March 28, 2023

Matador enters into $6.2 million settlement with NMED, EPA

An oil and gas company that allegedly released significant amounts of volatile organic compounds in the Permian Basin agreed to pay a $6.2 million settlement with the New Mexico Environment Department and the U.S. Environmental Protection Agency.

The EPA discovered the emissions during flyovers in 2019 at six of Matador Production Company’s well pads.

These emissions occurred when vapor control systems failed to route all of the vapors from storage vessels to control devices or processes. This led to the vapors being emitted directly into the atmosphere. 

“This settlement begins to hold the ninth largest oil and gas producer in our state accountable and mitigate the harmful impacts to our communities and ability to breathe clean air,” NMED Cabinet Secretary James Kenney said in a press release. “We are committed to holding companies accountable when they violate our air quality regulations.”

The EPA and NMED filed a complaint alleging that the company failed to capture and control the emissions from the storage vessels. Additionally, the agencies say that Matador did not comply with inspection, monitoring and recordkeeping requirements and did not obtain required permits at 25 of its oil and gas production sites in the state. They say that this led to “significant excess emissions” of nitrogen oxide, carbon monoxide and volatile organic compounds. 

In addition to the flyovers, the agencies conducted field investigations in 2019. 

In a press release, NMED stated that Matador has agreed to implement measures that “ will serve as a model in future resolution of violations by other producers.”

The settlement includes a civil penalty of $1.15 million that will be split between the federal government and the state.

Matador has also agreed to spend at least $1.25 million on a supplemental environmental project that involves diesel engine replacements.

The consent decree released on Monday also calls for Matador to spend $500,000 addressing equipment leaks.

Matador will also pay $2.5 million in injunctive relief and $800,000 in mitigation costs.

“Air quality in the Permian Basin is at risk of not meeting national standards,” Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division said in a press release. “We will continue to work with the State of New Mexico to ensure that oil and gas production operations are operating within the law to improve air quality and public health in surrounding communities.”