N.M. Stat. § 3-28-1
Any combination of two or more municipalities and the board of county commissioners of the county in which the municipalities are located shall have the power by joint or concurring resolution of the governing bodies to appoint three or more commissioners to organize an association for the purpose of acquiring a water or natural gas supply system. The board of county commissioners of any county in which any unincorporated rural community is located that is situate five miles or more from the nearest municipality in which natural gas utility service is available shall have the power by resolution to appoint three or more commissioners from the rural community to organize an association for the purpose of acquiring a natural gas supply system to provide natural gas utility service as provided in Chapter 3, Article 28 NMSA 1978. If commissioners are appointed by the board of county commissioners from two or more rural communities in the county, the commissioners who have been appointed may jointly organize an association for the purpose of acquiring a natural gas supply system to provide natural gas utility service as provided in Chapter 3, Article 28 NMSA 1978. The association may, by resolution of its board of directors, purchase or otherwise acquire any water or natural gas supply system, as the case may be, including distribution and transmission pipelines or other water or natural gas works, as the case may be, whether already constructed or that may be constructed, and to further acquire all the rights, privileges and franchises of any person, persons or corporation owning the same or having any interest or right therein and to hold and operate the same in the same manner as the persons or corporation from whom the same may be acquired and distribute the water or natural gas, as the case may be, in the same manner or as may otherwise be determined by the board of directors from time to time. No association or corporation formed by commissioners appointed by the board of county commissioners shall distribute natural gas in any municipality unless the municipality is incorporated in an area served by the association or corporation after the association or corporation has been formed, nor shall it distribute natural gas outside the county. An association or corporation formed by commissioners appointed by the board of county commissioners may distribute natural gas for domestic or residential, commercial and irrigation purposes but shall not distribute natural gas for industrial purposes except with the consent of any public utility holding a certificate of public convenience and necessity from the New Mexico public utility commission authorizing the same kind of utility service at any location in the county. Any association formed pursuant to this section shall not provide gas service to any customers of a gas utility regulated by the New Mexico public utility commission within any area described in the utility's jurisdictional certificate; provided that an association may serve an area not served in fact, although in the certificated area, but in the case of any dispute, the burden of persuasion shall be upon the association. The corporation is empowered to enter into joint or several agreements for the acquisition of water supply or natural gas transmission and distribution systems, as the case may be, whether existing or to be constructed in the future, with any existing consumer or any other person, firm or corporation, either private or municipal, upon such terms as may be agreed. As used in this section, the term "rural community" means an area that contains not less than fifty inhabitants and has a population density of not less than one person per acre.
NMS § 3-28-1