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April 22, 2013
Tank amendments proposed for O&G

About 10 amendments affecting requirements for volatile organic compound (VOC) emissions from storage tanks plus corrections to inadvertent technical errors in the August 16, 2012, New Source Performance Standards (NSPS) for the oil and natural gas sector are included in an EPA proposal.  The proposal responds to parts of petitions from both industry and environmental groups to reconsider the NSPS.  The Agency says its responses to other aspects of the petitions will be published at later dates. 

The NSPS included the first federal air standards for natural gas wells that are hydraulically fractured, along with requirements for several other sources of pollution in the oil and gas (O&G) industry that were not previously regulated at the federal level. 

Compliance dates, alternative limits, et al.

The principal changes directed at storage tank provisions are summarized as follows:

  • Revised compliance dates.  The Agency states that it underestimated the number of tanks that would be affected by the NSPS.  The EPA now believes that sufficient control equipment will not be available for tanks to meet the October 15, 2013, deadline for 95 percent control of VOC emissions.  Accordingly, the EPA is proposing to place tanks in two groups. 
    • Group 1 tanks, constructed between August 23, 2011 (the NSPS proposal date), and April 12, 2013, will have until October 15, 2013, to report that the tank is online and provide the tank’s geographic coordinates.  If there is a change that would potentially increase the tank’s emissions, the owner/operator (O/O) would have to install controls to reduce VOC emissions by 95 percent within 60 days of the change or by April 15, 2014, whichever is later.
    • Group 2 tanks that come online after April 12, 2013, must have controls to reduce VOC emissions by 95 percent in place by April 15, 2015, or within 60 days after start-up, whichever is later.
  • Alternative emissions limit.  O/Os may reduce VOC emissions from a tank by 95 percent, as required by the original rule, or they may demonstrate that VOC emissions from a tank have dropped to less than 4 tons per year (tpy) without emissions controls.  To qualify for this alternative, the O/O must document that emissions had been below 4 tpy for at least 12 consecutive months.  If emissions increase to or above the     4 tpy limit, the O/O would have 30 days to meet the 95 percent reduction requirement.
  • Test protocols.  O/Os may use manufacturer-tested emissions control device models (combustors) that have been demonstrated to reduce VOC emissions from storage tanks by 95 percent, rather than conducting field-performance tests of these devices.
  • Monitoring.  While the EPA continues to evaluate monitoring issues raised by stakeholders, the Agency is proposing to streamline compliance and monitoring requirements for tanks that have already installed VOC controls.  Specifically, for tanks with controls, the proposal would require monthly inspections of covers, closed-vent systems, and control devices.  According to the EPA, this step is expected to minimize VOC emissions by leading to prompt repairs while requiring little or no specialized monitoring training or equipment.
  • Tanks subject to rule.  Tanks that would be considered “affected sources” are those that have VOC emissions of 6 or more tpy and are used to store crude oil, condensate, unrefined petroleum liquids known as intermediate hydrocarbon liquids, and produced water. Fuel tanks, for example, are not covered by these rules.   Also, storage tanks subject to the rule may be located anywhere along the oil and natural gas production process–from the natural gas well to the point where gas enters the distribution system or at any point from the well to the point where oil is transferred to the pipeline for crude oil production.  Storage tanks located at refineries are not covered by the proposal.

According to the EPA, the proposed amendments will result in “minor” cost savings.  In addition, the Agency says it believes that O/Os will install and operate the same or similar control technologies to meet the proposed revised standards as they would have chosen to comply with the standards in the August 2012 final rule and that the proposed revisions will not “significantly increase emissions.”

Proposed amendments to the oil and natural gas NSPS were published in the April 12, 2013, FR.

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