The federal government announced a $241.5 million settlement with Marathon Oil for alleged air quality violations at the company’s oil and gas operations in North Dakota. The settlement requires Marathon to reduce emissions from its facilities, resulting in over 2.3 million tons of pollution reduction. This is the largest ever civil penalty for violations of the Clean Air Act at stationary sources.
Marathon operates 169 well pads in North Dakota and is the seventh-largest emitter of greenhouse gas emissions in the oil and gas industry. The majority of its emissions come from flaring, a practice that burns waste gases like methane. While flaring burns off pollutants, it is not completely efficient, leading to significant releases into the atmosphere with health impacts on nearby communities.
The settlement aims to eliminate over 2.25 million tons of carbon-dioxide emissions over five years, equivalent to taking 487,000 cars off the road for one year. Additionally, it will eliminate nearly 110,000 tons of volatile organic compound emissions, improving air quality and reducing respiratory illnesses in the region.
Marathon will invest $177 million in compliance measures to reduce harmful emissions from existing facilities on state land and the reservation, as well as new facilities built in North Dakota. This investment will have a positive impact on the health and future of Tribal communities in the area.
The settlement is part of an EPA climate change enforcement initiative focused on reducing methane emissions from oil and gas production. Marathon’s agreement to reduce harmful emissions across its production sources will benefit the Fort Berthold Indian Reservation and western North Dakota.
The case against Marathon is the first of its kind for violations of major source emissions permitting requirements under the Clean Air Act. The $64.5 million civil penalty imposed on Marathon is the largest-ever for stationary source violations. The settlement reflects the Biden administration’s efforts to target emissions from the oil and gas industry.
Marathon’s agreement to invest in compliance measures and reduce harmful emissions demonstrates a commitment to environmental responsibility. The consent decree is subject to a 30-day public comment period, allowing stakeholders to provide feedback on the settlement.
Despite the settlement, Marathon’s stock closed up 1.6% following the announcement. The company’s financial report showed earnings of $297 million in the last quarter, with revenue totaling $1.55 billion. The settlement did not appear to impact investors, with Marathon’s stock rising about 18% so far this year.
