UNITED STATES ENVIRONMENTAL PROTECTION AGENCY WASHINGTON, D.C. 20460 

# S EP 2 2 2009

MEMORANI>VM SUB J ECT: FR O M:

T O: W ithdrawa l of S our G in a McCa rth y 

### Ass i stant**dmi v**  Reg ional A dmi Reg ion s I

- X e te rmin a ti o n s f o r 

### O il and Gas Indu s trie s OFFICE OF AIR AND RADIATION

T h e p urp ose of thi s m e m o ra ndum is t o co mmuni c at e to yo u that I a m w ithdr aw in g a rece nt m e m o co nce rnin g th e applic a ti o n o f C le an A i r Ac t p e rmittin g pro g ram s t o th e o il an d gas indu s tri es . O n J a nu ary 1 2, 20 07, Ac tin g Ass i s t a nt A dm in i s tr a to r Willi a m Wehrum iss u ed a g uid an ce m e morandum e ntitl e d "So urce Dete rminati o n s f o r O il a nd Gas Indu s tri es . " ] T he s tat e d purpo s e o f the 2 0 0 7 gu id a n c e was to ass i s t pe rmi tt in g a uth o riti es in m aki ng m a j o r stati o n ar y so ur ce de t e rm i nati o n s for the oil a nd gas in d u stri es. Th e m emor a ndum did n o t m a nd a te app licati o n of a particular appro a c h but in stead was a n o n-bindin g p ol ic y s t a te m e nt th at se t f o rth a p oss ibl e m e th o d o logy fo r m akin g so urce de te rmin a tion s in these in d u s trie s. Th e m e m o r an dum a im e d t o s im p lify th e pro c ess fo r de t e rminin g wh en pe rmittin g a uth o riti es s ho uld co n s id e r t wo o r m o r e p o llut a nt- e mittin g act iv itie s in th ese indu s tri es to be a s in g le s t a ti o n ary s o urce f o r purp oses of the New So urce Re view (NS R) a nd Ti tl e V p e rmi tt in g prog ra m s. Tod ay , b y thi s mem orand um , I am w ithdr aw in g thi s prev iou s ly i ss ue d g uid a n ce a nd in s te ad re -em ph as iz in g th e fu ndam e nt a l crite ri a f o r m akin g s ource de te rmin ati o n s as s p ec ifi e d in o ur ex i s t i ng NS R reg ul ati o n s, ex pl ain e d in th e p re ambl e to o ur 1980 pro mul gati o n of th os e re g ul a ti o n s and d e m o n s tra t e d thro u g h hi s to ri c a l pract ic e in maki ng sou rce d ete rmin a tion s in th ese p ro g ra m s. 

## r recog ni ze th a t so ur ce de te rmin a ti o n s w ithin th e o il a nd gas indu s trie s w ill co ntinu e to b e co mple x, in vo l vin g in so m e cases in-d e pth a n a l yses of ow n e rs hip and o p e ra tio n al i ss u es. T he p rev i o u s m e mor and um att e mpt e d to s implif y t hi s a n a lys i s b y foc u s in g on o n e of th e thre e re gu lato ry c rit e ri a fo r so urc e det e nnin a t io n s - wh e th e r a c ti v iti es are "a djac e nt o r co nti g u o u s." It emph as i ze d prox imity in a ddress in g thi s c rit e ri o n . In pr ac ti ce , ho w e v er , I find indi v idu a l facts warr a nt a cl ose r examin a tion o f a ll three crite ri a identifi e d in th os e reg ulation s to arri v e a t a r easo ned dec i s io n , and th e r e f o re, th e s implifi e d appro a c h p rov id ed in the mem o r a ndum s ho uld not b e re li e d on b y pe rmittin g au th oriti es as a s u ffic i e nt e ndp oi nt in th e dec i s ion-m a kin g pro cess . 

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### Permitting authorities s hould therefore rely foremost on the three regulatory criteria for id e ntif yi ng emiss ion s activities that belong t o the same " buildin g," "s tru cture," "fac ility , " or " in stallatio n. " Th ese are (1) w hether the activities are under th e control of the same per son (or per son under common c o ntrol ); (2) whe th e r th e ac ti vities are located on o ne or more co nti g uo u s or adjacent properties; and (3) w hether the activities belon g to the same indu s trial groupin g. 4 0 C.F .R. 52. 21 (b)(6). In ap pl y ing the se criteria , pe rmittin g authorities s hould also remai n min df ul of the ex planation we provided i n the 1980 preamble

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### See 45 FR 52676, 5269 4-9 5 (August 7 , 1 980). In addition , over the past two d ecades, Regional O ffi ces ha ve applied these regulator y criteria in makin g so urce de termi nat ions in EPA permitting actions , and in providing guidance to o th e r p e rmittin g authorities making s uc h detenninations ( available al hIt p ;/l www.epa . gov/region0 7I programsl aNcVajr lpoljcy l search.hlm ) .Co 11 ect ive I y , th ese num ero u s case-by-case determination s illu s trat e the kind of reasone d de cis ion-makin g that i s necessary to justify adequately a p e rmittin g authority's source determination decision. None thele ss, the se case -b y -case so ur ce determinations re prese nt hi g hl y fact

s pecific decisions , and while inform a ti ve of the ne cessary analytical process, no s ingle determination can se r ve as an adequate justification for how to treat any other so urce determination for pollutant-emittin g activities with differ e nt fact-specific circumstances. I agree with th e previous mem orandum 's conclusion that whether or not a permitting authority s hould aggregate two or more pollutant-emitting activities into a s in g le major s tationary so urce for purposes of NSR and T itl e V remain s a case-by-case decision in which permitting authorities re ta in the di sc retion to consider th e factors re levant to th e speci fi c c irc um stances of th e permitted activities. After co ndu c tin g th e ne cessary analysis , it ma y be that , in so me cases, " proximity"may serve as the overwhelming factor in a permitti ng authority's so urce determination deci s i o n . However , s uch a conclusion can o nl y be justified thr oug h r easo ne d deci s ion making after exam inin g whether o ther factors are re levant to th e analysis. Acco rdin g ly , I withdraw the guidance me morandum dated January 12 , 20 07 , entitled " Source Determinations for Oil and Gas Industries, " and direct permitting autho riti es to th e three criteria for makin g so urce de te rmination s s pe c ifi ed in the existing NSR regu la ti o n s. Regional Offices s hould continue to rev i ew a nd co mment o n so urc e determinations to assure that permittin g authorities co ndu ct fully-reasoned source de te rmination s tha t r e main co n sis tent w ith existing reg ulatory re quir e m e nt s and historical permitting practice.