A trip through a sacrifice zone
In northwest New Mexico, hundreds of wells are in limbo

A trip through a sacrifice zone

Don Schreiber inspects a plugged and abandoned well in northwest New Mexico./ Photo by Jonathan Thompson

Jonathan Thompson - 07/28/2022

It’s mid-June and Don Schreiber is holding court behind the wheel of his ranch truck as he pilots it along a county road west of Farmington. Schreiber is a talker but comes up short of words as he tries to describe the grandeur and beauty of the place we’re headed, a sort of plateau from which one can see the ominous form of Tsé Bit’a’í, or Shiprock, the backside of Mesa Verde and the Carrizo Mountains. “It’s like … kinda like a cathedral,” he says. 

Then we’re all left speechless as we come over a rise and our vision is filled with the hulking shape of the San Juan Generating Station and its four smokestacks. Schreiber steers onto a gravel road in front of the coal-burning power plant and heads westward, climbing up and through one of the sandstone ridges that makes up the Hogback, a geological formation that marks the boundary of the San Juan Basin. From up here it does, indeed, feel like a sacred place, albeit one despoiled by pumpjacks, well pads, rusty pipes, pvc tubing and other industrial detritus. 

“It’s like someone went into a church and vandalized it,” Schreiber says, finding the words easily – and emphatically – this time. 

Schreiber – along with Robyn Jackson, interim executive director of Diné CARE, and David Fosdeck, a Farmington solar advocate, ditch rider and surveyor – are taking me on a tour of the Horseshoe Gallup oil and gas field. The field epitomizes one of the vexing problems facing advocates and regulators: How to tap federal funds for abandoned and orphaned well cleanups when the wells in question are in a state of limbo. Schreiber calls it the “orphaned/non-orphaned well syndrome.” That is, the wells are defunct and their operators bankrupt – but regulators still consider the facilities to be active, indefinitely delaying cleanup. 

Schreiber stops the truck, and we climb out to inspect an iron post indicating where a well had long ago been plugged and abandoned. He is a wiry guy, his mustachioed face shaded by a white cowboy hat. The silver buckle on the belt holding up his Wranglers is inlaid with turquoise-like stones that spell “Schreiber Insurance,” the business he ran for years. In the late 1990s, he retired, and he and his wife, Jane, bought the Devils Spring Ranch, east of Farmington, where they intended to run a holistic, sustainable ranching operation.

Plans were interrupted, however, by the drilling frenzy on and around the ranch during the George W. Bush/Dick Cheney administration, and Schreiber slid into a new role as one of the region’s most persistent and outspoken oil and gas watchdogs. Which is why, several months ago, an official in Washington, D.C., contacted him, looking for orphaned or abandoned wells that might be eligible for part of the $4.7 billion in cleanup funds in last year’s congressional infrastructure bill. 

You’d think finding it would be like shooting fish in a barrel. Some 40,000 wells have been drilled during the past century in the San Juan Basin – a 10,000-square-mile geological dish rife with hydrocarbons laid down during the Cretaceous era. And more than 100 wells pockmark Schreiber’s ranch and surrounding lands. But to Schreiber’s chagrin, he could not come up with any that fit the bill. When he asked around, a friend who runs a local well service business pointed him toward the Horseshoe Gallup, a collection of some 800 wells that sits a distance from major throughways in an area of overlapping jurisdictions.

That Schreiber had forgotten about the field was a bit embarrassing. He grew up in northwestern New Mexico, after all, and was a child when Farmington was transforming from an agricultural center into an oil, gas and coal hotspot. He remembers the smell of burning orchards that had been cleared to make way for oilfield worker housing. “I have such a clear image of the mounded trees and the smoke,” he says. “They were building Apple Valley subdivision.” 

Companies had been drilling for oil and gas here since the 1920s, but El Paso Natural Gas’ 1950 construction of a pipeline to carry San Juan Basin methane to California sparked the transformative boom. The flames were fanned by a flurry of oil finds in 1956-57, including the Horseshoe Gallup, where Arizona Exploration drilled the Horseshoe Canyon B#1 well, which had an initial production rate of 120 barrels per day, according to local historian Tom Dugan. 

Fosdeck directs Schreiber to turn down a dusty two-track, and we pull up near a tank smeared with an almost artistic rusty patina. This well originally was drilled by Standard Oil Co. of Texas in 1960, during the Horseshoe Gallup’s initial boom. Standard’s drill made it down 1,735 feet, but the hole was dry, so workers plugged what was called the Navajo 82-1-1 well and moved on. Two decades later, Raymond E. Sitta, Jr. took over the lease and applied for a permit to “move in cable tools, clean out cement plugs and open hole to 1735 and test for oil production.” When oil came bubbling out, he named it State Senate #2, most likely for his father, who was a New Mexico state senator up until his death in 1979.

Even from a distance, it’s clear that State Senate #2’s glory days are behind it. The relatively diminutive blue and yellow pumpjack is motionless, and tumbleweeds have gathered around the once-moving parts. An old garden hose that probably carried well gas or methane from the well to the pumpjack’s engine has rotted away. Indeed, the “poppin’ Jonny,” as the well-gas-powered engines are known, is long gone. According to state records, the well last produced oil semi-regularly in 2007, and even then, it was only at a rate of about 25 to 50 barrels per year – not exactly a cash cow. 

Sitta died in 2008 and, in 2011, his estate sold the State Senate #2, along with other wells in the field, to BIYA (which supposedly stands for “Boot in Your Ass”), which at the time was registered in Aztec under Richard and Debbie Baldwin. They tried to revive the old well, coaxing a whopping six barrels of oil from the ground in 2012. It hasn’t produced anything worth recording since, even though another obscure company, Diversified Resources, purchased BIYA and its wells in 2014.

It seemed as if Schreiber had found at least one well for his contact in D.C. Or maybe not. When Schreiber and company went to check the state oil conservation division’s records, they were astonished to find that the State Senate #2 is an “active” well. The Bureau of Land Management classifies it as “shut-in,” which supposedly means that it’s temporarily idled, and the operator plans to bring it back into production soon. It also means the operator doesn’t have to plug the well, clean up the site or give up whatever bond or financial assurance it may have posted.

The BLM’s designation is especially odd given that in 2016, the agency’s Farmington office sent a letter to BIYA regarding the State Senate #2 and another nearby well, saying the leases “… must contain a well capable of producing hydrocarbons in paying quantities … or they will be considered to have expired … If you consider the above-mentioned wells incapable of production in paying quantities, the subject leases will terminate and you should make plans to plug and abandon these wells.” State records stop there, so it’s not clear if BIYA responded. What is clear is the BLM never followed through. 

Even more mystifying is that BIYA entered Chapter 7 bankruptcy in 2019, filing an intent to abandon its oil and gas leases, including the State Senate #2.

If the State Senate #2 were an anomaly, it could be excused as a simple oversight by regulators. But as we continue our journey along the spiderweb of roads, passing one dilapidated well after another, it becomes clear that in the Horseshoe Gallup, neglect is the norm. As long as no one makes too much noise about it, regulators will apparently take an out-of-sight, out-of-mind approach. 

“How did they let them get away with this?” Schreiber says as he points to pipes snaking across the dirt and sandstone. “There is no one sticking up for this place.” 

That’s changing, though. A powerful team, which includes Schreiber, Jackson, Fosdeck, San Juan Citizens Alliance’s Mike Eisenfeld, Earthworks’ Kendra Pinto and others, has coalesced to document the Horseshoe Gallup’s wells and bring them to regulators’ attention.

But it’s no easy task. Literally hundreds of wells out here are in orphaned/non-orphaned limbo. Some haven’t produced in nearly 20 years. Others have produced exactly one barrel per month for several consecutive years, an indication that the operator goes to the well one day each month and pumps a barrel of oil to make it look like the well’s still producing. Records are spotty, enforcement and inspections apparently even more so. In 2017, three leaks were discovered coming from BIYA’s pipelines in the Horseshoe Gallup field. The company filed reports and hired a company to clean it up. But the paper trail ends there, and satellite imagery shows a gaping, open hole where the cleanup was supposed to take place.

Meanwhile, the facilities out here tend to be owned by small, obscure companies, some of which no longer exist or are in their own limbo.

As the sun climbs higher into the sky, and the mercury shoots into the 90s, Schreiber pilots the truck down an especially nasty road that criss-crosses an arroyo at the bottom of a shallow canyon. This area feels even more blighted than the other places we’ve visited, as though someone went on a drunken bulldozer rampage.

We stop at a collection of infrastructure sticking up from the earth and take a gander at the rusty fittings, a gathering system for oil or produced water – the briny, hydrocarbon-laden, occasionally radioactive waste that accompanies oil and gas. It may be associated with a nearby injection well, where the wastewater is shot back into the ground along with some sort of prayer that it doesn’t contaminate aquifers, wreak havoc on hydrology or stir up seismic activity – or if it does, that nobody finds out.

Given the decrepit condition of the equipment, we assume it is no longer in use and has been flushed clean. But just for kicks, someone turns one of the valves: A hiss emanates from the pipe’s open mouth (most likely methane), followed by a sick sort of gurgle and an ejaculation of shiny, black fluid. The valve is slammed shut. 

We hurriedly climb into the truck and continue on to today’s star attraction: Two rows of big tanks, a broken down yellow truck, a pile of old pumpjack parts and miscellaneous equipment in a clearing scraped into the dirt. This one is odd in that it doesn’t appear on the state’s well map or list of facilities, but it is clearly associated with an adjacent well owned by Chuza Oil Co.

Fosdeck, who has a knack for digging through arcane well records and other data, explains that Chuza’s CEO is Bobby Goldstein, the creator of a reality television show called “Cheaters.” It turns out Chuza was pushed into bankruptcy by its creditors in 2018. The case has yet to be wrapped up.

Again, this well’s status is officially “active,” even though the electricity that powered the pumpjack was pulled long ago. Big plastic chemical bins sit out in the open; some still have eerie looking liquid inside. And, most egregious, a big stock tank oozes oily water that sits pooled on the ground around it.

“I’m disturbed,” Jackson says in a measured tone while she inspects the leaky tank. “I’m disturbed by industry being allowed to do whatever it wants.” Jackson gestures toward the smokestack of the Four Corners Power Plant in the distance and tells us her father, Leroy Jackson, worked at the plant for a while as an engineer. He liked the work, and it paid well, but after watching operators shut down pollution control systems at night and otherwise cut corners at the expense of the environment, his conscience prodded him to quit. Later, Leroy, along with Diné CARE, led a successful fight against logging in the Chuska Mountains. 

“This place may not be pristine or lush,” Jackson says. “But for our people, it is sacred. It has significance.”

As the heat inches into unbearable territory, we continue on through the wreckage. I’m starting to imagine that we’re driving through a “Mad Max” movie set, not a real oil field, when a guy pulls up on a neon-green dirt bike. He may not be clad in Road Warrior armor, but his presence is startling nonetheless, as he’s the first person we’ve seen since morning. Even more startling is that when he sidles up next to the truck, he immediately rattles off a bunch of oil and gas industry lingo: P&As and shut-ins; water-flood and EOR.

“You looking around for acquisitions?” he asks.

“Nope. Just checking things out,” Schreiber replies cautiously.

The dirt biker tells us he’s a petroleum geologist working on his PhD and looking for a thesis topic. He thinks maybe the Horseshoe Gallup is a good candidate; he thinks the old wells could be perked up with carbon dioxide captured from the stacks of the San Juan Generating Station.

“What do you think?” he asks.

“Wouldn’t know anything about that,” Schreiber says.

Then the guy says farewell and rides off into the distance. Schreiber fires up the engine, and we do the same.

The Land Desk is a newsletter from Jonathan Thompson, author of “River of Lost Souls,” “Behind the Slickrock Curtain” and “Sagebrush Empire.” To subscribe, go to: www.landdesk.org