Oil and Natural Gas NSPS and NESHAP

Update for Interagency Review

March 5, 2012
Overview

► Overview of Public Comments Received

► Summary of Significant Changes from Proposal

► Impacts

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Oil and Natural Gas Operations

Crude Oil to Refineries 

(not covered by these 

rules)

Production & Processing

1. Drilling and Well Completion

2. Producing Wells

3. Gathering Lines

4. Gathering and Boosting Compressors

5. Gas Processing Plant

3

1

2

4

5

Oil and natural gas systems encompass wells, gas gathering and processing facilities, storage, as well as transmission and 

distribution pipelines. These components are all important aspects of the process of getting natural gas out of the 

ground and to the end user. 

Source: Adapted from American Gas Association and EPA Natural Gas STAR Program 3

6

7

8

10a

10b

10c

10d

9

Transmission & Storage

6. Transmission Compressor Stations

7. Transmission Pipeline

8. Underground Storage

Distribution (not covered by these rules)

9. Distribution Mains

10. Regulators and Meters for:

a. City Gate

b. Large Volume Customers

c. Residential Customers

d. Commercial Customer
Overview of Comments from Stakeholders

► More than 156,000 comments received on proposal

► Environmental community

► Generally supportive of the rulemaking regarding treatment of 

upstream operations (wells to gas processing plants)

► Believes we should regulate methane and cover existing sources, 

not just new sources, under the NSPS 

► Oil and gas industry

► Asserts that we are regulating methane under the guise of 

regulating VOC

► Claims that EPA’s emission factor overestimates emissions from 

well completions

► Generally supportive of control requirements

► Concerns with implementation and administrative burden

► States

► Generally supportive

► Want to minimize conflict with existing state regulations Deliberative – Do Not Cite or Quote 4
Summary of Significant Changes to NSPS

►Well Completions

►2 year delay for requiring reduced emission completion

•Based on unavailability of sufficient REC equipment to comply by the effective date

•For 2 years after publication, best system of emission reduction (BSER) will be combustion

►Clarified the period of well completion that is being regulated

•Begins with flowback following fracturing

•Ends with (1) well shut-in or (2) gas continuously routed to sales line (whichever 

is earlier)

►Formed new subcategory for “low pressure” wells

•Avoids wells with pressure inadequate to overcome gathering line being 

required to perform reduced emission completions

• Uses formula involving vertical well depth and reservoir pressure

•Will be required to flare (treated same as wildcat and delineation wells)

►Streamlined notification requirements

•Companies submit single “bulk” notification for all completions for upcoming 

month, instead of individually

•Submit 2-day follow-up e-mail for each completion

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Summary of Significant Changes to NSPS

►Compressors

►Reciprocating compressors

•Require changing rod packing every 26,000 hours of operation

•Added a new alternative that operators can change packing every 36 months instead of 

tracking hours of operation

►Centrifugal compressors

•Compressors in transmission and storage segments (emitting pipeline quality 

natural gas) are not affected

•Redefined “affected facility” to be only compressors with wet seal systems

•Require 95 percent control for wet seal systems

•Dry seal compressors (inherently low in emissions) are not regulated

►Pneumatic Controllers

►Controllers in transmission and storage segments are not affected

►Only “continuous bleed natural gas operated controllers” are affected

►Storage Vessels

►Changed applicability criteria from liquid throughput to VOC emissions

►Vessels emitting at least 6 tpy must reduce emissions by 95 percent 

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Impacts of NSPS Improvements

Emission Point 

or Activity

VOC

Reduction 

(tons/yr)

Methane 

Reduction 

(tons/yr)

VOC Cost 

Effectiveness 

(w/o savings) 

($/ton)

Methane Cost 

Effectiveness 

(w/ savings)

($/ton)

Total 

Nationwide 

Costs

(w/savings)

($ million/yr)

Total

Nationwide

Costs

(w/o savings)

($ million/yr)

Completions 240,000 1,600,000 (40) to 1400 (6) to 200 (9.3) 320.0

Storage vessels 30,000 6,500 200 900 to 930 5.9 6.0

Production 

(Compressors, 26,000 92,000 (800) to 33 (220) to 9 (21.0) 0.84

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(Compressors, 

Pneumatics)

26,000 92,000 (800) to 33 (220) to 9 (21.0) 0.84

Processing 

(Equipment Leaks, 

Compressors, and 

Pneumatics)

1,500 7,400 (500) to 650 (100) to 140 (0.76) 1.0

TOTAL 293,000

1.7 million

(33 MMT 

CO2-e)

(60) to 1,100 (10) to 200 (18) 335

Note: “Savings” above are realized through recovery of salable natural gas product. 

Total costs shown include $7.1 million of annualized reporting and recordkeeping costs.

Totals may not sum due to independent rounding.
NSPS Impacts: Changes from Proposal 

Costs Proposal Final

Annualized Compliance Costs ($/yr) 738 million 335 million

Revenues from Product Recovery ($/yr) 783 million 353 million

Net Annualized Compliance Costs ($/yr) (45 million) (18 million)

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Emissions

VOC Reductions (tons/yr) 535 thousand 293 thousand

Methane Reductions (tons/yr) 3.4 million 1.7 million

Well Completions

Well completions (number/yr) 22,000 11,000

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Impacts of NESHAP Improvements

Emission Point or 

Activity

Facilities 

Requiring 

Control

HAP

Reduction 

(tons/yr)

HAP 

Reduction 

(percent)

HAP Cost 

Effectiveness

($/ton)

Total

Costs

($ million/yr)

Small Dehydrators

(Production) 74 500 59 3,300 1.7

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Small Dehydrators

(Transmission/Storage) 7 160 85 810 0.13

Storage Vessels 376 590 72 23,000 13.0

TOTAL 1,260 $18 million

Note: Total costs shown include $2.4 million of annualized reporting and recordkeeping costs. 

Totals may not sum due to independent rounding.
NESHAP Impacts: Changes from Proposal 

Costs Proposal Final

Annualized Compliance Costs ($/yr) 16 million 18 million

Emissions

HAP Reductions (tons/yr) 1,380 1,260

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