The New Mexico Environment Department and the U.S. Environmental Protection Agency reached a settlement with one of the largest natural gas producers in the state.
Under the settlement agreement, Hilcorp Energy Company agreed to pay $9.4 million for allegedly failing to curb emissions while completing wells in New Mexico’s San Juan Basin, including on Jicarilla Apache and Navajo Nation lands.
The EPA and the state of New Mexico will split the money from the penalty.
“Oil and gas production results in significant air pollution, including emissions of methane that are one of the leading sources of near-term climate change, which makes today’s settlement with Hilcorp Energy a huge win for the environment and the planet,” Assistant Administrator David M. Uhlmann of EPA’s Office of Enforcement and Compliance Assurance said in a press release. “EPA is requiring Hilcorp to pay a $9.4 million penalty and make substantial investments in Clean Air Act compliance, which will reduce climate damaging emissions and improve air quality for all New Mexico residents, including communities with environmental justice concerns.”
Between August 2017 and August 2019, Hilcorp completed nearly 200 wells in Rio Arriba and San Juan counties. The EPA and NMED say that during the well completion operations at 145 of the caves, Hilcorp failed to capture any of the gas that was released. Instead this methane-rich gas was released into the atmosphere. At the other wells completed during that time, Hilcorp only captured a portion of the gas. This gas was directed into flares, which burn off excess gas.
State and federal officials say that Hilcorp’s actions during those two years resulted in thousands of tons of methane and volatile organic compounds being released into the air.
Hilcorp is also required to employ a third-party EPA-approved auditor to ensure that the company is in compliance with the Clean Air Act and the New Mexico Air Quality Control Act.
“This settlement holds one of the San Juan Basin’s largest polluters accountable for their contribution to climate change and ozone pollution,” NMED Secretary James Kenney said in the press release. “If we want to make New Mexico’s air safe for future generations then Houston-based Hilcorp Energy Corporation executives need to step up their game and comply with federal and state rules.”
Hilcorp has also agreed to do work that will result in a 113,000 ton reduction in carbon dioxide emissions over the next three years.