Company: PED
Filing Date: 2025-10-29
Form Type: 10-K/A
Source: 0001654954-25-012328
Chunk: 44

Company: PEDEVCO CORP
Filing Date: 2025-10-29
Form: 10-K/A
Chunk 44
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 petition; however, the COGCC initiated a cumulative impacts stakeholder process to determine how best to address cumulative impacts going forward, which may include additional regulations.

Since 2022, the ECMC has introduced regulatory measures impacting the oil and gas industry, including: (i)

in August 2024, the ECMC proposed regulations aimed at assessing and mitigating the cumulative effects of oil and gas operations, particularly in communities disproportionately impacted by environmental burdens, which rules are now in place as of December 15, 2024; and (ii) in April 2022, the ECMC implemented new financial assurance rules mandating that oil and gas operators provide adequate funds to cover well plugging and site reclamation.

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AQCC rulemakings are intended to further Colorado’s legislative directive to reduce carbon dioxide, methane and other greenhouse gases (“GHGs”) emissions to attain climate action goals. AQCC is expected to undertake several rulemaking efforts to further reduce emissions in the next several years. For example, in October 2023, the AQCC adopted the Greenhouse Gas Emissions and Energy Management for Manufacturing Phase 2 rule, which requires 18 of Colorado’s highest emitting manufacturers in the industrial sector (which includes energy use in the oil and gas industry) to collectively reduce their GHG levels by 20% by 2030, as compared to 2015 levels.

In 2021, the State of New Mexico Energy, Minerals and Natural Resources Department (“ENMRD”) enacted rule changes aimed at mitigating volumes of flared and vented natural gas. Commencing April 1, 2022, operators are required to reduce the annual volume of vented and flared natural gas in order to capture no less than ninety-eight percent of the natural gas produced from all wells by December 31, 2026 (New Mexico Administrative Code Section 19.15.27.9). This rule change is accompanied by additional reporting requirements for all flared and vented gas. We expect to meet or exceed the required gas capture requirements in accordance with this rule change.

In addition, the New Mexico state legislature is considering a bill that would increase fines and fees on oil and gas operators and codify New Mexico’s 98% methane capture rule, which the New Mexico Energy, Minerals and Natural Resources Department (“NMOCD”) enacted in 2021. Under the methane capture rule, oil and gas operators are required to capture 98% of their produced natural gas by December 31, 2026,