Conrad and Chuck:

Thanks again for making time last week to go over EMI’s fugitive emission source control plan

and proposed HAP testing protocol and schedule. Attached are the complementary materials for

Felman. Specifically, attached are:

(1)

A narrative description and engineering diagrams prepared by Felman’s consultants, Chu

&

Gassman, of a proposed fugitive emission control system for the Felman shop that we conservatively expect to eliminate 95% of the shop’s process fugitive emissions of parti culate

matter, re-routing these emissions to new and existing baghouses designed for 98% control

efficiency;

(2) The final test protocol for Felman’s planned July 2012 testing for mercury, PAH,

hydrochloric acid, and formaldehyde (i.e., the four pollutants EPA has proposed to add to the

existing ferroalloy NESHAP); and

(3)

A proposed protocol for additional testing to be performed in the first quarter of 2013 and

which would include testing for dioxin/furans and PCB5 at furnace #2. The latter we

areproposing in response to Chuck’s June 28th request for dioxin/furans and PCB data based on we

understand to be concerns at EPA about the reliability and representativeness of the dust analysis

data Felman collected on these pollutants per EPA’S April 2010 ICR.

We provide the attached materials in follow up to and consistent with the written

comments

Felman submitted on the proposed rule and the various meetings and telephone conferences

between EPA and the two companies, Felman and EMI, since that time. As we have repeatedly

emphasized in our written comments and subsequent discussions, the proposed rule’s “total

building enclosure” approach to emission control is infeasible and would very likely lead to the

end of the u.s. ferroalloy production industry. Felman remains committed, however, to driving

down its emissions of hazardous air pollutants; the attached proposal demonstrates the significant

emissions improvements that are possible with a control system targeting keyprocesses and

equipment. Please note that the control system described in chu

& Gassman’s report is, at this

point, merely a proposed strategy for capturing fugitive emissions in a more cost—effective

manner than EPA’S “total building enclosure.” Felman has not obtained (or, indeed,

even

requested) management approval to implement the work laid out in the proposal (which

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of Section 112(f) of the Clean Air Act, Felman will take the next steps forward in implementing the project, namely, seeking from Chu

& Gassman a detailed cost estimate and

app roxi mate

implementation ti mel i ne.

The test protocols, in turn, are designed to help the Agency fill in the numerous data aps in the

emissions profile for the industry that both Felman and EMI identified in their written comments

(especially with respect to the wide variability in furnace operations) and which the Agency itself

has noted with respect to Felman’s ICR data. As discussed in our telephone call on June 28th, it is

not practical for Felman to incorporate the requested dioxin/furans and PcB testing into its July protocol, but we are proposing to include those pollutants in the next scheduled stack testing. The next testing would be in the first quarter of 2013, likely in January or February. Again, as previously discussed, the purpose of conducting the testing in the first quarter is to gather emissions data in the winter months when the HAP content of the ores is different and when the

furnaces are running at a different temperature, both of which could have an impact on

emissions. Our proposal to conduct a second round of stack tests in early 2013 is also in

recognition of the fact that EPA is under both a statutory and a consent decree-specified deadline

to complete its risk and technology review of the current ferroalloy NESHAP. We understand

that, per agreement of the parties, that consent decree deadline is currently set at September 14,

2012. Obviously the collection of data in the first quarter of 2013 is conditioned

upon anextension of that deadline; indeed, we would anticipate an extension to no sooner than July 15,

2013, which we estimate to be an appropriate amount of time for EPA to review and

process the

1Q 2013 emissions data. Finally, similar to the fugitive emission control strategy, the 2013

testing is also subject to management approval.

we are next scheduled to meet and discuss the details of both EMI’s and Felman’s

fu9itive

emissions control efforts on July 16th. We’ve asked a representative from Chu

& Gassman (Jack

wang, the primary author of the attached design narrative) to be available by phone

on the 16th.

But we are also happy to discuss any specific questions you may have on the controlsystem

design before then. Jack as well as the full Felman team are generally available this Friday, July

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San Francisco, CA 94104

T (415) 262-4029 F (415) 262-4040 ALi ncol n@bdl aw. corn

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