# E C 

# / R Incorporated Providing Environmental Technical Support Since 1989

1 MEMORANDUM

TO: Bruce Moore

, EPA/OAQPS/SPPD/CCG

FROM: Bradley Nelson, EC/R, Inc.

DATE: January 12 , 201 2

SUBJECT: Summary of the January 5, 20 1 2

, Meeting with Region 8 and Air Quality

Representatives from Colorado and Wyoming with the U.S. Environmental Protection Agency to D iscuss the Proposed Oil & Gas NSPS/NESHAP

I. INTRODUCTION

The purpose of the meeting was to discuss questions on the proposed Oil and Gas NSPS (40 CFR Part 60, subparts KKK, LLL, and OOOO) and NESHAP (40 CFR Part 63, subpart s HH and

HHH ). This meeting summary will be available in the docket for this rulemaking (Docket ID

No. EPA

- HQ

- OAR

- 20 1 0

- 0 505 ). The proposed rule for the oil and natural gas sector wa s published in the Federal Register on August 23, 20 11 (7 6 FR 52738 ).

II. ATTENDEES

The following is a list of participants in the meeting.

U.S. Environmental Protection Agency

Bruce Moore

David Cozzie Alex Macpherson

EPA Region 8 Cindy Beeler Kate Fay Carl Daly

Colorado

Scott Patefield Gary Kaufman

Wyoming

Steve Dietrich2

Andrew Keyfauver Carissa Krey

EC/R Incorporated

D avid Hendricks

Heather Brown Bradley Nelson

III. SUMMARY OF DISCUSSION

Bruce Moore opened the meeting by stating that the comment period for the proposed rules has

ended and EPA could answer clarifying questions from the group, but could not provide any responses to comments on the proposed rules. EPA received approximately 150,000 comments, however only about 150 of the comments that were received were considered to be substantive.

He stated that EPA wanted to streamline the rule for both industry and regulators.

EPA stated that they had received many comments relating to the burden of the monitoring, recordkeeping, and reporting and the definitions in the proposed rule and were working to

address t hese issues.

The first topic of discussion was well completions. Representatives from Colorado and Wyoming believe EPA needs to clarify the requirements for recompletions and when they apply. Wyoming requires equipment to do green completions at well sites. Colorado stated that the Colorado Oil and Gas Conservation Commission (COGCC) oversee the drilling operations in their state, and their division takes over after production starts. Colorado noted that they do not have the staffing or expertise to observe drilling operations to make sure they are in compliance

with the rule s

.

EPA asked if there were significant emissions that aren’t regulated in the proposed rules subsequent to flowback. A member of t he group noted that emissions occur during different periods of flowback, and not just after fracturing. EPA asked when states require green completions. Colorado stated that completions were covered by the COGCC, and the current requirements for completions were for odor control and resource rec overy. Wyoming stated operators were required to do green completions after evaluation of safety, pressure and flow. EPA asked what were the state’s requirements for crude oil and condensate wells. Colorado noted that they won’t know if the well has oil (API Gravity <40°) or condensate, but the majority

of wells are condensate. EPA asked if emissions from these wells were comparable to natural gas wells. Colorado noted that they don’t have data, but emissions appear to vary by type of well. They noted in some cases the natural gas from the wells is a waste product. Wyoming stated that emissions from wells can range from 23 tons to PSD major.

EPA asked the group if they had suggestions to clarify applicability. The group stated that equipment availab ility was an issue. EPA stated that this issue has been brought up by other commenters and EPA was currently evaluating what can be done. EPA asked if this same technology could be applied to both natural gas wells and crude/condensate wells. The group3

responded that the equipment used for both was the same. They noted that some equipment may

differ because of the capacity of flow from the well. Wyoming stated that their minor source permit program requires reduced emission completions (REC). To do an REC, a pipeline must be available to collect the natural gas. Heavy crude oil wells are not required to do REC because of economics. EPA asked if a flare or other control is required. Wyoming responded that the

vented emissions must be controlled. The group asked if EPA could leave the regulation of well completions to the states and not include in the NSPS. EPA responded that not all states have regulations for well completions, and the emissions from these operations are significant.

Storage tanks were the next topic of discussion. EPA stated that they received numerous comments on the requirements for storage tanks and some wanted the applicability to be based on VOC emissions and other asked for a throughput cut

- off. EPA asked the group if they believed an emissions threshold was appropriate for storage tanks. Representatives from CO stated that a 6 TPY threshold has worked well in their state. The group from WY stated that an

emissions threshold of 8 TPY is used in some areas and is lower in o ther areas. The y added that

emission s can vary based on the well composition and the models used to estimate the emissions.

EPA asked if a rolling average was used to establish a limit. The group from WY stated that the

state allows a 30

- day period to establish an emission estimate and 30 days to put on controls if the emissions are determined to need control. The group from CO stated that non

- attainment areas require controls for first 90 days of production where they are required to estimate the

ann ual emissions. If the annual emissions are determined to be greater than 20 TPY then the controls must stay in place. For attainment areas, the operators have 90 days to determine if controls are needed (> 20 TPY). They also have a system wide reduction requirement of 90% aggregate control on all tank emissions from the facilities owned by a company in non

attainment areas. This helps to address cost effectiveness issues. The CO group also noted that they use an emission factor of 1 lb/BBL throughput. EPA asked if it would be useful to maintain a table of emission factors for tanks from the different formations or plays. The group stated they believe the emissions factors should remain at the state level and not on a national level.

EPA asked if the states allowed companies to remove controls in cases where the production and storage tank emissions start to decline. The group from CO stated that if the storage tank emissions can be shown to be less than 20 TPY, then the control can be removed, and the operator is required to maintain records that show they are below this threshold.

The next topic of discussion was notification and reporting requirements in the NSPS. EPA stated that they did not intend to require reporting of all pneumatics, t hey intended to only require reporting of new pneumatic controllers that were installed during the reporting period. EPA also noted that they received comment regarding the difficulty of a 30

- day notification for completions, but the intent was to make th e states aware of the activity in their respective state. The group from CO stated that they did not receive notification for well completions, but the COGCC was aware of the drilling operations. They have concerns with the burden on their staff

for over seeing these operations. The group from WY st a ted they require a 15

- day notification of well completions.4

EPA stated that they intend to make revisions to the definitions. They noted that they did not intend to say that workovers were the same as recomp letions, and will clarify this in the final rule. EPA stated that the rule would not apply to workovers.

EPA noted that both states provided information of produced water ponds and other emission

sources and EPA will review this information. EPA does no t intend to include any action in the current rule, but will consider for future regulations. The group from CO stated that emissions from produced water ponds are greater than 200 TPY, and consist s mostly of methanol

emissions

. The group from WY stated that they had no data on emissions from produced water ponds.

A representative from WY stated that nitrogen oxide (NO X ) emissions from nonroad engines are a large source of emissions, but the states can’t regulate them because they are mobile sources. They asked if EPA could classify these nonroad engines as stationary sources. EPA stated that any affected source covered by a NSPS is not a mobile source. The emissions are not included in this rulemaking, but EPA will consider this for future rulemakin gs. EPA asked if reducing

NO X emissions would help with ozone issues in the states. The group from WY stated that they did not know if they were NO X or VOC limited.

EPA asked how the 15

- day notification worked in WY. The group from WY responded that th e notification is sent to the district office by email or letter at least 15 days prior to the well completion.