An Exxon Mobil subsidiary agreed to spend $3 million to restore land in West Virginia damaged by oil and gas operations, the U.S. government announced.

Subsidiary XTO Energy Inc. agreed to spend millions of dollars on restoration and pay a civil penalty of $2.3 million for violating the Clean Water Act. The settlement resolves alleged violations related to the discharge of fill material into streams and wetlands related to its horizontal drilling operations.

"The extraction of domestic energy resources is vitally important, and so it is equally important that companies ensure that all activities are done in accordance with the nation's environmental laws," said Sam Hirsch, the acting assistant attorney general for the environmental division of the U.S. Department of Justice.

XTO under the terms of the agreement will work to restore wetlands and streams to their pre-contamination status to the extent possible.

Hydraulic fracturing operations have sparked criticism from environmental groups worried about the safety of water contamination stemming from the operations. Critics of the practice scored a victory last week when New York state enacted a moratorium on the drilling operations covered under the banner of fracking.

In a September note to investors, parent Exxon said XTO used a "disciplined approach" to safety, which includes a "rigorous regime of 11 separate elements that measures and mitigates safety, security, health and environmental risk."

XTO last year was fined $100,000 by the Environmental Protection Agency for disposing of water used during hydraulic fracturing operations in Pennsylvania, home to some of the largest shale natural gas basins in the country.

EPA Regional Administrator Shawn Garvin said the latest case "sends a clear message" to energy companies.

XTO had no comment on the settlement.