# Resolute

Patrick E. Flynn Vice President, Governmental & Corporate Affairs 303.534.4600 x 1145 pflynn@rnrc.net

VIA CERTIFIED MAILAND EMAIL 

### ~PR 2 ~ April19, 2011 nce Peifl~ ~ ~g~ofl 9 Mr. Andrew Chew, Air Division AIR-3 U.S. Environmental Protection Agency 75 Hawthorne Street San Francisco, CA 94105 Re: Subpt. HR Applicability

- Replacement ofDehydration Unit at MCU Facility

Dear Mr. Chew: As you are aware, Resolute Natural Resources Company (“Resolute”) is planning to replace the current dehydrator atthe McElmo Creek Unit oil production facility (“MCU”), located on Navajo Nation land in San Juan County, Utah, with a new, higher capacity, and more efficienttriethylene glycol (TEG) dehydrator. Based on pastcomments made byyou and Mr. Mintz, Resolute understands EPA’s position to bethatthe replacement dehydratorcan be added to the facility priorto issuance byyouroffice ofpending PSD and Operating permits, and without prior approval ofEPA, providedthat (1) the new dehydrator’s potential to emit (“PTE”) will be limited by40 C.F.R. Part 63, subpart RH; (2) the newdehydratorwill replacethe existing dehydrator atthe MCU and will have a lower PTE; (3) emissions from the new dehydratorwill not be routed to the Main Flare and will not cause an exceedance ofthe Consent Decree’s Main Flare emission limits; (4) greenhouse gas (GHG) emissions from the newdehydratorwill not exceed the GHG Tailoring Rule’s significance thresholds; and (5) the 1991 PSD permit limits and PSD significance thresholds will also not be exceeded by replacement ofthe dehydrator. In a March 17, 2011 letterto EPA Region 9, Resolute confirmed that replacement ofthe dehydratorwill satisfy the five conditions identified above. EPA Region 9 subsequently requested that Resolute notify EPA Region 9 ofthe specific requirements ofsubpart RH thatwill be applicableto the TEG dehydrator. This letter complies with that request. The uncontrolled emissions from the planned TEG dehydrator, as set forth in the noted attachmentto Resolute’s March 17, 2011 letter, exceed HAP majorsource thresholds for purposes ofsubpart HR. Therefore, the following requirements applyto the TEG dehydrator:

Resolute Natural Resources Company, LLC 1675 Broadway, Suite 1950, Denver, CO 80202 Voice: 303.534.4600 Fax: 303.623.3628Mr. Andrew Chew

April 19,2011 Page 2
Applicable Subpt. HH Sections Description 

### § 63.760(a)(l)-(2) Applicability

— —~________________ §63.760(b)(l)(i), (iii) Affected sources 

### § 63.760(0(2) Compliance requirements 

### § 63.760(h) Operating permit requirements 

### § 63.762 Startup, shutdown, and malfunction requirements 

### § 63.764(c)(1), (3) General standards for glycol dehydrators and ancillary equipment 

### § 63.765(b)(1)(i) Control requirements for dehydration unit processvent (i.e., connection to control device through a closed vent system) 

### § 63.769 Equipment leak standards for ancillary equipment 

### § 63./11(c) Closed ~ent system requirements 

### § 63.771(d)(1)(i)(A) Control device requirements (i.e., requires an enclosed combustion device designed and operatedto reduce the mass content oftotal HAPs in the gases vented to the device by 95% byweight or greater) 

### § 63.772(e) Control device performance test procedures

— 

### § 63.772(0 Compliance demonstration for control device performance requirements 

### § 63.773 Inspection and monitoring requirements §63.774 Recordkeepin~ requirements 

### § 63.775 Reporting requirements Table 2 to Subpart HFI Applicability of40 CFR Part 63 general provisions As noted in Resolute’s March 17, 2011 letter, the emissions from the planned TEG dehydratorwill be controlled by athermal oxidizerthatwill be designed and operated in accordance with the subpart HH requirements listed above, including the 95 percent destruction efficiency requirement of

### § 63.771(d), which will limitthe TEG dehydrator’s PTE accordingly. Resolute appreciates your consideration ofthis letter. We respectfully requestthatyou confirm that no further approval from EPA Region 9 is necessary before Resolute installs the planned replacement lEG dehydrator. Atimely response would he greatly appreciated, as Resolute intends to begin construction activity forthe newTEG dehydrator in the very near future. Please call me with any questions or comments. Sincerely, RES LUTE NATURAL RESOURCES COMPANY

Patrick E. Flynn Vice President, Governmental AffairsMr. Andrew Chew

April 19, 2011 Page 3

cc: Thomas P. Mintz, Esq.

—EPA Region 9 John R. Jacus, Esq.

— David Graham & Stubbs LLP