# c UNITED STATES ENVIRONMENTAL PROTECTION AGENCY REGION IX 75 Hawthorne Street San Francisco, CA 94105·3901
November 8, 2006

Patrick E

.. Flynn Environmental Health & SafetyManager Resolute Natural Resources Company 1675 Broadway, Suite 1950 Denver, CO 80202 OFFICE OF THE REGIONAL ADMINISTRATOR



### Re: Revised Application for a Prevention ofSignificantDeterioration Permit for McElmo CreekMain Flare

DearMr. Flynn:
This letter is inresponse to the submittal byExxonMobil ofa revised application for a Prevention ofSignificant Deterioration (PSD) permit for the Main Flare at ExxonMobil's McElmo Creek gas compression facility. This revised application, received byEPA, Region 9 on October 3, 2006, provides supplemental data in response to a letter from EPA dated May22, 2006 informing ExxonMobil that the initial permit application was administratively incomplete

.

. We appreciate the manyrevisions that have been made thus far to the application; most ofthe areas originally identified byEPA in its May 22, 2006 letter as administratively incomplete have been adequately addressed in the revised application. However, upon review ofthe revised application in accordance with 40 CFR § 124.3, EPAhas determined that the application remains administrativelyincomplete for PSD purposes with respect to emissions data and the BACT analysis. These areas are discussed below.

Emissions Data

In ourMay22, 2006 letter, werequested that ExxonMobil provide pre- and postproject actual emissions, as well as pre-project estimates ofthe potential to emit for all criteria pollutants. We stated that, for purposes ofthe PSD permit application, pre-project
means before the gas plant was dismantled in 1997, and post-project means after the gas plant was dismantled. As requested, ExxonMobil provided this data, using the limits from the Consent Decree for Civil Action Case United States v. Mobil Exploration and Production U.S. Inc. as the post-project PTE. In order for EPAto be able to properly calculate the cost-effectiveness ofthe various control options discussed in the revised application, the permit application must include the maximum PTE for all criteria

Printed on Rt>cycled Paperpollutants following the dismantling ofthe gas plant, butpriorto the imposition ofthe Consent Decree limits.
BACT Analysis
Also in ourMay 22, 2006 letter, we requested that the application address means to reduce the occurrence offlaring, considering, among other things, methods to improve the efficiency, reliability, and/or capacity ofthe gas compressors (including replacing the compressors), and any othermethods that mayreduce the frequency offlaring and the quantity ofgas flared. In response, the permit application has been revised to analyze compressor engine modifications per EPA's top-down BACT methodology. The revised application discusses options for improving the·reliabilityofthe existing compressor, replacing the compressor, and other compressimi operations changes. The application states that "Implementing these options [options to improve compressor operations] is assumed to achieve a minimum decrease of75% ofbase emissions ofeach pollutant." As noted in the application, step 3 ofEPA's top-down methodology is to rank all technically feasible control options by control effectiveness. However, the application does not contain a basis for the 75% control efficiency assumed for compressorimprovements. The application mustbe revised to include the technical basis for this assumed control efficiency. Where a range ofcontrol efficiencies is expected to exist, the top down analysis should examine the maximum possible control efficiency first. Ifthe maximum efficiency is eliminated based on technical infeasibility, then the application should explain the basis. The maximum technically.:achievable control efficiency should also be considered in the cost effectiveness analysis ofany control option, rather than onlythe minimum as is currently used.
Should you have any questions concerning the review ofyour application, or if you would like to arrange for a meeting orconference call to discuss your application, please contact me at (415) 972-3974. Sincerely,

# j~**·'G:~** C. Rios Chief, Permits Office

cc: Randy Cleaveland, ExxonMobil Torn Hormel, McVehil-Monnett Associates, Inc. (