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Oil surge reshapes life in New Mexico

Trucks crawl toward a congested intersection just south of Carlsbad this fall. The backups can be measured in miles. (Eddie Moore/Albuquerque Journal)

Copyright © 2019 Albuquerque Journal

Editor’s Note: It’s no secret that New Mexico is experiencing a record surge in oil production. For the last several months, Journal reporters have been digging into the oil boom’s far-reaching impact – on schools, roads, local residents, water, wildlife and the state budget. What follows is a five-part, in-depth look at how the surge is fundamentally reshaping southeast New Mexico – while stuffing local coffers and posing vexing challenges for state and local officials.

CARLSBAD – For a few months this year, David Davidson spent his days in an oil field, his nights in an RV park.

Twelve hours from home, he oversaw the installation of pipeline in the Permian Basin and lived out of a 36-foot recreational vehicle.

An unprecedented oil boom in southeastern New Mexico brought him – along with tens of thousands of roughnecks, roustabouts, executives, educators, waiters and construction workers. They arrived so fast there aren’t enough homes.

Pickup trucks fill hotel parking lots, and traffic backups can be measured in miles.

Drivers call one road “Death Highway.”

This is life in a New Mexico boomtown, where the nation’s fastest-growing region of oil production is creating wealth, straining public services and reshaping families.

A career in energy has taken Davidson, 58, to Midland, to Jal and – this summer and fall – to Carlsbad. Six days a week, he got up around 4:30 a.m. and returned to the RV park 14 hours later.

David Davidson, whose career in energy has taken him to communities in New Mexico and Texas, sits outside his camper at an RV park in Carlsbad this fall. (Eddie Moore/Albuquerque Journal)

“It’s changed this town,” Davidson said one fall evening, sitting on the steps of his RV.

The population of Carlsbad exploded over the last seven years as new drilling technologies unlocked oil and gas buried in the Permian Basin, largely south of town. Oil production is still accelerating.

Production hit 29 million barrels in a recent month, or twice the total recorded that month just two years earlier.

Carlsbad has ballooned to nearly triple its normal size since 2012. Roughly 75,000 people now live in the city, though the proliferation of RV parks and dormitory-style man camps makes estimating difficult.

Immigrants are an important part of the new workforce. In Hobbs, for example, about 40% of the population reports that a language other than English is spoken at home, higher than the statewide average, according to Census data.

Towns beyond Carlsbad and Hobbs, of course, are also feeling the boom. Pump jacks, drilling rigs and natural-gas flares dot the horizon across southeastern New Mexico and West Texas.

‘It’s different’

The influx of people is changing lives far from the oil fields.

Stella Rojo, a teacher who arrived from the Philippines, is greeted by Carlsbad Municipal Schools Superintendent Gerry Washburn this fall at Edison Elementary School. She is one of about two dozen international teachers recruited to help serve students in Carlsbad. (Eddie Moore/Albuquerque Journal)

Stella Rojo traveled 8,000 miles from her home in the Philippines to live a couple of blocks from Edison Elementary School in Carlsbad.

She is one of about 24 international teachers from Venezuela, India and elsewhere recruited to work with students in Carlsbad – a necessity as the demand for labor consumes the local workforce.

Rojo walked among nine fourth graders on a recent morning, leaning over a student occasionally to help with a math problem. Joining her was an instructional coach from Carlsbad schools to help with the transition.

Rojo, 28, taught for six years in her home country.

“Back in the Philippines,” Rojo said during a break, “it’s different – different in the curriculum and different in the strategies and techniques in teaching.”

But she said she is excited about the challenge and eager to learn about New Mexico and, in exchange, share her culture.

Carlsbad Superintendent Gerry Washburn said international teachers are a necessity.

A decade ago, he said, the district had 50 to 100 applications for every opening. Now some jobs don’t draw a single applicant – a reflection of the demand for workers, the high cost of living and the shortage of affordable housing.

“Our newest and most fresh-faced teachers are struggling to find places to live,” Washburn told the Journal.

The district now actively pursues housing for its new teachers. In some cases, Washburn said, as many as four teachers live together. In others, a family will make a bedroom available. And some teachers commute from Artesia or Roswell, more than an hour away.

Even as teacher recruitment grows difficult, the district sees a steady inflow of new students.

Children’s bikes and toys are a common sight in RV parks, and it isn’t unusual, Washburn said, for a handful of new kids a day to show up.

The student population has climbed to 7,200, a 12% increase since 2014. The district forecasts continued growth – to more than 8,000 students by 2023.

The district is accommodating the student body with a mix of school construction and reopening old schools. In November, residents approved an $80 million bond issue to fund a series of school improvements.

Construction of a new elementary school, in fact, is expected to be finished this month.

“When that school opens,” Washburn said, “it’ll be plumb full.”

Man camps

A housing shortage underpins many of the challenges.

Carlsbad is dotted with RV parks – some gated and well-kept, others informal, with just a few vehicles clustered together.

Oil and gas workers rent apartments in this row of temporary housing units in Carlsbad. (Eddie Moore/Albuquerque Journal)

And then there are the man camps – rows of temporary housing akin to a portable dormitory.

Higher-paid workers might pay hundreds a night to stay in a hotel, then drive or fly home for the weekend.

Wayne Ballard, owner of Built Concrete LLC in Carlsbad, said he swallows the cost for some of his employees to stay in temporary housing. At $1,500 a month per unit, each gets a 10-foot-by-10-foot room with a shower.

“It’s not the best or most pleasant living experience,” Ballard said. “It’s really not. People come here two to three months and go home.”

Hobbs – about an hour east of Carlsbad – isn’t quite so overwhelmed. The city, officials say, is more accustomed to the volatility of the oil industry. But even in Hobbs, newcomers had better be prepared to act fast.

“If you don’t take the apartment when you look at it,” Hobbs Mayor Sam Cobb said, “there’s someone sitting in the parking lot ready to take it.”

Hobbs aims to satisfy the demand for housing through an incentive package for developers. The city reimburses companies for the cost of building streets and other public infrastructure.

Cobb estimates the incentives contributed to the construction of 500 homes and 1,700 apartments over the last eight years. But there’s demand for more.

The city had about 90 homes on the market this fall, Cobb said, but a healthy housing inventory for a city the size of Hobbs would be 300 to 400 homes.

“We have more Realtors in Hobbs than we have homes for sale,” he said.

The housing shortage, in turn, is linked with the labor shortage.

Finding people to build homes – or do just about anything else – is difficult when workers can make a premium in the oil fields instead.

McDonald’s and similar chains advertise jobs at $14 an hour, and some fast-food workers are bused in from El Paso because of the high cost of living. Carlsbad residents also say they’ve seen restaurants close some days because there’s no staff available.

Ballard, whose company installs pipelines and handles similar work, said his 60-person company could use many more employees.

“We routinely turn down projects because we don’t have enough people to do the work,” he said. “We find people, but they can’t find housing here.”

Carlsbad officials say they are optimistic the housing crunch will ease as development – including the building of public streets and other infrastructure – catches up with demand.

Violations

State regulators, in the meantime, are scrambling. The liquid waste from all those showers and toilets – in temporary housing or otherwise – has to go somewhere.

Septic companies pump and collect the waste from RV parks in Carlsbad, then transport it to a treatment plant, sometimes in other cities.

Methane is burned off from wells near homes in Carlsbad. (Eddie Moore/Albuquerque Journal)

William Chavez, chief of the state’s environmental health bureau, said the trucks don’t always make it to a wastewater plant.

“In some cases,” he said, “they just go to some remote road down there and dump it on the side of the road.”

Raw sewage, of course, is a serious health concern. It could make its way into groundwater, state officials said, and birds and other animals could spread disease.

Also a concern, regulators said, is the proximity to nearby farms and orchards.

The Environment Department had, at one point, issued about 160 violation notices – a 10-fold increase compared to before the oil boom, officials said.

But while illegal dumping surges, they said, the state hasn’t hired a corresponding increase in staff.

“It is a strain on the Environment Department to address this and follow up,” said Sandra Ely, the department’s division director for environmental protection.

‘Death Highway’

Amid the oil boom, more people on the roads of Eddy and Lea counties are dying.

Tankers, semis and pickups of all sizes fill the roads and two-lane highways in southeastern New Mexico, and the heavy vehicles wear out the roads faster.

Residents joke about the sale of a T-shirt that says “I survived 285” – a reference to the U.S. highway that runs north and south through Artesia and Carlsbad and into Texas. It’s one of the busiest and most dangerous highways in New Mexico.

Locals call one stretch “Death Highway.”

Roadway traffic fatalities more than doubled in Eddy and Lea counties in a recent three-year period, from 17 in 2016 to 41 last year.

The number of traffic accidents jumped from six in 2012 to 49 in 2018 on U.S. 285 between the Texas line and Loving.

Lea County, meanwhile, is establishing a full-time traffic unit with training in accident reconstruction.

The budget approved by Gov. Michelle Lujan Grisham and state lawmakers this year earmarks about $389 million in special appropriations to improve the state’s transportation network, with the renovation of highways in southeastern New Mexico a priority.

The package includes $21 million for U.S. Highway 285 near the Texas line.

There’s demand, of course, for more. One key project backed by Eddy County is a relief route from U.S. 285 north to U.S. 62/180, said Wesley Hooper, the county’s community services director.

Cottonwood Elementary School is under construction in Carlsbad. The school is scheduled to open – at full capacity – in fall 2020. (Eddie Moore/Albuquerque Journal)

The county, in the last legislative session, secured about $11.7 million of the $35 million needed.

“We have got to get the investment in infrastructure down here to create a better quality of life and reduce frustration,” Hooper said.

Traffic backups at one intersection sometimes stretch beyond two miles.

“The roads across the basin are some of the worst in the country,” said Tracee Bentley, CEO of the Permian Strategic Partnership, an alliance of energy companies. “We have the most dangerous roads of anywhere in the country.”

The partnership has identified about $235 million in road funding needs across Eddy and Lea counties.

There are other public safety priorities, too, as people arrive in southeastern New Mexico and West Texas for work.

“It changes the culture,” Lea County Sheriff’s Deputy Vivian Martinez said. “You have an increase in crime.”

The number of sex offender registrations in Lea County surged last year, she said. Local police and sheriff’s deputies are establishing a regional SWAT team and violent crimes task force.

Collaborative solutions

The oil boom, of course, is generating wealth – both for families and government agencies.

Cooperation among local governments, the state and private companies will be critical, officials say, to investing the windfall wisely.

Nonpartisan analysts for the Legislative Finance Committee are recommending creation of a regional master plan to maximize the Permian Basin’s growth potential and address community needs. They suggest working with the Permian Strategic Partnership, the alliance of 19 energy companies, to identify priorities and guide collaboration.

The partnership has already donated money and participated in efforts to improve infrastructure and career training for young people.

Bentley, the partnership’s top executive, said the need for coordination is especially important given the Permian Basin’s location in two states, New Mexico and Texas.

“We have to view the Permian Basin as a community,” she said. “It’s a big one, but it’s a community. We share the same challenges along with the same benefits that nobody else in the country has.”

A 40-foot water slide in Hobbs might provide a guiding example for future collaboration.

A 40-foot water slide stands inside the new Center of Recreational Excellence in Hobbs – a product of cooperation among several local agencies. (Eddie Moore/Albuquerque Journal)

The city, school district, nonprofit JF Maddox Foundation and others worked together to build the $63.5 million Center of Recreational Excellence. Strong city revenue allowed Hobbs to contribute its portion without borrowing money through bonds, the typical route for city public works projects in New Mexico.

The CORE has a lazy river, a gym, competition and therapy pools, an indoor soccer field and a running track. At the heart of the building is a 40-foot water slide.

Lindsay Chism McCarter, the center’s marketing coordinator, said the 158,000-square-foot project is an example of civic leaders pushing to make Hobbs an attractive destination.

“A town this size to have a facility this size is literally unheard of,” she said. “Anything remotely close to this would be in a metropolitan area.”

Indeed, there’s nothing else like the CORE in New Mexico.

It isn’t clear how many of today’s oil field workers will be around to see the fruits of more collaboration. They tend to go where the work is, moving from town to town.

Davidson, who worked this summer and fall as an assistant superintendent overseeing pipeline installation, has already moved on from Carlsbad – taking work in Abilene, Texas.

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