Today New Energy Economy, Daniel Tso, Samuel Sage and 16 organizations filed an ethics complaint against Water Quality Control Commissioner Krista McWilliams and a Joint Motion was filed at the Water Quality Control Commission (WQCC) to request that she be disqualified from consideration of the “Ground and Surface Water Protection – Supplemental Requirements for Water Reuse” (“Reuse Rule”), Case No. WQCC 23 - 84 (R), currently pending before the Water Quality Control Commission.
The proposed Reuse Rule applies to all persons intending to reuse produced wastewater in their operations outside of the oil fields, and authorizes reuse of fluid oil and gas industry waste, also known as produced water, that has “undergone a level of treatment appropriate for an application such as agriculture, irrigation, potable water supplies, aquifer recharge, industrial processes, or environmental restoration” for demonstration and industrial projects.
Our complaint enumerates the conflicts at issue, including:
Commissioner McWilliams is currently the “Vice President of Operations Engineering,” for Logos Energy (“LOGOS”), and serves on the board of the Independent Petroleum Association of New Mexico (“IPA NM”), which actively lobbies to “ensure new rules will not impact the bottom-line of our members.”
Her husband Jay Paul McWilliams is the Chief Executive Officer of LOGOS, and LOGOS is a member of the New Mexico Oil and Gas Association (“NMOGA”). Mr. McWilliams was also on NMOGA’s Board from 2017 to 2021. NMOGA is a party in the rulemaking at issue.
Commissioner McWilliams’ company, LOGOS, is directly engaged in the produced water reuse business. It operates at least four saltwater disposal wells (aka produced water disposal wells), and in 2023 they used these four wells to dispose of 2,112,279 barrels (over 88 million gallons) of produced water.
LOGOS also operates the Rosa Recycling and Containment Facility, a six-acre surface area lined pit that has the capacity for 600,000 barrels of produced water and in Case No. 16069 before the Oil Conservation Division testified that the “purpose” for the Rosa Recycling and Containment Facility is “to minimize any freshwater usage,” precisely the talking points given to rationalize the pending Reuse Rule provided by NMED, NMOGA, and the New Mexico Produced Water Research Consortium (“Consortium”).
A LOGOS PowerPoint given to the Legislature admits that risk to the Company includes:
regulatory or legislative actions on LOGOS or the oil and gas exploration and production industry;
new restrictions impacting LOGOS’s development activities, including restrictions on water sourcing and/or disposal, restrictions on LOGOS’s water business; and
risks associated with the ownership and operations of LOGOS’s water and compression services.
LOGOS has been penalized by the US Environmental Protection Agency and New Mexico Oil Conservation Division records detail a number of spills and discharges of produced water (and crude oil and other materials, including condensate) by LOGOS, violations that are directly at issue in the pending Reuse rule.
Commissioner McWilliams’ name is listed on pg. 10 of the IPA NM booklet under 2023 Board Members. It states on p. 3, “we advance and preserve the interests of independent oil and gas producers.” And, under the heading, “Rulemaking Hearings – IPA NM insists on specific representation for independents during rulemaking. We push hard to ensure new rules will not impact the bottom-line of our members.”
To add insult to injury, NMOGA’s lawyer in the Reuse Rule case, Jeffrey Wechsler, is arguing the Reuse Rule before Commissioner McWilliams even as he is representing her in her capacity as a board member for IPA NM in the Atencio vs State of New Mexico case pending at the First District Court. (Today the effort by the State and the oil and gas industry to dismiss the NM LAWS Atencio vs State of New Mexico case was rejected!)
The Commissioner and her husband’s personal and financial ties to her company, their oil and gas associations (including with a party in the case), corresponding fiduciary duties, and the admission that rules restricting water sourcing and/or disposal threaten their company’s bottom line should be immediately disqualifying.
Water Quality Control Commissioners are required, upon the acceptance of the member’s appointment and prior to the performance of any of the members’ duties, to file a financial disclosure statement with the New Mexico Secretary of State under the Water Quality Act. NMSA 1978 § 74-6-3(B).
Section 20.1.6 et seq. of the New Mexico Administrative Code further requires that “No commission member shall participate in any action in which his or her impartiality of fairness may reasonably be questioned, and the member shall recuse himself or herself in any such action by giving notice to the commission and the general public by announcing this recusal on the record.”
Despite these clear legal and ethical requirements to ensure transparency and fairness in the rulemaking process, Commissioner McWilliams failed to file a financial disclosure with the Secretary of State, and when directly asked about real or perceived conflicts at the outset of the Reuse Rule hearing falsely asserted “I have no conflicts of interests, professional or otherwise.”
The outcome of this rulemaking will substantially, favorably or unfavorably, directly impact the Commissioner’s business and financial interests and that of her husband, and the organizations of which their business is a member, including the New Mexico Oil & Gas Association and the Independent Petroleum Association of New Mexico.
This direct Conflict of Interest compromises the integrity of the WQCC hearing and deprives the people of New Mexico the protections afforded by a fair and impartial adjudication in this important case.
New Energy Economy, Daniel Tso, and Samuel Sage were joined by American Friends Service Committee – New Mexico, Citizens for Fair Rates and the Environment, Climate Change Leadership Institute, Common Ground Rising, Concerned Citizens for Nuclear Safety, Earth Care, Honor Our Pueblo Existence (H.O.P.E.), Indivisible Albuquerque, Interfaith Worker Justice, Los Jardines Institute, New Mexico Social Justice Equity Institute, Physicians for Social Responsibility, Renewable Taos, Rio Arriba Concerned Citizens, Tewa Women United and Youth United for Climate Crisis Action in calling for the State Ethics Commission to conduct an independent investigation as to whether Commissioner McWilliams has a conflict of interest and has violated the public trust by her failure to recuse herself from the Reuse Rule case.
New Energy Economy, Daniel Tso and Samuel Sage additionally filed a Joint Motion to Disqualify Water Control Commissioner Krista McWilliams in the Reuse Case, currently pending before the WQCC, based on the same information.
The Governor, Secretary Kenney, the New Mexico Produced Water Research Consortium and NM oil and gas are seeking to radically change the rules for the Reuse of Toxic Radioactive fracking waste onto agriculture, into waterways and for industrial projects like hydrogen production that will poison our air, water, land and workers. There is no evidence that this can be done safely, and there are no scientific standards for reuse. The Reuse Rule endangers New Mexico waters, and having a biased and conflicted Commissioner who personally stands to gain from the rulemaking decision is completely unacceptable. New Mexico deserves fair and impartial regulators accountable to the people, not political stooges.
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