IN THE UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

CLIFFS NATURAL RESOURCES INC.,

et al. ,

Petitioners,

v.

Case No. 13-1.758

(and consolidated Case Nos.

13-1761, 13-21.26, 13-2129, 13-2130)

U.S. ENVIRONMENTAL PROTECTION

AGENCY and GINA McCARTHY,

ADMINISTRATOR,

Respondents.

CLIFFS NATURAL RESOURCES INC.,

et al.,

Petitioners,

►v~

U.S. ENVIRONMENTAL PROTECTION

AGENCY and GINA McCARTHY,

ADMINISTRATOR,

Case No. 13- 373

(and consolidated Case Nos.

13-3575, 13-359, 14-1710, and 14-1712)

Respondents.

SETTLEMENT AGREEMENT

This Settlement Agreement is entered into by Cliffs Natural Resources Inc. ("Cliffs"),

ArcelorMittal USA LLC ("ArcelorMittal"), the State of Michigan, and the United States

Environmental Protection Agency ("EPA") (collectively, the "Parties").

1
WHEREAS, Petitioners Cliffs, ArcelorMittal, and the State of Michigan (collectively the

"Petitioners") each filed a petition for review challenging a final rule promulgated by EPA under

sections 110 and 169A of the Clean Air Act, 42 U.S.C. §~ 7410 and 7491, entitled "Approval.

and Promulgation of Air Qualify Implementation Plans; States of Minnesota and Michigan;

Regional Haze State Implementation Plan; Federal Implementation Plan for Regional Haze;

Final Rule," 78 Fed. Reg. 8,706 (Feb. 6, 2013) (the "FIP Rule");

WHEREAS, the petitions for review of the FIP Rule have been consolidated in this court

under lead Case No. 13-1758;

WHEREAS, Petitioners Cliffs, ArcelorMittal, the State of Michigan, and U. S. Steel each

filed a petition for review challenging a final rule promulgated by EPA under section 110 of the

Clean Air Act, 42 U.S.C. ~ 741.0, entitled. "Approval and Promulgation of Air Quality

Implementation Plans; States of Michigan and Minnesota; Regional Haze," 78 Fed.. Rea. X9,825

(Sept. 30, 2013) (the "SIP Rule");

WHEREAS, the petitions for review of the SIP Rule have been consolidated in this court

under lead Case No. 13-3573;

WHEREAS, Petitioners have raised various challenges to the FIP Rule and the SIP Rule

associated with taconite facilities Located in Minnesota and Michigan;

WHEREAS, the Parties wish to implement this Settlement Agreement resolving all of

Petitioners' challenges to the FIP Rule and the SIP Rule, and thereby avoid protracted and costly

litigation and to preserve judicial resources; without any admission or adjudication of fact or law;

NOW, THEREFORE; the Parties, intending to be bound by this Settlement Agreement,

hereby agree as follows:

2
L No later than five days after this Settlement Agreement is final pursuant to

paragraph 7 of this Settlement Agreement, the Parties shall file joint motions with the court in

Case No. 13-1758 and in Case No. 13-3573 notifying the court of this Settlement Agreement and

requesting that the Petitioners' claims in each of these consolidated cases be held. in abeyance, if

the Court has not already done so.

2. EPA shall send -- as expeditiously as practicable, but not later than ten days after

the Settlement Agreement is final (see paragraph 7) -- a letter that grants the petitions for

reconsideration. submitted by Cliffs to EPA dated April 3, 2013, and November 26, 2013, and. by

ArcelorMittal on March 22, 2013

3. EPA shall. sign -- as expeditiously as practicable but not later than June 12, 2015

-- a notice of proposed rulemaking proposing changes to the FIP Rule that is substantially

consistent with, and includes numeric emission limits and time frames identical to those set forth

in; Attachment A to this Settlement Agreement. Aspects of the FIP Rule affecting Petitioners

not directly implicated by the terms of this Settlement Agreement (including, without limitation,

other emissions limits, recordkeeping and other requirements) shall not be altered in EPA's

proposed rulemaking. Once signed, the notice of proposed rulemaking shall be published in the

Federal Register as expeditiously as practicable.

4. The Petitioners shall not file any adverse comments on any portion of the

proposed rule under paragraph 3 above if it is substantially consistent with, and includes numeric

emission limits and time frames identical to those set forth in, Attachment A to this Settlement

Agreement. This does not preclude Petitioners from commenting on any portion of the proposed.

rule not expressly addressed in this settlement, including but not limited to the equitable

treatment of facilities not included in this settlement.
S. If EPA sib s by December 18, 2015, a final rule amending the FIP Rule that

includes changes that are substantially consistent with, and includes numeric emission limits and

time frames identical to those set forth in, Attachment ~ to this Settlement Agreement, then.

after that final rule has been published in fhe Federal Register, Petitioners and EPA shall

promptly file an appropriate pleading for the dismissal of Case Nos. 13-1758, 13-1761, 13-2126,

13-2129, 13-2130, 13-373, 13-575, and 13-3595 with prejudice in accordance ~~ith Rule 42(b)

of the Federal Rules of Appellate Procedure, with each party to bear its own costs and attorneys'

fees. Further, Petitioners waive any right to challenge in any court or administrative proceeding,

any portion of that final rule that is substantially consistent with, and. includes numeric emission.

limits and time frames identical to those set forth in, Attachment A to this Settlement Agreement.

6. If EPA does not sitrn by December 18, 2015, a final rule that is substantially

consistent with, and includes numeric emission limits and time frames identical to those set forth

in, Attachment A to this Settlement Agreement, then Petitioners' sole remedy under this

Settlement Agreement with respect to the rules under review in these cases shall be the right to

ask the court to lift the stay of proceedings and set Case No. li-178 for oral argument and

establish a briefing schedule for Case No. 13-3573.

7. The Parties agree and. acknowledge that before this Settlement Agreement. is final,

EPA must provide notice in the Federal Registe~~ and an opportunity for public comment

pursuant to section ll3(g) of the Clean Air Act. 42 U.S.C. ~ 7413(8). After this Settlement

Agreement has undergone an opportunity for notice and comment. the EPA Administrator andlor

the Attorney General, as appropriate, shall promptly consider any such written comments in

determining whether to withdraw or withhold consent to the Settlement Agreement; in

4
accordance with section 1 li(g) of the Clean Air Act. This Settlement Agreement shall become

final. on the date that EPA provides written notice of such finality to Petitioners.

8. Nothing in the terms of this Settlement. Agreement shall be construed. to limit or

modify the discretion accorded EPA by the Clean Air Act or by general principles of

administrative law. No provision of this Settlement Agreement shall be interpreted as or

constitute a commitment or requirement that EPA obligate funds in contravention of the AntiDeficiency Act, 31 U.S.C. § 1341. Furthermore, nothing in the terms of this Settlement

Agreement shall be construed to limit EPA's authority to alter, amend or revise any final rule

EPA may issue pursuant to paragraph 5 or to promulgate superseding regulations or guidance.

9. Nothing in the terms of this Settlement Agreement shall be construed to limit or

modify the obligations of Cliffs and ArcelorMittal fo obtain permits pursuant fo state and federal

law to implement the provisions of this Settlement Agreement.

10. The Parties may extend the dates sef forth in this Settlement Agreement or

otherwise modify this Settlement Agreement by a written agreement executed by counsel for the

Parties. If a lapse in EPA's appropriations occurs within 120 days prior to the deadline in

Paragraphs 3, 5 and 6 of this Settlement Agreement, that deadline shall be extended

automatically one day for each day of delay caused. by the lapse in appropriations.

11. Each. party shall. bear its own costs, including attorneys' fees, in this litigation.

including attorneys' fees and costs associated with monitoring, overseeing, or implementing this

Settlement Agreement, and including participation in any administrative proceedings

contemplated by this Settlement Agreement.

12. This Settlement Agreement with Attachment A constitutes the complete and.

entire a~ Bement among the Parties. All prior conversations, meetings, discussions, drafts and

5
writings of any kind are specifically superseded by this Settlement 1~greement and may not be

used by the Parties to vary or contest the terms of this Settlement Agreement or as evidence of

the Parties' intent in entering into this Settlement Agreeanent.

13. The undersigned representatives of each party certify that they are fully

authorized by the party that they represent to bind that respective party to the ternls of this

Agreement.

D~oLYglas .. McWilliams

Squire Pit on Boggs (US) LLP

4900 I~eyower

127 Public Square

Cleveland, Ohio 44114-1304

T; (216) 479-8500

F; (216) 479-8780

dou~las.mcwilliams~~squirepb.com

Counsel fog Petitzone~

Cliffs Natural Resozc~^ces Inc.

Allen A. Kacenjar

Squire Patton Boggs (US) LLP

4900 Key Tower

127 Public Square

Cleveland, Ohio 441.14-1304

T: {216) 479-8500

F: (216) 479-8780

allen.kacenjar cr,squirepb.com

Counsel for Petitioner A~celo~Mittal

USA LLC

0
u°ritings of any kind are speciLicall~~ superseded by this Settlement Agreement and may not be

used by the Parties to vary or• contest the terms of this Settlement Agreement or as evidence of

the Parties' intent in entering into this Settlement Agreement.

13. "I'he undersigned represEntatives of each party cet•tify that they are frilly

authorized by the party that they represent. to bind that respecti~~e party to the terns of this

Agreement.

Douglas A. McWilliams

Squire Patton Boggs (US) LLP

4900 Key Tower

1.27 Public Square

Cleveland, Ohio 44114-1304

T: (2l6) 479-8500

F; (21 b) 479-87$0

douglas.mcwilliams~squirepb.com

Coz~nsel fog Petitioner

Cliffs Natural ~esoz~rces Inc.

r~

Alen A. Kacenjar r~

Squire Patton. Boggs (US) LLP

4900 Key Tower

127 Public Square

Cleveland, Ohio 441 14-1304

T: (216) 479-8500

F: (216) 479-8780

a1len.kaceniar(cr~,squirepb.com

Counsel foi~ Petizione~^ A~^celorMzttal

USA LLC
SAM HIRSCH

Acting Assistant Attorney General ,~-~

Environment and Nat. Resources Div. ,~ ~ ~'

Alan D. Greenberg

U.S. Department of Justice

999 18~' Street, Suite 370

Denver, Colorado 80202

T: (3 03) 844-13 66

alan.~reenbergnusdoj.~o_v

Counsel fo~~ Respondent U.S.

Envi~~on~nental Protection Agency and

Gina McCaf~thy

Dated: December ~~ , 2014

Neil D. Gordon

Michigan Dept. of Attorney General

Co-Counsel of Record

Environment, Natural Resources, and

Agriculture Division

P. O. Box 30755

Lansing, Michigan 48909

T: (.517) 373-7540

~ordonnl (a,michigan.gov

Counsel for Petitione~~ State of

Michigan

7
ATTACHMENT A

EPA will propose amendments to the following sections of 40 C.F.R. Part ~2 that are consistent

with the following requirements and include numeric emission limits and time frames identical

to those set forth below:

Section 52.1183(k}(1)

Tilden.

An emission limit of 2.8 lbs NO,;/MMBtu, based on a 720-hour rolling average, will apply to

Tilden Grate Kiln. Line 1 when burning natural gas, and an emission limit of 1.5 lbs

NOa/MMBtu, based on a 720-hour rolling average, will apply to Tilden Grate Kiln Line 1 when

burning a mixture of coal and natural gas. These emission limits will become enforceable 60

months after the effective date of this rule and only after EPA's confirmation or modification of

the emission limit in accordance with the procedures set forth below. Compliance with these

emission limits will be demonstrated with. data collected by a continuous emissions monitoring

system (GEMS) for NOS.

The owner or operator must collect GEMS data for NO,; and SO? and submit the data to EPA no

later than 30 days from the end of each calendar quarter after the effective date of the rule until

~7 months from the effective date of the rule.

No later than. 48 months after the effective date of the rule, the owner or operator must submit to

EPA a report, including any final reports) completed by the selected NOa reduction technology

supplier and furnace retrofit engineer, containing a detailed engineering analysis and modeling of

the NO, reduction control technology being installed on Tilden Grate Kiln Line 1. The NOX

reduction control technology must be designed to meet emission limits of 2.8 lbs NOS/MMBtu

when burning natural gas and 1.5 lbs NOx/MMBtu when. burning mixed fuels (e.g., coal and

natural gas). This report must include a list of all variables that can reasonably be expected to

have an impact on NOa emission control technology performance, as well as a description of

how these variables can be adjusted to reduce NOx emissions to meet the NO,; design emission

limit. The NOS reduction control technology shall. be installed. on Tilden Grate Kiln Line 1

furnace no later than ~0 months after the effective date of the rule.

Commencing on the earlier of (i) six months from the installation of the NOX reduction control

technology or (ii) 50 months from the effective date of the rule, the owner or operator must

provide to EPA the results from pellet quality analyses. The owner or operator shall provide the

results from pellet quality analyses no later than 30 days from the end of each calendar quarter

until 57 months from the effective date of the rule. The pellet quality analyses shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, and {v) low temperature disintegration. For each of the pellet quality analysis factors,

the owner or operator must explain the pellet quality analysis factor, as well as the defined

acceptable range for each factor using the applicable product quality standards based upon

D
customers' pellet specifications that are contained in Tilden's ISO 9001 quality management

system. The owner or operator shall provide pellet quality analysis testing results that state the

date and time of the analysis and, in order to define the time period when pellets were produced

outside of the defined acceptable range for the pellet quality factors listed, provide copies of the

production logs that document the starting and ending times for such periods. The owner or

operator shall provide an explanation of causes for pellet samples that fail to meet the acceptable

range for any pellet quality analysis factor. Pellet quality information and data may be submitted

to EPA as Confidential Business Information.

No later than 57 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOa limits for Tilden Grate Kiln Line 1 within the

upper and lower bounds described below. EPA will review the report and either confirni or

modify the NOa limits. If the CEMS data collected during operating periods between months 50

and 57 that both meet pellet quality specifications and proper furnace/burner operation is

normally distributed, the limit adjustment determination shall be based on the appropriate

{depending upon whether data are statistically independent or dependent) 95% upper predictive

limit (UPL) equations provided at the end of this attachment. If the CEMS data collected during

operating periods between months 50 and ~7 that both meet pellet quality specifications and

proper furnace/burner operation are not normally distributed, the limit adjustment determination

shall be based on the non-parametric equation provided at the end of this attachment. The data

set for the determination shall exclude periods when pellet quality did not fall within the defined

acceptable ranges of the pellet quality factors listed. above and for any subsequent period when

production had been reduced in response to pellet quality concerns consistent with Tilden's ISO

9001 operating standards. Any excluded period will commence at the dime documented on the

production log demonstrating pellet quality did not fall within the defined acceptable range, and

shall end when pellet quality within. the defined acceptable range has been re-established at

planned production levels, which will presumed to be the level. that existed immediately prior to

the reduction in production. due to pellet quality concerns. EPA may also exclude data where

operations are inconsistent with the reported design parameters of the NOa reduction control

technology that were installed. EPA will take final agency action by publishing its final

confirmation or modification of the NOa limits in the Federal Register no later than 60 months

after the effective date of the rule.

The confirmed or modified NOa limit for Tilden Grate Kiln Line 1 when burning only natural

gas may be no lower than. 2.8 lbs NOt/MMBtu, based on a 720-hour rolling average, and may

not exceed 3.0 lbs NOX/MMBtu, based on a 720-hour rolling average. T11e confirmed or

modified NOa limit for Tilden Grate Kiln Line 1 when. burning mixed fuel may be no lower than

1.5 lbs NOX/MMBtu, based on a 720-hour rolling average, and may not exceed 2.5 lbs

NOX/MMBtu, based on a 720-hour rolling average. If the owner or operator submits a report

proposing a single NOa limit for all fuels, EPA may approve the proposed NOX limit for all fuels

based on a 30-day rolling average. The confirmed or modified limit will be established and

enforceable within 60 months from the effective date of this rule.

Section ~2.1.183(k)(3)

0
The owner or operator of the Tilden Grate Kiln Line 1 furnace shall meet an emission limit of

500 lbs SOZ/hr based on a 30-day rolling average beginning 6 months after the effective date of

the rule. The Tilden Grate Kiln Line 1 furnace shall not be limited to natural gas fuel.

Beginning 6 months after the effective date of the rule, any coal burned on Tilden Grate Kiln

Line 1 shall have no more than 0.60 percent sulfur by weight based on a monthly block average.

The sampling and calculation methodology for determining the sulfur content of coal must be

described in the monitoring plan required for this furnace. The owner or operator must calculate

an SOZ limit. based on twelve continuous months of CEMS emissions data and submit such limit,

calculations, and CEMS data. to EPA no later than 36 months after the effective date of the rule.

If the submitted CEMS SO? hourly data is normally distributed, the SOZ lbs/hr emission rate

shall be based on the appropriate (depending upon whether data are statistically independent or

dependent) 99% upper predictive limit (UPL) equation. If the submitted CEMS S02 hourly data

is not normally distributed, the SOS lbs/hr emission rate shall be based on the non-parametric

equation provided at the end of this attachment. Compliance to the SOZ lbs/hr emission rate shall

be determined on a 30-day rolling average basis. EPA will. take final agency action by

publishing a confirmation or modification of the SOS limit in the Fede~~al Register• no later than

39 months after the effective date of the rule. EPA. may adjust the 500 lbs/hr SOZ limit

downwaxd to reflect the calculated SOz emission rate; however, EPA will not increase the SO,

limit above SOO lbs/hr.

Section 52.1235(b)(1)(ii)

Hibbing Line 1.

An emission limit of 1.2 lbs NO,;/MMBtu, based on a 30-day rollins average, will apply to

Hibbing Line 1 when burning natural gas. This emission limit will become enforceable 37

months after the effective date of this rule and only after EPA's confirmation or modification of

the emission limit in accordance with the procedures set. forth below. Compliance with these

emission limits will be demonstrated with dafa collected by a continuous emissions monitoring

system (GEMS) for NOx.

The owner or operator of Hibbing Line 1 must install a GEMS for NOx and SO? within 6 months

from the effective date of the rule. The owner or operator must collect GEMS data and submit

the data to EPA no later than 30 days from the end of each calendar quarter after that installation.

deadline until 34 months from the effective date of the rule.

No later than 24 months after the effective date of the rule the owner or operator must submit to

EPA a report, including any final reports) completed by the selected NOx reduction technology

supplier and furnace retrofit engineer, containing a detailed engineering analysis and modeling of

the NOh reduction control technology being installed on Hibbing Line 1. Tile NO,; reduction

control technology must be designed to meet an emission limit of 1.2 lbs NOX/MMBtu. This

report must include a list of all process and control technology variables that can. reasonably be

expected to have an impact on NOa emissions control technology performance, as well as a

description of how these variables can. be adjusted to reduce NO,; emissions to meet the NOx

10
design emission limit. The NOx reduction control technology shall be installed on Hibbing Line

1 furnace no later than 26 months after the effective date of the rule.

Commencing on the earlier of (i) six months from the installation of the NOx reduction control

technology; or (ii) 26 months from the effective date of the rule, the owner or operator must

provide to EPA the results from pellet quality analyses. The owner or operator shall provide the

results from pellet quality analyses no later than 30 days from the end. of each calendar quarter

until 34 months from the effective date of the rule. The pellet quality analyses shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, {v) low temperature disintegration, and (vi) swelling. For each of the pellet quality

analysis factors, the owner or operator must explain the pellet quality analysis factor, as well as

the defined acceptable range for each factor using the applicable product quality standards based

upon customers' pellet specifications that are contained in Ribbing's ISO 9001 quality

management system. The owner or operator shall provide pellet quality analysis testing results

that state the date and time of the analysis and, in order to define the time period when. pellets

were produced outside of the defined acceptable range for the pellet quality factors listed,

provide copies of the production logs that document the starting and. ending times for such

periods. The owner or operator shall provide an explanation. of causes for pellet samples that fail

to meet the acceptable range for any pellet quality analysis factor. Pellet quality information and

data may be submitted to EPA as Confidential Business Information.

No later than 34 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOx limits for Hibbing Line 1 furnace within the

upper and lower bounds described below. EPA will review the report and either confirm or

modify the NOx limits. If the CEMS data collected during operating periods between months 26

and 34 that both meet pellet quality specifications and proper furnace burner operation is

normally distributed, the limit adjustment determination shall be based on the appropriate

(depending upon. whether data are statistically independent or dependent) 95% upper predictive

limit (UPL) equations provided at the end of this attachment. If the CEMS data collected during

operating periods between months 26 and ~4 that both meet pellet quality specifications and.

proper furnace/burner operation are not nornlally distributed, the limit adjustment determination

shall be based on the non-parametric equation provided. at the end of this attachment. The data

set for the determination shall exclude periods when pellet quality did not fall within the defined

acceptable ranges of the pellet quality factors listed. above and for any subsequent period when

production has been reduced in response to pellet quality concerns consistent with Ribbing's ISO

9001 operating standards. Any excluded. period will commence at the time documented on the

production log demonstrating pellet. quality did not fall within the defined. acceptable range and.

shall end when pellet quality within the defined acceptable range has been. re-established. at

planned. production levels, which. will be presumed to be the level that existed immediately prior

to the reduction in production due to pellet quality concerns. EPA may also exclude data where

operations are inconsistent wiih the reported desib parameters of the NOx reduction control

technology installed. EPA will take final agency action by publishing its final confirmation. or

modification of the NOx limit in the Federal Register no later than 37 months after the effective

date of the rule,

The confirmed or modified NOa limit for Hibbing Line 1 when burning only natural gas may be

11
no lower than 1.2 lbs NOx/MMBtu, based on a 30-day rolling average, and may not exceed 1.8

lbs NOX/MMBtu, based on a 30-day rolling average.

Hibbing Line 2.

An emission limit of 1.2 lbs NOX/MMBtu, based on a 30-day rolling average, will apply to

Hibbing Line 2 when burning natural gas. This emission limit will become enforceable 55

months after the effective date of this rule and only after EPA's confirmation. or modification of

the emission limit in accordance with the procedures set forth below. Compliance with these

emission limits will be demonstrated with data collected by a continuous emissions monitoring

system (GEMS) for NOa.

The owner or operator of Hibbing Line 2 must install a GEMS for NOx and SOZ within 6 months

from the effective date of the rule. The owner or operator must collect GEMS data and submit

the data to EPA no later than 30 days from. the end of each calendax quarter after that installation

date until 52 months from the effective date of the rule.

No later than 42 months after the effective date of the rule the owner or operator must submit to

EPA a report, including any final reports) completed by the selected NOx reduction technology

supplier and. furnace retrofit engineer. containing a detailed engineering analysis and modeling of

the NOa reduction control technology being installed on Hibbing Line 2. Tile NOk reduction

control technology mush be designed to meet an emission limit of 1.2 lbs NOX/MMBtu. This

report must include a list of all process and control technology variables that. can reasonably be

expected to have an impact on NOX emissions control technology performance, as well as a

description of how these variables can be adjusted to reduce NOt emissions to meet the NOx

design emission limit. The NOx reduction control technology sha11 be installed on Hibbing Line

2 furnace no later than 44 months after the effective date of the rule.

Commencing on the earlier of (i) six months from the installation. of the NOx reduction control

technology; or (ii) 44 months from the effective date of the rule, the owner or operator must

provide to EPA the results from. pellet. quality analyses. The owner or operator shall provide the

results from pellet quality analyses no later than 30 days from the end of each calendar quarter

until 52 months from the effective date of the rule. The pellet quality analyses shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, (v) low temperature disintegration, and (vi) swelling. For each of the pellet quality

analysis factors; the owner or operator must explain the pellet quality analysis factor, as well as

the defined acceptable range for each factor using the applicable product quality standards based

upon customers' pellet specifications that are contained in Ribbing's ISO 9001 quality

managen7ent system. The owner or operator shall provide pellet quality analysis testing results

that state the date and time of the analysis and, in order to define the time period when. pellets

were produced outside of the defined acceptable range for the pellet quality factors listed,

provide copies of the production logs that document the starting and. ending times for such

periods. The owner ox operator sha11 provide an explanation of causes for pellet samples that fail

12
to meet the acceptable range for any pellet quality analysis factor. Pellet quality information and

data may be submitted to EPA as Confidential Business Information.

No later than 52 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOx limits for Hibbing Line 2 furnace within the

upper and. lower bounds described below. EPA will review the report and either confirm or

modify the NOx limits. If the CEMS data collected during operating periods between months 44

and 52 that both meet pellet quality specifications and proper furnace burner operation is

normally distributed. the limit adjustment determination shall be based on the appropriate

{depending upon whether data are statistically independent or dependent) 95% upper predictive

limit (UPL) equations provided at the end of this attachment. If the CEMS data collected during

operating periods between months 44 and 52 that both meet pellet qualify specifications and

proper furnace/burner operation are not normally distributed, the limit adjustment determination

shall be based on the non-parametric equation provided at the end of this attachment. The data

set for the determination shall exclude periods when pellet quality did not fall within the defined

acceptable ranges of the pellet quality factors listed above and for any subsequent period when

production has been reduced in response to pellet quality concerns consistent. with Hrbbing's ISO

9001 operating standards. Any excluded. period will commence at the time documented on the

production log demonstrating pellet quality did not fall within the defined acceptable range and

shall end when pellet quality within the defined acceptable range has been re-established at

planned production levels, which will be presumed to be the level that existed immediately prior

to the reduction in production due to pellet quality concerns. EPA may also exclude data where

operations are inconsistent with the reported design parameters of the NOx reduction control

technology installed. EPA will take final. agency action by publishing its final confirmation or

modification of the NOx limit in tlse Federal Kegister no later than 5~ months after the effective

date of the rule,

The confirmed or modified NOS limit for Hibbing Line 2 when burning only natural gas may be

no lower than 121bs NOa/MMBtu, based on a 30-day rolling average, and may not exceed 1.8

lbs NO,~/MMBtu, based on a 30-day rolling average.

Hibbing Line 3.

An emission limit of 1.2 lbs NO,/MMBtu, based on a 30-day rolling average, will apply to

Hibbing Line 3 when burning natural gas. This emission limit ~~ill become enforceable 60

months after the effective date of this rule and only after EPA's confirmation or modification of

the emission limit in accordance with the procedures set forth below. Compliance with these

emission limits wi11 be demonstrated with data collected by a continuous emissions monitoring

system (CEMS) for NOS.

The owner or operator of Hibbing Line 3 must install a CEMS for NOx and SOS within 6 months

from the effective date of the rule. The owner or operator must collect CEMS data and submit

the data to EPA no later than 30 days from the end of each calendar quarter after that installation

date until 57 months from the effective date of the rule.

13
No later than 48 months after the effective date of the rule the owner or operator must submit to

EPA a report, including any final reports) completed by the selected NOx reduction technology

supplier and furnace retrofit engineer, containing a detailed engineering analysis and modeling of

the NOX reduction control technology being installed on Hibbing Line 3. The NOh reduction

control technology must be designed to meet an emission 1imi~ of 1.2 lbs NOa/MMBtu. This

report must include a list of all process and control technology variables that can. reasonably be

expected to have an impact on NOX emissions control technology performance, as well as a

description of how these variables can. be adjusted to reduce NOX emissions to meet the NOx

design emission limit. The NOx reduction control technology shall be installed on Hibbing Line

3 furnace no later than 50 months after the effective date of the rule.

Commencing on the earlier of (i) six months from the installation of the NOx reduction control

technology; or (ii) 50 months from the effective date of the rule, the owner or operator must

provide to EPA the results from pellet quality analyses. The owner or operator sha11 provide the

results from pellet quality analyses no later than. 30 days from the end of each calendar quarter

until ~7 months from the effective date of the rule. The pellet quality analyses shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, (v) low temperature disintegration, and (vi) swelling. For each of the pellet quality

analysis factors, the owner or operator must explain the pellet quality analysis factor, as well as

the defined acceptable range for each factor using the applicable product quality standards based

upon customers' pellet specifications that are contained in Ribbing's ISO 9001 quality

management system. The owner or operator shall provide pellet quality analysis testing results

that state the date and time of the analysis and, in order to define the time period when pellets

were produced outside of the defined acceptable range for the pellet quality factors listed,

provide copies of the production logs that document the starting and ending times for such

periods. The owner or operator shall provide an explanation of causes for pellet samples that fail

to meek the acceptable range for any pellet quality analysis factor. Pellet quality information and

data may be submitted to EPA as Confidential Business Information.

No later than 57 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOx limits far Hibbing Line 3 fun7ace within the

upper and. lower bounds described below. EPA will review the report and either confirnl or

modify the NOx limits. If the CEMS data collected during operating periods between months 50

and 57 that both meet pellet quality specifications and proper furnace burner operation is

normally distributed, the limit adjustment determination shall be based on the appropriate

{depending upon whether data are statistically independent or dependent) 95% upper predictive

limit (UPL) equations provided at the end of this attachment. If the CEMS data collected. during

operating periods between months 50 and 57 that. both meet pellet quality specifications and

proper fiunace/burner operation are not normally distributed, the limit adjustment determination

shall be based on the non-parametric equation provided at the end of this attachment. The data

set for the determination shall exclude periods when pellet quality did not fall within the defined

acceptable ranges of the pellet quality factors listed above and for any subsequent period when

production. has been reduced in response to pellet quality concerns consistent with Ribbing's ISO

9001 operating standards. Any excluded period will commence at the time documented on the

production log demonstrating pellet quality did not fall within. the defined acceptable range and

shall end when pellet quality within the defined acceptable range has been re-established at

14
planned production levels, which will be presumed to be the level that existed immediately prior

to the reduction in production due to pellet quality concerns. EPA may also exclude data where

operations are inconsistent with the reported design parameters of the NOx reduction control

technology installed. EPA will take final agency action by publishing its final confirmation or

modification of the NOx limit in the Fede~~al Register° no later than 60 months after the effective

date of the rule,

The confirmed or modified NOa limit for Hibbing Line 3 when burning only natural gas may be

no lower than 1.2 lbs NOa/MMBtu, based on a 30-day rolling average, and may not exceed 1.8

1bs NO,/MMBtu, based on a 30-day rolling average.

Section 52.1235(b)(1)(i~c~)

UTAC Line 2.

An emission. limit. of 2.8 lbs NO,;/MMBtu, based on a 720-hour rolling average, will apply to

UTAC Grate Kiln Line 2 when burning natural gas, and an emission limit of 1.5 lbs

NOx/MMBtu, based on a 720-hour rolling average, will apply to UTAC Grate Kiln Line 2 when

bunging a mixture of coal and natural gas. These emission limits will become enforceable 55

months after the effective date of this rule and only after EPA's confirmation or modification of

the emission. limit in accordance with the procedures set forth below. Compliance with these

emission limits will be demonstrated with data collected by a continuous emissions monitoring

system (GEMS) for NOk.

The owner or operator must collect GEMS data for NOa and SOS and submit the data to EPA no

later than 30 days from the end. of each calendar quarter after the effective date of the rule until

52 months from the effective date of the rule.

No later than 42 months after the effective date of the rule, the owner or operator must submit to

EPA a report, including any final reports) completed by the selected NOx reduction technology

supplier and furnace retrofit engineer, containing a detailed engineering analysis and. modeling of

the NOX reduction control technology being installed on UTAC Grate Kiln Line 2. The NOS

reduction control technology must be designed to meet emission limits of 2.8 lbs NOX/MMBtu

when burning natural gas and 1.5 lbs NOX/MMBtu when burning mixed fuels (e.g., coal and

natural gas). This report must include a list of all variables that can reasonably be expected to

have an impact on NOk emission control technology performance, as well as a description of

how these variables can be adjusted to reduce NOa emissions to meet the NOY design emission.

limit. The NOX reduction control technology shall be installed on UTAC Grate Kiln Line 2

furnace no later than 44 months after the effective date of the rule.

Corrunencing on the earlier of (i) six months from. the installation of the NOa reduction control

technology or (ii) 44 months from the effective date of the rule, the owner or operator must

provide to EPA the results from pellet quality analyses. The owner or operator shall provide the

results from pellet quality analyses no later than 30 days from the end of each. calendar quarter

15
until 52 months from the effective date of the rule. The pellet quality analyseis shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, and (v) low temperature disintegration. For each of the pellet quality analysis factors,

the owner or operator must explain the pellet quality analysis factor, as well as the defined

acceptable range for each factor using the applicable product quality standards based upon

customers' pellet specifications that are contained in UTAC's ISO 9001 quality management

system. The owner or operator shall provide pellet quality analysis testing results that state the

date and time of the analysis and, in order to define the time period when pellets were produced

outside of the defined acceptable range for the pellet quality factors listed, provide copies of the

production logs that document the starting and ending times for such periods. The owner or

operator shall provide an explanation of causes for pellet samples that fail to meet. the acceptable

range for any pellet quality analysis factor. Pellet quality information and data. n ay be submitted

to EPA as Confidential Business Information.

No later than 52 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOX limits for UTAC Grate Kiln Line 2 within the

upper and lower bounds described below. EPA will review the report and either confirm. or

modify the NOa limits. If the CEMS data collected during operating periods between months 44

and 52 that both meet pellet quality specifications and proper furnace burner operation is

normally distributed, the limit adjustment determination shall. be based on t11e appropriate

(depending upon whether data. are statistically independent or dependent) 95% upper predictive

limit (UPL) equations provided at the end of this attachment. If the CEMS data collected during

operating periods between months 44 and 52 that. both meet pellet quality specifications and

proper furnace/burner operation are not normally distributed, the limit adjustment determination

shall be based. on the non-parametric equation provided at the end of this attachment. The data

set for the determination. shall exclude periods when pellet quality did not fall within the defined

acceptable ranges of the pellet quality factors listed above and for any subsequent period when

production had been reduced in response to pellet quality concerns consistent with UTAC's ISO

9001 operating standards. Any excluded period will commence at the time documented on the

production log demonstrating pellet quality did not fall within the defined acceptable range, and

shall end when pellet quality within the defined acceptable range has been re-established at

planned production levels, which will presumed to be tihe level that existed immediately prior to

the reduction in production. due to pellet quality concerns. EPA may also exclude data where

operations are inconsistent with the reported design parameters of the NOx reduction control

technology that were installed. EPA will take final abency action by publishing its final

confirmation or modification of the NOX limits in the FedeYal Register no later than 55 months

after the effective date of the rule.

The confirmed or modified NOa limit for UTAC Grate Kiln Line 2 when burning only natural

gas may be no lower than 2.8 lbs NOa/1VIMBtu, based on a 720-hour rolling average, and may

not exceed. 3.0 lbs NOa/MMBtu, based. on a 720-hour rolling average. The confirmed or

modified NOa limit for UTAC Grate Kiln Line 2 when burning mixed fuel may be no lower than

L~ lbs NO,;/MMBtu, based on a 720-hour rolling average, and may not exceed 2.5 lbs

NOX/NIMBtu, based on a 720-hour rolling average. If the owner or operator submits a report

proposing a single NOa limit for all fuels, EPA may approve the proposed NOX limit for all fuels

16
based on a 30-day rolling average. The confirmed or modified limit will be established and

enforceable within 55 months from the effective date of this rule.

UTAC Line 1.

An emission limit of 2.8 lbs NOX/MMBtu, based on a 720-hour rolling average, will apply to

UTAC Grate Kiln Line 1 when burning natural gas, and. an emission limit of 1.5 lbs

NOX/MMBtu, based on a 720-hour rolling average, will apply fo UTAC Grate Kiln Line 1 when

burning a mixture of coal and natural gas. These emission limits will become enforceable 37

months after the effective date of phis rule and only after EPA's confirmation or modification of

the emission limit in accordance with the procedures set forth. below. Compliance with these

emission limits will be demonstrated with data collected by a continuous emissions monitoring

system (GEMS) for NOx.

The owner or operator must collect GEMS data for NO,; and SOS and submit the data to EPA no

later than 30 days from the end of each calendar quarter after the effective date of the rule until

34 months from the effective date of the rule.

No later than 24 months after the effective date of the rule, the owner or operator must submit to

EPA a report, including any final reports) completed by the selected NOX reduction technology

supplier and. furnace retrofit engineer, containing a detailed engineering analysis and modeling of

the NO,, reduction confrol technology being installed on UTAC Grate Kiln Line 1. The NOX

reduction. control technology must be designed to meet emission limits of 2.8 lbs NOX/MMBtu

when burning natural. gas and l.~ lbs NOX/MMBtu when burning mixed fuels (e.g., coal and

natural gas). This report must include a list of all variables that can reasonably be expected to

have an impact on NOh emission. control technology performance, as well as a description of

how these variables can be adjusted to reduce NOS emissions to meet the NOX design. emission

limit. The NOX reduction control technology shall be installed on UTAC Grate Kiln Line 1

furnace no later than 26 months after the effective date of the rule.

Commencing on the earlier of (i) six months from the installation of the NOX reduction control

technology or (ii) 26 months from the effective date of the rule, the owner or operator must

provide to EPA the results from. pellet quality analysis. The owner or operator shall provide the

results from pellet quality analysis no later than 30 days from the end of each calendar quarter

until 34 months from the effective date of the rule. The pellet quality analysis shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, and (v) low temperature disintegration. For each of the pellet qualit~~ analysis factors,

the owner or operator must explain the pellet quality analysis factor, as well as the defined

acceptable range for each factor using the applicable product quality standards based. upon

customer's pellet specifications that are contained in UTAC's ISO 9001. quality management

system. The owner or operator shall provide pellet quality analysis testing results that state the

date and time of the analysis and, in order to define the time period when pellets were produced

outside of the defined acceptable range for the pellet quality factors listed, provide copies of the

production logs that document the starting and ending times for such periods. The owner or

operator shall provide an explanation of causes for pellet samples that fail to meet the acceptable

17
range for any pellet quality analysis factor. Pellet quality information and data may be submitted

to EPA as Confidential Business Infornlation.

No later than 34 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOX limits for UTAC Grate Kiln Line 1 within the

upper and. lower bounds described below. EPA will review the report and. either confirm or

modify the NOS limits. If the CEMS data collected during operating periods between months 26

and 34 that. both meet pellet quality specifications and proper furnace burner operation is

nornlally distributed, the limit adjustment determination shall be based on the appropriate

(depending upon whether data. are statistically independent or dependent) 95% upper predictive

limit (UPL) equations provided at the end of this attachment. If the CEMS data collected during

operating periods between months 26 and 34 that both meet pellet quality specifications and

proper furnace/burner operation are not normally distributed, the limit adjustment determination

shall be based on the non-parametric equation provided. at the end of this attachment. The data

set for the determination shall exclude periods when pellet quality did not fall within. the defined

acceptable ranges of the pellet quality factors listed above and for any subsequent period when

production had been reduced in response to pellet quality concerns consistent with UTAC's ISO

9001 operating standards. Any excluded period will commence at the time documented on the

production log demonstrating pellet quality did not fall within the defined acceptable range, and.

shall end when pellet quality within the defined acceptable range has been re-established at

planned production levels, which will presumed to be the level that existed immediately prior to

the reduction. in production due to pellet quality concerns. EPA may also exclude data where

operations are inconsistent with. the reported design parameters of the NOX reduction control

technology that were installed. EPA will take final agency action. by publishing its final

confirmation or modification of the NUk limits in the h'ederal Kegister no later than 37 months

after the effective date of the rule.

The confirmed or modified NOa limit for UTAC Grate Kiln Line 1 when burning only natural

gas may be no lower than 2.8 lbs NOa/MMBtu, based on a 720-hour rolling average, and may

not exceed 3.0 lbs NOh/MMBtu, based on a 720-hour rolling average. The confirmed or

modified NOa limit for UTAC Grate Kiln Line 1 when burning mixed fuel may be no lower than

l.~ lbs NOx/MMBtu, based on a 720-hour rolling average, and may not exceed 2.5 ibs

NO,;/MMBtu, based on a 720-hour rolling average. If the owner or operator submits a report.

proposing a single NO,;limit for all fuels, EPA may approve the proposed NOa limit for all. fuels

based on a 30-day rolling average. The confirmed or modified limit will be established and

enforceable within 37 months from the effective date of this rule.

52.1235(b)(2)(iv):

An aggregate emission limit of 529.0 ibs SO~/hr, based on a 30-day rolling average, shall apply

to the Line 1 pellet furnace (EU040) and Line 2 pellet furnace (EU042) beginning 6 months after

the effective date of the rule. Beginning b months after the effective date of the rule, any coal

burned on UTAC Grate Kiln. Line 1 or Line 2 shall have no more than. 1.5 percent sulfur by

weight based on a monthly block average. The sampling and. calculation. methodology for
determining the sulfur content of coal must be described in the monitoring plan required for this

furnace.

Section 52.1235(b)(1)(v)

ArcelorMittal.

An emission limit of 1.2 lbs NOX/MMBtu, based on a ~0-day rolling average, will apply to the

indurating furnace when burning natural gas. This emission limit will become enforceable 55

months after the effective date of this rule and only after EPA's confirmation or modification of

the emission limit in accordance with the procedures set forth below. Compliance with these

emission. limits will be demonstrated with data collected. by a continuous emissions monitoring

system (GEMS) for NO,;.

The owner or operator of the ArcelorlVlittal Minorca Mine indurating furnace must install. a

GEMS for NOx and SOZ within 6 months from the effective date of the rule. The owner or

operator must collect GEMS data and submit the data. to EPA no later than 30 days from the end

of each calendar quarter after that installation deadline until 52 months from. the effective date of

the rule.

No later than 42 months after the effective date of the rule the owner or operator must submit to

EPA a report, including any final reports) completed. by the selected NOx reduction technology

supplier and furnace retrofit engineer, containing a detailed engineering analysis and modeling of

the NOa reduction control technology being installed on the ArcelorMittal Minorca Mine

indurating furnace. The NOa reduction control technology must be designed to meet an emission

limit of 12 Ibs NOt/MMBtu vvhen burning natural gas. This report must include a list of all

process and control. technology variables that can reasonably be expected to have an impact on

NOa emissions control technology performance, as we11 as a description of how these variables

can be adjusted to reduce NOa emissions to meet the NOX design emission limit. The NOx

reduction. control technology shall be installed on the ArcelorMittal Minorca Mine indurating

furnace no later than 44 months after the effective date of the rule.

Commencing on the earlier of (i) six months from the installation of the NOx reduction contral

technology; or (ii) 44 months from the effective date of the rule, the owner or operator must

provide to EPA the results from pellet quality analyses. The owner or operator shall provide the

results from pellet quality analyses no later than 30 days from the end of each calendar quarter

until. 52 months from the effective date of the rule. The pellet quality analyses shall include

results for the following factors: (i) compression, (ii) reducibility, (iii) before tumble, (iv) after

tumble, (v) low temperature disintegration, and (v) contraction. For each of the pellet quality

analysis factors, the owner or operator must explain the pellet quality analysis factor, as well as

the defined acceptable range for each factor using the applicable product quality standards based

upon. customers' pellet specifications that are contained in the ArcelorMittal Minorca Mine's

Standard Product Parameters. The owner or operator shall provide pellet quality analysis testing

results that state the date and time of the analysis and, in order to define the time period when

pellets were produced outside of the defined acceptable range for the pellet quality factors listed,

19
provide copies of production or scale data that documents the starting and ending times for such

periods. The owner or operator shall provide an explanation of causes for pellet samples that fail

to meet the acceptable range for any pellet quality analysis factor. Pellet quality information and

data may be submitted to EPA as Confidential Business Information.

No later than 52 months after the effective date of the rule, the owner or operator may submit to

EPA a report to either confirm or modify the NOx limits for the ArcelorMittal Minorca Mine

indurating furnace within the upper and lower bounds described. below. EPA will review the

report and either confirm or modify the NOx limits. If the CEMS data collected during operating

periods between months 44 and 52 that both meet pellet quality specifications and proper

furnace burner operation is normally distributed, the limit adjustment determination shall be

based on the appropriate (depending upon whether data are statistically independent or

dependent) 95% upper predictive limit (UPL) equations provided at the end of this attachment.

If the CEMS data collected during operating periods between months 44 and 52 that both. meet

pellet quality specifications and proper furnace burner operation are not normally distributed, the

limit adjustment determination shall be based on the non-parametric equation provided at the end.

of this attachment. The data set for the determination shall exclude periods when pellet quality

did not fall within the defined acceptable ranges of the pellet quality factors listed above and for

any subsequent period when production has been reduced in response to pellet quality concerns

consistent with the ArcelorMittal Minorca Mine's Standard Product Parameters. Any excluded

period. will commence at the time documented in related. quality reports demonstrating pellet

quality did not fall within the defined acceptable range and. shall end when pellet quality within

the defined acceptable range has been re-established at planned production levels, which will be

presumed. to be the level that existed immediately prior to the reduction. in production due to

pellet quality concerns. EPA may also exclude data where operations are inconsistent with the

reported design parameters of the NOx reduction control technology installed. EPA will take

final agency action by publishing its final. confirmation or modification of the NOx limit in the

Federal Register no later than ~5 months after the effective date of the rule,

The confirmed or modified NOh limit for the ArcelorMittal Minorca Mine indurating furnace

when. burning only natural gas may be no lower than 1.2 lbs NOh/MMBtu, based on a 30-day

rolling average, and may not exceed 1.8 lbs NOX/MMBtu, based on a 30-day rolling average.

SI]
Equations:

Equation for Normal Distribution and Statistically Independent Data

-r, '~: ax

Where:

:~ =average or mean of test run data;

~~,~,~_~,~,~~ ~~-,,~ = t score, the one-tailed t value of the Student's t distribution for a specific degree

of freedom (n-1)and a confidence level (0.95; 0.99 for Tilden SOS)

s~ =variance of the dataset;

a~ =number of values

t =number of values used to calculate the test average (m = 720 as per averaging time)

To determine if statistically independent, use the Rank von. Neumann Test on p. 1 ~7 of data

Quality Assessment: Statistical Methods for Practitioners EPA QA/G-9S.

Alternative to Rank von Neumann. test to determine if data are dependent, data are dependent if

t test value is greater than t critical value, where:

i L~P~3rL - 1

_~~

~i

p =correlation between data points

~r~.tie~~ = t~~3~_~~a~~y~~~~ = t score, the two-tailed t value of the Student's t distribution for a

specific degree of freedom (n-2) and a confidence level (0.95)

If data are dependent then use the following equation.

Equation for Normal Distribution and Data not Statistically Independent

{ ~ ,. ~ i

Where:

p =correlation. between data points

21
Non-parametric Equations for Data Not Normally Dis~ribnted

rn =~n ~ ~~ x a

r~ =the rank of the ordered. data point, when data is sorted smallest to largest

n =number of data points

c~ = 0.95, to reflect the 95~' percentile

If m is a whole number, then the limit, UPL, shall be computed. as:

Where:

~,,~ =value of the mth data point in terms of lbs SO,/hr or lbs NOX/MMBtu, when the data is

sorted smallest to largest.

If m is not a whole number, the limit shall be computed. by linear interpolation according

to the following equation.

where

~r~; =the integer portion of rn, i.e., m truncated at zero decimal. places;and

are =the decimal portion of m

22