NMED fines natural gas firm $47.8 million over emissions at Jal plant
Company directed to cease polluting and pay civil penalty
News-Sun Staff
JAL – A natural gas firm with ties to southeast Lea County has been fined by the New Mexico Environment Department over what has been described as “harmful emissions.”
Targa Northern Delaware, a subsidiary of Houston-based firm Targa Resources Corp., was assessed $47.8 million in fines and civil penalties for reported emission releases far exceeding permitted levels at the Red Hills Gas Processing Plant near Jal. The enforcement action cites Targa for alleged violations of state rules including significant excess emissions of regulated air pollutants, late reporting of some mandated documentation and an incomplete attempt at providing a root cause analysis to address the facility’s ongoing excess emissions.
NMED’s enforcement action requires Targa to:
– Cease and desist all excess emissions at the Red Hills Gas Processing Plant effective immediately.
– Complete 16 projects, initiatives and improvements to the Red Hills Gas Processing Plant to address its operations and excess emissions with an estimated cost of around $140 million, as proposed by Targa.
– Pay a civil penalty of $47.8 million to the state general fund.
In total, the excess emissions cited in the enforcement action address nearly 2 million pounds more than Targa’s permitted air emission limits for five individual air pollutants: carbon monoxide, nitrogen oxides, sulfur dioxide, volatile organic compounds and hydrogen sulfide. Pollutants released into the air are regulated by permit limits because they can threaten both human health and to the environment, a NMED press release announcing the penalty reported.
For example, emissions of nitrogen oxides and volatile organic compounds react in the atmosphere to cause ozone, often referred to a smog. The NMED investigation showed ozone levels around the plant at 95 percent of the federal standard. Other compounds reportedly released include hydrogen sulfide and an estimated 7 million pounds of methane.
“When the New Mexico Environment Department issues you a permit, it is a legally binding agreement to protect the health of New Mexicans,” said NMED General Counsel Zachary Ogaz. “If you violate your permit by failing to effectively invest in compliance, we will hold you accountable.”
Targa is one of the largest gatherers and processors of natural gas in the Permian Basin and across the country, according to their public-facing materials. Targa’s year-over-year adjusted earnings increased by over $229 million to over $1 billion from the third quarter of 2023 to this year, according to a recent company release.
Regarding NMED’s investigation, Targa spokespersons said in a recent Securities and Exchanges Commission (SEC) filing: “Although this matter is ongoing and management cannot predict its ultimate outcome, we do not expect that any expenditures related to this matter will be material to our consolidated financial statements.”
A portion of the excess emissions and late reporting violations stem from Lucid Energy Delaware, LLC, who previously owned the facility before Targa took over in 2022. However, as the excess emissions and late reporting continued under Targa, it is the entity responsible for the facility and its compliance with state law.
Targa must respond to NMED’s enforcement action and pay the civil penalty within 30 days or request a hearing before a hearing officer for a decision by the NMED Cabinet Secretary.
NMED has also referred this matter to federal and state regulatory agencies to investigate additional civil and potentially criminal violations.
