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The U.S. Department of Justice and U.S. Environmental Protection Agency (EPA) joined with regulators in Louisiana and Colorado this week to announce separate $2.5 million settlements with ExxonMobil Corp. and PDC Energy Inc. that would resolve federal Clean Air Act violations at facilities in Colorado, Louisiana and Texas.
In addition to the civil penalties, each are required to implement mitigation measures.
The settlements resolved allegations that ExxonMobil failed to properly operate and monitor industrial flares at petrochemical facilities in Louisiana and Texas that regulators claim resulted in excess emissions of harmful air pollutants including benzene and volatile organic compounds (VOC). Denver-based PDC’s settlement resolves a joint lawsuit filed over the summer by the federal agencies and Colorado, alleging the company violated requirements to reduce VOC emissions from its oil storage tanks in the Denver-Julesburg Basin.
EPA Administrator Scott Pruitt, who has faced criticism for his past and present relationships with the oil and natural gas industry, said the settlement demonstrates that the agency is committed to partnering with states to enforce environmental violations and improve compliance.
ExxonMobil agreed to spend $300 million to install and operate air pollution control and monitoring technology to reduce air pollution from 26 industrial flares at five of its facilities in Texas and three in Louisiana. The company must also spend $1 million on a project to plant trees in the petrochemical complex around Baytown, TX, that regulators said would provide a “natural buffer to reduce airborne pollutants from the chemical plants.”
“These investments, which include flare monitoring equipment and flare gas recovery systems, will help improve flare efficiency at these chemical facilities, which are among the largest petrochemical complexes in the world,” said ExxonMobil spokesman Aaron Stryk. “ExxonMobil complies with environmental laws, regulations and permits.”
PDC is expected to spend an estimated $18 million on system upgrades, improved operations, along with monitoring and inspections to reduce emissions. PDC is also required to implement environmental mitigation projects at some sites to further reduce VOC and nitrogen oxide emissions at a cost of $1.7 million. PDC has already started the work, which must be completed in phases by June 2019. The settlement covers 650 PDC storage tanks.
PDC CEO Bart Brookman said the settlement “builds upon our years of proactive work, which includes internal assessment and an ongoing remediation program.”
Each operator said they have worked closely with regulators to reach the settlements, which must still be approved by federal courts.