Major oil field theft busts continue in Permian Basin in Texas, New Mexico

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(The Center Square) – Major oil field theft busts continue in the Permian Basin in west Texas and southeastern New Mexico at the state and federal level.

In Texas, a lengthy multi-agency investigation into an alleged criminal network trafficking stolen petroleum products led to the arrest of six people in four west Texas counties. 

The investigation focused on Texas-based Vallee Oil and Gas, a wastewater disposal company, suspected of participating in the organized theft and trafficking of petroleum products. So far, 17 search warrants have been executed in Reeves, Rockwall, Kaufman and Hunt counties in Texas, and in Garvin County, Oklahoma, Texas Department of Public Safety said. Texas DPS Criminal Investigations Division's Organized Oilfield Theft Prevention Unit led the investigation working with multiple local, state and federal law enforcement partners. 

Through “Operation Black Market Basin,” authorities seized more than $12 million in petroleum products, luxury goods, cars and cash. The six arrested included the company's corporate leadership. State charges are being prosecuted by the 143rd Judicial District Attorney Sarah Stogner.

Stogner said the case was “historic and only the beginning. Oil thieves leave a trail of victims. Oil theft hurts hard working people. It leads to loss of jobs, loss of tax revenue, budget shortfalls for schools, hospitals and other vital services” that depend on oil and gas tax revenue. 

She also said, “In the past, law enforcement and authorities turned a blind eye to this kind of crime. Some have called it ‘the cost of doing business in oil and gas.’ but they are wrong. It must be stopped. I will continue to vigorously prosecute those who steal oil. It is the lifeblood of the Permian Basin.” 

The investigation led to finding 2,600 barrels of stolen petroleum products with an estimated market value of $220,402.

They also seized 60 vehicles worth approximately $2.85 million, 34 luxury watches and jewelry worth approximately $443,000, and $786,215 in cash. The search warrant also led to uncovering eight bank accounts with deposits totaling more than $8 million.

Multiple agencies were involved in the investigation, including the sheriff’s offices of Reeves and Loving counties, FBI El Paso Midland Resident Agency, DPS CID North Texas Region, Oklahoma State Bureau of Investigations, among others. The investigation is ongoing and “additional arrests and seizures are anticipated,” DPS said.

Texas Railroad Commissioner Wayne Christian praised the bust, stating it was “a victory for Texas’ oil and gas industry.” In response, Stagner said the bust occurred “in spite of the RRC” and encouraged the RCC to implement “real oversight, take away permits, fine bad actors and actually collect the fines.” 

Christian said the RRC is working with law enforcement through a state task force on petroleum theft. Both the DPS oil field theft unit and task force were established by the state legislature in the last legislative session, The Center Square reported. 

He also pointed to a Dallas Federal Reserve’s third-quarter 2025 Energy Survey, which reported that 41% of oil and gas executives said oilfield theft affected their operations in 2024. “Industry officials estimate that oil field theft costs Texas operators potentially billions of dollars annually,” Christian said. “In the Permian Basin alone, an FBI-led task force estimated that operators lose up to $300,000 per month to the theft of tools, pipes and valves.”

Ten years ago, oil field theft caused an estimated annual loss of 10 million to 30 million barrels, or roughly $450 million to nearly $1.5 billion in revenue losses, The Center Square reported.

In a separate federal case in New Mexico, three men pleaded guilty and three men, including a Mexican national, were convicted on multiple oil field theft charges.  

This scheme involved stealing thousands of barrels of crude oil from a Plains All American Pipeline facility in New Mexico and transporting it to a storage yard in Carlsbad, including the 7 Rivers facility operated by Hound Dog Energy. The oil was then transported to Texas for resale. The thefts “occurred multiple times per week, often multiple times per day,” the U.S. Attorney's Office for the District of New Mexico said. The thefts generated approximately $350,000 in proceeds, authorities found.

The charges include “conspiracy to transport stolen property in interstate commerce; conspiracy to launder money, interstate transportation of stolen property, and laundering of monetary instruments; misprision of a felony in concealing crimes of conspiracy and interstate transportation of stolen property,” among others.

Bureau of Land Management special agents investigated the case, which was prosecuted by the U.S. Attorney’s Office.