After several years of negotiations with the New Mexico Office of the State Engineer, Chevron has announced a settlement for the 1,433-acre feet of water rights in the Questa area estimated to be worth $22 million. Obtaining these rights is a crucial need for the reclamation work Chevron has been involved in at the former Molycorp Mine site for the past decade.
The dispute over the water rights began in 2023 when Chevron attempted to sell a total of 7 acre-feet of water to two businesses in Questa, but were blocked by the Office of the State Engineer as the water rights were deemed invalid, due to being dormant for several years. New Mexico is considered a “use it or lose it’ state and must utilize its water ‘beneficially’ otherwise risk losing the rights all together.
Hearings have taken place over the past year, with local leaders voicing their support for Chevron and the Office of the State Engineer to come to an agreement over the water rights in question.
While the details of the negotiations remain confidential due to an agreement entered into with the Office of the State Engineer and Chevron, the company says they’re pleased with the outcome.
“Chevron has resolved the status of 1,433 acre-feet of water rights at the former Questa Mine Site,” a release from the company spokesperson says in part. “The settlement ensures Chevron has sufficient water rights for environmental remediation of the mine site. Surplus water rights are also available for communities in the Questa area and Taos County.”
Chevron has been committed to the remediation of Questa Mine, a project they’ve been invested in since the permanent closure of the mine in 2014. The project is expected to last for several decades, which is why these negotiations were crucial to the future of the remediation project.
Locally, Questa leadership was pleased with the outcome of the dispute. Mayor John Ortega says, “Two years ago, Bobby Ortega and I started to work with the State Engineer’s Office to support Chevron in getting these water rights back. Water rights are critical to the future growth and economic development within the village of Questa. Currently, the village of Questa over-diverts between 100 and 120 acre-feet of water every year. The possible transfer of 120-acre feet from Chevron is great and will really help the village move forward in the future,” Ortega says. “I praise both Chevron and the OSE for working together and getting this done for the Questa community. We have many projects beginning soon, including housing, greenhouses, and the green hydrogen project that may benefit from this settlement.”
In a statement, the State Engineer designee Elizabeth Anderson said, “We are pleased to have reached a settlement resolving the dispute over Chevron’s water rights at the Molycorp Mine Site. With this dispute behind us, we look forward to working productively to tackle the water challenges of the communities of Questa and Taos. This settlement provides certainty about the Chevron water rights, ensures that there will be sufficient water in place for the cleanup of the Molycorp Mine Site, and also ensures that these water rights will not be transferred away from the Questa/Taos area.”
Although Chevron was unable to go into extensive detail about the agreement, we asked about their stance on Questa’s newest endeavor, the Green Hydrogen Project. A spokesperson for the company confirmed they have been in talks with Kit Carson Electric Cooperative (KCEC) and “remain committed to negotiating the land and water rights necessary to effectively support KCEC’s project.”
