An oil and gas company that has been polluting the Uinta Basin’s air quality has to pay a fine for Clean Air Act violations and make big changes to its operations.
In the meantime, its parent — Denver-based Ovintiv Inc. — is considering a possible sale of its operations in the basin, which could fetch as much as $2 billion, Bloomberg recently reported.
Ovintiv USA Inc., a subsidiary of Ovintiv Inc., has violated the federal act and state regulations at 22 of its facilities in Utah.
The U.S. Environmental Protection Agency announced Monday that the company must pay a $5.5 million civil penalty, split evenly between Utah and the U.S., and make changes worth $10.7 million to get its emissions under control as part of a settlement agreement.
The EPA estimates that the changes that Ovintiv USA will implement will reduce over 2,000 tons of volatile organic compounds. VOCs contribute to ground-level ozone, or smog, and can worsen respiratory conditions like asthma, bronchitis and pneumonia.
The company’s changes will also prevent methane emissions — equivalent to 53,180 tons of carbon dioxide — from entering the atmosphere. Methane is a powerful greenhouse gas that heats the planet and contributes to climate change.
These mitigated emissions, according to the EPA, will have the same effect as removing 13,000 gas-powered cars from the road each year.
“This settlement represents an important step toward improving air quality in Utah,” said a spokesperson for the state Department of Environmental Quality. “We look forward to investing this funding back into the Uinta Basin on projects that will provide additional air quality benefits.”
The spokesperson said that 80% of the money Utah receives from the settlement will go into the state’s Environmental Mitigation Fund, which is used to address the impact of oil and gas emissions in the Uinta Basin. Specific projects have not been finalized.
Ovintiv USA said it had no comment on the settlement. Utah Attorney General Sean Reyes’ office did not respond to multiple requests for comment.
The company has 139 well pads for oil and gas production in Utah. According to the settlement agreement, inspectors from the EPA and the Utah Division of Air Quality inspected Ovintiv production sites in the Uinta Basin in 2018 and 2019.
They found storage tanks leaking VOCs and observed visible emissions at some of the company’s facilities, violating federal and state laws.
Ovintiv agreed to conduct engineering evaluations, make more frequent inspections, bolster preventative maintenance and install tank pressure monitors to fix its noncompliance, which will cost about $9 million.
The company has already implemented changes to reduce harmful emissions. Twenty-seven Ovintiv facilities previously used controllers that vented emissions into the atmosphere, but as of July 31, they’ve been replaced with zero-emission devices. The company estimated that this project cost about $2 million.
The terms in the settlement are currently subject to a 30-day comment period and final court approval.
A statewide poll published by the Utah Foundation on Tuesday found that nearly 60% of Utah residents support stronger environmental regulations nationwide and that 88% agree that air pollution is a serious problem. A majority of respondents — 65% — said they felt they would experience health concerns due to air pollution over their lifetime.
