“A Fraudulent Scheme”: New Mexico Sues Texas Oil Companies for Walking Away From Their Leaking Wells
How is this acceptable?
The state of New Mexico is accusing three Texas oil executives of orchestrating “a fraudulent scheme” to pocket revenue from hundreds of oil and gas wells in New Mexico and offload the cost of plugging and cleaning up the wells onto the state’s taxpayers. The suit, filed in late December by the New Mexico attorney general’s office, is the latest salvo in the state’s fight against oil and gas executives accused of foisting old wells onto the public.
The 72-page complaint alleges a yearslong pattern of fraud and self-dealing in which the oil executives — Everett Willard Gray II, Robert Stitzel and Marquis Reed Gilmore Jr., all of Midland, Texas — repeatedly transferred wells among “a series of shell corporations, LLCs, and partnerships they created.” On multiple occasions, the men placed companies into bankruptcy protection, only to move their profitable wells to other companies they owned or managed outside the bankruptcy proceedings, the suit said.
New Mexico faces millions of dollars in costs to plug wells the companies shed through the bankruptcies. Unplugged oil and gas wells can emit climate-warming methane and carcinogenic gases and often leak briny, radioactive wastewater, as ProPublica and Capital & Main detailed in a 2024 investigation. The newsrooms uncovered Gray, Stitzel and Gilmore’s early business dealings and use of bankruptcy proceedings.
“I will not stand by while bad actors take advantage of the system — avoiding responsibility, burdening the state with costly remediation, and recklessly endangering the health of New Mexicans,” Raúl Torrez, the state’s attorney general, said in a statement.
As part of ProPublica and Capital & Main’s 2024 investigation, the news organizations toured dozens of wells belonging to Remnant, the group of companies through which the men launched their enterprise. Some wells leaked such high volumes of methane that, if ignited, the air could explode; others emitted hydrogen sulfide at potentially lethal concentrations; and several were surrounded by oil and wastewater spills. At the time, the owner of an oil field services company that had worked on Remnant’s wells said that the men filed for bankruptcy protection without paying his company what it was owed.
The recent lawsuit is “meritless” and built on “baseless claims,” Gray said in a statement responding to questions from ProPublica and Capital & Main. “I have always acted ethically and never been involved in any activities to defraud the state of New Mexico. I strongly deny any wrongdoing in this matter,” he said.
New Era Energy & Digital, one of Gray’s companies named in the state’s complaint, ended up with 87 of the group’s best gas wells, and the company said in a press release that those “no longer align with the Company’s business model.” New Era is focused instead on building an AI data center powered by a yet-to-be-built nuclear power station, it said.
Stitzel and Gilmore didn’t respond to requests for comment.
The tactics alleged by the attorney general are commonly used in the industry to squeeze profits from old wells before companies go bankrupt. Oil and gas executives so frequently follow a similar pattern that …
How is this acceptable?
The state of New Mexico is accusing three Texas oil executives of orchestrating “a fraudulent scheme” to pocket revenue from hundreds of oil and gas wells in New Mexico and offload the cost of plugging and cleaning up the wells onto the state’s taxpayers. The suit, filed in late December by the New Mexico attorney general’s office, is the latest salvo in the state’s fight against oil and gas executives accused of foisting old wells onto the public.
The 72-page complaint alleges a yearslong pattern of fraud and self-dealing in which the oil executives — Everett Willard Gray II, Robert Stitzel and Marquis Reed Gilmore Jr., all of Midland, Texas — repeatedly transferred wells among “a series of shell corporations, LLCs, and partnerships they created.” On multiple occasions, the men placed companies into bankruptcy protection, only to move their profitable wells to other companies they owned or managed outside the bankruptcy proceedings, the suit said.
New Mexico faces millions of dollars in costs to plug wells the companies shed through the bankruptcies. Unplugged oil and gas wells can emit climate-warming methane and carcinogenic gases and often leak briny, radioactive wastewater, as ProPublica and Capital & Main detailed in a 2024 investigation. The newsrooms uncovered Gray, Stitzel and Gilmore’s early business dealings and use of bankruptcy proceedings.
“I will not stand by while bad actors take advantage of the system — avoiding responsibility, burdening the state with costly remediation, and recklessly endangering the health of New Mexicans,” Raúl Torrez, the state’s attorney general, said in a statement.
As part of ProPublica and Capital & Main’s 2024 investigation, the news organizations toured dozens of wells belonging to Remnant, the group of companies through which the men launched their enterprise. Some wells leaked such high volumes of methane that, if ignited, the air could explode; others emitted hydrogen sulfide at potentially lethal concentrations; and several were surrounded by oil and wastewater spills. At the time, the owner of an oil field services company that had worked on Remnant’s wells said that the men filed for bankruptcy protection without paying his company what it was owed.
The recent lawsuit is “meritless” and built on “baseless claims,” Gray said in a statement responding to questions from ProPublica and Capital & Main. “I have always acted ethically and never been involved in any activities to defraud the state of New Mexico. I strongly deny any wrongdoing in this matter,” he said.
New Era Energy & Digital, one of Gray’s companies named in the state’s complaint, ended up with 87 of the group’s best gas wells, and the company said in a press release that those “no longer align with the Company’s business model.” New Era is focused instead on building an AI data center powered by a yet-to-be-built nuclear power station, it said.
Stitzel and Gilmore didn’t respond to requests for comment.
The tactics alleged by the attorney general are commonly used in the industry to squeeze profits from old wells before companies go bankrupt. Oil and gas executives so frequently follow a similar pattern that …
“A Fraudulent Scheme”: New Mexico Sues Texas Oil Companies for Walking Away From Their Leaking Wells
How is this acceptable?
The state of New Mexico is accusing three Texas oil executives of orchestrating “a fraudulent scheme” to pocket revenue from hundreds of oil and gas wells in New Mexico and offload the cost of plugging and cleaning up the wells onto the state’s taxpayers. The suit, filed in late December by the New Mexico attorney general’s office, is the latest salvo in the state’s fight against oil and gas executives accused of foisting old wells onto the public.
The 72-page complaint alleges a yearslong pattern of fraud and self-dealing in which the oil executives — Everett Willard Gray II, Robert Stitzel and Marquis Reed Gilmore Jr., all of Midland, Texas — repeatedly transferred wells among “a series of shell corporations, LLCs, and partnerships they created.” On multiple occasions, the men placed companies into bankruptcy protection, only to move their profitable wells to other companies they owned or managed outside the bankruptcy proceedings, the suit said.
New Mexico faces millions of dollars in costs to plug wells the companies shed through the bankruptcies. Unplugged oil and gas wells can emit climate-warming methane and carcinogenic gases and often leak briny, radioactive wastewater, as ProPublica and Capital & Main detailed in a 2024 investigation. The newsrooms uncovered Gray, Stitzel and Gilmore’s early business dealings and use of bankruptcy proceedings.
“I will not stand by while bad actors take advantage of the system — avoiding responsibility, burdening the state with costly remediation, and recklessly endangering the health of New Mexicans,” Raúl Torrez, the state’s attorney general, said in a statement.
As part of ProPublica and Capital & Main’s 2024 investigation, the news organizations toured dozens of wells belonging to Remnant, the group of companies through which the men launched their enterprise. Some wells leaked such high volumes of methane that, if ignited, the air could explode; others emitted hydrogen sulfide at potentially lethal concentrations; and several were surrounded by oil and wastewater spills. At the time, the owner of an oil field services company that had worked on Remnant’s wells said that the men filed for bankruptcy protection without paying his company what it was owed.
The recent lawsuit is “meritless” and built on “baseless claims,” Gray said in a statement responding to questions from ProPublica and Capital & Main. “I have always acted ethically and never been involved in any activities to defraud the state of New Mexico. I strongly deny any wrongdoing in this matter,” he said.
New Era Energy & Digital, one of Gray’s companies named in the state’s complaint, ended up with 87 of the group’s best gas wells, and the company said in a press release that those “no longer align with the Company’s business model.” New Era is focused instead on building an AI data center powered by a yet-to-be-built nuclear power station, it said.
Stitzel and Gilmore didn’t respond to requests for comment.
The tactics alleged by the attorney general are commonly used in the industry to squeeze profits from old wells before companies go bankrupt. Oil and gas executives so frequently follow a similar pattern that …
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