SANTA FE, N.M. (AP) — New Mexico's state government is bracing for a financial hit from flooding in Texas as Houston-area oil and natural gas businesses likely struggle to make royalty and tax payments.
State Land Commissioner Aubrey Dunn on Wednesday warned that Hurricane Harvey's destruction will disrupt revenues due to New Mexico for oil and gas operations on state and federal land.
Dunn offered a one-month grace period for Houston-based companies to pay royalties and interest for operations on New Mexico state trust land, extending a late-September deadline into October.
New Mexico state government depends on the oil and natural gas sector for about one-third of its annual budget, through royalties, severance taxes, lease payments and fees.
An estimated 40 percent of severance taxes collected by New Mexico are paid by Houston-based companies.