Empire Petroleum receives favorable ruling to advance CO2 development

Empire Petroleum (EP) announced the New Mexico Oil Conservation Commission has issued a unanimous and favorable ruling regarding the company’s rights to the residual oil zone in the Eunice Monument South Unit Unitized Interval in Lea County, New Mexico. After four years of expenditures, Empire received the Commission’s unanimous decision at a public hearing on August 14, affirming the existence of a ROZ in the Grayburg and San Andres formations within the EMSU and confirming Empire’s exclusive rights to produce the ROZ under the 1984 Commission Order. The commission is allowing Empire the opportunity to implement a CO2 enhanced oil recovery pilot project over the next three years. In addition to the findings noted above, the commission unanimously ordered the following actions: deny five new injection well applications from Goodnight Midstream Permian; deny application for increased injection from Goodnight; suspend injection operations on four existing Goodnight injection wells and deny all pending motions attached to these cases. The commission further found that, while Empire did not prove immediate correlative rights impairment in the Grayburg from neighboring operators’ injection activities, the company presented compelling evidence of possible future impairment or waste. Following this outcome, Empire intends to proceed with Motions to Revoke existing permits granted to the remaining third-party saltwater disposal operators disposing wastewater into the EMSU and Unitized Interval of the Arrowhead Grayburg Unit, while concurrently advancing litigation for trespass and damages.