A legislative committee in New Mexico has passed a bill aimed at establishing a Strategic Water Supply for the state. House Bill 137 received approval from the House Agriculture, Acequias and Water Resources Committee with a narrow 5-4 vote. The bill is part of Governor Michelle Lujan Grisham's initiative to ensure that New Mexico has sufficient water resources to support future economic growth without jeopardizing its freshwater supplies, as outlined in her 50-Year Water Action Plan.

Following this initial approval, the bill will proceed to the House Energy, Environment and Natural Resources Committee for further consideration.

House Bill 137 proposes the creation of a Strategic Water Supply Program Fund. This fund would enable state natural resource agencies to provide grants and contracts for projects aimed at advancing economic development goals while reducing dependence on freshwater resources. According to experts, New Mexico's underground aquifers may contain up to 650 trillion gallons of brackish water. Additionally, the state's oil and gas industry produces over 80 billion gallons of produced water annually. The strategic use of these water sources could support manufacturing and clean energy projects that create jobs and boost local revenue.

Governor Lujan Grisham expressed her support for the initiative, stating: “The Strategic Water Supply will support clean energy and advanced manufacturing initiatives without putting our freshwater supplies at risk.” She also emphasized her commitment to working with the legislature to advance the bill and secure necessary funding.

If enacted into law, HB 137 would establish guidelines for eligible deep brackish water projects to access funding through the program. It also introduces a three-cent per-barrel fee on produced water volume generated by industry once reuse rules are adopted by the Water Quality Control Commission. This fee aims to encourage recycling and reuse within the oil and gas sector, with revenues contributing to future projects via the Strategic Water Supply Program Fund.

The collaboration among four state agencies — Energy, Minerals and Natural Resources Department; Environment Department; Office of the State Engineer; Economic Development Department — is central to developing industrial-use water projects from treated produced or deep brackish sources while conserving freshwater for essential uses like agriculture and natural ecosystems.