Document ID: EPA-HQ-OW-2004-0002-0679
Agency: epa
Document Type: Supporting & Related Material
Title: 
Posted Date: 2004-11-30T05:00Z

1
MEMORANDUM
Date:
September
24,
2004
To:
316(
b)
Phase
III
Rulemaking
Record
(
Non­
CBI)
From:
Anne
Jones,
ERG,
Inc.
Subject:
Calculation
of
Weights
for
Engineering
Cost
Estimates
In
this
memorandum,
ERG
calculates
the
weights
assigned
to
MODUs
and
platforms
that
were
surveyed
using
information
derived
from
the
316(
b)
survey
of
MODUs
and
platforms
(
TetraTech,
2004),
as
well
as
weights
for
MODUs
and
platforms
that
voluntarily
provided
data
to
EPA
(
Non­
CBI
In
Scope
Facility
Database
 
DCN
7­
3505).
These
weights
are
used
for
two
purposes.

First,
they
are
used
to
calculate
average
capital
and
O&
M
costs
using
the
engineering
cost
estimates
derived
by
EPA
(
U.
S.
EPA
2004a)
for
both
surveyed
and
non­
surveyed
existing
oil
and
gas
facilities.
The
average
costs,
by
facility
type
(
deepwater
platform/
structure,
Alaska
platform,
and
semi­
submersible,
jackup,
and
drill
ship
MODU),
are
used
as
a
proxy
for
compliance
costs
to
new
facilities
of
these
types.

Second,
they
are
used
to
compute
the
hypothetical
incremental
costs
of
the
316(
b)
rule
had
EPA
chosen
to
regulate
existing
oil
and
gas
facilities.

Sections
1
and
2
discuss
the
derivation
of
weights
for
MODUs
and
platforms,
respectively.
In
general,
these
derivations
involved
a
2­
step
process.

As
the
first
step,
ERG
discusses
briefly
how
the
weights
of
the
surveyed
facilities
were
derived
based
on
the
survey
sampling
plan,
adjusted
for
non­
responses.
Most
of
this
step
relies
on
information
found
in
spreadsheets
showing
the
original
sampling
strata
and
the
facilities
sampled
in
the
316(
b)
survey
(
DCN
7­
4021).
The
original
groups
of
facilities
in
each
sampling
frame
were
developed
based
on
information
in
DCN
7­
4022,
which
merged
data
from
EPA's
contractor,
TetraTech
(
DCN
7­
4023)
and
MMS
(
DCN
7­
4025,
DCN
7­
4026,
DCN
7­
4027).
Preliminary
strata
selected
for
sampling
are
discussed
in
ERG
(
2003)
and
are
finalized
as
discussed
in
Westat
(
2003)
and
summarized
below.
These
strata
and
the
facilities
they
encompass
are
shown
in
the
sampling
frame
spreadsheets
(
DCN
7­
4021).

As
the
second
step,
ERG
further
adjusted
these
weights
to
account
for
extra­
survey
information
that
could
be
applied
to
refine
the
representativeness
of
the
survey
data.
These
data
are
shown
in
DCN
7­
3505.

1.
Derivation
of
Weights
for
MODUs
1.1
Calculation
of
Survey
Weights
ERG
first
investigates
information
derived
from
the
survey
of
MODUs
undertaken
for
the
purposes
of
the
Phase
III
rulemaking
decision
(
Tetra
Tech,
2004).
Not
all
of
the
MODUs
identified
as
currently
operating
1
The
original
universe
was
404;
duplicates
were
found
and
eliminated
after
the
survey
was
returned,
leaving
384
non­
duplicates
in
the
sampling
universe.

2
(
See
Chapter
C2
in
the
EA;
U.
S.
EPA,
2004b)
would
be
subject
to
the
proposed
rule
for
oil
and
gas
facilities
had
they
been
regulated
as
new
facilities.
EPA
used
a
multi­
step
process
to
estimate
the
total
number
of
existing
MODUs
that
would
be
regulated
under
the
proposed
rule
were
they
to
be
constructed
in
the
future
(
i.
e.,
CWISs
with
total
design
flow
of
at
least
2
MGD
and
greater
than
25
percent
of
intake
volume
used
for
cooling
water
purposes).
This
process
relied
on
information
in
TetraTech
(
2004).

The
following
is
the
status
of
the
economic
survey
respondents
(
TetraTech,
2004):

23
respondents
returned
surveys.

8
respondents
were
determined
to
have
CWISs
that
meet
proposed
rule
criteria.

15
respondents
were
determined
to
have
CWISs
that
do
not
meet
proposed
rule
criteria
or
were
not
operating
in
U.
S.
waters

4
surveys
were
not
returned
from
among
a
group
of
MODUs
whose
CWIS
intake
rates
were
known
and
were
considered
to
meet
proposed
316(
b)
criteria
(
based
on
voluntary
data
submitted
during
the
316(
b)
Phase
I
rulemaking)
(
see
DCN
7­
3505)

3
surveys
were
not
returned
among
a
group
of
MODUs
whose
CWIS
intake
rates
were
unknown.

The
original
sampling
frame
for
MODUs
(
DCN
7­
4021)
included
404
MODUs.
After
the
survey
was
completed,
ERG
noted
several
duplicate
facilities
(
no
duplicate
facilities
were
sampled
twice).
These
duplicates
were
removed
from
the
universe,
which
reduced
the
universe
to
384
MODUs
(
see
Final
MODU
List,
DCN
7­
4029).
The
final
count
of
384
MODUs,
with
their
parent
companies,
is
summarized
in
Table
C2­
1
in
the
EA
(
U.
S.
EPA,
2004b).
1
EPA
sampled
30
of
these
384
MODUs
in
the
survey.
The
adjusted
statistical
weight
for
each
MODU
is
thus
384
divided
by
30,
or
12.8.

Based
on
the
ratio
of
respondents
whose
intake
rates
meet
proposed
316(
b)
criteria
to
total
respondents
(
8/
23),
EPA
assumes
that
among
the
3
MODUs
with
unknown
intake
rates,
1
would
have
intake
rates
meeting
proposed
criteria
and
2
would
have
intake
rates
not
meeting
proposed
criteria.
Thus
the
total
number
of
MODUs
in
the
economic
survey
sample
whose
intake
rates
are
assumed
to
meet
proposed
criteria
is
estimated
to
be
13
(
including
the
8
respondents,
the
1
nonresponse
with
unknown
CWIS
rates
that
was
imputed
in­
scope,
and
the
4
nonresponses
with
known
in­
scope
CWIS
rates).
Multiplying
this
number
(
13)
by
the
survey
weight
of
12.8
yields
an
estimate
of
a
total
of
166
MODUs
with
intake
rates
meeting
proposed
rule
criteria.

1.2
Adjustments
To
Weights
Using
Extra­
Survey
Information
EPA
needed
to
refine
weights
in
order
to
fully
use
all
technical
data
from
the
voluntary
survey
of
members
of
the
International
Association
of
Drilling
Contractors
(
IADC)
to
compute
aggregate
costs
to
existing
MODUs
(
DCN
7­
3505).
EPA
used
this
technical
information
to
develop
vessel­
specific
compliance
costs
2
53
of
the
384
are
foreign­
based
and
not
considered
affected
by
this
rulemaking.

3
for
an
additional
71
MODUs
not
sampled
in
the
survey.
This
information
is
used
to
determine
what
the
additional
cost
of
the
Phase
III
rulemaking
would
have
been
had
EPA
opted
to
regulate
existing
MODUs
and
to
calculate
the
weighted
average
cost
of
compliance
by
type
of
MODU.

1.2.1
Additions
to
the
Universe
or
Adjustments
to
Total
Numbers
of
MODUs
To
compute
the
weights
of
existing
MODUs
for
the
purposes
of
aggregating
the
engineering
cost
estimates,
the
following
approach
was
used.
After
the
survey
was
undertaken,
ERG
identified
6
MODUs,
originally
thought
have
intake
rates
of
less
than
2
MGD
based
on
IADC
data,
that
were
subsequently
determined
to
have
intake
rates
greater
than
2
MGD.
Since
these
MODUs
were
never
included
in
the
original
sampling
frame,
ERG
adds
them
to
the
original
estimate
of
MODUs
with
CWISs
meeting
proposed
criteria
(
166
MODUs),
for
a
total
of
172
MODUs
meeting
proposed
criteria
(
DCN
7­
4029).
This
is
roughly
half
of
the
existing
MODUs
operating
in
U.
S.
waters,
which
total
331
MODUs
or
about
52
percent.
2
1.2.2
Adjusting
Drill
Ship
Weights
Of
the
172
MODUs
believed
to
meet
proposed
316(
b)
criteria,
seven
are
drill
ships
and
all
of
these
have
technical
data
available
and
are
assigned
estimated
compliance
costs
(
DCN
7­
3505).
Two
of
the
drill
ships
were
sampled
in
the
survey
and
meet
the
proposed
criteria.
Had
EPA
used
the
original
survey
weights
for
these
two
drill
ships,
EPA
would
have
estimated
that
26
drill
ships
operate
in
the
Gulf,
which
is
known
to
be
false.
To
avoid
overestimating
drill
ships,
EPA
assigns
a
weight
of
one
to
all
seven
drill
ships,
including
the
two
that
were
surveyed.

1.2.3
Calculation
of
Weights
for
MODUs
Other
Than
Drill
Ships
With
Technical
Data
After
removing
the
seven
drill
ships
from
the
list
of
MODUs,
165
MODUs
remained
to
have
weights
assigned.
EPA
has
technical
data
on
87
MODUs
that
are
considered
in­
scope.
(
DCN
7­
3505)
Of
these,
80
are
not
drill
ships.
Of
these
80,
71
were
not
sampled
in
the
316(
b)
survey.
These
71
were
assigned
a
weight
of
1.
ERG
does
this
because
this
group
of
MODUs
may
not
be
representative
of
MODUs
in
general.
ERG
believes
that
the
group
of
MODUs
surveyed
by
IADC
may
be
highly
biased
towards
MODUs
with
relatively
high
CWIS
intake
rates
and/
or
large
numbers
of
CWISs
(
due
to
the
voluntary
nature
of
the
IADC
survey).
To
avoid
the
possibility
of
overstating
compliance
costs
by
assuming
all
MODUs
with
technical
data,
regardless
of
whether
they
were
sampled
or
not,
have
equal
weights,
ERG
assumed
the
MODUs
with
technical
data
that
were
not
surveyed
in
the
316(
b)
survey
represent
themselves
only.
Thus
ERG
assigns
a
weight
of
1
to
a
total
of
78
MODUs
(
71
non­
surveyed
MODUs
with
technical
data
and
7
drill
ships).

1.2.4
Calculation
of
Weights
for
Surveyed
MODUs
Other
Than
Drill
ships
Out
of
the
172
MODUs
considered
to
meet
proposed
criteria,
an
estimated
94
MODUs
(
172
total
MODUs
minus
78
MODUs
assigned
a
weight
of
one)
are
not
a
part
of
the
group
assigned
a
weight
of
1.
These
MODUs
are
assumed
to
be
represented
by
the
surveyed
MODUs.
3There
are
13
sampled
MODUs,
of
which
one
was
a
nonrespondent
imputed
"
in­
scope."
This
nonrespondent
MODU
had
no
technical
data
available,
except
that
it
is
known
not
to
be
a
drill
ship.
Thus
ERG
returned
this
MODU
to
the
pool
of
MODUs
assumed
to
be
represented
by
the
surveyed
MODUs
considered
in
scope.
That
is,
it
is
one
of
the
94
MODUs
represented
by
the
surveyed
respondents.
One
of
the
13
respondents
returned
an
economic
survey,
but
had
no
technical
data
in
EPA's
database.
It
is
a
semi­
submersible,
so
its
compliance
costs
were
imputed
based
on
costs
assigned
to
the
other
in­
scope
semi­
submersibles
that
responded
to
EPA's
survey.
The
cost
to
this
MODU
is
used
only
to
generate
aggregate
costs
for
existing
MODUs
(
ERG,
2004a)
and
to
analyze
MODU
impacts
(
ERG,
2004b).

4
Out
of
the
count
of
13
sampled
MODUs
that
are
estimated
or
assumed
to
meet
proposed
316(
b)
criteria,
EPA
has
technical
data
or
imputes
technical
data
for
12
MODUs,
of
which
10
are
not
drill
ships.
3
These
94
MODUs
are
assumed
to
be
represented
by
the
10
non­
drill­
ship
MODUs
that
were
sampled
in
the
survey
and
that
are
considered
to
meet
proposed
316(
b)
criteria.
The
weight
of
each
of
the
10
representative
MODUs
is
thus
calculated
to
be
9.4
(
94/
10).
Table
1
shows
the
weights
for
all
MODUs
for
which
technical
information
is
available
and
for
which
engineering
estimates
are
available
and/
or
imputed.

Table
1.
Weights
Assigned
to
MODUs
For
Engineering
Cost
Purposes
Parent
Company
MODU
Name
Assigned
Weight
Glomar
Glomar
CR
Luigs
1
Transocean
Transocean
Discoverer
Deep
Seas
1
Glomar
Glomar
Explorer
1
Transocean
Transocean
Discoverer
Enterprise
1
Transocean
Transocean
Discoverer
Spirit
1
Transocean
Transocean
Deepwater
Millennium
1
Transocean/
Deepwater
Drilling
LLC
Transocean
Deepwater
Pathfinder
1
Nabors
Nabors
BR­
201
1
Nabors
Nabors
BR­
11
1
Nabors
Nabors
BR­
12
1
Rowan/
Rowan
Companies
Inc.
Rowan
Alaska
1
Rowan/
Rowan
Companies
Inc.
Rowan
Juneau
1
Rowan/
Rowan
Companies
Inc.
Rowan
Louisiana
1
Rowan/
Rowan
Companies
Inc.
Rowan
Odessa
1
ENSCO
ENSCO
64
1
Rowan/
Rowan
Companies
Inc.
Arch
Rowan
1
Rowan/
Rowan
Companies
Inc.
Cecil
Provine
1
Rowan/
Rowan
Companies
Inc.
Gilbert
Rowe
1
Rowan/
Rowan
Companies
Inc.
Rowan
California
1
Rowan/
Rowan
Companies
Inc.
Rowan
Fort
Worth
1
Rowan/
Rowan
Companies
Inc.
Rowan
Halifax
1
Rowan/
Rowan
Companies
Inc.
Rowan
Middletown
1
Rowan/
Rowan
Companies
Inc.
Rowan
Paris
1
Rowan/
Rowan
Companies
Inc.
Rowan
Gorilla
II
1
Rowan/
Rowan
Companies
Inc.
Rowan
Gorilla
III
1
Rowan/
Rowan
Companies
Inc.
Rowan
Gorilla
IV
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
High
Island
1
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
High
Island
2
9.4
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
High
Island
3
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
High
Island
8
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Adriatic
10
9.4
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
High
Island
4
1
Parent
Company
MODU
Name
Assigned
Weight
5
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Main
Pass
1
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Main
Pass
4
9.4
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Adriatic
2
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Adriatic
3
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Adriatic
4
1
Noble
Noble
Carl
Norberg
1
Noble
Noble
Eddie
Paul
1
Noble
Noble
Johnnie
Hoffman
1
Noble
Noble
Sam
Noble
9.4
Noble
Noble
Tom
Jobe
1
Noble
Noble
Bill
Jennings
1
ENSCO
ENSCO
60
1
ENSCO
ENSCO
68
1
ENSCO
ENSCO
69
1
ENSCO
ENSCO
81
1
ENSCO
ENSCO
82
1
ENSCO
ENSCO
83
1
ENSCO
ENSCO
84
1
ENSCO
ENSCO
86
1
ENSCO
ENSCO
87
1
ENSCO
ENSCO
88
9.4
ENSCO
ENSCO
89
1
ENSCO
ENSCO
90
1
ENSCO
ENSCO
93
1
ENSCO
ENSCO
95
1
ENSCO
ENSCO
98
1
ENSCO
ENSCO
99
1
Rowan/
Rowan
International
Inc.
Rowan
Anchorage
9.4
Rowan/
Rowan
International
Inc.
Rowan
Houston
1
Rowan/
Rowan
International
Inc.
Rowan
New
Orleans
1
Rowan/
Rowan
Drill
Inc.
Rowan
Texas
1
Rowan/
Rowan
Companies
Inc.
Charles
Rowan
9.4
Noble
Noble
Earl
Fredrickson
1
Noble
Noble
Leonard
Jones
1
ENSCO
ENSCO
26
1
Rowan
Rowan
Midland
1
Transocean
Transocean
Deepwater
Horizon
1
Transocean
Transocean
Deepwater
Nautilus
9.4
Noble
Noble
Homer
Ferrington
1
Transocean
Transocean
Rather
1
Transocean
Transocean
Richardson
1
Transocean
Falcon
100
1
ENSCO
ENSCO
7500
1
Noble
Noble
Amos
Runner
1
Noble
Noble
Jim
Thompson
1
Noble
Noble
Max
Smith
1
Noble
Noble
Paul
Romano
1
Transocean
Transocean
Marianas
1
Transocean
Transocean
Cajun
Express
1
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Arctic
1
9.4
Parent
Company
MODU
Name
Assigned
Weight
6
Global
Santa
Fe/
Glomar
Global
Santa
Fe
Glomar
Celtic
Sea
1
Noble
Noble
Joe
Alford
1
Noble
Noble
Lester
Pettus
1
ENSCO
ENSCO
25
1
ENSCO
ENSCO
29
1
Pride
Pride
Viking
9.4
Total
172
Source:
DCN
7­
3505,
DCN
7­
4021,
DCN
7­
4029,
ERG
estimates.

2.
Weights
for
Platforms
Very
few
existing
platforms
appear
to
have
CWISs
with
intake
rates
that
meet
the
proposed
rule's
criteria.
Most
of
the
existing
platforms
with
CWISs
of
this
size
are
located
in
the
deepwaters
of
GOM
and
in
California
and
Alaska
waters
(
Cook
Inlet).
Using
the
same
approach
as
outlined
for
determining
existing
MODUs
with
CWIS
intake
rates
meeting
proposed
rule
criteria,
EPA
makes
estimates
of
the
number
of
platforms
that
would
be
regulated
had
EPA
covered
existing
platforms
under
316(
b).
These
estimates
rely
initially
on
information
from
the
survey
conducted
for
the
oil
and
gas
sectors
to
support
this
rulemaking
(
TetraTech,
2004).

The
following
sections
discuss
weights
for
platforms
in
the
GOM
(
Section
2.1),
platforms
off
the
California
coast
(
Section
2.2)
and
platforms
in
Alaska
(
Section
2.3).

2.1
Gulf
of
Mexico
EPA
divided
the
survey
in
the
GOM
into
three
strata:
deepwater,
shallow
large
(
20+
slot
platforms),
and
shallow
small
(
fewer
than
20
slots)
(
DCN
7­
4021).
These
three
strata
are
discussed
separately
below.

2.1.1
Deepwater
Calculation
of
Survey
Weights
A
total
of
26
platforms
are
identified
as
operating
in
deepwater
Gulf
locations
(
DCN
7­
4022).
The
survey
universe
of
deepwater
structures
was
24
(
2
structures
were
removed
from
the
universe
prior
to
the
survey
because
their
CWIS
intake
rates
were
known
to
be
less
than
2
MGD)
(
Westat,
2003).
For
the
survey,
EPA
sampled
four
facilities
(
DCN
7­
4021).
There
were
no
nonrespondents
(
TetraTech,
2004).
Only
one
of
the
four
reported
data
showing
them
to
have
CWIS
intake
rates
meeting
proposed
rule
criteria
(
DCN
7­
3505).
Thus
EPA
estimates
that
6
deepwater
structures
would
have
CWIS
intake
rates
meeting
proposed
rule
criteria
(
24
divided
by
4
is
a
weight
of
6;
with
1
respondent
reporting
an
intake
rate
of
2
MGD
or
more,
this
produces
an
estimate
of
6
total
new
structures
meeting
proposed
rule
criteria).

Adjustments
To
Weights
Using
Extra­
Survey
Information
IADC
data
indicate
that
8
structures
in
the
deepwater
have
CWIS
intake
rates
meeting
the
proposed
316(
b)
criteria
(
see
DCN
7­
3505).
ERG
uses
this
higher
number
of
structures
to
estimate
the
number
of
existing
4Assuming
that
the
four
are
the
only
large
platforms
in
shallow
water
that
meet
the
criteria,
the
likelihood
of
being
an
in­
scope
platform
is
4
out
of
206
or
1.9
percent.
The
likelihood
of
drawing
a
random
sample
of
33
obsrevations
and
not
sampling
any
of
these
in­
scope
facilities
is
0.98133
or
52
percent.

7
structures
with
CWISs
meeting
proposed
criteria.
ERG
thus
assigns
a
weight
of
1
to
each
of
the
8
deepwater
structures
that
are
assigned
engineering
costs.
Table
2
shows
the
weights
assigned.

Table
2.
Weights
Assigned
to
Deepwater
Structures
For
Engineering
Cost
Purposes
Parent
Company
Facility
Name
Assigned
Weight
BP
BP
Pompano
1
Shell
Shell
Mississippi
Canyon
807
1
Shell
Shell
Vioska
Knoll
1
ExxonMobil
ExxonMobil
Mississippi
Canyon
1
Amerada
Hess
Corporation
A
(
BALDPATE);
G07462
1
ChevronTexaco
ChevronTexaco
Green
Canyon
1
Shell
Shell
West
Delta
1
ExxonMobil
ExxonMobil
Alaminos
Canyon
1
Total
8
Source:
DCN
7­
3505,
DCN
7­
4021,
ERG
estimates.

2.1.2
Shallow
Water,
Large
Platforms
Calculation
of
Survey
Weights
A
total
of
209
shallow
water
platforms
with
greater
than
20
well
slots
were
identified
in
MMS
data
(
DCN
7­
4022).
ERG
determined
that
206
existing
platforms
were
either
known
to
have
CWISs
with
intake
rates
meeting
proposed
rule
criteria
or
their
intake
rates
were
unknown
(
3
platforms
were
known
to
have
total
CWIS
intake
rates
less
than
2
MGD
and
were
dropped
from
the
sampling
frame)
(
DCN
7­
4021,
Westat
2003).
EPA
sampled
33
platforms
out
of
the
206
in
the
sampling
frame,
of
which
30
responded.
None
of
these
had
intake
rates
meeting
the
proposed
316(
b)
criteria
(
DCN
7­
3505).
EPA
therefore
assumes
that
all
non­
respondents
also
would
not
meet
the
criteria.

Adjustments
To
Weights
Using
Extra­
Survey
Information
The
sample
of
large
platforms
in
shallow
water
identified
no
platforms
that
meet
proposed
316(
b)
criteria.
However,
four
platforms
were
known
to
have
CWISs
meeting
proposed
rule
criteria
based
on
earlier
data
(
DCN
7­
3505).
None
of
these
was
sampled
(
DCN
7­
4021).
4
Because
these
platforms
are
known
to
meet
316(
b)
criteria,
ERG
assigns
each
a
weight
of
one.
See
Table
3
for
the
weight
assignments
by
platform.

Table
3.
Weights
Assigned
to
Shallow
Water,
Large
Platforms
For
Engineering
Cost
Purposes
Parent
Company
Facility
Name
Assigned
Weight
Marathon
Marathon
South
Pass
(
Block
86)
1
ExxonMobil
ExxonMobil
South
Pass
1
ExxonMobil
ExxonMobil
Green
Canyon
1
Marathon
Marathon
Ewing
Bank
1
5Assuming
that
the
four
are
the
only
small
platforms
in
shallow
water
that
meet
the
criteria,
the
likelihood
of
being
an
in­
scope
platform
is
4
out
of
2,194
or
0.14
percent
percent.
The
likelihood
of
drawing
a
random
sample
of
18
obsrevations
and
not
sampling
any
of
these
in­
scope
facilities
is
0.986918or
98
percent.

8
Total
4
Source:
DCN
7­
3505,
DCN
7­
4021,
ERG
estimates.

Shallow
Water,
Small
Platforms
Calculation
of
Survey
Weights
For
shallow
water,
small
platforms,
EPA
determined
that
2,194
platforms
were
in
the
universe
of
platforms
in
the
Federal
GOM
(
DCN
7­
4022).
The
vast
majority
of
these
platforms
have
unknown
CWIS
intake
rates.
Four
platforms
were
identified
prior
to
EPA's
Phase
III
Survey
as
having
CWIS
intake
rates
exceeding
2
MGD
(
DCN
7­
3505).
None
of
these
was
sampled
(
DCN
7­
4021).
A
total
of
18
platforms
with
unknown
CWIS
intake
rates
were
sampled
(
all
responded),
but
EPA
determined
that
none
of
the
sampled
platforms
had
total
design
flow
rates
meeting
proposed
rule
criteria
(
TetraTech,
2004;
DCN
7­
3505).
Although
this
is
a
very
small
sample,
this
finding
is
bolstered
by
EPA's
observations
that
platforms
in
state
waters
are
unlikely
to
have
CWIS
with
intake
rates
totaling
2
MGD
or
more
(
U.
S.
EPA,
2004a).
Platforms
in
state
waters
and
small
platforms
in
Federal
waters
are
generally
similar
structures.

Adjustments
To
Weights
Using
Extra­
Survey
Information
Although
the
survey
indicates
that
no
shallow
water,
small
platforms
would
meet
the
proposed
criteria,
there
are
four
such
platforms
known
to
meet
these
criteria
(
DCN
7­
3505).
ERG
thus
assumes
that
only
four
small
platforms
located
in
the
shallow
water
GOM
have
CWIS
intakes
meeting
proposed
rule
criteria.
5
These
four
platforms
are
assigned
a
weight
of
one.
See
Table
4
for
the
weight
assignments
by
platform.

Table
4.
Weights
Assigned
to
Shallow
Water,
Small
Platforms
For
Engineering
Cost
Purposes
Parent
Company
Facility
Name
Assigned
Weight
BP
BP
Matagorda
Island
(
Block
623)
1
BP
BP
Matagorda
Island
(
Block
519)
1
ExxonMobil
ExxonMobil
Main
Pass
1
BP
BP
Matagorda
Island
(
Block
622)
1
Total
4
Source:
DCN
7­
3505,
DCN
7­
4021,
ERG
estimates.

2.2
California
Platforms
Calculation
of
Survey
Weights
EPA
identified
33
California
platforms,
13
of
which
were
dropped
from
the
analysis
because
their
intake
rates
were
known
to
be
less
than
2
MGD
(
DCN
7­
4022;
Westat,
2003).
EPA
sampled
3
of
the
remaining
20
platforms
(
DNC
7­
4021).
Only
one
was
found
to
have
an
intake
rate
meeting
proposed
rule
criteria
(
DCN
7­
3505).
ERG
thus
assumes
seven
existing
platforms
in
California
have
total
intake
rates
meeting
proposed
rule
criteria
(
20
divided
by
3
is
a
weight
of
6.7,
which
yields
7
weighted
platforms).
9
Adjustments
To
Weights
Using
Extra­
Survey
Information
A
total
of
six
platforms
are
known
from
earlier
data
(
see
DCN
7­
3505)
to
have
intakes
rates
meeting
proposed
criteria
(
including
the
platform
surveyed
in
the
316(
b)
survey).
ERG
subtracted
the
five
nonsurveyed
known
platforms
from
the
extrapolated
count
of
seven
platforms,
leaving
two
platforms
estimated
to
be
represented
by
the
surveyed
platform.
The
remaining
five
platforms
are
then
assigned
a
weight
of
one.
See
Table
5
for
a
listing
of
weights
by
platform.

Table
5.
Weights
Assigned
to
California
Platforms
For
Engineering
Cost
Purposes
Parent
Company
Facility
Name
Assigned
Weight
Aera
Energy
Ellen
(
Beta)
1
Aera
Energy
Eureka
(
Beta)
2
Arguello
Hermosa
(
Point
Arguello)
1
ExxonMobil
Harmony
(
Hondo
Field)
1
ExxonMobil
Heritage
(
Pescado
Field)
1
Arguello
Harvest
(
Point
Arguello)
1
Total
7
Source:
DCN
7­
3505,
DCN
7­
4021,
ERG
estimates.

2.3
Alaska
Platforms
Calculation
of
Survey
Weights
 
In
Alaska,
EPA
determined
that
19
platforms/
production
facilities
are
in
the
survey
universe
(
one
platform
was
known
to
have
a
total
CWIS
intake
rate
of
less
than
2
MGD
and
was
dropped
from
the
sampling
frame)
(
DCN
7­
4022;
DCN
7­
4021;
Westat,
2003).
EPA
sampled
two
platforms,
but
only
one
was
determined
to
have
a
CWIS
intake
rate
meeting
proposed
rule
criteria.
ERG
therefore
estimates
that
there
are
10
platforms
in
Alaska
with
intakes
that
meet
proposed
rule
criteria
(
19/
2
is
a
weight
of
9.5).

Adjustments
To
Weights
Using
Extra­
Survey
Information
 
Five
platforms
(
all
located
in
Cook
Inlet)
have
CWIS
data
showing
them
to
have
CWISs
meeting
proposed
rule
criteria
(
including
the
surveyed
platform)
(
DCN
7­
3505).
ERG
subtracted
the
four
platforms
not
surveyed
in
the
316(
b)
survey
effort
from
the
total
of
10.
The
remaining
6
estimated
platforms
that
would
be
subject
to
the
316(
b)
requirements
were
assumed
represented
by
the
surveyed
platform,
which
was
assigned
a
weight
of
6.
The
non­
surveyed
platforms
were
assigned
a
weight
of
one.
See
Table
6
for
a
listing
of
weights
by
platform.

Table
6.
Weights
Assigned
to
Alaska
Platforms
For
Engineering
Cost
Purposes
Parent
Company
Facility
Name
Assigned
Weight
Unocal
Anna
Platform
1
Unocal
Steelhead
1
Unocal
King
Salmon
Platform
6
Unocal
Grayling
Platform
1
Unocal
Dolly
Varden
Platform
1
Total
10
Source:
DCN
7­
3505,
DCN
7­
4021,
ERG
estimates.
10
References
ERG.
2003.
Assessment
of
Platforms
in
the
Gulf
of
Mexico
That
Are
Likely
To
Be
In
Scope.
Memorandum
to
George
Denning,
EPA,
from
ERG.
August
21,
2003.

ERG.
2004a.
Costs
for
Existing
Oil
and
Gas
Facilities
Had
These
Been
Regulated
Under
316(
b)
Phase
III..
Memorandum
to
Rulemaking
Record.
September
24,
2004.

ERG.
2004b.
MODU
Cost
and
Impact
Calculations.
Memorandum
to
Rulemaking
Record.
September
24,
2004.

U.
S.
Environmental
Protection
Agency
(
U.
S.
EPA).
2004a.
Technical
Development
Document
for
the
Proposed
Section
316(
b)
Phase
III
Rule.

U.
S.
Environmental
Protection
Agency
(
U.
S.
EPA).
2004b.
Economic
Analysis
of
the
Proposed
Section
316(
b)
Phase
III
Rule.

Tetra
Tech.
2004.
Phase
III
Survey
Response_
Strata_
Summary_
April
20_
2004.
Spreadsheet
submitted
to
the
CBI
Rulemaking
Record.

Westat.
2003.
Sampling
Selection
for
Offshore
Oil
and
Gas­
TD#
00040917a
dated
September
17,
2003.
Memorandum
to
John
Fox,
EPA.
October
7,
2003.