New Mexico has reached a record settlement with a Texas company over air pollution violations at natural gas gathering facilities in the Permian Basin.
The $24.5 million settlement with Ameredev, announced Monday, is the largest settlement ever sought by the state Department of Environmental Conservation over oil and gas civil violations. This comes from burning billions of cubic feet of natural gas that the company produced over 18 months but was unable to transport to refiners.
Environment Minister James Kenney said in an interview that the gas flared would be enough to supply nearly 17,000 homes for a year.
“It’s the complete opposite of how it’s supposed to work,” Kenny said. “If they weren’t wasting New Mexico’s resources, they could use that gas.”
Gas flaring resulted in emissions of more than 7.6 million pounds, including hydrogen sulfide, sulfur dioxide, nitrogen oxides and other gases that state regulators say cause breathing problems and contribute to climate change.
Ameredev, in a statement released Monday, said he was pleased to resolve what he called a “legacy issue” and that the state Bureau of Air Quality was not aware of any ongoing compliance issues at the company’s facilities.
“We take this issue very seriously,” the company said. “Ameredev has not experienced any excess flaring emissions over the past four years, thanks to our significant—and ongoing—investments in a variety of advanced technologies and operational improvements.”
Although operators may vent or flare natural gas during emergencies or equipment failures, New Mexico in 2021 accepted rules ban regular venting and flaring and set a 2026 deadline for companies to capture 98% of their gas. The regulations also require regular tracking and reporting of emissions.
Ameredev said it was capturing more than 98% of the gas when the new venting and flaring regulations were adopted, and since then the annual capture rate has been above 98%.
A study published in March in the journal Nature found that U.S. oil and gas wells, pipelines and compressors release more greenhouse gases than the government had estimated, causing $9.3 billion in climate damage each year. The authors argue that this is a solvable problem, since about half of the emissions come from just 1% of oil and gas facilities.
Under the agreement, Ameredev agreed to conduct an independent audit of its New Mexico operations to ensure compliance with emissions regulations. It must also submit monthly reports on actual emissions and propose a plan for weekly inspections over a two-year period or install leak monitoring and repair equipment.
Kenney said it was a citizen complaint that first brought Ameredew’s arson to the attention of state regulators.
The Department of Environment is currently investigating numerous other potential pollution violations at the basin, and Kenney said additional fines could likely follow.
“Given that the average air quality compliance rate in the oil and gas industry is 50%,” he said, “we have a responsibility to continue working toward compliance and holding polluters accountable.”