Denver-Julesburg Basin producer HighPoint Operating Corp. agreed to pay fines and spend $3 million to settle alleged Clean Air Act violations under a settlement with the U.S. Environmental Protection Agency (EPA), the U.S. Department of Justice (DOJ) and Colorado.
The settlement resolves claims that HighPoint violated requirements to reduce volatile organic compound (VOC) emissions from its oil and natural gas production operations in Colorado.
In addition to the mitigation measures, the Denver-based producer agreed to pay a $275,000 civil penalty and perform a state supplemental environmental project. HighPoint will apply $220,000 of the state’s portion of the penalty to the project.
“This settlement reflects EPA’s continued efforts with DOJ, the State of Colorado and oil and gas producers to secure Clean Air Act compliance and reduce emissions that are contributing to high levels of ground-level ozone in communities across Colorado’s Front Range,” said EPA Acting Regional Administrator Deb Thomas.
The action arose when inspections of HighPoint operations conducted from 2014-2017 by EPA and Colorado officials found VOC emissions from condensate storage tanks. Through inspections and information requests, EPA and the state identified alleged violations of the Colorado State Implementation Plan, Regulation No. 7, from undersized vapor control systems and inadequate operations and maintenance practices.
The settlement covers 50 HighPoint tank systems in Colorado. The tank systems covered by the settlement are in an ozone nonattainment area, which means the area does not meet the National Ambient Air Quality Standard set for ozone.
HighPoint plans to undertake measures to ensure the vapor control systems on its condensate storage tanks are adequately designed and sized. It also agreed to improve its operation and maintenance practices, monitoring and inspections. The improvements include monthly inspections using infrared cameras to better detect and respond in real time to emissions.
EPA and state officials estimate that HighPoint’s modifications and improvements would reduce VOC emissions by about 350 tons/year.
HighPoint also agreed to implement an environmental mitigation project to reduce VOC emissions in the Denver area using vapor balancing controls to minimize emissions associated with loading condensate into tank trucks at 10 well pads. The project is expected to reduce HighPoint’s VOC emissions from tank truck loadout by an estimated 50 tons/year.
The consent decree was lodged in U.S. District Court for the District of Colorado and is subject to a 30-day public comment period and final court approval.