilcorp San Juan, L.P.'s operational decisions and commodity price recovery to generate any distributable income. If onboarding takes 14+ days, churn risk rises-and for SJT, if gas prices stay low, the distribution risk is permanent until the underlying asset is exhausted.

Local community and tribal interests affect drilling permits and operational areas, especially near Chaco Canyon

The social fabric around the San Juan Basin is currently strained by land use conflicts, which directly affect the operator, Hilcorp, and thus SJT's royalty stream. The fight over drilling near Chaco Culture National Historical Park is a prime example of community interests overriding potential energy development.

As of late 2025, the Bureau of Land Management (BLM) was consulting with Native American tribes over a proposal to revoke the 10-mile buffer zone ban on new oil and gas leasing around the park, a ban put in place by the Biden administration. This creates significant regulatory uncertainty. Some Pueblo leaders fear hydraulic fracturing will damage sacred sites, while some Navajo Nation members depend on royalties from existing wells nearby.

This tension is a real, tangible risk to production stability in the basin. The Trust's Q3 2025 report showed a loss of $111,000 on revenue of just $400, illustrating the extreme volatility tied to these operational and regulatory environments. The cumulative excess production costs net to the Trust was still approximately $12,869,691 as of February 2025 production month, meaning any operational hiccup or permit delay directly impacts the timeline for unitholders to see a distribution again.

Here is a comparison of the Chaco Canyon protection status:

Policy/Entity	Status as of Late 2025	Impact on San Juan Basin Operations
Biden-era Buffer Zone	Under formal review for revocation.	Potential for new leasing, but high social/legal opposition.
Pueblo Opposition	Strongly against drilling, citing potential damage to sacred sites.	Increases permitting risk and potential for litigation delays.
Navajo Nation Members	Some support drilling for vital royalty income.	Creates internal tribal division affecting unified political front.
SJT Distribution Status	Suspended since May 2024; no distribution for Oct 2025.	Directly tied to net proceeds after covering operator costs.

Finance: draft 13-week cash view by Friday.

San Juan Basin Royalty Trust (SJT) - PESTLE Analysis: Technological factors

You're looking at a royalty trust, SJT, which means your fate is entirely tied to the technology and capital decisions made by the operator, Hilcorp. The tech here isn't about software; it's about rock physics and drilling mechanics, specifically how well Hilcorp can execute complex horizontal drilling in the San Juan Basin.

The core issue is that the Trust's asset base is overwhelmingly natural gas-it produces a negligible amount of oil, which means you can't pivot if gas prices tank. This reliance on gas makes the success of advanced drilling techniques absolutely critical for any future value realization.

Operator Execution and Horizontal Drilling Dependency

The Trust's performance hinges on Hilcorp's technical prowess. Future production growth, or even just slowing the decline, is pinned on unlocking value from the deeper Mancos Shale, which requires sophisticated horizontal well technology. For context, Hilcorp spent a hefty $24.6 million in calendar year 2024 on just two new horizontal drilling projects targeting the Mancos formation.

However, the results from that 2024 capital expenditure (CAPEX) have been underwhelming so far. As of August 2025, the average daily natural gas production has actually dropped about 14.5% compared to December 2024 levels, suggesting the initial output from those new wells didn't meet bullish expectations.

Here's a quick look at the production context:

Metric	Value/Period	Source Context
Peak San Juan Gas Production	4.5 Bcf/d	Early 2000s
Estimated San Juan Gas Production	1.7 Bcf/d	2025 level mentioned in analysis
2024 Mancos Horizontal CAPEX (Hilcorp)	$24.6 million	Spent on 2 wells
2025 Vertical Drilling CAPEX (Hilcorp)	$4.0 million	For 7 new vertical wells

Mancos Shale: The Technological Bet for Future Reserves

The industry is betting big on the Mancos Shale as the next major source of gas in the basin, moving beyond the older Fruitland Coal seam. Operators exploring this deeper layer are reporting much higher Initial Production (IP) rates from their horizontal wells compared to older wells. For example, one operator's Mancos horizontal well achieved a peak rate of 24.9 million equivalent cubic feet per day over a 30-day period.

The Trust's future production profile is entirely dependent on Hilcorp's ability to scale this technology successfully across the Trust's acreage. If Hilcorp can consistently replicate those high IP rates with their horizontal drilling program, the Trust's cash flow could stabilize. If not, the slow, steady decline continues.

Commodity Rigidity Due to Gas Dominance

You must remember that SJT is fundamentally a gas play. The Trust is essentially a pass-through vehicle for royalties from properties that produce a negligible amount of oil. This lack of oil exposure means the Trust cannot benefit from the higher margins or different price dynamics that oil-weighted royalty companies enjoy. You are locked into the natural gas market, which is why the performance of gas-focused technology like horizontal drilling in the Mancos is so important.

The basin-wide production decline reflects this rigidity; San Juan gas production has fallen from a peak of 4.5 Bcf/d in the early 2000s to an estimated 1.7 Bcf/d in 2025.

Technological success is the only lever for growth here.

• Horizontal wells access more reserves per pad.
• Mancos Shale development is the key focus area.
• Drilling technology must overcome aging conventional wells.
• The Trust has no ability to shift to oil production.

Finance: draft 13-week cash view by Friday.

San Juan Basin Royalty Trust (SJT) - PESTLE Analysis: Legal factors

You're looking at a structure that is legally rigid, which is a major factor in how SJT navigates the current commodity price environment. The legal framework essentially locks the asset base in place, meaning no growth through acquisition is possible.

Asset Base Restriction and Governing Documents

The Trust's governing documents, specifically the Amended and Restated Royalty Trust Indenture (as amended on February 15, 2024), are quite restrictive. A key legal constraint is that the Trust prohibits acquiring new properties, effectively fixing the asset base to the existing San Juan Basin acreage. This means the only way for the Trust to generate more revenue is through the production performance of the current assets, which are operated entirely by Hilcorp San Juan L.P. The Trustee, Argent Trust Company, is authorized to retain a cash reserve for liabilities, but the primary legal hurdle right now is clearing the massive deficit before any cash flows back to you, the unitholder.

Here are the key legal conditions that must be met before distributions resume:

• Repay the balance of Excess Production Costs (EPC).
• Replenish the cash reserve to $2,000,000.
• Repay the principal and interest on the Line of Credit.

Cash Reserve Mandate and Distribution Suspension

The Trustee has a clear, legally defined path for resuming monthly distributions, and it starts with building up the cash cushion. If onboarding takes 14+ days, churn risk rises, but here, if the reserve isn't topped up, distributions stay suspended. As of the latest filings, the Trust is far from this target. For instance, as of October 2025, the cash reserves stood at a mere $27,243 after using some funds to cover interest on the Line of Credit. This is a long way from the required $2.0 million target.

The current situation is stark, showing zero distributable income for many months in 2025, such as the $0.00 distribution declared for October 2025. The Trust must first clear the EPC overhang, which was approximately $11,630,625 gross as of the August 2025 production month reporting.

Going Concern Qualification

Legally, the preparation of financial statements must assume a going concern, but the reality forces a major caveat. As of September 30, 2025, management explicitly disclosed substantial doubt about the San Juan Basin Royalty Trust's ability to continue as a going concern. This is a direct legal consequence of the cumulative EPC balance, which was over $10.1 million net to the Trust at that time.

Here's a snapshot of the financial pressure points that trigger this legal disclosure:

Metric	Value as of Sep 30, 2025 (Approximate)	Source of Doubt
Cumulative EPC (Net)	$10,195,300	EPC must be recovered before Net Proceeds yield Royalty Income
Cash Reserves	$29,160	Far below the required $2.0 million replenishment target
Line of Credit Outstanding	$274,135	Must be repaid before distributions resume

What this estimate hides is that the going concern warning is based on the current inability to cover liabilities and reserves, not a prediction of future operational failure by Hilcorp. Still, it's a red flag for any income-focused investor.

Operational Control and Fiduciary Duty

You definitely need to understand that SJT is a passive entity. The Trust has no operational control whatsoever; it is entirely dependent on Hilcorp's management decisions regarding drilling, production, and cost management. The Trustee's role is primarily oversight and fiduciary duty, not day-to-day management of the gas wells.

The Trustee's legal recourse involves continuous engagement and auditing. Argent Trust Company routinely engages with Hilcorp concerning accounting, reporting, sales revenues, production costs, and capital expenditures. This dependency means that the pace at which the massive EPC balance is paid down is entirely dictated by Hilcorp's operational spending and the resulting net proceeds. If Hilcorp decides to ramp up capital expenditures again, the legal path back to distributions for unitholders gets longer, defintely.

Finance: draft 13-week cash view by Friday

San Juan Basin Royalty Trust (SJT) - PESTLE Analysis: Environmental factors

You're managing a royalty interest in the San Juan Basin, and honestly, the environmental landscape is getting tighter, which directly affects the long-term viability of those aging gas wells your Trust relies on.

The primary concern is the basin's natural decline coupled with increasingly strict state oversight, especially around water and emissions. This isn't just about public perception; it's about compliance costs and operational continuity for the operators who pay you royalties.

New Mexico Regulations for Produced Water Reuse and Disposal

New Mexico took a hard line on produced water (the toxic wastewater from drilling) in 2025. The Water Quality Control Commission voted in May 2025 to completely ban any discharge of treated produced water to ground or surface waters. This is a big deal because New Mexico generates roughly 2 billion barrels of this wastewater annually.

While the ban is in effect, the state is planning Phase 2 rulemaking in 2026 to explore safe reuse pathways. For now, operators must rely on injection wells or closed-loop systems, which adds complexity and cost. To be fair, the state is trying to protect its scarce water, but this regulatory uncertainty impacts future drilling decisions in the basin.

The risk of spills remains a factor; state records showed 938 incidents of produced water spills in 2023.

Declining Production and Aging Well Infrastructure

The Trust's main asset is tied to a basin that has been shrinking since its peak in 2010. Natural gas production has been steadily falling due to competition and the maturity of the coalbed methane (CBM) wells.

Here's a quick look at the trend for the gas that matters to your cash flow:

Metric	2010 (Peak/Baseline)	2024 Estimate	2025 Forecast
San Juan Raw Gas Production (Bcf/d)	3.372	1.701 (Total)	1.644 (Old Wells Only)
Total Annual Gas Production (Tscf)	0.86	~0.47 (in 2024)	N/A
Annual Water Production (MMBW)	~49 (Peak in 2011)	~20 (in 2024)	N/A

The older infrastructure inherited by the current smaller operators often means higher potential for leaks and emissions.

Methane Emissions and Compliance Costs

Methane is a potent greenhouse gas, and New Mexico has aggressive rules to control it. Operators are required to capture no less than 98% of their natural gas waste by the end of 2026.

The state's rules appear effective, as 2024-2025 satellite data showed New Mexico's methane intensity in the Permian at 1.2% versus Texas's 3.1% in the Delaware sub-basin. This captured gas is not just an environmental win; it generated an estimated $125 million in additional natural gas production value and $27 million in tax revenue for the state in the measurement period.

For operators, compliance means capital expenditure on new equipment and leak detection. Furthermore, the regulatory expansion under Senate Bill 4 could mean the Environment Department needs 10 more personnel and up to $1.7 million in new funding to enforce these rules.

Water Management and Drilling Viability

Water is the lifeblood of any drilling operation, and in arid New Mexico, it's a constant constraint. Water management-sourcing, transport, treatment, and disposal-is now a central economic factor.

For the San Juan Basin specifically, the petroleum industry holds about 6.3% of the groundwater rights, totaling around 6,674 acre-ft/year. New horizontal wells are water-intensive, averaging 3.13 acre-feet (af) per well.

The cost of moving water is significant, with transport accounting for 43% of total water-related expenses for operators. If operators cannot secure cost-effective water or disposal for produced water due to the new discharge bans, drilling viability for new infill wells in the basin definitely suffers.

• Transport costs drive the push for water reuse.
• U.S. midstream water market projected at $156 billion (2025-2030).
• Reuse is seen as key to reducing freshwater demand.
• New drilling is focused on the Mancos Shale.

Finance: draft 13-week cash view by Friday.