UNITED STATES ENVIRONMENTAL PROTECTION AGENCY AIR, PESTICIDES & TOXICS MANAGEMENT DIVISION

61 Forsyth St., S. W. Atlanta, Georgia 30303

FACT SHEET

– July 9 , 2014

ACTION: Preliminary Determination and Draft Outer Continental Shelf (OCS) Air

Permit

, OCS

- EPA

- R40 12

- M1 , for Statoil Gulf Services

, LLC ( Statoil )

, DeSoto Canyon Drilling Exploration Project

Public Notice & July 9 , 201 4 : Publication in the Panama City News

Comment Period: Herald, Mobile Press Register, Pensacola News Journal, Florida

Administrative Code and Register, emails to the OCS public notice list, www.regulations.gov , and the EPA Region 4’s website at: http://www.epa.gov/region4/air/permits/ocspermits/ocspermits.html

.

August 8 , 201 4 : Close of Public Comment Period

. If a public hearing is held, the public comment period will automatically be extended to the close of the public hearing.

Public H earing : If there is a significant degree of public interest, a hearing will be held August 14 , 2014 , from 5:3 0 pm

– 7: 00 pm at:

Bay County Public Library

898 W 11th St Panama City, FL 32401 (850) 522

- 2119

.

If a public hearing is held, EPA staff will be available prior to the hearing,

from 4:00

- 5:30 pm to answer questions and provide additional information on this proposed action during an informal public information session.

Project: Statoil has applied for a modification of permit No. OCS

- EPA

- R4012

, which

was issued by EPA Region 4 on October 28, 20 13 pursuant to section 328 of the Clean Air Act (CAA). The permit regulates air pollutant emissions from a proposed exploratory drilling operation within the eastern Gulf of Mexico of the OCS. The project , which has not yet begun operations under the existing permit

, will include mobilization and operation of one of two deep water drilling vessels, the Maersk Developer or the Transocean Discoverer

Americas

, and associated crew and support vessels . Drilling operations may occur for up to180 d ays per year for a period of five to ten years. The proposed project is for exploratory drilling only and does not include the establishment of any permanent production platforms.

Proposed Changes : Statoil has requested that the permit be amended to incl ude best available control technology (BACT) limits for particulate matter with an aerodynamic diameter less than or equal to 2.5 microns (PM 2.5 ), particulate matter with an aerodynamic diameter less than or equal to 10 microns (PM 10 ) and volatile organic compounds (VOC) as well as revised BACT limits for nitrogen oxides (NO X ) for engines on the Maersk Developer drilling vessel based on recent
source test data for these pollutants that was not available at the time ofpermitting

. The respective control technology determinations for NO X emissions from these engines are not being revised. H owever, determinations for control technologies related to VOC and particulate emissions (PM) are added to the permit

.

Statoil is also requesting that the permit be modified to include additional lease

blocks in the same eastern Gulf of Mexico area, which meet location criteria detailed in the draft permit and preliminary determination. Proposed l anguage has been added to the permit to allow this flexibility for the Developer drilling

vessel . Written notification to the EPA of all drilling locations prior to the commencement of operations remains a condition of the modified permit.

The requested permit modification does not constitute a change in the emission

units or in operation of the source, nor does it waive any applicable air quality standards or requirements . While Statoil has made preparations to drill, including source testing, Statoil has not yet begun drilling operations on th e lease blocks covered by the permit. This action is a proposed modification to

include BACT limits for PM 2.5 , PM 10

, and VOCs and revise BACT limits for

NO X for engines on the Developer to reflect data that is more representative of actual drilling operati ons , and to allow the Developer’s operations to be conducted in additional lease blocks subject to specific criteria . Permit

conditions unrelated to the Developer’s updated BACT limits and operating

location have not been modified in th is draft permit except where necessary for clarification or to correct typographic errors.

Public comments are being accepted for these proposed changes only.

The EPA has completed review of Statoil’s application to modify the existing permit in addition to all supplemental materials provided and is proposing to

issue Permit Number OCS

- EPA

- R4012

- M1 to Statoil for a multi

- year exploratory drilling program subject to the terms and conditions described in the draft permit. This project is considered a major s ource under the applicable Prevention of Significant Deterioration (PSD) regulations 40 CFR part 52.21 and is subject to the title V program at 40 CFR part 71. The permit incorporates applicable requirements from the federal PSD and title V operating permi t programs, New Source Performance Standards (NSPS), and National Emission Standards for Hazardous Air Pollutants (NESHAP) as required by the OCS air quality regulations in 40 CFR part 55.

Project Location: The Transocean Discoverer Americas will operate i n the DeSoto Canyon area lease blocks 143, 187, 188, 230, 231, 625, 669, 670, 671, 715, 716, 759, 760,

and 804. The Maersk Developer will operate in the same DeSoto Canyon area or in any eastern Gulf of Mexico area located further from the Breton

Wildernes s Class I area, east of longitude 87.5, west of the Military Mission Line (86°41’ west longitude), outside of the current Congressional moratoria area as specified by the Gulf of Mexico Energy Security Act of 2006, and not

within 75 nautical miles of the s tate seaward boundary of Florida. These lease blocks are located in OCS waters of the Gulf of Mexico east of longitude 87.5°, approximately 160 miles southeast of the mouth of the Mississippi River and 200 miles southwest of Panama City, Florida

. The north west corner of lease block 143, the closest point within the project area to any state’sshoreline, is located on OCS waters of the Gulf of Mexico east of longitude 87.5 o W at latitude 28.85o N and longitude 86.42 o W

. It is located beyond the

area restricted by the Gulf of Mexico Energy Security Act Morat oria, which

extends approximately 100

- 125 miles off the coast of Florida

.

Authority: EPA Region 4 is the agency responsible for implementing and enforcing CAA requirements for OCS sou rces in the Gu lf of Mexico east of longitude 87.5° W.

The Department of Interior , Bureau of Ocean Energy Management, is the lead

a gency for leasing and drilling approvals, as well as implementation of the

Clean Air Act west of 87.5 ° longitude

.

Emissions: The following table lists the PTE for each regulated NSR pollutant from the Developer for which Statoil is seeking a new or revised BACT limit based on October 2013 source testing of the eight main generator engines , as well as the significant emission rate for these po llutant s

.

Potential to Emit for Regulated NSR Pollutants Based on Source Testing

1 NO X and VOC are the measured precurs ors for the criteria pollutant o zone. NO X & SO 2 are precursors for PM 2.5

.

A full air quality impact analysis was performed for th e revised operation. A summary of the results of the air quality impact analysis is available in the preliminary determination (see additional information below).

Control Technology: Sta toil is required to apply BACT for emissions of

NO X , VOC, PM 10 , and PM 2.5 while using the Developer to conduct activities under this permit

. BACT for this project will include the use of engines with intake air cooling and turbo chargers, open crankshaft ventilation systems, good combustion and power management practices, and enhanced engine performance management and maintenance on the drilling vessels’ diesel engines. BACT for this project includes, among other things, the use of ultra

lo w sulfur diesel fuel to limit sulfur dioxide and particulate emissions

.

Additional Information: The draft permit and preliminary determination /statement of basis document s that explain the revised permit conditions are available on EPA Region 4’s

website at : http://www.epa.gov/region4/air/permits/ocspermits/ocspermits.html

EPA Contact: For questions regarding the draft permit and public hearing, contact:

Lori Shepherd

Air Permits Section Air, Pesticides and Toxics Management Division U.S. EPA Region 4 Pollutant Scenario 1

( Developer ) Tons per Year Significant Emission

Rate Tons per Year PSD Review

Required

NO X 1 554.05 40 Yes

VOC 1 75.65 40 Yes

PM 10 17.47 15 Yes

PM 2.5 16.03 10 Yes61 Forsyth Street, SW Atlanta, GA 30303 (404) 562

- 8435

Email: shepherd.lorinda@epa.gov

C omments on the draft permit an d requests for a public hearing should be addressed to :

U.S. EPA Region 4 Air Permits Section, APTMD 61 Forsyth Street, SW Atlanta, GA 30303 Attn: Rosa Yarbrough

Email: R4OCSpermits@epa.gov