Office of Transportation EPA420-F-06-039 

and Air Quality May 2006 

Regulatory

Announcement

Refiner and Importer Quality

Assurance Requirements for

Downstream Oxygenate

Blending and Requirements for

Pipeline Interface 

The U.S. Environmental Protection Agency (EPA) has published a Direct 

Final Rule that addresses: (1) requirements for parties that handle 

pipeline interface; and (2) downstream quality assurance requirements 

for refiners of reformulated gasoline blendstock for oxygenate blending 

(RBOB). 

Overview 

With respect to parties that handle pipeline interface, the Direct Final 

Rule largely codifies existing guidance for compliance with reformulated 

gasoline (RFG) and anti-dumping regulations. It also establishes gasoline 

sulfur standards for transmix processors and blenders that are consistent 

with the sulfur standards for other entities—such as pipelines and terminals—that are downstream of refineries in the gasoline distribution system. Further, the Direct Final Rule clarifies the requirements for transmix 

processors under the Mobile Source Air Toxics program. 

With respect to refiners and importers of RBOB, this Direct Final Rule 

amends the RFG regulations to allow for the option of an alternative 
method for fulfilling a regulatory requirement to conduct quality assurance sampling and testing at downstream oxygenate blending facilities. 

This alternative consists of a comprehensive program of quality assurance sampling and testing that would cover all terminals that blend 

oxygenate with RBOB in a specified RFG-covered area. The program 

would be carried out by an independent surveyor funded by industry. The 

program would be conducted pursuant to a survey plan, approved by EPA 

on an annual basis that is calculated to achieve the same objectives as the 

current regulatory quality assurance requirement. 

The clean air benefits of the RFG, antidumping, and gasoline sulfur 

programs will continue to be realized. The goal of these programs is to 

reduce motor vehicle emissions of the pollutants that contribute to ozone, 

or smog, and toxic pollutants, such as benzene. The RFG, antidumping, 

and gasoline sulfur programs control gasoline properties to reduce emissions of these pollutants. 

The clean air benefits of these three programs are significant. Smog 

threatens millions of Americans each year with respiratory problems, 

and is particularly dangerous to children, who are increasingly at risk to 

asthma attacks. The reformulated gasoline program alone reduces smogforming pollutants by 105,000 tons and toxic pollutants by 24,000 tons 

annually. This is equivalent to eliminating the pollution from 16 million 

cars every year. 

Although we do not anticipate any adverse comments on this direct final 

rule, we are also concurrently publishing a Notice of Proposed Rulemaking in order to be able to address any comments we may receive without 

withdrawing this direct final rule in its entirety. 

Transmix 

Refined petroleum products that are transported by pipeline normally are 

pumped sequentially, as a continuous flow through the pipeline. As a result, some amount of mixing of adjacent product types normally occurs. 

The product in a pipeline between two adjacent volumes of petroleum 

product consists of a mixture of the two adjacent volumes and is called 

“interface.” Generally, interface mixture is blended into the two adjoining 

products that created the interface. Transmix is an interface consisting of 

two adjacent dissimilar petroleum products, such as gasoline and distillate fuel, which cannot be blended into either of the two adjacent products without causing either of them to violate commercial standards. 


Since transmix cannot be blended into either of the two adjacent products 

transported by the pipeline, it is diverted by the pipeline into a separate 

storage tank. Transmix is generally transported via tank truck, pipeline or 

barge to a facility designed to separate the transmix into its fuel components. For example, where the transmix consists of gasoline and distillate 

fuel, the transmix may be transported to a “transmix processing” facility 

where the gasoline portion is separated from the distillate fuel. At locations where it is either relatively expensive or inconvenient to transport 

transmix to a transmix processing facility for separation, the transmix is 

sometimes blended into gasoline in very small amounts, typically around 

0.25 volume percent of the gasoline. 

The RFG and anti-dumping requirements apply at any facility where 

gasoline is produced. Gasoline most commonly is produced by processing crude oil at refineries, but it is also produced by other processes, such 

as combining blendstocks or adding blendstocks to finished gasoline. 

Gasoline is also produced when transmix is blended into gasoline, or 

when transmix is separated into gasoline and distillate fuel. Transmix 

blending is similar to adding blendstock to gasoline where the addition of 

the transmix, like blendstock, may change the properties of the gasoline. 

Similarly, the process of separating gasoline and distillate fuel may result 

in gasoline with different properties than the gasoline originally certified 

by the refinery. 

Transmix processors and transmix blenders are refiners under the RFG/ 

anti-dumping regulations, but EPA has historically provided transmix 

processors and transmix blenders with flexibility in complying with the 

refiner requirements. Parties have been processing and blending transmix 

in accordance with EPA guidance (See Reformulated Gasoline and Antidumping Questions and Answers (November 12, 1996)). This Direct Final Rule would incorporate most of the existing guidance, and would also 

include modifications reflecting EPA experience. Our experience since 

the guidance was issued indicates that the approach taken in the guidance 

is mostly appropriate, but that some revisions are warranted. 

Lastly, in the preamble to the gasoline sulfur regulations, EPA indicated 

that the Agency would establish requirements for transmix processors in 

a future rulemaking (65 FR 6800, February 10, 2000). Therefore, as part 

of this rulemaking, EPA is including requirements for transmix processors and transmix blenders under the gasoline sulfur regulations at 40 

CFR Part 80, subpart H. 


Alternative Quality Assurance at Downstream 

Blending Facilities

The RFG regulations currently require RFG to contain a minimum of 

2.0 weight percent oxygen (40 CFR § 80.41). To fulfill this requirement, 

oxygenate is either added at the refinery before the gasoline is certified 

by the refiner as meeting RFG requirements, or it is added downstream 

from the refinery at an oxygenate blending facility. As discussed in more 

detail below, refiners often wish to require that more than the minimum 

amount of oxygenate be added downstream in order to include the additional oxygenate in their emissions performance compliance calculations 

Although the Energy policy Act mandated the removal of the oxygen 

requirement for RFG, we believe many refiners and importers may wish 

to continue to include oxygenate added downstream in their emissions 

compliance calculations. Under the current regulations, refiners must 

conduct a program of quality assurance (QA) testing at the downstream 

oxygenate blending facility in order to include the oxygenate in their 

compliance calculations. This Direct Final Rule provides an alternative 

QA requirement for these refiners and importers. 

Under the current regulations, when oxygenate is to be added to produce 

RFG at a downstream oxygenate blending facility, refiners produce a 

product called reformulated gasoline blendstock for oxygenate blending, 

or RBOB. RBOB is certified by the refiner, or by an importer who imports RBOB, as complying with all of the RFG requirements except the 

minimum 2.0 weight percent oxygen requirement. The oxygenate blender 

is responsible for complying with the oxygen requirement when the oxygenate is added to the RBOB to produce RFG at the oxygenate blending 

facility. 

Various oxygenates may be used to fulfill the oxygen requirement. Some 

oxygenates, such as ethanol, have a propensity to attract water. As a result, these oxygenates cannot be added at the refinery, particularly where 

the finished gasoline will be traveling through a pipeline on its way to 

terminals and retail gasoline stations. Thus, RFG containing ethanol is 

typically produced by blending the ethanol with RBOB at a blending 

facility downstream from the refinery that produced the RBOB. 

Refiners and importers of RBOB are required to calculate compliance 

with the RFG emissions performance standards for volatile organic 

compounds (VOC), nitrogen oxides (NOx) and toxics by sampling and 

testing a hand-blended mixture of the RBOB and the type and amount of 

oxygenate that the refiner or importer of the RBOB designates must be 

4
added downstream. If the refiner or importer does not meet certain contractual and quality assurance requirements, the refiner or importer must 

assume for purposes of its handblend that 4.0 volume percent ethanol 

will be added to the RBOB downstream. 

The states of New York and Connecticut passed laws banning the use 

of the oxygenate methyl tertiary butyl ether (MTBE) in gasoline sold 

in these states. As a result, many refiners and importers that historically 

produced or imported RFG containing MTBE for the NY/CT RFG area 

currently produce or import RBOB for ethanol blending. Refiners in that 

area have indicated that, due to the complex gasoline marketplace in New 

York and Connecticut, it is extremely difficult, if not impossible, to track 

RBOB from the refinery where it is produced to the terminal where it is 

blended with ethanol in order the fulfill the downstream QA sampling 

and testing requirement. As a result, under the current regulations, refiners in the NY/CT RFG area are effectively precluded from producing an 

RBOB which requires a specific type and amount of oxygenate, such as 

10 volume percent ethanol, and instead must produce a generic any-oxygenate RBOB, which does not require the refiner to conduct downstream 

QA testing at the ethanol blender facility. 

This rulemaking provides RBOB refiners and importers the option to 

comply with an alternative QA requirement which consists of a program 

of sampling and testing designed to provide oversight of all terminals 

that blend ethanol with RBOB for use in a specified RFG covered area. 

Under this option, a refiner or importer must either arrange to have an independent surveyor conduct a program of compliance surveys, or participate in the funding of an organization which arranges to have an independent surveyor conduct a program of compliance surveys. In either event, 

compliance surveys must be carried out by an independent surveyor 

pursuant to a survey plan calculated to achieve the same QA objectives 

as the current regulatory requirement. A detailed survey plan must be 

submitted to EPA for approval by September 1st of the year preceding 

the annual averaging period in which the alternative QA sampling and 

testing program would be implemented. The survey plan must include a 

methodology for determining when the survey samples will be collected, 

the location of the retail outlets where the samples will be collected, the 

number of samples to be included in the survey, and any other elements 

that EPA determines are necessary to achieve the same level of quality 

assurance as the current QA requirement. 

5
We believe that use of this QA compliance alternative will result in oversight sampling and testing that is equivalent to the current regulatory QA 

requirement, and may, in fact, result in significantly superior QA oversight, since the sampling and testing will be conducted by an independent 

surveyor in accordance with a comprehensive plan approved by EPA, 

rather than by individual refiners and importers. This rule will not have 

any adverse environmental impact, and will provide refiners and importers with additional flexibility in complying with the regulations. As a 

result, while this rulemaking was initiated in response to the compliance 

issues raised by refiners in the New York / Connecticut area, we believe 

it is appropriate to provide this compliance alternative to refiners and 

importers supplying any RFG covered area. The rule, therefore, provides 

this QA compliance alternative to any RBOB refiner or importer in any 

RFG area who either arranges to have an independent surveyor conduct 

a program of compliance surveys, or who participates in the funding of 

an organization that arranges to have an independent surveyor conduct a 

program of compliance surveys, in accordance with the provisions in this 

Direct Final Rule. 

Compliance with this QA alternative is optional. Refiners and importers 

may choose to comply with the existing QA requirement and not participate in the survey program. Refiners and importers who supply more than 

one RFG area may choose to participate in the survey program for one 

RFG area and comply with the existing QA requirement for another RFG 

area. 

Health and Environmental Impacts

The clean air benefits of these programs will continue to be realized. 

There will be no adverse health or environmental impacts as a result of 

this rulemaking. 

Flexibility to Industry

EPA believes the flexibilities provided for transmix operations by this 

Direct Final Rule are appropriate, given the unique roles that transmix 

processors and transmix blenders fill in the petroleum products distribution system. Although these parties are refiners under EPA’s regulations, 

almost all of the gasoline and distillate fuel they produce is derived from 

fuel which has already been produced and certified by an upstream refinery or importer. Thus, this Direct Final Rule allows transmix processors 

the flexibility to exclude conventional gasoline that they recover directly 

6
from transmix from their antidumping compliance calculations, since the 

conventional gasoline has already been accounted for in the compliance 

calculations of an upstream producer. Similarly, this Direct Final Rule 

allows transmix processors to only have to meet the downstream sulfur 

standards (as opposed to the more stringent refinery standards) for gasoline they recover directly from transmix, since the gasoline has already 

been accounted for in the compliance calculations of an upstream refinery. However, transmix processors must comply with all refiner standards at each of their transmix processing facilities for any blendstocks 

they add to gasoline. Lastly, this Direct Final Rule allows transmix 

blenders to blend transmix into gasoline without restriction on location 

or rate, provided the distillation endpoint of the transmix-blended gasoline does not exceed 437 degrees Fahrenheit, and that the gasoline meets 

all applicable downstream standards. 

This Direct Final Rule also provides significant additional flexibility 

to refiners supplying RBOB to be blended with ethanol, especially at 

distant locations. The survey plan described above will allow refiners greater flexibility in making RFG by adding the most cost-effective 

amount of oxygenate to their reformulated blendstocks for oxygenate 

blending. 

For Further Information 

You can access the Direct Final Rule and concurrent Notice of Proposed 

Rulemaking from EPA’s Office of Transportation and Air Quality Web 

site at: 

www.epa.gov/otaq/rfg_regs.htm 

For further information about the Direct Final Rule, contact Chris McKenna at (202) 343-9037 (E-mail: mckenna.chris@epa.gov) regarding 

the transmix portion of the rule and Marilyn Bennett at (202) 343-9624 

(E-mail: bennett.marilyn@epa.gov) regarding the alternative quality assurance procedure.