Third Time Lucky? Oil Industry Renews Wastewater Reuse Bid

An industry group petitions New Mexico regulators for the third time to allow treated oilfield water onto crops and rivers

26 Mar 2026

New Mexico's prolonged dispute over oilfield wastewater disposal has intensified, as an industry alliance filed a fresh petition with state regulators seeking permission to discharge treated produced water onto farmland, pastures, and rivers.

The Water Access Treatment and Reuse Alliance submitted its petition to the New Mexico Water Quality Control Commission on March 3, 2026. The application goes further than its two predecessors, including a request to irrigate food crops with treated water drawn from oil and gas operations.

The commission banned such discharges in May 2025 following an 18-month scientific review. Regulators found that existing treatment technologies could not reliably remove more than 1,400 toxic and radioactive substances identified in produced water from the Permian Basin. The ban included a five-year review period to allow technology to develop.

The industry's second reversal attempt collapsed in November 2025 after reports emerged of political pressure from the governor's office on commission members. The commission voted 7 to 4 to dismiss that petition. A subsequent legislative effort, which would have required the commission to approve reuse rules by year-end, was tabled by a state House committee in February 2026.

Environmental groups and Navajo community advocates have again mobilised against the latest bid, arguing that no new scientific evidence justifies overturning the existing ban and that risks to drinking water and indigenous communities remain too high.

The economic stakes are considerable. New Mexico's oil and gas sector produces an estimated 10 million barrels of wastewater daily. Operators and some lawmakers contend that treating and reusing this output could ease acute freshwater scarcity in one of the country's driest states, with potential uses ranging from industrial cooling to rangeland irrigation.

The commission is expected to decide in the coming months whether to advance the petition to a formal hearing. With federal water regulations continuing to evolve, New Mexico's handling of the issue may influence how other shale-producing states approach produced water disposal and reuse.