Marathon Oil Co., which is in deal to be bought by ConocoPhillips in $22.5 billion all-stock deal, has agreed to a settlement with the U.S. Government regulators and to pay $241.5 million in penalties over climate- and health-harming emissions in North Dakota.
The settlement with the U.S. Environmental Protection Agency or EPA and Department of Justice includes largest ever civil penalty for violations of the Clean Air Act at stationary sources. The deal will result in reduction of over 2.3 million tons worth of pollution.
In a statement, the EPA and DoJ said the settlement resolves Clean Air Act violations at the company\'s oil and gas production operations on the Fort Berthold Indian Reservation in North Dakota. As per the deal, Marathon is required to pay a civil penalty of $64.5 million for the violations of the Clean Air Act at stationary sources, which include facilities such as oil and gas tank systems.
Marathon has also agreed to implement extensive compliance measures, estimated to cost $177 million, to achieve major reductions in harmful emissions from over 200 facilities across the state. Much of the estimated cost is expected to be implemented by the end of 2024.
The consent decree, which was filed with the United States District Court, District of North Dakota, Western Division, is subject to a 30-day comment period.
The complaint, which is deemed to be the first of its kind against an oil and gas producer for such emissions violations, alleges that nearly 90 Marathon facilities caused thousands of tons of illegal pollution, including volatile organic compounds or VOCs and carbon monoxide, which contribute to asthma and increase susceptibility to respiratory illnesses.
Additionally, greenhouse gases, including methane, were released in large quantities, contributing to climate change.
Marathon, the nation\'s 22nd largest producer of oil based on 2022 data, holds the 7th position as the largest emitter of greenhouse gas emissions in the oil and gas industry. A large portion of these emissions come from flaring, an industry practice that releases methane, a climate super-pollutant.
As per the complaint, Marathon failed to obtain required preconstruction permits under the PSD program and operating permits under the Title V program.
With the settlement agreement, Marathon now needs 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.
According to the agencies, these actions would 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.
Marathon\'s new measures would result in the equivalent of over 2.25 million tons of reduced carbon dioxide emissions over the next five years. The settlement would also eliminate nearly 110,000 tons of VOC emissions.
Assistant Administrator David Uhlmann of EPA\'s Office of Enforcement and Compliance Assurance, said, \"Today\'s record Clean Air Act settlement is the most significant to date under EPA\'s climate enforcement initiative and makes clear that EPA will hold corporate polluters like Marathon accountable for violations that put communities and our futures at risk.... As a result of today\'s settlement, Marathon will dramatically cut its emissions of methane, a climate super-pollutant that is dozens of times more potent in the near term than carbon dioxide.\"