Oil and gas company agrees to $24.5 million settlement with New Mexico

(The Center Square) – Oil and gas company Ameredev II, LLC will pay New Mexico $24.5 million to settle alleged violations of state air regulations, the state’s Environmental Department announced in a press release.

It is the largest settlement for a civil oil and gas violation in Department history. Most of the money will go into New Mexico’s General Fund.“This settlement makes one thing crystal clear – companies that pollute our air will pay for circumventing New Mexico’s rules,” Governor Michelle Lujan Grisham said in a statement. “Today’s settlement is about penalizing the bad actors in an effort to protect communities from breathing harmful pollution.”NMED’s Environmental Protection Division hit Ameredev with a $40.3 million Administrative Compliance Order (ACO) on June 29, 2023. The company did not respond to a request for comment. NMED identified five Ameredev facilities that extracted oil and natural gas from October 2018 to April 2020 that were unable to accept or transport gas to downstream processors. In that timeframe, the company flared over 3,219,402 thousand cubic feet of natural gas. Ameredev’s flaring caused over 7.6 million pounds of excess hydrogen sulfide, sulfur dioxide, nitrogen oxides, carbon monoxide, and volatile organic compounds to be released into the air. “These pollutants are known to cause serious health issues, including respiratory issues, impaired cognition, and convulsions, as well as contribute to climate change,” a release said.After discovering the compliance issues by NMED staff, Ameredev enlisted a third-party contractor to review its compliance with New Mexico requirements. The company provided these results to NMED’s Air Quality Bureau. “Let this serve as a wake-up call to the oil and gas industry – the Environment Department is using remote sensing technology, on-the-ground inspections, and responding to citizen complaints,” Environment Department Cabinet Secretary James Kenney said in a statement. “The only option to avoid enforcement is to comply with state rules and permits.”Ameredev agreed to do the following as a part of the settlement::Perform an independent, third-party compliance audit of their operations at all the New Mexico facilities that they own or operate. Calculate and submit monthly reports of actual emission rates from each emissions unit at each facility operating in New Mexico under General Construction Permits or notices of intent. Propose, subject to NMED approval, a mitigation project to conduct weekly Optical Gas Imaging inspections for each facility operating in New Mexico under a General Construction Permit-Oil & Gas for two years or implement an advanced leak and repair monitoring technology. Remove equipment from the Azalea Central Tank Battery and submit the appropriate permit application or registration to amend the permit. If Ameredev doesn’t take the proper corrective actions in the time allotted in the settlement, New Mexico will issue fines of $2,000 per day until the company honors the settlement.