The Justice Department and Environmental Protection Agency (EPA) have reached a settlement with Marathon Oil Company* over Clean Air Act violations at the company’s oil and gas production operations on the Fort Berthold Indian Reservation in North Dakota. The settlement requires that Marathon pay a civil penalty of $64.5 million, the largest ever for violations of the Clean Air Act at stationary sources, which include downstream facilities such as oil and gas tank systems. Under the settlement agreement, Marathon will implement extensive compliance measures to achieve major reductions in harmful emissions from more than 200 facilities across the state.
“The complaint alleges that Clean Air Act violations at nearly 90 Marathon facilities resulted in thousands of tons of illegal emissions. The work that Marathon will do under this agreement will result in the equivalent of over 2.25 million tons of reduced carbon-dioxide emissions over the next five years and also eliminate nearly 110,000 tons of VOC emissions. The Justice Department will continue to vigorously enforce our environmental laws to protect the health of the American people,” said Attorney General Merrick B. Garland.
The agreement requires Marathon to invest in compliance measures estimated to cost $177 million, much of which will be expended by the end of 2024. The settlement requires Marathon to obtain permits with federally enforceable emissions limits at production facilities on the Fort Berthold Indian Reservation and future operations in the state of North Dakota. Compliance measures also include flare monitoring, periodic infrared camera inspections and implementation of storage tank design requirements.
These actions EPA said will significantly reduce harmful health-related emissions from 169 existing facilities on state land and on the Fort Berthold Indian Reservation, as well as at new facilities built in North Dakota. Therefore, the United States will secure pollution limits on twice the number of facilities where it investigated and alleged violations. The complaint alleges that Marathon failed to obtain required preconstruction permits under the PSD program and operating permits under the Title V program.
“Today’s historic settlement is the most significant to date under EPA’s climate enforcement initiative as well as part of a larger effort to hold oil and gas companies accountable for widespread violations at oil and gas facilities throughout the country,” said Assistant Administrator David M. Uhlmann of EPA’s Office of Enforcement and Compliance Assurance. “As a result of today’s settlement, Marathon will dramatically cut its emissions, including the release of methane, a climate super-pollutant that is 25 times more potent in the near term than carbon dioxide. EPA is committed to doing everything possible to limit climate change and ensure a sustainable future.”
The settlement is part of EPA’s National Enforcement and Compliance Initiative, Mitigating Climate Change. This initiative focuses, in part, on reducing methane emissions from oil and gas and landfill sources. The complaint and the proposed consent decree were filed by the Justice Department’s Environmental Enforcement Section. The proposed consent decree is subject to a 30-day public comment period. It can be viewed on the Justice Department’s website at www.justice.gov/enrd/consent-decrees.
*ConocoPhillips (NYSE: COP) and Marathon Oil Corporation (NYSE: MRO) announced on 29 May 2024 that they have entered into a definitive agreement pursuant to which ConocoPhillips will acquire Marathon Oil in an all-stock transaction with an enterprise value of $22.5 billion, inclusive of $5.4 billion of net debt. Under the terms of the agreement, Marathon Oil shareholders will receive 0.2550 shares of ConocoPhillips common stock for each share of Marathon Oil common stock, representing a 14.7% premium to the closing share price of Marathon Oil on 28 May 28 2024, and a 16.0% premium to the prior 10-day volume-weighted average price.
Largest Ever Clean Air Act Fine Imposed on Marathon Oil
The Justice Department and Environmental Protection Agency (EPA) have reached a settlement with Marathon Oil Company* over Clean Air Act violations at the company’s oil and gas production operations on the Fort Berthold Indian Reservation in North Dakota. The settlement requires that Marathon pay a civil penalty of $64.5 million, the largest ever for violations of the Clean Air Act at stationary sources, which include downstream facilities such as oil and gas tank systems. Under the settlement agreement, Marathon will implement extensive compliance measures to achieve major reductions in harmful emissions from more than 200 facilities across the state.
“The complaint alleges that Clean Air Act violations at nearly 90 Marathon facilities resulted in thousands of tons of illegal emissions. The work that Marathon will do under this agreement will result in the equivalent of over 2.25 million tons of reduced carbon-dioxide emissions over the next five years and also eliminate nearly 110,000 tons of VOC emissions. The Justice Department will continue to vigorously enforce our environmental laws to protect the health of the American people,” said Attorney General Merrick B. Garland.
The agreement requires Marathon to invest in compliance measures estimated to cost $177 million, much of which will be expended by the end of 2024. The settlement requires Marathon to obtain permits with federally enforceable emissions limits at production facilities on the Fort Berthold Indian Reservation and future operations in the state of North Dakota. Compliance measures also include flare monitoring, periodic infrared camera inspections and implementation of storage tank design requirements.
These actions EPA said will significantly reduce harmful health-related emissions from 169 existing facilities on state land and on the Fort Berthold Indian Reservation, as well as at new facilities built in North Dakota. Therefore, the United States will secure pollution limits on twice the number of facilities where it investigated and alleged violations. The complaint alleges that Marathon failed to obtain required preconstruction permits under the PSD program and operating permits under the Title V program.
“Today’s historic settlement is the most significant to date under EPA’s climate enforcement initiative as well as part of a larger effort to hold oil and gas companies accountable for widespread violations at oil and gas facilities throughout the country,” said Assistant Administrator David M. Uhlmann of EPA’s Office of Enforcement and Compliance Assurance. “As a result of today’s settlement, Marathon will dramatically cut its emissions, including the release of methane, a climate super-pollutant that is 25 times more potent in the near term than carbon dioxide. EPA is committed to doing everything possible to limit climate change and ensure a sustainable future.”
The settlement is part of EPA’s National Enforcement and Compliance Initiative, Mitigating Climate Change. This initiative focuses, in part, on reducing methane emissions from oil and gas and landfill sources. The complaint and the proposed consent decree were filed by the Justice Department’s Environmental Enforcement Section. The proposed consent decree is subject to a 30-day public comment period. It can be viewed on the Justice Department’s website at www.justice.gov/enrd/consent-decrees.
*ConocoPhillips (NYSE: COP) and Marathon Oil Corporation (NYSE: MRO) announced on 29 May 2024 that they have entered into a definitive agreement pursuant to which ConocoPhillips will acquire Marathon Oil in an all-stock transaction with an enterprise value of $22.5 billion, inclusive of $5.4 billion of net debt. Under the terms of the agreement, Marathon Oil shareholders will receive 0.2550 shares of ConocoPhillips common stock for each share of Marathon Oil common stock, representing a 14.7% premium to the closing share price of Marathon Oil on 28 May 28 2024, and a 16.0% premium to the prior 10-day volume-weighted average price.