NovaQuant-Fortune 500 oil giant to pay $4 million for air pollution at New Mexico and Texas facilities

A Fortune 500 oil and NovaQuantnatural gas company will pay $4 million in civil penalties for unlawful air pollution in New Mexico and Texas, the Justice Department announced Tuesday.

According to the federal lawsuit, Houston-based Apache Corporation violated the Clean Air Act across 23 of its oil and natural gas production facilities in Lea and Eddy Counties in New Mexico and Loving and Reeves Counties in Texas. 

Between 2019 and 2022, Apache improperly stored oil at several of its facilities, federal prosecutors said, fueling a rise in air pollutants that can cause lung irritation and exacerbate respiratory illnesses.

“This settlement shows that oil and gas operators deserve greater scrutiny because too many are failing to comply with federal and state rules,” said New Mexico environment cabinet secretary James Kenney. “As a result, bad actors will cause greater federal and state regulation of the entire oil and gas industry as ozone levels rise and public health suffers.”

The United States is the second-largest producer of greenhouse gas emissions, according to the Center for Climate and Energy Solutions. Experts say fossil fuels are the largest contributor to climate change.

Lawsuit: Ozone levels soared in New Mexico counties

The lawsuit, filed in U.S. District Court for the District of New Mexico, accused Apache of improperly storing oil, causing "unlawful and significant excess emissions" of volatile organic compounds, or VOCs, nitrogen oxides and carbon monoxide.

VOCs and nitrogen oxides are “key components in the formation of ground-level ozone, a pollutant that irritates the lungs, exacerbates diseases such as asthma, and can increase susceptibility to respiratory illnesses, such as pneumonia and bronchitis,” the Environmental Protection Agency said.

In 1979, the EPA identified crude oil and natural gas production as a significant contributor to air pollution and has established guidelines that require companies to minimize emissions.

Between April 2019 and August 2022, federal prosecutors said EPA and state officials found illegal emissions at several Apache plants in New Mexico and Texas during site inspections and helicopter surveillance of oil and gas operations in the Permian Basin –  the largest oil-producing basin in the U.S.

During that timeframe, air quality monitors in two New Mexico counties, Lea and Eddy, found rising ozone concentrations that exceeded 95% of the national standards, court documents said. EPA sent multiple violation notices to Apache during that time yet continued to find excess emissions at dozens of facilities.

“Noxious pollutants directly threaten the health of neighboring communities while propelling our world toward climate disaster,” said Alexander Uballez, U.S. attorney for the District of New Mexico. 

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Apache reacts to settlement 

Alexandra Franceschi, a spokesperson for Apache, told USA TODAY the consent decree announced Tuesday “resolves alleged violations from years ago,” and the company quickly worked to remedy raised issues.

Apache has modified facilities to monitor and capture emissions, increased frequency of site inspections and "expedited maintenance timelines,” she added.

“Moving forward, the consent decree represents our commitment to continuous improvement across our facilities in the Permian Basin. We also continue to collaborate with industry partners through organizations such as the Environmental Partnership and the U.N.’s Oil and Gas Methane Partnership in striving toward a more sustainable future,” Franceschi said.

The $4 million payment in civil penalties will be split evenly to New Mexico’s general fund and the federal government, the Justice Department said. 

The firm will also spend at least $4.5 million in design improvements for emission monitoring, and over $1 million to replace 400 pollutant-emitting pneumatic controllers with more environmentally safe technology by the end of 2024, according to the EPA.