**UNITED STATES**  **ENVIRONMENTAL PROTECTION**  **AGENCY**
**REGION IX** 

**75 Hawthorne Street** 
**San Francisco,**  **CA 94105** 



### PREVENTION **OF SIGNIFIC**  **ANT DETERIORATION PERMIT** 
**ISSUED PURSUANT**  **TO THE**  **REQUIREMENTS AT**  **40 CFR**  **§ 52.21** 

**U.S. ENVIRONMENTAL**  **PROTE CTION**  **AGENCY, REGION**  **9**

**PSD PERMIT**  **NUMBER: NU**  **05-01**

**PERMITTEE: Resolute**  **Natural Resources**  **Company**

**1675 Broadway,**  **Suite 1950** 
**Denver, Colorado**  **80202**

**FACILITY NAME**  **McElmo Creek**  **Unit Oil**  **Production**

**Facility**

**FACILITY LOCATION:**  **Section 31,**  **Township 40**  **South, Range** 
**25 East**  **within the**  **Four Comers**  **Area**

**on the**  **Navajo Nation**  **Indian**
**Reservation near**  **the city**  **of Aneth,**  **San**

**Juan County,**  **Utah**

**Pursuant to**  **the provisions**  **of the**  **Clean Air**  **Act (CAA),**  **Subchapter I,**  **Part C (**  **42 U.S.C.**  **§ 7470,** 

**et. seq.),**  

### and **the Code**  **of Federal**  **Regulations (CFR)**  **Title 40,**  **Section 52.21,**  **the United**  **States Environmental Protection Agency (EPA), Region**  **9 is**  **issuing this**  **amended Prevention**  **of Significant**  **Deterioration (PSD)**  **air quality**  **permit to**  **Resolute Natural**  **Resources Company**  **(Resolute) for**  **the McElmo**  **Creek Unit**  **Oil Production Facility**  **as described herein,**  **in accordance** 
**with the**  **permit application**  **(and plans**  **submitted with**  **the permit**  **application), federal**  **regulations governing**  **the Prevention**  **of Significant Deterioration**  **of air**  **quality (40**  **CFR §**  **52.21), and**  **other**

**terms and**  **conditions set**  **forth in**  **this amended**  **PSD Permit.** 

**Failure to**  **comply with any**  **condition or**  **term set**  **forth in**  **this amended**  **PSD Permit**  **is subject**  **to enforcement**  **action pursuant**  **to Section**  **113 of**  **the Clean**  **Air Act. This**  **permit does**  **not relieve**

**Resolute from**  **the responsibility**  **to comply**  **with any other applicable**  **provisions of**  **the CAA**  **(including applicable**  **implementing regulations**  **in 40**  **CFR Parts**  **51, 52, 60,**  **61 and 63),**  **or other**  **federal, tribal, and**  **local requirements.** 

**Per 40**  **CFR §**  **124.15(b ),**  **this PSD**  **Permit becomes**  **effective 30**  **days after**  **the service**  **of notice**  **of**
**this final**  **permit decision**  **unless review**  **is requested**  **on the**  **permit pursuant**  **to 40**  **CFR §**  **124.19.**



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**Date**McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 2 ABBREVIATIONS & ACRONYMS

Act Clean Air Act [42 U.S.C. § 7401 et seq.]

BACT Best Available Control Technology

BTU British thermal units

CAA Clean Air Act [42 U.S.C. § 7401 et seq.]

CEMS Continuous Emissions Monitoring System

CFR Code of Federal Regulations

CMS Continuous Monitoring System

CO Carbon Monoxide

CO 2 Carbon Dioxide

CPMS Continuous Parameter Measurement S ystem

EPA United States Environmental Protection Agency

H 2 S Hydrogen Sulfide

h p Horsepower

hr H our lb, lbs P ound, pounds MCU Facility / Facility McElmo Creek Unit Oil Production Facility

m in Minute

MMBTU Million British thermal units

MM CFD Million cubic feet per day NAAQS National Ambient Air Quality Standards

NHV dil Net heating value of dilution

NHV vg Net heating value of vent gas

NO
x Oxides of nitrogen

O 2 Oxygen

Permittee / Owner or Operator Resolute Natural Resources Company, or the owner and/or operator of the McElmo Creek Unit Oil Production Facility

PSD Prevention of Significant Deterioration

scf Standard cubic feet

scfm Standard cubic feet permit minute

SO 2 Sulfur Dioxide

tpy Tons per y ear VOC Volatile Organic Compounds as defined in 40 CFR § 51.100(s)McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 3 

### MCELMO CREEK UNIT OIL PRODUCTION FACILITY

PREVENTION OF SIGNIFICANT DETERIORATION PERMIT

PROJECT DESCRIPTION

The McElmo Creek Unit Oil Production Facility (MCU Facility or Facility) is an existing oil and gas production operation located within the Four Corners Area on the Navajo Nation Indian Reservation near the city of Aneth, San Juan County, Utah. The Facility is owned, in partnership

with the Navajo Nation Oil and Gas Company, and operated by the Resolute Natural Resources Company. The Facility is on the McElmo Creek Unit oilfield

, which includes field operations and a gas compression plant.

The field operations consist of approximately 90 producing wells where petroleum crude oil is recovered from producing strata, and brought to the surface to be stored at either a satellite tank battery (i.e., in general, a sub

- tank battery that is located between wells and the main tank battery) or a mai n tank battery. There are eleven satellite tank batteries that function as testing facilities for producing wells and four main tank batteries.

The gas compression plant serves tertiary oil recovery operations for the McElmo Creek Unit

oilfield. The gas compression plant receives produced gas through a gathering system, pressures the gas up to a suitable working pressure, and re

- injects the gas to maintain reservoir pressure in the oilfield. The natural gas is injected with produced water in a dual inje ction system. The Main Flare is located at the gas compression plant.

This PSD Permit amendment revises the existing PSD permit by incorporat ing Best Available Control Technology (BACT) requirements for the Main Flare, including emission limitation s for

emissions of sulfur dioxide (SO 2 ), nitrogen oxides (NO
x ), carbon monoxide (CO), and volatile organic compounds (VOC). A ir pollution emissions associated with this permit amendment will not cause or contribute to violations of any National Ambient Air Qual ity Standards (NAAQS) or any applicable PSD increments for the pollutants regulated under the PSD permit.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 4 EQUIPMENT LIST

The following devices and acti vities are subject to this PSD P ermit

.

Unit ID Description

Main Flare One (1) air

- assist flare

, rated at 618,104 scf/hr, which combusts produced field gas in excess of the facility compression capacity

Glycol Dehydrator One (1) Glycol Dehydrator with o ne (1) T riethylene Glycol ( TEG ) Reboiler rated at 0.75 MMBtu/hr, which combusts purchased pipeline quality natural gas to provide heat to the Glycol Heater

Glycol Heater One (1) Glycol Heater (TEG regenerator), rated at 12 MM CFD

, which provides inter

- stage dehydration for the HOS

- 6 compressor

Gasoline Storage Tank One (1) 10,000 gallon nominal capacit y gasoline storage tank that is used for refueling of vehicles

Aerial C

- 5 Compressor Ariel JGD

- 6 electrically

- driven compressor

, driven by a Reliance model 9240 AC induction motor rated at 2,500 hp

HOS

- 4 Compressor Dresser Rand HOS

- 4 electrically

- driven compressor
, driven by a General Electric model EK AC induction motor rated at 2,000 hp

HOS

- 6 Compressor Dresser Rand HOS

- 6 electrically

- driven compressor

, driven by an Allis Chalmers model 6802 AC induction motor rated at 5,000 hp

Acid Gas A Compressor W orthington Cub

- 4 electrically

- driven compressor

, driven by a Westinghouse model 6808 AC induction motor rated at 400 hp

Acid Gas B Compressor Worthington Cub

- 4 electrically

- driven compressor

, driven by a Westinghouse model 6808 AC induction motor rated at 400 hp

PERMIT CONDITIONS

I. PERMIT EXPIRATION

As provided in 40 CFR § 52.21(r), this PSD Permit shall become invalid if construction:

A. is not commenced (as defined in 40 CFR § 52.21(b)(9)) within 18 months after the approval takes effect; or

B. is discontinued for a period of 18 months or more; or

C. is not completed within a reasonable time.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 5 II. PERMIT NOTIFICATION REQUIREMENTS

The Permittee shall notify the EPA Region 9 by letter or by electronic mail of the:

A. date construction is commenced, postmarked within 30 days of such date;

B. actual date of initial startup, as defined in 40 CFR § 60.2, postmarked within 15 days of such date;

C. date upon which initial performance tests will commence postmarked not less than 30 days prior to such date. Notification may be provided with the submittal of the performance test protocol; and

D. date upon which initial performance evaluation of the continuous emissions monitoring system (CEMS) will commence in accordance with 40 CFR § 60.13(c), postmarked not less than 30 days prior to such date. Notification may be provided with the submittal of the CEMS performance test.

III. FACILITY OPERATION

A. At all times, including periods of startup, shutdown, s hakedown, and malfunction,

the Permittee shall, to the extent practicable, maintain and operate the Facility

, including associated air pollution control equipment

, in a manner consistent with good air pollution control practice for minimizing emissions. D etermination of whether acceptable operating and maintenance procedures are being used will be

based on information available to the EPA, which may include, but is not limited to, monitoring results, opacity observations, review of operating maintenance

pr ocedures

, and inspection of the Facility.

B. The operating staff with management authority at this F acility shall be advised of

and be familiar with all the conditions of this PSD Permit.

IV. GENERAL MALFUNCTION REPORTIN G

A. The Permittee shall notify the EPA at AEO_R9@epa.gov within two (2) working days following the discovery of any failure of air pollution control equipment or process equipment, or failure of a process to operate in a normal manner, which

results in an increase in emissions above the allowab le emission limits stated in Section IX of this permit.

B. In addition, the Permittee shall provide an additional notification to the EPA in writing or electronic mail within fifteen (15) days of any such failure describedMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 6 under Condition IV.A. This notific ation shall include a description of the malfunctioning equipment or abnormal operation, the date of the initial malfunction, the period of time over which emissions were increased due to the failure, the cause of the failure, the estimated resultant emiss ions in excess of

those allowed in Section I X, and the methods utilized to mitigate emissions and restore normal operations.

C. Compliance with this malfunction notification provision shall not excuse or otherwise constitute a defense to any violation of t his permit or any law or regulation such malfunction may cause.

V. RIGHT OF ENTRY

A. The EPA and its contractors, consultants, and agents shall have authority to enter the Facility at all reasonable times, and upon presentation of credentials, shall be permitted to :

1. E nter the premises where the Facility is located or where any records are required to be kept under the terms and conditions of this PSD Permit;

2. During normal business hours, have access to and to copy any records required to be kept under the terms and conditions of this PSD Permit;

3. In spect any equipment, operation, or method subject to requirements in this PSD Permit; and

4. S ample materials and emissions from the Facility

.

B. This provision in no way limits or otherwise affects any right of entry held by the EPA pursuant to applicable federal, state, or local laws, regulations, or permits.

VI. TRANSFER OF OWNERSHI P

In the event of any changes in control or ownership of the Facili ty, this PSD Permit shall be binding on all subsequent owners or operators. Within 14 days of any such change in control or ownership, the Permittee shall notify the succeeding owner or operator of the existence of this PSD Permit and its conditions by le tter . The Permittee shall send a copy of this letter to the EPA Region 9 within thirty (30) days of its issuance

.

VII. SEVERABILITYMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 7 The provisions of this PSD Permit are severable, and, if any provision of the PSD Permit is held invalid, the remainder of thi s PSD Permit shall not be affected.

VIII. ADHERENCE TO APPLICA TION AND COMPLIANCE WITH OTHER

ENVIRONMENTAL LAWS

The Permittee shall construct in accordance with this PSD Permit , the application on which this permit is based

, and all other applicable federal, s tate, and local air quality regulations. This PSD P ermit does not release the Permittee from any liability for compliance with other applicable federal, state

, and local environmental laws and regulations, including the Clean Air Act.

IX. SPECIAL CONDITIONS FOR THE MAIN FLARE

A. Definitions

1. “CO 2 Breakthrough” shall mean an event where a gas or fluid injected in the Facility’s oil field for the purpose of promoting the production of oil contacts a producing well and results in an increase in gas volume to

comp ressor station equipment.

2. “Day” shall mean a calendar day, unless expressly stated to be a working day. In computing any period of time under Section IX of this PSD

Permit , where the last day of such period would fall on a Saturday, Sunday, or federal h oliday, the period shall run until the close of business on the next day that is not a Saturday, Sunday, or federal holiday.

3. “Facility” shall mean the Permittee’s McElmo Creek Unit Oil Production Facility and associated oil fields, located near Aneth, Uta h, on the Navajo

Nation Indian Reservation

.

4. “Field Flares” shall mean the following flares at the Facility: (i) Tank Battery Flares at MCU Area 1 Battery, MCU Area 2 Battery, MCU Area 4 Battery, and MCU Area 6 Battery; and (ii) Satellite Flares at MCU S ection 2, MCU Section 3, MCU Section 5, MCU Section 6, MCU Section 9, MCU Section 11, MCU Section 17, MCU Section 19, MCU Section 32,

and MCU Section 33.

5. “Flaring Incident” shall mean continuous or intermittent flaring at the

Main Flare that results in th e emissions of SO 2 equal to, or greater than, 500 pounds in any 24

- hour period; provided, however, that if 500 pounds

or more of SO 2 have been emitted in a 24

- hour period and the flaringMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 8 continues into subsequent, contiguous, non

- overlapping 24

- hour period(s), each period of which results in emissions equal to, or greater than, five hundred (500) pounds of SO 2 , then only one Flaring Incident shall have occurred. Subsequent, contiguous, non

- overlapping periods are measured

from the initial commencemen t of flaring within the Flaring Incident.

6. “Main Flare” shall mean the flare installed as part of the Facility’s former gas processing plant.

7. “Main Flare Emissions” shall mean the emissions from the Main Flare at the Facility as well as all emissions tha t result from: (1) combustion of fuel gas in the Main Flare’s pilot, (2) the closed drain and filter backwash operations, (3) CO 2 Breakthroughs, (4) any Scheduled Maintenance, and (5) unscheduled maintenance of the Facility’s compressors.

8. “Malfunction” s hall mean , for the purposes of reporting under Condition

IX. H .3 of this PSD Permit only

, any sudden and unavoidable breakdown of process or pollution control equipment. CO 2 Breakthroughs and Scheduled Maintenance of the Facility’s compressors are not

Malf unctions.

9. “Root Cause” shall mean the primary cause of a Flaring Incident as determined through a process of investigation; provided, however, that if a Flaring Incident encompasses m ultiple releases of SO 2 , the “Root Cause” may encompass multiple prima ry causes.

10. “Scheduled Maintenance” shall mean work that is part of the routine work plan for the compressors located at the Facility's former gas processing plant. This work is typically planned and arranged on a set frequency, usually based on periods o f time (e.g., daily, weekly or monthly) or on the operating hours of the equipment. Scheduled Maintenance shall not include work necessitated by the failure of a part of a compressor.

B. Air Pollution Control Equipment

The Main Flare shall be an automatic air

- assisted flare system.

C. Emission Limit ations

1. T he Permittee shall not discharge or cause the discharge of Main Flare

E missions from the Main Flare into the atmosphere in excess of theMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 9 following the emission limitations , based on a cumulative 365

- day r olling

total

.

SO 2 NO x CO VOC

60.0 tpy 13.4 tpy 73.0 tpy 95.4 tpy

2. The Permittee shall calculate the 365

- day rolling emissions totals for SO 2 , NO
x , CO

, and VOC each day for the Main Flare.

3. The Permittee shall not use the Field Flares to circumvent the emission

limitations in Condition IX. C .1.

4. All e missions during all modes of operation (including, but not limited to, emissions during periods of startup, shutdown, or malfunction) shall be used in determining compliance with the emission limitations i n Condition

IX.C.1.

D. Main Flare Operational Requirements

1. The Permittee shall install , operate and maintain an automatic air

- assisted flare system on the Main Flare, pursuant to the provisions of 40 CFR § 60.18(c)(5) and (f)(6).

2. The Permittee shall operate and maintain the Main Flare in compliance

with 40 CFR § 60.18(c)(l), (c)(2), (c)(3)(ii), (c)(5), (d), (e), (f)(1) through (f)(4), and (f)(6).

3. The Main Flare shall be operated with a flame present at all times when

emissions ma y be vented to it

.

4. The Permittee shall comply with the following requirements for ensuring proper combustion efficiency:

The net heating value air assist dilution parameter (NHV dil ) shall be greater than or equal to 24 BTU/ft 2

, on a daily basis, calculated in

accordance with the following equations

. If NHV dil is less than 24

BTU/ft 2 , the Permittee shall take actions as expeditiously as practicable to raise NHV dil to comply with the limit. The Permittee

shall determine NHV dil in BTU/ft 2 as specif ied in Condition IX.E.2 of

this Permit.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 10 Equation 1: 

### DDDD = QQ vvvv 

### × DDDDDDDD

QQ vvvv 

### + QQ pppppppppppp aa 

### + QQ pppppppppppppppppp aa

Equation 2: 

### NNNNNN dd dd 

### = NNNNNN vvvv 

### × DDDD

where:

DF = Dilution factor, feet (ft).

Q vg = Volumetric flow rate of the flare vent gas, scfm.

Q premix air = Cumulative volumetric flow of premix assist air, scfm ( Premix assist air means the portion of assist air that is introduced to the flare vent gas, whether injected or induced, prior to th e flare tip )

Q perimeter air = Cumulative volumetric flow of perimeter assist air, scfm. ( Perimeter assist air means the portion of assist air introduced at the perimeter of the flare tip or above the flare tip. Perimeter assist air

includes all assist a ir except premix assist air. )

Diam = Diameter of the flare vent gas release stack, ft.

NHV vg = Net heating value of flare vent gas, B TU /scf.

NHV dil = Net heating value air assist dilution parameter

, BTU/ft 2

.

5. The Permittee shall also perform any necessary operations to minimize

emissions so that emissions are at or below the emi ssion limits specified in

this P ermit.

E. Monitoring

, Testing , and Emissions Calculations

1. The Permittee shall use the following requirements to determine compliance with the emission limitations in Condition IX. C .1 for the Main

Flare.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 11 The Permittee shall measure and record the H 2 S concentration in the field gas at the Facility in each calendar mon th at the inlet to the Facility’ s former gas processing plant where the Main Flare is located.

The Permittee shall measure and record the volume of gas combusted

in the Main Flare in scfm when the flare is in use

.

Each and every calendar day, the Permittee shall calculate and record the daily emissions from the Main Flare based on the last recorded

measurement of H 2 S concentration in the field gas at the Facility and that day’s recorded volume of gas combusted in the Main Flare.

Each and every calendar day, t he Permittee shall calc ulate the 365

- day rolling total of emissions of SO 2 , NO
x , CO

, and VOC for the Main

Flare , using best available data and good engineering practices

. Each

365

- day rolling total s hall be calculated using data from the previous 365 days

. The Permittee shall maintain all records of actual operating

data and calculations.

If the Permittee is unable to measure the volume of gas combusted in the Main Flare on any day, the volume of gas for that day shall be deemed to be equal to the daily average volume of ga s combusted in the Main Flare based on the previous 12 months’ emissions data. However, the use of this daily average as substitute data neither relieves nor excuses the Permittee from complying with the sampling, data collection, and monitoring requireme nts.

2. Determination of Net Heating Value Air Assist Dilution Parameter

Flare vent gas and air assist flowrate monitoring

(1) The Permittee shall use one or more of the following m ethod s

to monitor flare v ent gas flowrate or comply with Condition IX.E.2.(a)(3) of this PSD Permit . In addition, the Permittee

shall us e a monitoring system capable of correcting any such measured flow rates to standard conditions, as specified in Condition IX.E.2.(a)(4).

C ontinuously m onitor and record the volume of g as combusted in the Main Flare in scfm per Condition IX.E.1.(b) of this PSD Permit ; orMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 12 Install, operat e , and maintain a m ass flow monitor and

determin e volumetric flow rate of flare vent gas using

E quation 3 below to convert mas s flow rates to volumetric

flow rate. For the flare vent gas, molecular weight must be determined using compositional analysis

.

Equation 3 : 

### QQ
vvvv 

### = QQ
mmmm 

### × 385

. 3

MMMMMM

Where: Q vol = Volumetric flow rate, standard cubic feet per second. Q
mass = Mass flow rate, pounds per second. 385.3 = Conversion factor, standard cubic feet per pound

mole. MWt = Molecular weight of the gas at the flow monitoring location, pounds per pound

- mole.

(2) T he Permittee shall use one or more of the following methods

to m onitor assist air flowrate or comply with Condition IX.E.2.(a)(3) of this PSD Permit . In addition, the Permittee

shall us e a monitoring system capable of correcting any such measured flow rates to standard conditions, as specified in Condition IX.E.2.(a) (4).

Monitor the fan speed or power, and use fan curves and appropriate engineering calculations to determine assist air flow rates; or

I nstall, operate, calibrate, and maintain a monitoring system capable of continuously measuring, calculating, and

reco rding the volumetric flow rate of assist air used with

the flare. If pre mix assist air and perimeter assist air are both used, install, operate, calibrate, and maintain a monitoring system capable of separately measuring, calculating, and recording the vo lumetric flow rate of premix assist air and perimeter assist air used with the flare;

orMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 13 Install, operat e
, calibrate, and maintain a m ass flow

monitor and determin e the volumetric flow rate of assist air using E quation 3 above to convert mass flow rates to
volumetric flow rate (u s e a molecular weight of 29 pounds per pound

- mole for assist air ).

(3) Continuous pressure/temperature monitoring system(s) (i.e., at least once every 15

- minutes) and appropriate engineering calculations may be used in lieu of a volu metric flow monitoring systems provided the molecular weight of the gas is

known. For assist air, use a molecular weight of 29 pounds per pound

- mole. For flare vent gas, molecular weight must be determined using compositional analysis per Condition

IX.E. 2.(b) of this PSD Permit.

(4) The flow rate monitoring systems must be able to correct for the temperature and pressure of the system and output parameters in standard conditions (i .e., a temperature of 20°C (68°F) and a pressure of 1 atmosphere).

The Permit tee shall use one or more of the following methods to

monitor the net heating value of the flare vent gas.

(1) Each month, measure and record the concentration of individual components in the flare vent gas at the Facility in each calendar month at the inlet to the Facility’s former gas processing plant where the Main Flare is located and use this

information to calculate NHV vg using Equation 4 in Condition IX.E.2.(c) of this PSD permit; or

(2) Each month, measu re and record with a calorimeter the net heating value of the flare vent gas at standard conditions at the Facility in each calendar month at the inlet to the Facility’s former gas processing plant where the Main Flare is located ; or

(3) The owner or operator may elect to use a different monitoring

method , determined on a monthly basis, for the vent gas provided the composition or NHV vg are determined consistent with good engineering practices

.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 14 Each month

, t he Permittee shall determine the net heating value o f the flare vent gas (NHV vg ) based on compositional analysis performed per Condition IX.E.2.(b) (1) of this PSD Permit usin g Equation 4 below, by direct measurement of the net heating value of the flare vent gas at standard conditions as specified in Condit ion IX.E.2.(b)(2) of this PSD

Permit

, or as allowed by Condition IX.E.2.(b)(3) of this PSD Permit

.

Equation 4 : 

### NNNNNN vvvv 

### = �

xx nn

= 1 

### NNNNNN

Where:

NHV vg = Net heating value of flare vent gas, BTU/scf.

i = Individual component in flare vent gas.

n = Number of components in flare vent gas.

x i = Concentration of component i in flare vent gas, volume fraction.

NHV i = Net heating value of component i a ccording to T able 1

below , Btu/scf. If the component is not specified in Table

1 below , the heats of c ombustion may be determined using any published values where the net enthalpy per mole of offgas is based on combustion at 25°C and 1 atmosphere (or constant pressure) with offgas water in the gaseous state, but the standard temperature for determining the volume corresponding to one mole of vent gas is 20°C.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 15 Table 1

— Individual Component Properties

Component Molecular

Formula MW i ( pounds per pound

- mol e ) NHV i ( British thermal units

per standard cubic foot ) Acetylene C 2 H 2 26.04 1,404

Benzene C 6 H 6 78.11 3,591
1,2

- Butadiene C 4 H 6 54.09 2,794
1,3

- Butadiene C 4 H 6 54.09 2,690

iso

- Butane C 4 H 10 58.12 2,957

n

- Butane C 4 H 10 58.12 2,968

cis

- Butene C 4 H 8 56.11 2,830

iso

- Butene C 4 H 8 56.11 2,928

trans

- Butene C 4 H 8 56.11 2,826

Carbon Dioxide CO 2 44.01 0

Carbon Monoxide CO 28.01 316 Cyclopropane C 3 H 6 42.08 2,185

Ethane C 2 H 6 30.07 1,595 Ethylene C 2 H 4 28.05 1,477 Hydrogen H 2 2.02 274 Hydrogen Sulfide H 2 S 34.08 587

Methane CH 4 16.04 896 Methyl

- Acetylene C 3 H 4 40.06 2,088 Nitrogen N 2 28.01 0 Oxygen O 2 32.00 0
Pentane+ (C5+) C 5 H 12 72.15 3,655 Propadiene C 3 H 4 40.06 2,066 Propane C 3 H 8 44.10 2,281 Propylene C 3 H 6 42.08 2,150

Water H 2 O 18.02 0

Each and every calendar day, t he Permittee shall determine the net heating value air assist dilution parameter ( NHV dil ) based on the f lare

vent gas flowrates per Condition IX.E.2(a)(1)

, air assist flowrate s per Condition IX.E.2(a)(2)

, and NHV vg per Condition IX.E.2 (b) and (c) of this PSD Permit, and using the equations in Condition IX.D.4 of this

PSD Permit

.

3. The Perm ittee shall continuously monitor the Main Flare for the presence of a flare pilot flame using a device (including, but not limited to, a thermocouple, ultraviolet beam sensor, or infrared sensor) capable ofMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 16 detecting that the pilot flame is present . The M ain Flare shall be equipped with an alarm that informs Facility operators of any period when a pilot flame is not present in the flare and no gas shall be sent to the flare until a pilot flame is restored.

4. The Permittee shall operate the Main Flare with no visible emissions, except for periods not to exceed a total of 5 minutes during any 2 consecutive hours. EPA Test Method 22 in Appendix A of 40 CFR Part 60 shall be used to determine the compliance of fla res with the visible emission provisions. The observation period is 2 hours and shall be used according to Method 22. The Permittee shall perform monthly visible emissions tests during a flaring event using Method 22.

5. If applicable, t he Permittee shall follow the calibration and quality control requirements below for any corresponding continuous parameter measurement systems (CPMS) if used at the Facility to comply with the requirements in Condition IX.D or IX.E of this PSD Permit.

For flare vent gas v olumetric flowrates , the following requirements apply:

Minimum accuracy requirements Calibration requirements

±20 percent of flow rate at velocities ranging from 0.03 to 0.3 meters per second (0.1 to 1 feet per second) ±5 percent of flow rate at velociti es greater than 0.3 meters per second (1 feet per second) Conduct a flow sensor calibration check at least biennially (every two years); conduct a calibration check following any period of more than 24 hours throughout which the flow rate exceeded the manufacturer's specified maximum rated flow rate or install a new flow sensor.

At least quarterly, inspect all components for leakage, unless the

CPMS has a redundant flow sensor.

Record the results of each calibration check and inspection.

Locate the flow sensor(s) and other necessary equipment (such as straightening vanes) in a position that provides representative flow; reduce swirling flow or abnormal velocity distributions due to upstream and downstream disturbances.

For f low rate and all flows o ther than the flare vent gas, the following requirements apply:

Minimum accuracy requirements Calibration requirements

±5 percent over the normal range of flow measured or 1.9 liters per minute Conduct a flow sensor calibration check at least biennially (every two years); conduct a calibration check following any period of more thanMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 17 (0.5 gallons per minute), whichever is greater, for liquid flow 24 hours throughout which the flow rate exceeded the manufacturer's specified maximum rated flow rate or insta ll a new flow sensor.

±5 percent over the normal range of flow measured or 280 liters per minute (10 cubic feet per minute), whichever is greater, for gas flow At least quarterly, inspect all components for leakage, unless the

CPMS has a redundant flow se nsor.

±5 percent over the normal range

measured for mass flow Record the results of each calibration check and inspection

.

Locate the flow sensor(s) and other necessary equipment (such as straightening vanes) in a position that provides representative flow; reduce swirling flow or abnormal velocity distributions due to upstream and downstream disturbances.

For net heating v alue determinations by c alorimeter , the following requirements apply:

Minimum accuracy requirements Calibration requirements

±2 percent of span Specify calibration requirements in your site specific CPMS monitoring plan. Calibration requirements should follow

manufacturer's recommendations at a minimum.

Temperature control (heated and/or cooled as necessary) the sampling

system t o ensure proper year

- round operation.

Where feasible, select a sampling location at least two equivalent diameters downstream from and 0.5 equivalent diameters upstream from the nearest disturbance. Select the sampling location at least two equivalent duct diameters from the nearest control device, point of pollutant generation, air in

- leakages, or other point at which a change in the pollutant concentration or emission rate occurs.

For net heating value determinations by g as c hromatograph , the following requirements apply:

Minimum accuracy requirements Calibration requirements

As specified in Performance Specification 9 of 40 CFR part 60, appendix B Follow the procedure in Performance Specification 9 of 40 CFR part 60, appendix B, except that a single weekly mid

- level calibration check can be used (rather than triplicate analysis), the multi

- point calibration can be conducted quarterly (rather than monthly), and the sampling line temperature must be maintained at a minimum temperature of 60 °C (rather than 120 °C).McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 18 T he following requirements apply for temperature monitoring systems :

Minimum accuracy requirements Calibration requirements

±1 percent over the normal range of temperature measured, expressed in degrees Celsius (C), or 2.8 degrees C, whichever is greater Conduct calibration checks at least annually; conduct calibration checks following any period of more than 24 hours throughout which the temperature exceeded the manufacturer's specified maximum rated temperature or install a new temperature sensor.

At least quarterly, inspect all components for integrity and all electrical connections for continuity, oxidation, and galvanic

cor rosion, unless the CPMS has a redundant temperature sensor.

Record the results of each calibration check and inspection.

Locate the temperature sensor in a position that provides a representative temperature; shield the temperature sensor system from electromagnetic interference and chemical contaminants.

T he following requirements apply for pressure monitoring systems :

Minimum accuracy requirements Calibration requirements

±5 percent over the normal operating range or 0.12 kilopascals (0.5 inches of water column), whichever is greater Review pressure sensor readings at least once a week for straightline (unchanging) pressure and perform corrective action to ensure proper pressure sensor operation if blockage is indicated.

Using an instrument re commended by the sensor's manufacturer, check gauge calibration and transducer calibration annually; conduct calibration checks following any period of more than 24 hours throughout which the pressure exceeded the manufacturer's specified maximum rated pre ssure or install a new pressure sensor.

At least quarterly, inspect all components for integrity, all electrical connections for continuity, and all mechanical connections for leakage, unless the CPMS has a redundant pressure sensor.

Record the results of each calibration check and inspection.

Locate the pressure sensor(s) in a position that provides a representative measurement of the pressure and minimizes or eliminates pulsating pressure, vibration, and internal and external

corrosion.

F. Operation and Maintenance of Main Flare and Compressors

1. The Permittee shall at all times and to the extent practicable, including during periods of startup, shutdown, m alfunction, CO 2 B reakthrough,McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 19 S cheduled M aintenance, or unscheduled maintenance of the Facility’s compressors, operate and maintain the compressor station equipment and Main Flare in a manner consistent with good air pollution control practices for minimizing emissions.

2. The Permittee shall compl y with the provisions of the Operations and

Maintenance Plan in Appendix A of this PSD Permit

. The Permittee ’ s failure to comply with any requirement of the Operations and Maintenance

Plan shall constitute a violation.

3. The Permittee shall follow the procedures for the inspection of the Facility ’ s compressors and associated equipment as set forth in the Life Cycle Maintenance Plan of the Operations and Maintenance Plan in Appendix A of this PSD Permit , and shall maintain inspection logs at the Facility documenting that these inspections have been conducted.

4. The Permittee shall maintain daily records at the Facility regarding operation of the Facility ’ s compressors on a Daily Plant Reading Form in the Operations and Maintenance Plan in Appendix A of t his PSD Permit

.

5. The Permittee shall maintain a supply of designated spare parts for the Facility’s compressors and associated equipment that includes all of the equipment on the Spare Parts List in the Operations and Maintenance Plan in Appendix A of this PSD Permit.

6. After using equipment on its Spare Parts List, the Permittee shall replace such equipment as expeditiously as possible. The Permittee shall place a purchase order for such equipment within 45 days after it is used.

7. The Permittee shall co nduct training of Facility operators in accordance with the Training Program for Plant Operators in Section 5 of the Operations and Maintenance Plan in Appendix A of this PSD Permit. The Permittee shall maintain records documenting that the training has b een conducted.

8. The Permittee shall retain copies of inspection logs and other records required by S ection IX. F (Operations and Maintenance of Main Flare and Compressors) of this PSD Permit

.

9. The Permittee shall maintain inspection, maintenance and rep air log(s) or

other similar records and identify any occasion when the Permittee wasMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 20 unable to carry out its established maintenance procedures, with explanation.

10. The Operations and Maintenance Plan in Appendix A of this PSD Permit

shall be updated period ically to account for changes in the operation of the

Main F lare, but the plan need be resubmitted to the EPA only if the owner or operator adds new equipment or removes existing equipment listed in

th is PSD P ermit. If such revision is needed, Resolute shall request a permit amendment (Attn: AIR

- 3) . The owner or operator must comply with the updated plan as submitted.

G. Flare Minimization for the Main Flare

1. Flare Minimization Plan

The Permittee shall d evelop and implement a written Flare

Minimization P lan (FMP) for the Main Flare that contains information about the operation of the flare to minimize Flaring Incidents

. At minimum, t he FMP must include all of the following information:

(1) A listing of all process units and ancillar y equipment connected

to the flare.

Flare design parameters including:

(A) A general description of the flare, including whether it is a ground flare or elevated (including height); (B) Information regarding design capacity; (C) General description of flare tip (date installed, manufacturer, nominal and effective tip diameter, tip drawing); (D) A description of the assist system and an indication of whether the fan/blower is single speed

, multi

- fixed speed (e.g., high, medium, and low speeds)

, or variable speeds; and (E) The flame detection system and pilot ignition system.

(2) Detailed description of the manufacturer’s specifications, including, but not limited to, make, model, type, range, precision, accuracy, calibration, maintenance and quality assurance procedures.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 21 (3) A simple process flow diagram of the flare system illustrating all connections to the flare including all pipelines, process units, compressors and other ancillary equipment that vent to

the flare.

(4) A description of the locations of all associated monitoring and

o f the methods for monitoring flow rate to the flare (including a detailed description of the manufacturer’s specifications for each flow monitoring system including but not limited to make, model, type, range, precision, accuracy, calibration, maintenance, and quality assurance procedures for flare gas monitoring devices).

(5) A description of the data recording, collection and management for the flare monitoring system.

(6) An assessment of whether discharges to the flare from these process units and ancillary e quipment can be minimized or prevented during periods of upsets, malfunctions, or emergency releases.

(7) A description of the method to alert personnel designated to collect samples that a F lare I ncident has started.

The Permittee shall d evelop and implement a written FMP no later than three ( 3 ) years after the final PSD permit amendment becomes effective pursuant to 40 CFR 124.15(b).

The FMP shall be updated periodically to account for changes in the operation of the Main F lare, such as new connect ions to the Main

F lare, at least once every five (5) years since the previous update of the plan . The owner or operator need not resubmit the plan to the EPA

unless the owner or operator alters the design capacity of the Main

F lare. The owner or operator must comply with the updated plan as

submitted.

2. Root Cause Analysis

For a Flaring Incident caused by Scheduled Maintenance or a CO 2 Breakthrough, the Permittee shall submit a report to the EPA, at the

address in Condition X. C of this PSD Permit, no lat er than sixty (60) days following the end of such a Flaring Incident that sets forth theMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 22 following information listed below. Except for those Flaring Incidents caused by Scheduled Maintenance or a CO 2 Breakthrough, the

Permittee shall conduct a Root Cause Analysis in accordance with the Root Cause Failure Analysis Program in Appendix B of this PSD

Permit to evaluate the cause of each Flaring Incident and shall submit

a report to the EPA, at the address in Condition X. C of this PSD Permit, no later than sixty (60) days following the end of a Flaring Incident, that sets forth all of the following:

(1) The date and time that the Flaring Incident started and ended. To the extent that the Flaring Incident involved multiple

releases either within a 24

- hour period or within subsequent, contiguous, non

- overlapping 24

- hour periods, the Permittee shall set forth the starting and ending dates and times of each release;

(2) An estimate of the quantity of SO 2 that was emitted and the

calculations that were used to determine that quantity;

(3) The steps, if any, that the Permittee took to limit the duration and/or quantity of SO 2 emissions associated with the Flaring Incident;

(4) Except for those Flaring Incidents caused by Scheduled

Maintenance or a CO 2 Breakthro ugh, a detailed analysis that sets forth the Root Cause and all contributing causes of that Flaring Incident, to the extent determinable; however, if a Flaring Incident is caused by Scheduled Maintenance or CO 2 Breakthrough, then the Permittee need only id entify the Root

Cause as Scheduled Maintenance or CO 2 Breakthrough (whichever is applicable), and either (i) describe the nature of the work done for Scheduled Maintenance or (ii) identify the specific wells that most likely experienced the CO 2 Breakthroug h;

(5) An analysis of the measures, including possible design, operational, and maintenance changes, that are available to reduce the likelihood of a recurrence of a Flaring Incident resulting from the same Root Cause or contributing causes in

the future. If the Permittee concludes that corrective action(s) is (are) required under Section IX. G.3 (Corrective Action) of

this PSD Permit , the report shall include a description of theMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 23 action(s) and, if not already completed, a schedule for its (their) implementati on, including proposed commencement and completion dates. If the Permittee concludes that corrective action is not required under Section IX. G.3 (Corrective Action) of this PSD Permit, the report shall explain the basis for that conclusion;

(6) To the extent that investigations of the causes and/or possible corrective actions still are under way on the due date of the report, a statement of the anticipated date by which a follow

- up report fully conforming to the requirements of Conditions

IX.G.2. (a)(4) and (5 ) of this PSD Permit will be submitted

. Nothing in this Permit Condition shall be deemed to excuse the Permittee from its investigation, notification, reporting, and corrective action obligat ions in this PSD Permit for any Flaring

Incident that occurs aft er the Flaring Incident for which the Permittee has requested an extension of time under this Permit

Condition

.

(7) To the extent that completion of the implementation of corrective action(s), if any, is not finalized at the time of the

submission of the report required under this Permit Condition

, then, by no later than thirty (30) days after completion of the implementation of corrective action(s), the Permittee shall submit a report identifying the corrective action(s) taken and

the dates of commencemen t and completion of implementation.

The Root Cause Failure Analysis Program in Appendix B of this PSD

Permit shall be updated periodically to account for changes in the operation of the Main F lare, but the plan need be resubmitted to the EPA only if the owner or operator adds new equipment or removes existing equipment listed in the permit. If such revision is needed,

Resolute shall request a permit amendment (Attn: AIR

- 3) . The owner or operator must comply with the updated Root Cause Fa ilure Analysis Program as submitted.

No later than 72 hours after an event first qualifies as a Flaring Incident, the Permittee shall notify by electronic mail , at AEO_R9@epa.gov , the Manager of the Air/TRI Enforcement Office,

Enforcement Division

, EPA Re gion 9 , of such Flaring Incident

. Telephone notification shall be followed by a detailed written

notification to the EPA, at the address in Condition X.C of this PSDMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 24 Permit, made within seven (7) working days after the event first qualifies as a Flaring I ncident.

3. Corrective Action

In response to any Flaring Incident, the Permittee shall take, as expeditiously as practicable, such interim and/or long

- term corrective actions, if any, as are consistent with good engineering practice to

minimize the likel ihood of a recurrence of the Root Cause and all contributing causes of that Flaring Incident.

H. Compliance Reporting

1. Within thirty (30) days following the end of each calendar semiannual period (i.e., January 1 to June 30, and July 1 to December 31), the

Permittee shall submit to the EPA a semiannual report.

2. All semiannual reports shall be signed and affirmed by a respo nsible official, and bearing the certification statement as follows:

“I certify under penalty of law that I have examined and am familiar with

the information submitted in this document and all attachments and that this document and its attachments were p repared either by me personally or under my direction or supervision in a manner designed to ensure that qualified and knowledgeable personnel properly gathered and presented the information contained therein. I further certify, based on my personal

knowl edge or on my inquiry of those individuals immediately responsible for obtaining the information, that the information is true, accurate, and complete. I am aware that there are significant penalties for submitting false information, including the possibi lity of fines and imprisonment for knowing and willful submission of a materially false statement.”

3. All semiannual reports shall include the following information:

A list of the rolling 365

- day cumulative Main Flare E missions for each day in that semiann ual period ;

A list of the NHV dil in BTU/ft 2 determined for each day in that semiannual period.McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 25 A list of each day in the semiannual period when the emissions limits that apply to the Main Flare were exceeded and, for each such day, the limit(s) exceeded and the amount(s) of excess emissions;

A list of all emissions for the semiannual period that the Permittee

claims are attributable to Malf unctions;

A list of all emissions for the semiannual period that may be

attributable to CO 2 Breakthroughs, Scheduled Maintenance, or unscheduled maintenance of the Facility ’ s compressors;

The date(s) and time(s) during the semiannual period when the

th ermocouple or flow meter associated with the Main Flare was inoperative;

The date(s) and time(s) during the semiannual period when the

Permittee failed to measure or record the H 2 S concentration in the field gas at the Facility or failed to continuously measure or record the volume of gas combusted in the Main Flare;

A certification that during the semiannual period the Permittee operated and maintained the compressor station equ ipment and Main Flare in a manner consistent with good air pollution control practices for minimizing emissions, and performed all of the obligations (including, but not limited to, inspection and training obligations)

contained in the Operations and Maint enance Plan in Appendix A of

this PSD Permit ;

A certification that the Field Flares have not been used to circumvent the emission limits that apply to the Main Flare;

A list of total emissions from the Field Flares and the reason for Flaring ; and

Any and all reports generated from the FMP, and root cause analysis and corrective action program of Condition IX. G of this PSD Permit

.

I. Recordkeeping RequirementsMcElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 26 1. The Permittee shall maintain a file of all records, data, measurements, reports, and documents related to operation of the Facility. All records

shall be in a permanent form suitable for inspection.

2. The Permittee shall retain the following records at the facility for a period

of at least five (5) years from the date of monitoring, sampling,

measu rement, or reporting. All applicable records shall be maintained at the nearest manned facility and shall be readily accessible.

Each 365

- day rolling total for SO 2 , NO
x , CO

, and VOC emissions ;

Daily calculations of NHV dil in BTU/ft 2 , and the methods used to

determine NHV dil in Condition IX.E.2 of this PSD Permit.

Emissions calculations of SO 2 , NO
x , CO

, and VOC for the Main Flare

, which shall include the e mission factors , operating data and other supporting documentation that the Per mittee use d to calculate emissions of each pollutant ;

Monthly H 2 S concentration in the field gas at the Facility;

Daily total volume of gas combusted in the Main Flare;

Gas throughput;

Records of gas analyses and testing;

Records of flare design for the Main Flare in accordance with 40 CFR 60.18 (including whether the flare is steam

- assisted, air

- assisted, or

non

- assisted);

Semiannual reports required in Section IX. H (Compliance Reporting),

of this PSD Permit ;

A written log of the monthly inspectio ns of the Main Flare containing the following information for ea ch inspection: (i) the date and time of the inspection, and the name of the observer; (ii) a description of any corrective actions taken and repairs made; and (iii) the date(s) of

corrective a ctions and repairs;

Visible emission readings, heat content determinations, flowrate measurements, and exit velocity determinations made ;McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 27 Pe riods when the pilot flame is absent or spark igniter(s) is inoperable ;

A ny and al l reports generated from the root cause analysis and corrective action program, which shall include the following :

(1) Date, time and duration of flaring ;

(2) Description of the event, including the flare(s) involved in the event and a discussion of the cause(s) and probable cause(s) of

the event ;

(3) Confirmation that the flare(s) functioned properly, i.e., a flame was present and any visible emissions that occurred were in compliance with 40 CFR 60.18(f)(1) ;

(4) Corrective actions taken during the event ; and

(5) A description of any actions taken t o prevent or reduce the

likelihood of similar future occurrences.

I nspection, maintenance and repair log(s) o r other similar records ; and

Any other records and reports required by this PSD permit.

X. AGENCY NOTIFICATION

A. Permit Applications & Permit

- Related Requests

The owner or operator shall submit permit applications, permit amendments, and other applicable permit information, which includes but not limited to installation of control equipment, replacement of an emissions unit, and changes that contravene permit terms, to:

D irector, Air Division (Attn: AIR

- 3) U. S. Environmental Protection Agency Region 9

75 Hawthorne Street San Francisco, CA 94105McElmo Creek Unit Oil Production Facility

PSD Permit No. NU 05

- 01 September 30, 2016 28 B. Submittals to Navajo Nation Environmental Protection Agency

The owner or operator shall submit copies of a ll correspondence required by this

PSD Permit to:

Navajo Nation Environmental Protection Agency Air Quality Control Program and Operating Permits Program

P

. O

. Box 529 Fort Defiance, AZ 86504

C. Compliance Reporting

Unless otherwise direc ted by the EPA or this PSD P ermit, the owner or operator shall submit a copy of all test plans, reports, certifications, notifications, and other information pertaining to compliance with this PSD Permit to the following

address. All notices and submissio ns shall be sent by certified mail, express mail, or similar overnight mail delivery with return receipt requested and addressed to :

Director, Enforcement Division (Attn: ENF

- 2

- 1) U.S. Environmental Protection Agency, Region 9

75 Hawthorne Street San Francisco, California 94105

All notices and submission made in accordance to Condition X.C shall be deemed submitted on the date postmarked. All notices and submission s made in

accordance to Condition X. C shall be signed and affirmed by a responsibl e official, and bearing the certification statement as follows:

“I certify under penalty of law that I have examined and am familiar with the

information submitted in this document and all attachments and that this

document and its attachments were prepared either by me personally or under my direction or supervision in a manner designed to ensure that qualified and knowledgeable personnel properly gathered and presented the information contained therein. I further certify, based on my personal know ledge or on my inquiry of those individuals immediately responsible for obtaining the information, that the information is true, accurate, and complete. I am aware that there are significant penalties for submitting false information, including the possib ility of fines and imprisonment for knowing and willful submission of a materially false statement.”