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EPA Targets Oil and Gas Emissions With Three Final Rules, Notice

The U.S. Environmental Protection Agency (EPA) has published a final rule covering certain oil and gas production and processing segments either located within, or expanding on tribal lands.

Meanwhile, the EPA also issued two final rules affecting the oil and gas industry -- clarifying the term "adjacent" when used to describe stationary sources of air pollution, and setting new standards for greenhouse gases (GHG) and volatile organic compounds (VOC) -- and issued a notice that it plans to draw up an information collection request (ICR) to gather more information on oil and gas facilities (see Shale DailyMay 12).

The three final rules and the notice were all published in Friday's edition of the Federal Register.

EPA 'concerned' by rapid oil, gas growth on tribal lands

In the final rule affecting tribal lands [No. 2016-11969], the EPA said it was finalizing a federal implementation plan (FIP) that covers new true minor sources of emissions in the oil and gas sector, and which makes minor modifications at existing true minor sources of emissions.

"We are concerned that the rapid growth of the oil and natural gas production segment, in combination with existing exploration and production activities, could result, or in some cases already has resulted, in adverse air quality impacts..." the EPA said. "However, we believe that the most appropriate means for addressing impacts from existing sources is through area- or reservation-specific FIPs and not through a national FIP.

"If we determine that it is 'necessary or appropriate' to exercise our discretionary authority...we will publish a proposed area- or reservation-specific FIP that provides an opportunity for full public review and comment. At a minimum, the EPA or tribes will need to develop area-specific plans if and when areas of Indian country become non-attainment for ozone or other NAAQS [National Ambient Air Quality Standards] pollutants. At that time, any such area that has oil and natural gas minor source activity may require additional controls on existing (and new and modified) sources in order to achieve attainment of the NAAQS."

According to the EPA, the FIP will satisfy the minor source permitting requirement under the Federal Minor New Source Review (NSR) Program in Indian Country. In terms of oil and gas production and processing, the FIP requires compliance with emission limitations and other requirements from some federal emission standards for oil and gas wells completed using hydraulic fracturing.

Eight federal rules will be included in the oil and gas FIP for tribal lands. The EPA said these rules could potentially impact process heaters; reciprocating internal combustion engines; compression ignition internal combustion engines; spark ignition internal combustion engines; fuel storage tanks; storage vessels; pneumatic controllers; compressors (reciprocating and centrifugal); pneumatic pumps; fugitive emissions from wells sites and compressor stations; glycol dehydrators, and combustion turbines.

Several amendments to the NSR were also finalized, EPA said, including "adding new text regarding the purpose of the program, revising the program overview provision, revising certain provisions to incorporate compliance with the FIP, revising the applicability provision to establish that oil and natural gas sources are required to comply with the FIP unless they either opt to obtain a source-specific permit or are otherwise required to do so, and revising the source registration provision for oil and natural gas sources constructing under this FIP."

Other final rules

Another final rule [No. 2016-11968] issued Friday clarifies the term "adjacent" as it pertains to stationary sources of air pollution, for the purposes of the Prevention of Significant Deterioration and Nonattainment New Source Review preconstruction permitting programs. The clarification will also affect the scope of a "major source" of air pollution in the Title V Operating Permit Program, as applicable to the onshore oil and gas sector.

"We believe that this clarification will provide greater certainty for the regulated community and for permitting authorities, and will result in more consistent determinations of the scope of a source in this sector," the EPA said.

A third final rule [No. 2016-11971] calls for finalizing amendments to the current new source performance standards and establishes new standards for GHGs and VOCs. The EPA said that with the exception of implementation improvements and the new standards for GHGs, the requirements do not change requirements for operations covered by current standards.

"These rules are designed to complement other federal actions as well as state regulations," the EPA said, adding that its action finalizes standards from subpart OOOOa, and is based on its determination of best system of emissions reduction (BSER) for reducing GHGs, specifically methane, as well as VOCs produced during oil and gas production, processing, transmission and storage.

Specifically, the new BSER and OOOOa standards call for, among other things:

  • a 95% reduction in GHGs and VOCs from wet seal centrifugal compressors;
  • the replacement of rod packing on or before 26,000 hours of operation or 36 calendar months at reciprocating compressors;
  • a zero natural gas bleed rate from pneumatic controllers at gas processing plants;
  • a natural gas bleed rate no greater than six standard cubic feet per hour from pneumatic controllers at locations other than gas processing plants;
  • zero natural gas emissions from pneumatic pumps at gas processing plants; and
  • 95% control of pneumatic pumps at well sites, under certain conditions.

The EPA also called for operators to deploy optical gas imaging to find fugitive emissions from well sites on a semiannual basis, and from compressor stations on a quarterly basis. Operators could also deploy a portable VOC monitoring instrument -- such as an organic vapor analyzer, or methane "sniffer" -- as an alternative for finding and repairing leaks with a repair threshold of 500 parts per million, a process the EPA calls "Method 21."

All three of the final rules are to take effect on Aug. 2.

Information Collection Request

Last month, the EPA its first draft of an ICR that will legally require oil and gas companies to provide information on a broad range of topics, including the potential and actual configuration of emissions controls, and the details and costs associated with their deployment.

On Friday, the EPA said it wants public comments on the ICR issue before it submits one to the Office of Management and Budget, which will review it to determine compliance with the Paperwork Reduction Act. EPA will accept public comments through Aug. 2.

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