PDC Energy to Pay $22.2 Million Settlement for Alleged Air Pollution Violations

Colorado oil and gas firm accused of releasing emissions that lead to health problems

Denver-based PDC Energy has agreed to a $22.2 million settlement with state and federal government agencies after regulators sued the oil and gas company for allegedly violating the federal Clean Air Act and the Colorado Air Pollution Prevention and Control Act.

According to a news release from the U.S. Environmental Protection Agency, Colorado state inspectors found significant VOC (volatile organic compound) emissions from PDC’s storage tanks in the Denver-Julesburg Basin, then notified the Environmental Protection Agency and the U.S. Department of Justice. The EPA says VOCs contribute to smog or ground-level ozone, which can irritate the lungs, exacerbate diseases such as asthma and increase susceptibility to respiratory illnesses such as bronchitis and pneumonia.

“As a result of state and federal efforts, PDC has agreed to take comprehensive action to address excess VOC emissions from its oil and gas operations,” Associate Attorney General Rachel L. Brand of the Department of Justice said in a statement“We are proud that we were able to work side by side with EPA and Colorado to bring these facilities into compliance with the law.”

"We applaud today's settlement between the EPA, DOJ, state regulators and PDC Energy," said Environment Colorado director Garrett Garner-Wells. "The settlement represents baby steps, but steps in the right direction. Long-term, Colorado must address the damage that extractive industries do to our well being and environment. We can and must move away from these dirty fossil fuels and toward a clean energy future."

The EPA says that as part of the settlement, PDC has consented to evaluate the design and capacity of its vapor control systems, modify them as needed to ensure they collect and convey emissions to a control device, implement an enhanced inspection and maintenance program and conduct periodic infrared camera inspections to identify any emissions and take prompt corrective action to address those emissions. 

In a news release, PDC’s president and CEO Bart Brookman said, “This agreement is the result of months of cooperative conversations with State and EPA regulators and builds upon our years of proactive work, which includes internal assessment and an ongoing remediation program.”

PDC also shared it has voluntarily included about 40 facilities in the agreement that it is in the process of acquiring in the Denver-Julesburg Basin.

PDC estimates it will cost about $18 million through 2022 to implement the main system fixes, with some of that money already spent over the past two years. An additional $1.7 million will go toward mitigation projects to further reduce emissions, including emissions control systems on some engines and better control over transferring oil into tankers. PDC also has to pay a $1.5 million dollar fine and give the State of Colorado $1 million toward supplemental environmental projects.

The EPA also reached a settlement with ExxonMobil for air pollution violations in Texas and Louisiana. As a result, ExxonMobil will have to invest about $300 million in pollution mitigation and pay a $2.5 million fine.

“While it’s encouraging to see the government punishing polluters such as PDC and ExxonMobil, the fines are drops in the bucket for corporations that make their living by exploiting our land and tainting our air,” said Garner-Wells. “We can only hope that these fossil fuel companies take these penalties seriously and change their ways.”

Mark Morgenstein is the senior communications manager of The Public Interest Network, which runs organizations, including Environment Colorado, which are committed to a better world, a set of core values and a strategic approach to getting things done.

Categories: Companies to Watch