Tenneco to Pay $5 Million for Waste of Natural Gas

Tenneco Inc. will pay the federal government $5 million to settle allegations it violated the law by destroying 1 billion cubic feet of natural gas and trying to hide the action, officials said today.

Tenneco was making the payment today at the Interior Department’s New Orleans office, and federal officials called it one of the largest of its kind ever collected. The government agreed not to seek criminal prosecution, civil penalties or cancellation of Tenneco’s federal lease.

“This is a matter of cheating the American people, first by wasting an important natural resource and second by not paying America for using it,” said Interior Secretary Manuel Lujan Jr. in a statement from Washington. “We will not tolerate this kind of behavior.”

Tenneco agreed to the settlement after investigators for the Interior Department’s Minerals Management Service and office of inspector general discovered more than 300 incidents of unauthorized venting of natural gas at offshore drilling platforms in areas owned by the federal government and leased to Tenneco.

According to the department, more than 1 billion cubic feet of gas was lost through flaring, a process by which unwanted fuel is burned off. Tenneco was accused of burning the gas because prices at the time were too low to make it profitable to bring the gas to shore and it was easier for Tenneco then to pump more lucrative oil reserves from the offshore properties.