New Mexico has reached a record settlement with Ameredev, a Texas-based company, over air pollution violations at natural gas gathering sites in the Permian Basin. The $24.5 million agreement announced by the state Environment Department is the largest settlement ever reached for a civil oil and gas violation. The violations stemmed from the flaring of billions of cubic feet of natural gas that the company had extracted but was unable to transport to downstream processors over an 18-month period. Environment Secretary James Kenney stated that the flared gas could have supplied nearly 17,000 homes for a year, and the excess emissions from the flaring included gases known to cause respiratory issues and contribute to climate change.
Ameredev acknowledged the violations as a “legacy issue” in a statement issued following the settlement announcement. The company stated that over the past four years, they had not experienced any flaring-related excess emissions events thanks to investments in advanced technologies and operational enhancements. New Mexico adopted rules in 2021 to prohibit routine venting and flaring by oil and gas companies and set a deadline for companies to capture 98% of their gas by 2026. The rules also require regular tracking and reporting of emissions to prevent excess emissions like those caused by Ameredev’s flaring.
A study published in March in the journal Nature revealed that American oil and natural gas wells, pipelines, and compressors were emitting more greenhouse gases than previously estimated by the government, causing $9.3 billion in yearly climate damage. The study noted that about half of the emissions came from just 1% of oil and gas sites, indicating that the problem is fixable with proper regulation and enforcement. Under the settlement with Ameredev, the company agreed to conduct an independent audit of its operations in New Mexico to verify compliance with emission requirements, submit monthly reports on actual emission rates, and propose a plan for weekly inspections for a two-year period.
The Environment Department received a citizen complaint that initially alerted regulators to Ameredev’s flaring violations. Investigations are ongoing into numerous potential pollution violations around the Permian Basin, and Environment Secretary Kenney indicated that more penalties could result from non-compliant companies. With a reported 50% average compliance rate with air quality regulations by the oil and gas industry, regulators see it as their obligation to ensure compliance and hold polluters accountable. The settlement with Ameredev sets a precedent for future enforcement actions in the industry, emphasizing the importance of monitoring and enforcing emission regulations to protect air quality and public health in New Mexico.
