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Albuquerque Journal: Federal drilling rate shortchanges N.M., the West

New Mexico’s share of federal oil and gas royalties made news of a different sort last month when Sen. Tom Udall introduced legislation to block the federal government from taking $25 million of the state’s share as part of the budget sequester this year.

Udall, D-N.M., teamed up with Sen. Mike Enzi, R-Wyo., to craft a bill that would protect the money, a key revenue stream for Western states. Wyoming is the only state facing a royalty loss larger than that of New Mexico, one of the nation’s largest onshore oil and gas producers. Wyoming stands to lose $53 million, compared with the $25 million loss for New Mexico.

The Department of Interior announced in March that it would withhold a portion of the energy and minerals royalties it collects from companies extracting oil, gas and minerals from federal lands. Udall’s bill would restore the state’s full federal royalty share and do away with an additional 2 percent fee that the Interior Department charges the states.

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