Noble Energy has agreed to spend $73.45m on system upgrades and projects to mitigate air pollution from its oil and gas exploration and production activities in the Denver-Julesburg (DJ) Basin, north of Denver, Colorado.

The agreement with the US Environmental Protection Agency (EPA), the US Department of Justice (DOJ) and the State of Colorado will see Noble Energy improve emission control systems on several oil storage tanks situated within the DJ Basin.

The settlement resolves claims that the company failed to design, size, operate and maintain vapour control systems on its condensate storage tanks, leading to the emissions of volatile organic compounds (VOCs).

"We’re implementing a serious action plan through which we will evaluate tank batteries throughout our DJ Basin operations, remove the tank batteries that should be removed, improve others and implement enhanced environmental strategies."

Under the settlement, the company will spend $60m on system upgrades, monitoring and inspections; $4.5m on environmental mitigation projects, $4m on supplemental environmental projects, and $4.95m on civil penalty.

The modifications to the vapour control systems are expected to reduce VOC emissions by about 2,400t a year.

Noble Energy executive vice-president of operations Gary Willingham said: "By working together with the federal government and the State of Colorado to reduce emissions we are doing the right thing.

"We’re implementing a serious action plan through which we will evaluate tank batteries throughout our DJ Basin operations, remove the tank batteries that should be removed, improve others and implement enhanced environmental strategies."

Department of Justice Environment and Natural Resources Division assistant attorney general John C. Cruden said: "This first-of-its-kind settlement takes a basin-wide, systematic approach to address oil and gas emissions.

"Our nation’s energy security and independence requires that oil and gas production be done safely, responsibly, and lawfully. We look forward to continuing to work with states and the oil and gas industry to ensure that oil and gas emissions are minimised nationwide."