E

C

/R Incorporated Providing Environmental Technical Support Since 1989

501 Eastowne Drive, Suite 250  Chapel Hill, North Carolina 27514

Telephone: (919) 484-0222  Fax: (919) 484-0122

MEMORANDUM 

DATE: August 19, 2011

SUBJECT: Impacts for Control Options for the Oil and Natural Gas Production and the 

Natural Gas Transmission and Storage Source Categories as a Result of the 

Residual Risk and Technology Review

FROM: Heather Brown, EC/R Incorporated

Lesley Stobert, EC/R Incorporated

TO: Bruce Moore, EPA/OAQPS/SPPD/FIG

The purpose of this memorandum is to present the estimated impacts of control options 

identified to reduce hazardous air pollutant (HAP) emissions and risks from facilities that are 

subject to the Oil and Natural Gas National Emission Standards for HAP (NESHAP) – 40 CFR 

63, subpart HH and the Natural Gas Transmission and Storage NESHAP – 40 CFR 63, 

subpart HHH. These control options are being evaluated under EPA’s Risk and Technology 

Review program, which is addressing statutory requirements under section 112(d)(6) and 112(f)

of the Clean Air Act. Section 1 provides background information, followed by a summary of the 

risk results for these source categories in Section 2. Section 3 includes an identification of the 

control options. Section 4 summarizes the estimated impacts of the 112(f) options and Section 5

summarizes the estimated impacts of the 112(d)(6) options.

1.0 BACKGROUND

Section 112 of the Clean Air Act (CAA) establishes a comprehensive regulatory process 

to address emissions of hazardous air pollutants (HAP) from stationary sources. In accordance 

with CAA section 112(c), EPA identifies categories and subcategories of major sources that emit 

one or more of the HAP listed in CAA section 112(b). CAA section 112(d)(2) then calls for EPA 

to promulgate national technology-based emission standards for each listed category or 

subcategory of sources. For “major sources” that emit or have the potential to emit any single 

HAP at a rate of 10 tons or more per year or any combination of HAP at a rate of 25 tons or more 

per year, these technology-based standards must reflect the maximum reductions of HAP 

achievable (after considering cost, energy requirements, and non-air health and environmental 

impacts) and are commonly referred to as maximum achievable control technology (MACT) 

standards. Section 112(d)(6) then requires EPA to review the CAA section 112(d) technologybased standards and to revise them “as necessary, taking into account developments in practices, 

processes, and control technologies,” no less frequently than every 8 years. The residual risk 

review is described in section 112(f) of the CAA. CAA section 112(f)(2) requires EPA to 

promulgate standards for each category or subcategory of CAA section 112(d) sources “if 

promulgation of such standards is required in order to provide an ample margin of safety to 

protect public health . . . or to prevent, taking into consideration costs, energy, safety, and other 

relevant factors, an adverse environmental effect.
2

The Oil and Natural Gas Production NESHAP (40 CFR 63, subpart HH) addresses 

emissions from the following types of emission points: (1) glycol dehydration unit process vents, 

(2) storage vessels with the potential for flash emissions, and (3) equipment leaks at natural gas 

processing plants. The Natural Gas Transmission and Storage NESHAP (40 CFR 63, subpart 

HHH) addresses emissions from glycol dehydration unit process vents.

2.0 SUMMARY OF RISKS

EPA performed an assessment of the residual risks from these source categories using 

2005 base year data in order to determine if additional regulation was necessary under CAA 

section 112(f).1Table 1 contains a summary of the results of this assessment, and Table 2 

summarizes the contribution of individual emission point types to the cancer risks.

Table 1. Summary of Risk Results

Source Category

Number of 

Facilities 

Modeled

Maximum 

Cancer 

Risk (In 1 

Million)

Population 

Exposed To 

Cancer Risk 

Greater Than 1 

In 1 Million

Cancer 

Incidence

Maximum 

Chronic 

Hazard 

Index

Maximum 

Acute Hazard 

Quotient

Oil and Natural 

Gas Production 990 40 160,000 0.02 0.1

9 (benzene 

HQREL)

0.07 (benzene 

HQAEGL-1)

Natural Gas 

Transmission and 

Storage

321 90 2,500 0.001 0.4

5 (benzene 

HQREL)

0.04 (benzene 

HQAEGL-1)

This document presents the estimated impacts of control options identified to reduce 

hazardous air pollutant (HAP) emissions and risks from facilities in the Oil and Natural Gas and 

the Natural Gas Transmission and Storage source categories. However, because the chronic noncancer risks are already low, as shown in Table 1, we do not estimate the potential further 

reduction of these impacts with any of the risk reduction options identified. In addition, because 

it is not clear what impact, if any, the identified risk reduction options would have on acute 

emissions episodes, this analysis does not estimate impacts on acute risks. 

 

1 U.S. EPA, Office of Air Quality Planning and Standards. Draft Residual Risk Assessment for the Oil and Gas 

Production and Natural Gas Transmission and Storage Source Categories. July 2011.
3

Table 2. Maximum Emission Point Type Contribution to Risks*

Source Category

Maximum Cancer 

Risk (In 1 Million) Source Type HAP

Oil and Natural Gas 

Production

27 Wells: Other POM 75002

22 Oil and Gas Miscellaneous Benzene

22 Equipment leaks: 

Production Benzene

21 Fugitives: Other Benzene

15 Equipment leaks: 

Production Benzene

14 Dehydrators: Controlled Benzene

10 Dehydrators: Uncontrolled Benzene

8 Fugitives: Other Naphthalene

8 Dehydrators: Uncontrolled Benzene

7 Equipment Leaks: other Benzene

Natural Gas 

Transmission and 

Storage

83 Dehydrators: Uncontrolled Benzene

65 Dehydrators: Uncontrolled Benzene

14 Fugitives: Other Benzene

7 Oil and Gas Miscellaneous Benzene

3 Dehydrators: Uncontrolled Benzene

3 Dehydrators: Uncontrolled Benzene

3 Dehydrators: Uncontrolled Benzene

2 Dehydrators: Uncontrolled Benzene

2 Fugitives: Other Benzene

2 Fugitives: Other Benzene

*Top 10 emission point contributions to source category maximum individual cancer risks shown for each source 

category.
4

3.0 IDENTIFICATION OF CONTROL OPTIONS

There are two reasons that control options could be identified and evaluated. First are 

options identified to potentially reduce risks in accordance with section 112(f), second, are 

developments in practices, processes, and control techniques identified in the technology review 

in accordance with section 112(d)(6). Following are the control options identified and evaluated.

112(f) Risk Reduction Options Identified:

 Oil and Natural Gas Production

o Eliminate the glycol dehydrator alternative compliance option of 0.9 Mg/yr 

benzene 

o Require a second control device on glycol dehydrators

o Require a second control device on storage tanks

o Require more stringent LDAR programs for leak detection

 Require compliance with 40 CFR part 60 subpart VVa rather than subpart 

VV plant-wide

 Require compliance with 40 CFR part 60 VVa rather than subpart VV for 

certain components

 Require the use of an optical gas imaging camera monthly with an annual 

EPA Method 21 check

 Natural Gas Transmission and Storage

o Eliminate the glycol dehydrator alternative compliance option of 0.9 Mg/yr 

benzene 

112(d)(6) Technology Review Options Identified:

 Oil and Natural Gas Production

o Require more stringent LDAR programs for leak detection

 Require compliance with 40 CFR part 60 subpart VVa rather than subpart 

VV plant-wide

 Require compliance with 40 CFR part 60 VVa rather than subpart VV for 

certain components

 Require the use of an optical gas imaging camera monthly with an annual 

EPA Method 21 check

 Natural Gas Transmission and Storage

o No control options identified
5

4.0 IMPACTS OF RISK REDUCTION OPTIONS

The methodologies and impacts estimates for each of the risk reduction options identified 

above in section 3 are discussed below.

4.1 Elimination of the glycol dehydrator alternative compliance option

The current MACT standards for subparts HH and HHH contain a compliance option for 

glycol dehydrators that allows for either a 95% reduction of total HAP emissions from glycol 

dehydrators or a reduction in benzene emissions to less than 0.9 Mg/year. While many facilities 

control benzene emissions to a level less than 0.9 Mg/yr, in theory, they are allowed to increase 

their emissions to just below 0.9 Mg/yr. To determine the emissions and resulting risks that 

would occur if facilities with controlled glycol dehydrators with less than 0.9 Mg/yr emissions 

used the alternative compliance option and increased benzene emissions to 0.9 Mg/yr (the 

MACT-allowable level), we identified each glycol dehydrator in the NEI database that had 

controlled benzene emissions at a level of less than 0.9 Mg/yr, and we scaled the emissions up to 

0.9 Mg/yr for each of these dehydrators. Based on the difference at each dehydrator between the 

reported benzene emissions and 0.9 Mg/yr and the contribution each of these dehydrators made 

to the risk values, we determined the risks associated with emissions at the alternative 

compliance level. The risks based on reported HAP emissions and the risks estimated if all 

controlled dehydrators complied with the alternative compliance option are shown in Table 1. 

While the NEI contains information on whether an emission point is controlled or not, we 

do not have information on the type of control measure in place. Therefore, we cannot determine 

how many controlled dehydrators are complying with the 95% reduction alternative or how 

many are using less effective controls to meet the 0.9 Mg/yr benzene alternative limit. However, 

based on information gathered to determine the cost effectiveness of controlling small glycol 

dehydrators, we can infer the cost effectiveness of controlling the large dehydrators that would 

be affected by the removal of the 0.9 Mg/yr benzene emissions alternative.2 The estimated cost 

effectiveness of the controls to reduce HAP emissions by 95% for small glycol dehydrators in 

the Oil and Natural Gas Production source category is $7,000/Mg HAP reduced and is 

$1,650/Mg HAP reduced for the Natural Gas Transmission and Storage source category.3 While 

control methodologies are similar for large and small dehydrators, the gas flow being processed

and the amount of HAP reductions achieved for large glycol dehydrators are expected to be 

equal to or greater than those for small glycol dehydrators. However, we would expect the cost 

effectiveness for large units not to exceed twice the cost effectiveness of small units. Therefore, 

we would assume the cost effectiveness for large units not to exceed $14,000/Mg HAP reduced

for the Oil and Natural Gas Production source category and $3,300/Mg HAP reduced for the 

Natural Gas Transmission and Storage source category. The estimated source category risks and 

removal of the glycol dehydrator alternative control option cost effectiveness values are 

presented in Table 3. 

 

2 To address an unregulated emission point under CAA section 112(d)(2) and (3), EPA has estimated the costs of 

requiring controls on currently unregulated “small” glycol dehydrators, which are those with an actual annual 

average natural gas flowrate less than 85,000 standard cubic meters per day (scmd) and actual average benzene 

emissions less than 0.9 Mg/yr. The risk reduction options pertain to the previously regulated “large” glycol 

dehydrators, which are those above the thresholds specified for “small” glycol dehydrators.

3 Memorandum from Heather Brown, EC/R Inc. to Bruce Moore and Greg Nizich, EPA. Oil and Natural Gas 

Production MACT and Natural Gas Transmission and Storage MACT – Glycol Dehydrators: Impacts of MACT 

Review Options. July 28, 2011.
6

Table 3. Estimated Impacts of Removing the Glycol Dehydrator Alternative Compliance 

Option

Source 

Category

Source Category Max Cancer Risk

if Controlled Glycol Dehydrators 

Use 0.9 Mg/yr Alternative

Source Category Max 

Cancer Risk Without the 

0.9 Mg/yr Alternative

Control Cost 

Effectiveness 

($/Mg HAP)a

Oil and Natural 

Gas Production 400 40 $14,000

Natural Gas 

Transmission 

and Storage

90 90b$3,300

a Assumes the control cost is twice that of the control cost for small glycol dehydrators

b

The maximum cancer risk is from a facility without controlled glycol dehydrators, so removing the alternative 

compliance alternative alone would not reduce the maximum cancer risk from this category. Although not 

investigated specifically as a risk reduction option, the requirement for small glycol dehydrators proposed under 

CAA section 112(d)(2) for the Natural Gas Transmission and Storage source category is expected to reduce risks to 

20-in-1 million.

4.2 Require a second control device on controlled glycol dehydrators

Requiring an additional control device beyond that required to meet the MACT floor 

level of control for glycol dehydrators was an option identified in making the ample margin of 

safety decision for the Oil and Natural Gas Production source category. For sources achieving 

the MACT level of control, it is assumed that for most glycol dehydrators required to reduce 

emissions, the emissions are routed to a condenser or a combustion device, which achieve at 

least a 95% HAP reduction. To reduce the emissions remaining after the use of this control 

device, the option of requiring an additional add-on control device, most likely a combustion 

device that would also achieve a 95% emission reduction, was investigated. The costs for the 

second device were assumed to be equal to the costs of the first device, however, the amount of 

emission reduction would be less, as they would have already been reduced substantially by the 

first control device. Assuming the first device achieves a 95% HAP reduction in the 

uncontrolled emissions, the second device would achieve a 95% HAP reduction in the remaining 

emissions, or 4.75% of the uncontrolled emissions. Therefore, the second device would achieve 

1/20 the emissions reduction of the first device for the same cost. Based on the cost 

effectiveness of the first device of $7,000/Mg HAP reduced4, the cost effectiveness of the second 

device would be $7,000*20, or $140,000. 

The maximum cancer risks for the source category are not due to emissions from glycol 

dehydrators, assuming the 0.9 Mg/yr benzene emissions alternative is removed, as shown in 

Table 2. Therefore, further reduction of emissions and risk from glycol dehydrators with a 

second control device will not reduce the maximum cancer risks for the source category. The

estimated source category risks and glycol dehydrator additional control device cost 

effectiveness values are presented in Table 4. 

Table 4. Estimated Impacts of Adding a Second Control Device to Glycol Dehydrators

Source Source Category Max Cancer Source Category Max Cancer Control Cost 

 

4 Memorandum from Heather Brown, EC/R Inc. to Bruce Moore and Greg Nizich, EPA. Oil and Natural Gas 

Production MACT and Natural Gas Transmission and Storage MACT – Glycol Dehydrators: Impacts of MACT 

Review Options. July 28, 2011.
7

Category Risk Without the 0.9 Mg/yr 

Alternative (Baseline)

Risk With Second Control 

Device on Glycol Dehydrators

Effectiveness 

($/Mg HAP)1

Oil and Natural 

Gas Production 40 40a

$140,000

a The maximum cancer risk is from an emission point other than a glycol dehydrator, so reducing emissions from 

this type of emission point alone would not reduce the maximum cancer risk from this category.

4.3 Require a second control device on controlled storage vessels

Requiring an additional control device beyond that required to meet the MACT floor 

level of control for storage vessels was an option identified in making the ample margin of safety 

decision for the Oil and Natural Gas Production source category. For sources achieving the 

MACT level of control, it is assumed that storage vessels required to reduce emissions are 

equipped with a cover vented through a closed vent system to a control device, which achieves at 

least a 95% HAP reduction. To reduce the emissions remaining after the use of this control 

device, the option of requiring an additional add-on control device, most likely a combustion 

device that would also achieve a 95% emission reduction, was investigated. The costs for the 

second device were assumed to be equal to the costs of the first device, however, the amount of 

emission reduction would be less, as they would have already been reduced substantially by the 

first control device. Assuming the first device achieves a 95% HAP reduction in the 

uncontrolled emissions, the second device would achieve a 95% HAP reduction in the remaining 

emissions, or 4.75% of the uncontrolled emissions. Therefore, the second device would achieve 

1/20 the emissions reduction of the first device for the same cost. Based on the cost 

effectiveness of the first device of $18,300/Mg HAP reduced5, the cost effectiveness of the 

second device would be $18,300*20, or $366,000. 

The maximum cancer risks for the source category are not due to emissions from storage 

vessels, as shown in Table 2. Therefore, further reduction of emissions and risk from storage 

vessels with a second control device will not reduce the maximum cancer risks for the source 

category. The estimated source category risks and storage vessel additional control device cost 

effectiveness values are presented in Table 5. 

Table 5. Estimated Impacts of Adding a Second Control Device to Storage Vessels

Source 

Category

Source Category Max Cancer 

Risk Without the 0.9 Mg/yr 

Alternative (Baseline)

Source Category Max 

Cancer Risk With Second 

Control Device on Storage 

Vessels

Control Cost 

Effectiveness 

($/Mg HAP)1

Oil and Natural 

Gas Production 40 40a

$366,000

a The maximum cancer risk is from an emission point other than a storage vessel, so reducing emissions from this 

type of emission point alone would not reduce the maximum cancer risk from this category.

4.4 Require a leak detection and repair (LDAR) program for additional facility 

components

 

5 Memorandum from Heather Brown, EC/R Inc. to Bruce Moore and Greg Nizich, EPA. Oil and Natural Gas 

Production MACT and Natural Gas Transmission and Storage MACT – Storage Vessels: Impacts of MACT Review 

Options. July 28, 2011.
8

Requiring an LDAR program for additional facility components was an option identified 

in making the ample margin of safety decision for the Oil and Natural Gas Production source 

category. For natural gas processing plants, which already have LDAR requirements, more 

stringent options were not investigated. For production facilities and gathering and boosting 

facilities, which do not currently have LDAR requirements, several LDAR options were 

investigated. The investigated LDAR programs include:

 Compliance with 40 CFR part 60 subpart VVa (which is based on conducting Method 21 

monthly, defining a leak at the 500 ppm threshold for valves, and includes connectors on

the list of components to be monitored)

 Compliance with 40 CFR part 60 subpart VVa for certain components (including valves, 

pressure relief devices, connectors, and open-ended lines)

 Use of an optical gas imaging camera monthly with an annual EPA Method 21 check

The costs of these options were examined under the review of the NSPS for the oil and 

gas sector based on reductions of VOC. Since the HAP present is approximately 1/20 the VOC 

present in material handled by regulated equipment, the cost effectiveness of these LDAR 

programs is approximately 20 times greater for HAP reduction than for VOC reduction. For 

example, based on the VOC cost effectiveness of requiring VVa for production facilities of 

$17,700/Mg VOC reduced, the cost effectiveness of this program for HAP reduction would be 

$17,700*20, or $354,000/Mg HAP reduced. To estimate the cost effectiveness for HAP 

reduction, we performed this calculation for each option for each plant component investigated. 

While cost estimates were developed under the NSPS review for the use of the optical camera 

without an annual Method 21 check, due to the lack of data on the emission reduction associated 

with this method, cost effectiveness values were not developed. Similarly due to this lack of 

data, cost effectiveness values were not developed for HAP reduction and are not included here 

as options considered.

The maximum cancer risks for the source category are not due to emissions from 

equipment leaks, as shown in Table 2. Therefore, further reduction of emissions and risk from 

equipment leaks with an LDAR program will not reduce the maximum cancer risks for the 

source category. The estimated source category risks and LDAR program control cost 

effectiveness values are presented in Table 6. 

Table 6. Estimated Impacts of Requiring an LDAR Program for Additional Facility 

Components

Source 

Category

Plant 

Component LDAR Option

Source 

Category Max 

Source 

Category 

Control Cost 

Effectiveness

Control Cost 

Effectiveness 
9

Cancer Risk

Without the 0.9 

Mg/yr 

Alternative 

(Baseline)

Max 

Cancer 

Risk With 

LDAR 

Option

($/Mg VOC)

a

($/Mg HAP)

Oil and 

Natural 

Gas 

Production

Production 

facilities 

(currently 

unregulated)

VVa facilitywide 40 40c

$17,700 $354,000

VVa for certain 

components 40 40c $16,600-$233,000

$332,000 -

$4,660,000

Optical camera 

monthly with 

annual Method 

21 check 

40 40c$17,700 $354,000

Gathering 

and 

boosting 

facilities 

(currently 

unregulated)

VVa site-wide 40 40c$10,300 $206,000

VVa for certain 

components 40 40c $5,700-$85,000

$114,000 -

$1,700,000

Optical camera 

monthly with 

annual Method 

21 check 

40 40c$11,100 $222,000

a

Values taken from the following source: U.S. EPA, Office of Air Quality Planning and Standards. New Source 

Performance Standards for the Oil and Natural Gas Industry - Background Technical Support Document for 

Proposed Standards. July 2011.

c The maximum cancer risk is from an emission point other than equipment leaks, so reducing emissions from this 

type of emission point alone would not reduce the maximum cancer risk from this category.

5.0 IMPACTS OF TECHNOLOGY REVIEW OPTIONS

The methodologies and impacts estimates for each of the technology review options 

identified above in section 3 are discussed below.

5.1 Require an enhanced leak detection and repair (LDAR) program 

Requiring an LDAR program more stringent than the current LDAR program for natural 

gas processing plants was an option identified in the technology review for the Oil and Natural 

Gas Production source category. For these natural gas processing plants, several LDAR options 

were investigated. The investigated LDAR programs include:

 Compliance with 40 CFR part 60 subpart VVa (which is based on conducting Method 21 

monthly, defining a leak at the 500 ppm threshold for valves, and includes connectors on 

the list of components to be monitored)

 Compliance with 40 CFR part 60 subpart VVa for certain components (including valves, 

pressure relief devices, connectors, and open-ended lines)

 Use of an optical gas imaging camera monthly with an annual EPA Method 21 check 

The costs of these options were examined under the review of the NSPS for the oil and 

gas sector based on reductions of VOC. Since the HAP present is approximately 1/20 the VOC 

present in material handled by regulated equipment, the cost effectiveness of these LDAR 

programs is approximately 20 times greater for HAP reduction than for VOC reduction. For 

example, based on the VOC cost effectiveness of requiring VVa for natural gas processing 

plants, the cost effectiveness of this program for HAP reduction would be $3,700*20, or 

$73,500/Mg HAP reduced. To estimate the cost effectiveness for HAP reduction, we performed 
10

this calculation for each option. While cost estimates were developed under the NSPS review for 

the use of the optical camera without an annual Method 21 check, due to the lack of data on the 

emission reduction associated with this method, cost effectiveness values were not developed. 

Similarly due to this lack of data, cost effectiveness values were not developed for HAP 

reduction and are not included here as options considered. The estimated enhanced LDAR 

program control cost effectiveness values are presented in Table 7. 

Table 7. Estimated Impacts of Requiring a More Stringent LDAR Program

Source 

Category

Plant 

Component LDAR Option

Control Cost 

Effectiveness

($/Mg VOC)a

Control Cost 

Effectiveness 

($/Mg HAP)

Oil and 

Natural Gas 

Production

Natural gas 

processing 

plants 

VVa facility-wide $3,700 $73,500

VVa for certain 

components $160 – $4,800 $3,200 - $96,000

Optical camera 

monthly with annual 

Method 21 check 

$5,100 $102,000

a Values taken from the following source: U.S. EPA, Office of Air Quality Planning and Standards. New Source 

Performance Standards for the Oil and Natural Gas Industry - Background Technical Support Document for 

Proposed Standards. July 2011.