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New Mexico Slaps $40 Million Fine On Oil Firm Over Excess Emissions

New Mexico regulators have fined a Texas-based oil and gas company with more than $40 million for violating emissions standards and air quality rules. 

The New Mexico Environment Department (NMED) and the New Mexico Energy, Minerals and Natural Resources Department (EMNRD) announced this week separate, but significant, enforcement actions against Ameredev II, LLC and affiliate Ameredev Operating, LLC, an Austin, Texas-based oil and gas production company, “for egregious violations of state rules and permitting requirements.”   

NMED issued an Administrative Compliance Order to Ameredev for violations of state rules, including significant excess emissions of five regulated air pollutants from five facilities in Lea County. 

NMED identified five Ameredev facilities that actively extracted oil and natural gas without any means to transport the gas to a midstream pipeline as required by New Mexico state law. Instead, Ameredev chose to flare the natural gas, releasing an amount of CO2 equivalent to heating 16,640 homes for one year. As a result of the flaring, Ameredev emitted over 7.5 million pounds of excess hydrogen sulfide, sulfur dioxide, nitrogen oxides, carbon monoxide, and volatile organic compound emissions, the regulator said. 

“Ameredev is a Texas-based exploration and production company that exploited public health for profit,” Environment Secretary James Kenney said. 

“Ameredev’s management team have shown blatant disregard for our right to breathe clean air and now they must be held accountable.”

The Administrative Compliance Order requires the company to pay a civil penalty $40.3 million to the State of New Mexico’s general fund, cease and desist all excess emissions from its facilities in accordance with applicable regulations, and seek permits reflective of the equipment and operations on-site. The New Mexico regulators also required the Texas-based firm to hire an NMED-approved independent, third-party auditor to assess all Ameredev facilities in New Mexico, and to undertake projects to mitigate excess emissions. 

By Michael Kern for Oilprice.com 

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