Oil and Natural Gas Sector: New Source Performance Standards and National Emission Standards for Hazardous Air Pollutants Reviews, 52738-52843 [2011-19899]

Agencies

• ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 76, Number 163 (Tuesday, August 23, 2011)]
[Proposed Rules]
[Pages 52738-52843]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-19899]



[[Page 52737]]

Vol. 76

Tuesday,

No. 163

August 23, 2011

Part II





Environmental Protection Agency





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40 CFR Parts 60 and 63





Oil and Natural Gas Sector: New Source Performance Standards and 
National Emission Standards for Hazardous Air Pollutants Reviews; 
Proposed Rule

Federal Register / Vol. 76 , No. 163 / Tuesday, August 23, 2011 / 
Proposed Rules

[[Page 52738]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 60 and 63

[EPA-HQ-OAR-2010-0505; FRL-9448-6]
RIN 2060-AP76


Oil and Natural Gas Sector: New Source Performance Standards and 
National Emission Standards for Hazardous Air Pollutants Reviews

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: This action announces how the EPA proposes to address the 
reviews of the new source performance standards for volatile organic 
compound and sulfur dioxide emissions from natural gas processing 
plants. We are proposing to add to the source category list any oil and 
gas operation not covered by the current listing. This action also 
includes proposed amendments to the existing new source performance 
standards for volatile organic compounds from natural gas processing 
plants and proposed standards for operations that are not covered by 
the existing new source performance standards. In addition, this action 
proposes how the EPA will address the residual risk and technology 
review conducted for the oil and natural gas production and natural gas 
transmission and storage national emission standards for hazardous air 
pollutants. This action further proposes standards for emission sources 
within these two source categories that are not currently addressed, as 
well as amendments to improve aspects of these national emission 
standards for hazardous air pollutants related to applicability and 
implementation. Finally, this action addresses provisions in these new 
source performance standards and national emission standards for 
hazardous air pollutants related to emissions during periods of 
startup, shutdown and malfunction.

DATES: Comments must be received on or before October 24, 2011.
    Public Hearing. Three public hearings will be held to provide the 
public an opportunity to provide comments on this proposed rulemaking. 
One will be held in the Dallas, Texas area, one in Pittsburgh, 
Pennsylvania, and one in Denver, Colorado, on dates to be announced in 
a separate document. Each hearing will convene at 10 a.m. local time. 
For additional information on the public hearings and requesting to 
speak, see the SUPPLEMENTARY INFORMATION section of this preamble.

ADDRESSES: Submit your comments, identified by Docket ID Number EPA-HQ-
OAR-2010-0505, by one of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov: 
Follow the instructions for submitting comments.
     Agency Web site: https://www.epa.gov/oar/docket.html. 
Follow the instructions for submitting comments on the Air and 
Radiation Docket Web site.
     E-mail: a-and-r-docket@epa.gov. Include Docket ID Number 
EPA-HQ-OAR-2010-0505 in the subject line of the message.
     Facsimile: (202) 566-9744.
     Mail: Attention Docket ID Number EPA-HQ-OAR-2010-0505, 
1200 Pennsylvania Ave., NW., Washington, DC 20460. Please include a 
total of two copies. In addition, please mail a copy of your comments 
on the information collection provisions to the Office of Information 
and Regulatory Affairs, Office of Management and Budget (OMB), Attn: 
Desk Officer for the EPA, 725 17th Street, NW., Washington, DC 20503.
     Hand Delivery: United States Environmental Protection 
Agency, EPA West (Air Docket), Room 3334, 1301 Constitution Ave., NW., 
Washington, DC 20004, Attention Docket ID Number EPA-HQ-OAR-2010-0505. 
Such deliveries are only accepted during the Docket's normal hours of 
operation, and special arrangements should be made for deliveries of 
boxed information.
    Instructions: Direct your comments to Docket ID Number EPA-HQ-OAR-
2010-0505. The EPA's policy is that all comments received will be 
included in the public docket without change and may be made available 
online at https://www.regulations.gov, including any personal 
information provided, unless the comment includes information claimed 
to be confidential business information (CBI) or other information 
whose disclosure is restricted by statute. Do not submit information 
that you consider to be CBI or otherwise protected through https://www.regulations.gov or e-mail. The https://www.regulations.gov Web site 
is an ``anonymous access'' system, which means the EPA will not know 
your identity or contact information unless you provide it in the body 
of your comment. If you send an e-mail comment directly to the EPA 
without going through https://www.regulations.gov, your e-mail address 
will be automatically captured and included as part of the comment that 
is placed in the public docket and made available on the Internet. If 
you submit an electronic comment, the EPA recommends that you include 
your name and other contact information in the body of your comment and 
with any disk or CD-ROM you submit. If the EPA cannot read your comment 
due to technical difficulties and cannot contact you for clarification, 
the EPA may not be able to consider your comment. Electronic files 
should avoid the use of special characters, any form of encryption, and 
be free of any defects or viruses. For additional information about the 
EPA's public docket, visit the EPA Docket Center homepage at https://www.epa.gov/epahome/dockets.htm. For additional instructions on 
submitting comments, go to section II.C of the SUPPLEMENTARY 
INFORMATION section of this preamble.
    Docket: All documents in the docket are listed in the https://www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, is not placed on the Internet and will be 
publicly available only in hard copy. Publicly available docket 
materials are available either electronically through https://www.regulations.gov or in hard copy at the U.S. Environmental 
Protection Agency, EPA West (Air Docket), Room 3334, 1301 Constitution 
Ave., NW., Washington, DC 20004. The Public Reading Room is open from 
8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal 
holidays. The telephone number for the Public Reading Room is (202) 
566-1744, and the telephone number for the Air Docket is (202) 566-
1742.

FOR FURTHER INFORMATION CONTACT: Bruce Moore, Sector Policies and 
Programs Division, Office of Air Quality Planning and Standards (E143-
01), Environmental Protection Agency, Research Triangle Park, North 
Carolina 27711, telephone number: (919) 541-5460; facsimile number: 
(919) 685-3200; e-mail address: moore.bruce@epa.gov.

SUPPLEMENTARY INFORMATION: 
    Organization of This Document. The following outline is provided to 
aid in locating information in this preamble.

I. Preamble Acronyms and Abbreviations
II. General Information
    A. Does this action apply to me?
    B. Where can I get a copy of this document and other related 
information?
    C. What should I consider as I prepare my comments for the EPA?
    D. When will a public hearing occur?
III. Background Information
    A. What are standards of performance and NSPS?
    B. What are NESHAP?

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    C. What litigation is related to this proposed action?
    D. What is a sector-based approach?
IV. Oil and Natural Gas Sector
V. Summary of Proposed Decisions and Actions
    A. What are the proposed revisions to the NSPS?
    B. What are the proposed decisions and actions related to the 
NESHAP?
    C. What are the proposed notification, recordkeeping and 
reporting requirements for this proposed action?
    D. What are the innovative compliance approaches being 
considered?
    E. How does the NSPS relate to permitting of sources?
VI. Rationale for Proposed Action for NSPS
    A. What did we evaluate relative to NSPS?
    B. What are the results of our evaluations and proposed actions 
relative to NSPS?
VII. Rationale for Proposed Action for NESHAP
    A. What data were used for the NESHAP analyses?
    B. What are the proposed decisions regarding certain unregulated 
emissions sources?
    C. How did we perform the risk assessment and what are the 
results and proposed decisions?
    D. How did we perform the technology review and what are the 
results and proposed decisions?
    E. What other actions are we proposing?
VIII. What are the cost, environmental, energy and economic impacts 
of the proposed 40 CFR part 60, subpart OOOO and amendments to 
subparts HH and HHH of 40 CFR part 63?
    A. What are the affected sources?
    B. How are the impacts for this proposal evaluated?
    C. What are the air quality impacts?
    D. What are the water quality and solid waste impacts?
    E. What are the secondary impacts?
    F. What are the energy impacts?
    G. What are the cost impacts?
    H. What are the economic impacts?
    I. What are the benefits?
IX. Request for Comments
X. Submitting Data Corrections
XI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations

I. Preamble Acronyms and Abbreviations

    Several acronyms and terms used to describe industrial processes, 
data inventories and risk modeling are included in this preamble. While 
this may not be an exhaustive list, to ease the reading of this 
preamble and for reference purposes, the following terms and acronyms 
are defined here:

ACGIH American Conference of Governmental Industrial Hygienists
ADAF Age-Dependent Adjustment Factors
AEGL Acute Exposure Guideline Levels
AERMOD The air dispersion model used by the HEM-3 model
API American Petroleum Institute
BACT Best Available Control Technology
BID Background Information Document
BPD Barrels Per Day
BSER Best System of Emission Reduction
BTEX Benzene, Ethylbenzene, Toluene and Xylene
CAA Clean Air Act
CalEPA California Environmental Protection Agency
CBI Confidential Business Information
CEM Continuous Emissions Monitoring
CEMS Continuous Emissions Monitoring System
CFR Code of Federal Regulations
CIIT Chemical Industry Institute of Toxicology
CO Carbon Monoxide
CO2 Carbon Dioxide
CO2e Carbon Dioxide Equivalent
DOE Department of Energy
ECHO Enforcement and Compliance History Online
e-GGRT Electronic Greenhouse Gas Reporting Tool
EJ Environmental Justice
EPA Environmental Protection Agency
ERPG Emergency Response Planning Guidelines
ERT Electronic Reporting Tool
GCG Gas Condensate Glycol
GHG Greenhouse Gas
GOR Gas to Oil Ratio
GWP Global Warming Potential
HAP Hazardous Air Pollutants
HEM-3 Human Exposure Model, version 3
HI Hazard Index
HP Horsepower
HQ Hazard Quotient
H2S Hydrogen Sulfide
ICR Information Collection Request
IPCC Intergovernmental Panel on Climate Change
IRIS Integrated Risk Information System
km Kilometer
kW Kilowatts
LAER Lowest Achievable Emission Rate
lb Pounds
LDAR Leak Detection and Repair
MACT Maximum Achievable Control Technology
MACT Code Code within the NEI used to identify processes included in 
a source category
Mcf Thousand Cubic Feet
Mg/yr Megagrams per year
MIR Maximum Individual Risk
MIRR Monitoring, Inspection, Recordkeeping and Reporting
MMtCO2e Million Metric Tons of Carbon Dioxide Equivalents
NAAQS National Ambient Air Quality Standards
NAC/AEGL National Advisory Committee for Acute Exposure Guideline 
Levels for Hazardous Substances
NAICS North American Industry Classification System
NAS National Academy of Sciences
NATA National Air Toxics Assessment
NEI National Emissions Inventory
NEMS National Energy Modeling System
NESHAP National Emissions Standards for Hazardous Air Pollutants
NGL Natural Gas Liquids
NIOSH National Institutes for Occupational Safety and Health
NOX Oxides of Nitrogen
NRC National Research Council
NSPS New Source Performance Standards
NSR New Source Review
NTTAA National Technology Transfer and Advancement Act
OAQPS Office of Air Quality Planning and Standards
OMB Office of Management and Budget
PB-HAP Hazardous air pollutants known to be persistent and bio-
accumulative in the environment
PFE Potential for Flash Emissions
PM Particulate Matter
PM2.5 Particulate Matter (2.5 microns and less)
POM Polycyclic Organic Matter
PPM Parts Per Million
PPMV Parts Per Million by Volume
PSIG Pounds per square inch gauge
PTE Potential to Emit
QA Quality Assurance
RACT Reasonably Available Control Technology
RBLC RACT/BACT/LAER Clearinghouse
REC Reduced Emissions Completions
REL CalEPA Reference Exposure Level
RFA Regulatory Flexibility Act
RfC Reference Concentration
RfD Reference Dose
RIA Regulatory Impact Analysis
RICE Reciprocating Internal Combustion Engines
RTR Residual Risk and Technology Review
SAB Science Advisory Board
SBREFA Small Business Regulatory Enforcement Fairness Act
SCC Source Classification Codes
SCFH Standard Cubic Feet Per Hour
SCFM Standard Cubic Feet Per Minute
SCM Standard Cubic Meters
SCMD Standard Cubic Meters Per Day
SCOT Shell Claus Offgas Treatment
SIP State Implementation Plan
SISNOSE Significant Economic Impact on a Substantial Number of Small 
Entities
S/L/T State and Local and Tribal Agencies
SO2 Sulfur Dioxide
SSM Startup, Shutdown and Malfunction
STEL Short-term Exposure Limit
TLV Threshold Limit Value
TOSHI Target Organ-Specific Hazard Index
TPY Tons per Year
TRIM Total Risk Integrated Modeling System
TRIM.FaTE A spatially explicit, compartmental mass balance model 
that

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describes the movement and transformation of pollutants over time, 
through a user-defined, bounded system that includes both biotic and 
abiotic compartments
TSD Technical Support Document
UF Uncertainty Factor
UMRA Unfunded Mandates Reform Act
URE Unit Risk Estimate
VCS Voluntary Consensus Standards
VOC Volatile Organic Compounds
VRU Vapor Recovery Unit

II. General Information

A. Does this action apply to me?

    The regulated industrial source categories that are the subject of 
this proposal are listed in Table 1 of this preamble. These standards 
and any changes considered in this rulemaking would be directly 
applicable to sources as a Federal program. Thus, Federal, state, local 
and tribal government entities are not affected by this proposed 
action.

 Table 1--Industrial Source Categories Affected by This Proposed Action
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                                      NAICS code   Examples of regulated
              Category                   \1\             entities
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Industry...........................       211111  Crude Petroleum and
                                                   Natural Gas
                                                   Extraction.
                                          211112  Natural Gas Liquid
                                                   Extraction.
                                          221210  Natural Gas
                                                   Distribution.
                                          486110  Pipeline Distribution
                                                   of Crude Oil.
                                          486210  Pipeline
                                                   Transportation of
                                                   Natural Gas.
Federal government.................  ...........  Not affected.
State/local/tribal government......  ...........  Not affected.
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\1\ North American Industry Classification System.

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be affected by this 
action. To determine whether your facility would be regulated by this 
action, you should examine the applicability criteria in the 
regulations. If you have any questions regarding the applicability of 
this action to a particular entity, contact the person listed in the 
preceding FOR FURTHER INFORMATION CONTACT section.

B. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this proposal will also be available on the EPA's Web site. Following 
signature by the EPA Administrator, a copy of this proposed action will 
be posted on the EPA's Web site at the following address: https://www.epa.gov/airquality/oilandgas.
    Additional information is available on the EPA's Residual Risk and 
Technology Review (RTR) Web site at https://www.epa.gov/ttn/atw/rrisk/oarpg.html. This information includes the most recent version of the 
rule, source category descriptions, detailed emissions and other data 
that were used as inputs to the risk assessments.

C. What should I consider as I prepare my comments for the EPA?

    Submitting CBI. Do not submit information containing CBI to the EPA 
through https://www.regulations.gov or e-mail. Clearly mark the part or 
all of the information that you claim to be CBI. For CBI information on 
a disk or CD ROM that you mail to the EPA, mark the outside of the disk 
or CD ROM as CBI and then identify electronically within the disk or CD 
ROM the specific information that is claimed as CBI. In addition to one 
complete version of the comment that includes information claimed as 
CBI, a copy of the comment that does not contain the information 
claimed as CBI must be submitted for inclusion in the public docket. If 
you submit a CD ROM or disk that does not contain CBI, mark the outside 
of the disk or CD ROM clearly that it does not contain CBI. Information 
not marked as CBI will be included in the public docket and the EPA's 
electronic public docket without prior notice. Information marked as 
CBI will not be disclosed except in accordance with procedures set 
forth in 40 CFR part 2. Send or deliver information identified as CBI 
only to the following address: Roberto Morales, OAQPS Document Control 
Officer (C404-02), Environmental Protection Agency, Office of Air 
Quality Planning and Standards, Research Triangle Park, North Carolina 
27711, Attention Docket ID Number EPA-HQ-OAR-2010-0505.

D. When will a public hearing occur?

    We will hold three public hearings, one in the Dallas, Texas area, 
one in Pittsburgh, Pennsylvania, and one in Denver, Colorado. If you 
are interested in attending or speaking at one of the public hearings, 
contact Ms. Joan Rogers at (919) 541-4487 by September 6, 2011. Details 
on the public hearings will be provided in a separate notice and we 
will specify the time and date of the public hearings on https://www.epa.gov/airquality/oilandgas. If no one requests to speak at one of 
the public hearings by September 6, 2011, then that public hearing will 
be cancelled without further notice.

III. Background Information

A. What are standards of performance and NSPS?

1. What is the statutory authority for standards of performance and 
NSPS?
    Section 111 of the Clean Air Act (CAA) requires the EPA 
Administrator to list categories of stationary sources, if such sources 
cause or contribute significantly to air pollution, which may 
reasonably be anticipated to endanger public health or welfare. The EPA 
must then issue performance standards for such source categories. A 
performance standard reflects the degree of emission limitation 
achievable through the application of the ``best system of emission 
reduction'' (BSER) which the EPA determines has been adequately 
demonstrated. The EPA may consider certain costs and nonair quality 
health and environmental impact and energy requirements when 
establishing performance standards. Whereas CAA section 112 standards 
are issued for existing and new stationary sources, standards of 
performance are issued for new and modified stationary sources. These 
standards are referred to as new source performance standards (NSPS). 
The EPA has the authority to define the source categories, determine 
the pollutants for which standards should be developed, identify the 
facilities within each source category to be covered and set the 
emission level of the standards.
    CAA section 111(b)(1)(B) requires the EPA to ``at least every 8 
years review and, if appropriate, revise'' performance standards unless 
the ``Administrator determines that such review is not appropriate in 
light of readily available information on the efficacy'' of the

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standard. When conducting a review of an existing performance standard, 
the EPA has discretion to revise that standard to add emission limits 
for pollutants or emission sources not currently regulated for that 
source category.
    In setting or revising a performance standard, CAA section 
111(a)(1) provides that performance standards are to ``reflect the 
degree of emission limitation achievable through the application of the 
best system of emission reduction which (taking into account the cost 
of achieving such reduction and any nonair quality health and 
environmental impact and energy requirements) the Administrator 
determines has been adequately demonstrated.'' In this notice, we refer 
to this level of control as the BSER. In determining BSER, we typically 
conduct a technology review that identifies what emission reduction 
systems exist and how much they reduce air pollution in practice. Next, 
for each control system identified, we evaluate its costs, secondary 
air benefits (or disbenefits) resulting from energy requirements and 
nonair quality impacts such as solid waste generation. Based on our 
evaluation, we would determine BSER. The resultant standard is usually 
a numerical emissions limit, expressed as a performance level (i.e., a 
rate-based standard or percent control), that reflects the BSER. 
Although such standards are based on the BSER, the EPA may not 
prescribe a particular technology that must be used to comply with a 
performance standard, except in instances where the Administrator 
determines it is not feasible to prescribe or enforce a standard of 
performance. Typically, sources remain free to elect whatever control 
measures that they choose to meet the emission limits. Upon 
promulgation, an NSPS becomes a national standard to which all new, 
modified or reconstructed sources must comply.
2. What is the regulatory history regarding performance standards for 
the oil and natural gas sector?
    In 1979, the EPA listed crude oil and natural gas production on its 
priority list of source categories for promulgation of NSPS (44 FR 
49222, August 21, 1979). On June 24, 1985 (50 FR 26122), the EPA 
promulgated an NSPS for the source category that addressed volatile 
organic compound (VOC) emissions from leaking components at onshore 
natural gas processing plants (40 CFR part 60, subpart KKK). On October 
1, 1985 (50 FR 40158), a second NSPS was promulgated for the source 
category that regulates sulfur dioxide (SO2) emissions from 
natural gas processing plants (40 CFR part 60, subpart LLL). Other than 
natural gas processing plants, EPA has not previously set NSPS for a 
variety of oil and natural gas operations.

B. What are NESHAP?

1. What is the statutory authority for NESHAP?
    Section 112 of the CAA establishes a two-stage regulatory process 
to address emissions of hazardous air pollutants (HAP) from stationary 
sources. In the first stage, after the EPA has identified categories of 
sources emitting one or more of the HAP listed in section 112(b) of the 
CAA, section 112(d) of the CAA calls for us to promulgate national 
emission standards for hazardous air pollutants (NESHAP) for those 
sources. ``Major sources'' are those that emit or have the potential to 
emit (PTE) 10 tons per year (tpy) or more of a single HAP or 25 tpy or 
more of any combination of HAP. For major sources, these technology-
based standards must reflect the maximum degree of emission reductions 
of HAP achievable (after considering cost, energy requirements and 
nonair quality health and environmental impacts) and are commonly 
referred to as maximum achievable control technology (MACT) standards.
    MACT standards are to reflect application of measures, processes, 
methods, systems or techniques, including, but not limited to, measures 
which, (1) reduce the volume of or eliminate pollutants through process 
changes, substitution of materials or other modifications, (2) enclose 
systems or processes to eliminate emissions, (3) capture or treat 
pollutants when released from a process, stack, storage or fugitive 
emissions point, (4) are design, equipment, work practice or 
operational standards (including requirements for operator training or 
certification) or (5) are a combination of the above. CAA section 
112(d)(2)(A)-(E). The MACT standard may take the form of a design, 
equipment, work practice or operational standard where the EPA first 
determines either that, (1) a pollutant cannot be emitted through a 
conveyance designed and constructed to emit or capture the pollutant or 
that any requirement for or use of such a conveyance would be 
inconsistent with law or (2) the application of measurement methodology 
to a particular class of sources is not practicable due to 
technological and economic limitations. CAA sections 112(h)(1)-(2).
    The MACT ``floor'' is the minimum control level allowed for MACT 
standards promulgated under CAA section 112(d)(3), and may not be based 
on cost considerations. For new sources, the MACT floor cannot be less 
stringent than the emission control that is achieved in practice by the 
best-controlled similar source. The MACT floors for existing sources 
can be less stringent than floors for new sources, but they cannot be 
less stringent than the average emission limitation achieved by the 
best-performing 12 percent of existing sources in the category or 
subcategory (or the best-performing five sources for categories or 
subcategories with fewer than 30 sources). In developing MACT 
standards, we must also consider control options that are more 
stringent than the floor. We may establish standards more stringent 
than the floor based on the consideration of the cost of achieving the 
emissions reductions, any nonair quality health and environmental 
impacts and energy requirements.
    The EPA is then required to review these technology-based standards 
and to revise them ``as necessary (taking into account developments in 
practices, processes, and control technologies)'' no less frequently 
than every 8 years, under CAA section 112(d)(6). In conducting this 
review, the EPA is not obliged to completely recalculate the prior MACT 
determination. NRDC v. EPA, 529 F.3d 1077, 1084 (D.C. Cir. 2008).
    The second stage in standard-setting focuses on reducing any 
remaining ``residual'' risk according to CAA section 112(f). This 
provision requires, first, that the EPA prepare a Report to Congress 
discussing (among other things) methods of calculating risk posed (or 
potentially posed) by sources after implementation of the MACT 
standards, the public health significance of those risks, and the EPA's 
recommendations as to legislation regarding such remaining risk. The 
EPA prepared and submitted this report (Residual Risk Report to 
Congress, EPA-453/R-99-001) in March 1999. Congress did not act in 
response to the report, thereby triggering the EPA's obligation under 
CAA section 112(f)(2) to analyze and address residual risk.
    CAA section 112(f)(2) requires us to determine for source 
categories subject to MACT standards, whether the emissions standards 
provide an ample margin of safety to protect public health. If the MACT 
standards for HAP ``classified as a known, probable, or possible human 
carcinogen do not reduce lifetime excess cancer risks to the individual 
most exposed to emissions from a source in the category or subcategory 
to less than 1-in-1 million,'' the EPA must promulgate

[[Page 52742]]

residual risk standards for the source category (or subcategory), as 
necessary, to provide an ample margin of safety to protect public 
health. In doing so, the EPA may adopt standards equal to existing MACT 
standards if the EPA determines that the existing standards are 
sufficiently protective. NRDC v. EPA, 529 F.3d 1077, 1083 (D.C. Cir. 
2008). (``If EPA determines that the existing technology-based 
standards provide an ``ample margin of safety,'' then the Agency is 
free to readopt those standards during the residual risk rulemaking.'') 
The EPA must also adopt more stringent standards, if necessary, to 
prevent an adverse environmental effect,\1\ but must consider cost, 
energy, safety and other relevant factors in doing so.
---------------------------------------------------------------------------

    \1\ ``Adverse environmental effect'' is defined in CAA section 
112(a)(7) as any significant and widespread adverse effect, which 
may be reasonably anticipated to wildlife, aquatic life or natural 
resources, including adverse impacts on populations of endangered or 
threatened species or significant degradation of environmental 
qualities over broad areas.
---------------------------------------------------------------------------

    Section 112(f)(2) of the CAA expressly preserves our use of a two-
step process for developing standards to address any residual risk and 
our interpretation of ``ample margin of safety'' developed in the 
National Emission Standards for Hazardous Air Pollutants: Benzene 
Emissions from Maleic Anhydride Plants, Ethylbenzene/Styrene Plants, 
Benzene Storage Vessels, Benzene Equipment Leaks, and Coke By-Product 
Recovery Plants (Benzene NESHAP) (54 FR 38044, September 14, 1989). The 
first step in this process is the determination of acceptable risk. The 
second step provides for an ample margin of safety to protect public 
health, which is the level at which the standards are set (unless a 
more stringent standard is required to prevent, taking into 
consideration costs, energy, safety, and other relevant factors, an 
adverse environmental effect).
    The terms ``individual most exposed,'' ``acceptable level,'' and 
``ample margin of safety'' are not specifically defined in the CAA. 
However, CAA section 112(f)(2)(B) preserves the interpretation set out 
in the Benzene NESHAP, and the United States Court of Appeals for the 
District of Columbia Circuit in NRDC v. EPA, 529 F.3d 1077, concluded 
that the EPA's interpretation of subsection 112(f)(2) is a reasonable 
one. See NRDC v. EPA, 529 F.3d at 1083 (D.C. Cir., ``[S]ubsection 
112(f)(2)(B) expressly incorporates EPA's interpretation of the Clean 
Air Act from the Benzene standard, complete with a citation to the 
Federal Register''). (D.C. Cir. 2008). See also, A Legislative History 
of the Clean Air Act Amendments of 1990, volume 1, p. 877 (Senate 
debate on Conference Report). We notified Congress in the Residual Risk 
Report to Congress that we intended to use the Benzene NESHAP approach 
in making CAA section 112(f) residual risk determinations (EPA-453/R-
99-001, p. ES-11).
    In the Benzene NESHAP, we stated as an overall objective:

    * * * in protecting public health with an ample margin of 
safety, we strive to provide maximum feasible protection against 
risks to health from hazardous air pollutants by, (1) protecting the 
greatest number of persons possible to an individual lifetime risk 
level no higher than approximately 1-in-1 million; and (2) limiting 
to no higher than approximately 1-in-10 thousand [i.e., 100-in-1 
million] the estimated risk that a person living near a facility 
would have if he or she were exposed to the maximum pollutant 
concentrations for 70 years.

    The Agency also stated that, ``The EPA also considers incidence 
(the number of persons estimated to suffer cancer or other serious 
health effects as a result of exposure to a pollutant) to be an 
important measure of the health risk to the exposed population. 
Incidence measures the extent of health risk to the exposed population 
as a whole, by providing an estimate of the occurrence of cancer or 
other serious health effects in the exposed population.'' The Agency 
went on to conclude that ``estimated incidence would be weighed along 
with other health risk information in judging acceptability.'' As 
explained more fully in our Residual Risk Report to Congress, the EPA 
does not define ``rigid line[s] of acceptability,'' but considers 
rather broad objectives to be weighed with a series of other health 
measures and factors (EPA-453/R-99-001, p. ES-11). The determination of 
what represents an ``acceptable'' risk is based on a judgment of ``what 
risks are acceptable in the world in which we live'' (Residual Risk 
Report to Congress, p. 178, quoting the Vinyl Chloride decision at 824 
F.2d 1165) recognizing that our world is not risk-free.
    In the Benzene NESHAP, we stated that ``EPA will generally presume 
that if the risk to [the maximum exposed] individual is no higher than 
approximately 1-in-10 thousand, that risk level is considered 
acceptable.'' 54 FR 38045. We discussed the maximum individual lifetime 
cancer risk (or maximum individual risk (MIR)) as being ``the estimated 
risk that a person living near a plant would have if he or she were 
exposed to the maximum pollutant concentrations for 70 years.'' Id. We 
explained that this measure of risk ``is an estimate of the upper bound 
of risk based on conservative assumptions, such as continuous exposure 
for 24 hours per day for 70 years.'' Id. We acknowledge that maximum 
individual lifetime cancer risk ``does not necessarily reflect the true 
risk, but displays a conservative risk level which is an upper-bound 
that is unlikely to be exceeded.'' Id.
    Understanding that there are both benefits and limitations to using 
maximum individual lifetime cancer risk as a metric for determining 
acceptability, we acknowledged in the 1989 Benzene NESHAP that 
``consideration of maximum individual risk * * * must take into account 
the strengths and weaknesses of this measure of risk.'' Id. 
Consequently, the presumptive risk level of 100-in-1 million (1-in-10 
thousand) provides a benchmark for judging the acceptability of maximum 
individual lifetime cancer risk, but does not constitute a rigid line 
for making that determination.
    The Agency also explained in the 1989 Benzene NESHAP the following: 
``In establishing a presumption for MIR, rather than a rigid line for 
acceptability, the Agency intends to weigh it with a series of other 
health measures and factors. These include the overall incidence of 
cancer or other serious health effects within the exposed population, 
the numbers of persons exposed within each individual lifetime risk 
range and associated incidence within, typically, a 50-kilometer (km) 
exposure radius around facilities, the science policy assumptions and 
estimation uncertainties associated with the risk measures, weight of 
the scientific evidence for human health effects, other quantified or 
unquantified health effects, effects due to co-location of facilities 
and co-emission of pollutants.'' Id.
    In some cases, these health measures and factors taken together may 
provide a more realistic description of the magnitude of risk in the 
exposed population than that provided by maximum individual lifetime 
cancer risk alone. As explained in the Benzene NESHAP, ``[e]ven though 
the risks judged ``acceptable'' by the EPA in the first step of the 
Vinyl Chloride inquiry are already low, the second step of the inquiry, 
determining an ``ample margin of safety,'' again includes consideration 
of all of the health factors, and whether to reduce the risks even 
further.'' In the ample margin of safety decision process, the Agency 
again considers all of the health risks and other health information 
considered in the first step. Beyond that information, additional 
factors relating to the appropriate level

[[Page 52743]]

of control will also be considered, including costs and economic 
impacts of controls, technological feasibility, uncertainties and any 
other relevant factors. Considering all of these factors, the Agency 
will establish the standard at a level that provides an ample margin of 
safety to protect the public health, as required by CAA section 112(f). 
54 FR 38046.
2. How do we consider the risk results in making decisions?
    As discussed in the previous section of this preamble, we apply a 
two-step process for developing standards to address residual risk. In 
the first step, the EPA determines if risks are acceptable. This 
determination ``considers all health information, including risk 
estimation uncertainty, and includes a presumptive limit on maximum 
individual lifetime [cancer] risk (MIR) \2\ of approximately 1-in-10 
thousand [i.e., 100-in-1 million].'' 54 FR 38045. In the second step of 
the process, the EPA sets the standard at a level that provides an 
ample margin of safety ``in consideration of all health information, 
including the number of persons at risk levels higher than 
approximately 1-in-1 million, as well as other relevant factors, 
including costs and economic impacts, technological feasibility, and 
other factors relevant to each particular decision.'' Id.
---------------------------------------------------------------------------

    \2\ Although defined as ``maximum individual risk,'' MIR refers 
only to cancer risk. MIR, one metric for assessing cancer risk, is 
the estimated risk were an individual exposed to the maximum level 
of a pollutant for a lifetime.
---------------------------------------------------------------------------

    In past residual risk determinations, the EPA presented a number of 
human health risk metrics associated with emissions from the category 
under review, including: The MIR; the numbers of persons in various 
risk ranges; cancer incidence; the maximum noncancer hazard index (HI); 
and the maximum acute noncancer hazard. In estimating risks, the EPA 
considered source categories under review that are located near each 
other and that affect the same population. The EPA provided estimates 
of the expected difference in actual emissions from the source category 
under review and emissions allowed pursuant to the source category MACT 
standard. The EPA also discussed and considered risk estimation 
uncertainties. The EPA is providing this same type of information in 
support of these actions.
    The Agency acknowledges that the Benzene NESHAP provides 
flexibility regarding what factors the EPA might consider in making our 
determinations and how they might be weighed for each source category. 
In responding to comment on our policy under the Benzene NESHAP, the 
EPA explained that: ``The policy chosen by the Administrator permits 
consideration of multiple measures of health risk. Not only can the MIR 
figure be considered, but also incidence, the presence of noncancer 
health effects, and the uncertainties of the risk estimates. In this 
way, the effect on the most exposed individuals can be reviewed as well 
as the impact on the general public. These factors can then be weighed 
in each individual case. This approach complies with the Vinyl Chloride 
mandate that the Administrator ascertain an acceptable level of risk to 
the public by employing [her] expertise to assess available data. It 
also complies with the Congressional intent behind the CAA, which did 
not exclude the use of any particular measure of public health risk 
from the EPA's consideration with respect to CAA section 112 
regulations, and, thereby, implicitly permits consideration of any and 
all measures of health risk which the Administrator, in [her] judgment, 
believes are appropriate to determining what will `protect the public 
health.' ''
    For example, the level of the MIR is only one factor to be weighed 
in determining acceptability of risks. The Benzene NESHAP explains ``an 
MIR of approximately 1-in-10 thousand should ordinarily be the upper 
end of the range of acceptability. As risks increase above this 
benchmark, they become presumptively less acceptable under CAA section 
112, and would be weighed with the other health risk measures and 
information in making an overall judgment on acceptability. Or, the 
Agency may find, in a particular case, that a risk that includes MIR 
less than the presumptively acceptable level is unacceptable in the 
light of other health risk factors.'' Similarly, with regard to the 
ample margin of safety analysis, the Benzene NESHAP states that: ``EPA 
believes the relative weight of the many factors that can be considered 
in selecting an ample margin of safety can only be determined for each 
specific source category. This occurs mainly because technological and 
economic factors (along with the health-related factors) vary from 
source category to source category.''
3. What is the regulatory history regarding NESHAP for the oil and 
natural gas sector?
    On July 16, 1992 (57 FR 31576), the EPA published a list of major 
and area sources for which NESHAP are to be published (i.e., the source 
category list). Oil and natural gas production facilities were listed 
as a category of major sources. On February 12, 1998 (63 FR 7155), the 
EPA amended the source category list to add Natural Gas Transmission 
and Storage as a major source category.
    On June 17, 1999 (64 FR 32610), the EPA promulgated MACT standards 
for the Oil and Natural Gas Production and Natural Gas Transmission and 
Storage major source categories. The Oil and Natural Gas Production 
NESHAP (40 CFR part 63, subpart HH) contains standards for HAP 
emissions from glycol dehydration process vents, storage vessels and 
natural gas processing plant equipment leaks. The Natural Gas 
Transmission and Storage NESHAP (40 CFR part 63, subpart HHH) contains 
standards for glycol dehydration process vents.
    In addition to these NESHAP for major sources, the EPA also 
promulgated NESHAP for the Oil and Natural Gas Production area source 
category on January 3, 2007 (72 FR 26). These area source standards, 
which are based on generally available control technology, are also 
contained in 40 CFR part 63, subpart HH. This proposed action does not 
impact these area source standards.

C. What litigation is related to this proposed action?

    On January 14, 2009, pursuant to section 304(a)(2) of the CAA, 
WildEarth Guardians and the San Juan Citizens Alliance filed a 
Complaint alleging that the EPA failed to meet its obligations under 
CAA sections 111(b)(1)(B), 112(d)(6) and 112(f)(2) to take actions 
relative to the review/revision of the NSPS and the NESHAP with respect 
to the Oil and Natural Gas Production source category. On February 4, 
2010, the Court entered a consent decree requiring the EPA to sign by 
July 28, 2011,\3\ proposed standards and/or determinations not to issue 
standards pursuant to CAA sections 111(b)(1)(B), 112(d)(6) and 
112(f)(2) and to take final action by February 28, 2012.
---------------------------------------------------------------------------

    \3\ On April 27, 2011, pursuant to paragraph 10(a) of the 
Consent Decree, the parties filed with the Court a written 
stipulation that changes the proposal date from January 31, 2011, to 
July 28, 2011, and the final action date from November 30, 2011, to 
February 28, 2012.
---------------------------------------------------------------------------

D. What is a sector-based approach?

    Sector-based approaches are based on integrated assessments that 
consider multiple pollutants in a comprehensive and coordinated manner 
to manage emissions and CAA requirements. One of the many ways we can 
address sector-based approaches is by reviewing multiple regulatory 
programs together whenever possible, consistent with all

[[Page 52744]]

applicable legal requirements. This approach essentially expands the 
technical analyses on costs and benefits of particular technologies, to 
consider the interactions of rules that regulate sources. The benefit 
of multi-pollutant and sector-based analyses and approaches includes 
the ability to identify optimum strategies, considering feasibility, 
cost impacts and benefits across the different pollutant types while 
streamlining administrative and compliance complexities and reducing 
conflicting and redundant requirements, resulting in added certainty 
and easier implementation of control strategies for the sector under 
consideration. In order to benefit from a sector-based approach for the 
oil and gas industry, the EPA analyzed how the NSPS and NESHAP under 
consideration relate to each other and other regulatory requirements 
currently under review for oil and gas facilities. In this analysis, we 
looked at how the different control requirements that result from these 
requirements interact, including the different regulatory deadlines and 
control equipment requirements that result, the different reporting and 
recordkeeping requirements and opportunities for states to account for 
reductions resulting from this rulemaking in their State Implementation 
Plans (SIP). The requirements analyzed affect criteria pollutant, HAP 
and methane emissions from oil and natural gas processes and cover the 
NSPS and NESHAP reviews. As a result of the sector-based approach, this 
rulemaking will reduce conflicting and redundant requirements. Also, 
the sector-based approach facilitated the streamlining of monitoring, 
recordkeeping and reporting requirements, thus, reducing administrative 
and compliance complexities associated with complying with multiple 
regulations. In addition, the sector-based approach promotes a 
comprehensive control strategy that maximizes the co-control of 
multiple regulated pollutants while obtaining emission reductions as 
co-benefits.

IV. Oil and Natural Gas Sector

    The oil and natural gas sector includes operations involved in the 
extraction and production of oil and natural gas, as well as the 
processing, transmission and distribution of natural gas. Specifically 
for oil, the sector includes all operations from the well to the point 
of custody transfer at a petroleum refinery. For natural gas, the 
sector includes all operations from the well to the customer. The oil 
and natural gas operations can generally be separated into four 
segments: (1) Oil and natural gas production, (2) natural gas 
processing, (3) natural gas transmission and (4) natural gas 
distribution. Each of these segments is briefly discussed below.
    Oil and natural gas production includes both onshore and offshore 
operations. Production operations include the wells and all related 
processes used in the extraction, production, recovery, lifting, 
stabilization, separation or treating of oil and/or natural gas 
(including condensate). Production components may include, but are not 
limited to, wells and related casing head, tubing head and ``Christmas 
tree'' piping, as well as pumps, compressors, heater treaters, 
separators, storage vessels, pneumatic devices and dehydrators. 
Production operations also include the well drilling, completion and 
workover processes and includes all the portable non-self-propelled 
apparatus associated with those operations. Production sites include 
not only the ``pads'' where the wells are located, but also include 
stand-alone sites where oil, condensate, produced water and gas from 
several wells may be separated, stored and treated. The production 
sector also includes the low pressure, small diameter, gathering 
pipelines and related components that collect and transport the oil, 
gas and other materials and wastes from the wells to the refineries or 
natural gas processing plants. None of the operations upstream of the 
natural gas processing plant are covered by the existing NSPS. Offshore 
oil and natural gas production occurs on platform structures that house 
equipment to extract oil and gas from the ocean or lake floor and that 
process and/or transfer the oil and gas to storage, transport vessels 
or onshore. Offshore production can also include secondary platform 
structures connected to the platform structure, storage tanks 
associated with the platform structure and floating production and 
offloading equipment.
    There are three basic types of wells: Oil wells, gas wells and 
associated gas wells. Oil wells can have ``associated'' natural gas 
that is separated and processed or the crude oil can be the only 
product processed. Once the crude oil is separated from the water and 
other impurities, it is essentially ready to be transported to the 
refinery via truck, railcar or pipeline. We consider the oil refinery 
sector separately from the oil and natural gas sector. Therefore, at 
the point of custody transfer at the refinery, the oil leaves the oil 
and natural gas sector and enters the petroleum refining sector.
    Natural gas is primarily made up of methane. However, whether 
natural gas is associated gas from oil wells or non-associated gas from 
gas or condensate wells, it commonly exists in mixtures with other 
hydrocarbons. These hydrocarbons are often referred to as natural gas 
liquids (NGL). They are sold separately and have a variety of different 
uses. The raw natural gas often contains water vapor, hydrogen sulfide 
(H2S), carbon dioxide (CO2), helium, nitrogen and 
other compounds. Natural gas processing consists of separating certain 
hydrocarbons and fluids from the natural gas to produced ``pipeline 
quality'' dry natural gas. While some of the processing can be 
accomplished in the production segment, the complete processing of 
natural gas takes place in the natural gas processing segment. Natural 
gas processing operations separate and recover NGL or other non-methane 
gases and liquids from a stream of produced natural gas through 
components performing one or more of the following processes: Oil and 
condensate separation, water removal, separation of NGL, sulfur and 
CO2 removal, fractionation of natural gas liquid and other 
processes, such as the capture of CO2 separated from natural 
gas streams for delivery outside the facility. Natural gas processing 
plants are the only operations covered by the existing NSPS.
    The pipeline quality natural gas leaves the processing segment and 
enters the transmission segment. Pipelines in the natural gas 
transmission segment can be interstate pipelines that carry natural gas 
across state boundaries or intrastate pipelines, which transport the 
gas within a single state. While interstate pipelines may be of a 
larger diameter and operated at a higher pressure, the basic components 
are the same. To ensure that the natural gas flowing through any 
pipeline remains pressurized, compression of the gas is required 
periodically along the pipeline. This is accomplished by compressor 
stations usually placed between 40 and 100 mile intervals along the 
pipeline. At a compressor station, the natural gas enters the station, 
where it is compressed by reciprocating or centrifugal compressors.
    In addition to the pipelines and compressor stations, the natural 
gas transmission segment includes underground storage facilities. 
Underground natural gas storage includes subsurface storage, which 
typically consists of depleted gas or oil reservoirs and salt dome 
caverns used for storing natural gas. One purpose of this storage is 
for load balancing (equalizing the receipt and delivery of natural 
gas). At an underground storage site, there are typically other 
processes,

[[Page 52745]]

including compression, dehydration and flow measurement.
    The distribution segment is the final step in delivering natural 
gas to customers. The natural gas enters the distribution segment from 
delivery points located on interstate and intrastate transmission 
pipelines to business and household customers. The delivery point where 
the natural gas leaves the transmission segment and enters the 
distribution segment is often called the ``citygate.'' Typically, 
utilities take ownership of the gas at the citygate. Natural gas 
distribution systems consist of thousands of miles of piping, including 
mains and service pipelines to the customers. Distribution systems 
sometimes have compressor stations, although they are considerably 
smaller than transmission compressor stations. Distribution systems 
include metering stations, which allow distribution companies to 
monitor the natural gas in the system. Essentially, these metering 
stations measure the flow of gas and allow distribution companies to 
track natural gas as it flows through the system.
    Emissions can occur from a variety of processes and points 
throughout the oil and natural gas sector. Primarily, these emissions 
are organic compounds such as methane, ethane, VOC and organic HAP. The 
most common organic HAP are n-hexane and BTEX compounds (benzene, 
toluene, ethylbenzene and xylenes). Hydrogen sulfide (H2S) 
and sulfur dioxide (SO2) are emitted from production and 
processing operations that handle and treat ``sour gas.'' Sour gas is 
defined as natural gas with a maximum H2S content of 0.25 
gr/100 scf (4ppmv) along with the presence of CO2.
    In addition, there are significant emissions associated with the 
reciprocating internal combustion engines and combustion turbines that 
power compressors throughout the oil and natural gas sector. However, 
emissions from internal combustion engines and combustion turbines are 
covered by regulations specific to engines and turbines and, thus, are 
not addressed in this action.

V. Summary of Proposed Decisions and Actions

    Pursuant to CAA sections 111(b), 112(d)(2), 112(d)(6) and 112(f), 
we are proposing to revise the NSPS and NESHAP relative to oil and gas 
to include the standards and requirements summarized in this section. 
More details of the rationale for these proposed standards and 
requirements are provided in sections VI and VII of this preamble. In 
addition, as part of these rationale discussions, we solicit public 
comment and data relevant to several issues. The comments we receive 
during the public comment period will help inform the rule development 
process as we work toward promulgating a final action.

A. What are the proposed revisions to the NSPS?

    We reviewed the two NSPS that apply to the oil and natural gas 
industry. Based on our review, we believe that the requirements at 40 
CFR part 60, subpart KKK, should be updated to reflect requirements in 
40 CFR part 60, subpart VVa for controlling VOC equipment leaks at 
processing plants. We also believe that the requirements at 40 CFR part 
60, subpart LLL, for controlling SO2 emissions from natural 
gas processing plants should be strengthened for facilities with the 
highest sulfur feed rates and the highest H2S 
concentrations. For a more detailed discussion, please see section 
VI.B.1 of this preamble.
    In addition, there are significant VOC emissions from oil and 
natural gas operations that are not covered by the two existing NSPS, 
including other emissions at processing plants and emissions from 
upstream production, as well as transmission and storage facilities. In 
the 1984 notice that listed source categories (including Oil and 
Natural Gas) for promulgation of NSPS, we noted that there were 
discrepancies between the source category names on the list and those 
in the background document, and we clarified our intent to address all 
sources under an industry heading at the same time. See 44 FR 49222, 
49224-49225.\4\ We, therefore, believe that the currently listed Oil 
and Natural Gas source category covers all operations in this industry 
(i.e., production, processing, transmission, storage and distribution). 
To the extent there are oil and gas operations not covered by the 
currently listed Oil and Natural Gas source category, pursuant to CAA 
section 111(b), we hereby modify the category list to include all 
operations in the oil and natural gas sector. Section 111(b) of the CAA 
gives the EPA broad authority and discretion to list and establish NSPS 
for a category that, in the Administrator's judgment, causes or 
contributes significantly to air pollution which may reasonably be 
anticipated to endanger public health or welfare. Pursuant to CAA 
section 111(b), we are modifying the source category list to include 
any oil and gas operation not covered by the current listing and 
evaluating emissions from all oil and gas operations at the same time.
---------------------------------------------------------------------------

    \4\ The Notice further states that ``The Administrator may also 
concurrently develop standards for sources which are not on the 
priority list.'' 44 FR at 49225.
---------------------------------------------------------------------------

    We are also proposing standards for several new oil and natural gas 
affected facilities. The proposed standards would apply to affected 
facilities that commence construction, reconstruction or modification 
after August 23, 2011. These standards, which include requirements for 
VOC, would be contained in a new subpart, 40 CFR part 60, subpart OOOO. 
Subpart OOOO would incorporate 40 CFR part 60, subpart KKK and 40 CFR 
part 60, subpart LLL, thereby having in this one subpart, all standards 
that are applicable to the new and modified affected facilities 
described above. We also propose to amend the title of subparts KKK and 
LLL, accordingly, to apply only to affected facilities already subject 
to those subparts. Those operations would not become subject to subpart 
OOOO unless they triggered applicability based on new or modified 
affected facilities under subpart OOOO.
    We are proposing operational standards for completions of 
hydraulically fractured gas wells. Based on our review, we identified 
two subcategories of fractured gas wells for which well completions are 
conducted. For non-exploratory and non-delineation wells, the proposed 
operational standards would require reduced emission completion (REC), 
commonly referred to as ``green completion,'' in combination with pit-
flaring of gas not suitable for entering the gathering line. For 
exploratory and delineation wells (these wells generally are not in 
close proximity to a gathering line), we proposed an operational 
standard that would require pit flaring. Well completions subject to 
the standards would be limited to gas well completions following 
hydraulic fracturing operations. These completions include those 
conducted at newly drilled and fractured wells, as well as completions 
conducted following refracturing operations at various times over the 
life of the well. We have determined that a completion associated with 
refracturing performed at an existing well (i.e., a well existing prior 
to August 23, 2011) is considered a modification under CAA section 
111(a), because physical change occurs to the existing well resulting 
in emissions increase during the refracturing and completion operation. 
A detailed discussion of this determination is presented in the 
Technical Support Document (TSD) in the docket. Therefore, the proposed 
standards would apply to completions at new gas wells that are 
fractured or

[[Page 52746]]

refractured along with completions associated with fracturing or 
refracturing of existing gas wells. The modification determination and 
resultant applicability of NSPS to the completion operation following 
fracturing or refracturing of existing gas wells (i.e., wells existing 
before August 23, 2011 would be limited strictly to the wellhead, well 
bore, casing and tubing, and any conveyance through which gas is vented 
to the atmosphere and not be extended beyond the wellhead to other 
ancillary components that may be at the well site such as existing 
storage vessels, process vessels, separators, dehydrators or any other 
components or apparatus.
    We are also proposing VOC standards to reduce emissions from gas-
driven pneumatic devices. We are proposing that each pneumatic device 
is an affected facility. Accordingly, the proposed standards would 
apply to each newly installed pneumatic device (including replacement 
of an existing device). At gas processing plants, we are proposing a 
zero emission limit for each individual pneumatic controller. The 
proposed emission standards would reflect the emission level achievable 
from the use of non-gas-driven pneumatic controllers. At other 
locations, we are proposing a bleed limit of 6 standard cubic feet of 
gas per hour for an individual pneumatic controller, which would 
reflect the emission level achievable from the use of low bleed gas-
driven pneumatic controllers. In both cases, the standards provide 
exemptions for certain applications based on functional considerations.
    In addition, the proposed rule would require measures to reduce VOC 
emissions from centrifugal and reciprocating compressors. As explained 
in more detail below in section VI.B.4, we are proposing equipment 
standards for centrifugal compressors. The proposed standards would 
require the use of dry seal systems. However, we are aware that some 
owners and operators may need to use centrifugal compressors with wet 
seals, and we are soliciting comment on the suitability of a compliance 
option allowing the use of wet seals combined with routing of emissions 
from the seal liquid through a closed vent system to a control device 
as an acceptable alternative to installing dry seals.
    Our review of reciprocating compressors found that piston rod 
packing wear produces fugitive emissions that cannot be captured and 
conveyed to a control device. As a result, we are proposing operational 
standards for reciprocating compressors, such that the proposed rule 
would require replacement of the rod packing based on hours of usage. 
The owner or operator of a reciprocating compressor affected facility 
would be required to monitor the duration (in hours) that the 
compressor is operated. When the hours of operation reaches 26,000 
hours, the owner or operator would be required to change the rod 
packing immediately. However, to avoid unscheduled shutdowns when 
26,000 hours is reached, owners and operators could track hours of 
operation such that packing replacement could be coordinated with 
planned maintenance shutdowns before hours of operation reached 26,000. 
Some operators may prefer to replace the rod packing on a fixed 
schedule to ensure that the hours of operation would not reach 26,000 
hours. We solicit comment on the appropriateness of a fixed replacement 
frequency and other considerations that would be associated with 
regular replacement.
    We are also proposing VOC standards for new or modified storage 
vessels. The proposed rule, which would apply to individual vessels, 
would require that vessels meeting certain specifications achieve at 
least 95-percent reduction in VOC emissions. Re