Document ID: EPA-HQ-OPA-2007-0584-0163
Agency: epa
Document Type: Rule
Title: Oil Pollution Prevention; Spill Prevention, Control, and Countermeasure Rule Requirements--Amendments
Posted Date: 2008-12-05T05:00Z

[Federal Register: December 5, 2008 (Volume 73, Number 235)]
[Rules and Regulations]               
[Page 74235-74323]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05de08-15]                         

[[Page 74235]]

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Part II

Environmental Protection Agency

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40 CFR Part 112

Oil Pollution Prevention; Spill Prevention, Control, and Countermeasure 
Rule Requirements--Amendments; Final Rule

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 112

[EPA-HQ-OPA-2007-0584; FRL-8746-3]
RIN 2050-AG16

 
Oil Pollution Prevention; Spill Prevention, Control, and 
Countermeasure Rule Requirements--Amendments

AGENCY: Environmental Protection Agency.

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA or the Agency) is 
amending the Spill Prevention, Control, and Countermeasure (SPCC) rule 
in order to provide increased clarity, to tailor requirements to 
particular industry sectors, and to streamline certain requirements for 
those facility owners or operators subject to the rule, which should 
result in greater protection to human health and the environment. 
Specifically, this final rule: Exempts hot-mix asphalt (HMA), pesticide 
application equipment and related mix containers, and heating oil 
containers at single-family residences from the SPCC rule; amends the 
definition of ``facility'' to clarify the existing flexibility 
associated with describing a facility's boundaries; amends the facility 
diagram requirement to provide additional flexibility; defines 
``loading/unloading rack'' to clarify the equipment subject to the 
provisions for facility tank car and tank truck loading/unloading 
racks, as well as amends the provisions for this equipment; provides 
streamlined requirements for a subset of qualified facilities; amends 
the general secondary containment requirement to provide more clarity; 
exempts non-transportation-related tank trucks from the sized secondary 
containment requirements; amends the security requirements; amends the 
integrity testing requirements to allow greater flexibility in the use 
of industry standards; amends the integrity testing requirements for 
containers that store animal fats or vegetable oils and meet certain 
criteria; streamlines a number of requirements for onshore oil 
production facilities; and exempts underground oil storage tanks at 
nuclear power generation facilities. EPA is also providing 
clarification in the preamble to this final rule on additional issues 
raised by the regulated community and, in a separate action in the 
Federal Register of November 26, 2008, (73 FR 72016), the Agency is 
proposing a new compliance date for farms.

DATES: This final rule is effective February 3, 2009.

ADDRESSES: The public docket for this rulemaking, Docket ID No. EPA-HQ-
OPA-2007-0584, contains the information related to this rulemaking, 
including the response to comment document. All documents in the docket 
are listed in index at the http://www.regulations.gov. Although listed 
in the index, some information may not be publicly available, such as 
Confidential Business Information (CBI) or other information the 
disclosure of which is restricted by statute. Certain other material, 
such as copyrighted material, will be publicly available only in hard 
copy. Publicly available docket materials are available either 
electronically at http://www.regulations.gov or in hard copy at the EPA 
Docket, EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW., 
Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 
p.m., Monday through Friday, excluding legal holidays. The telephone 
number of the Public Reading Room is 202-566-1744, and the telephone 
number to make an appointment to view the docket is 202-566-0276.

FOR FURTHER INFORMATION CONTACT: For general information, contact the 
Superfund, TRI, EPCRA, RMP, and Oil Information Center at 800-424-9346 
or TDD at 800-553-7672 (hearing impaired). In the Washington, DC 
metropolitan area, contact the Superfund, TRI, EPCRA, RMP, and Oil 
Information Center at 703-412-9810 or TDD 703-412-3323. For more 
detailed information on specific aspects of this final rule, contact 
either Vanessa E. Rodriguez at 202-564-7913 
(rodriguez.vanessa@epa.gov), or Mark W. Howard at 202-564-1964 
(howard.markw@epa.gov), U.S. Environmental Protection Agency, 1200 
Pennsylvania Avenue, NW., Washington, DC, 20460-0002, Mail Code 5104A.

SUPPLEMENTARY INFORMATION: The contents of this preamble are:

I. General Information
II. Entities Potentially Affected by This Final Rule
III. Statutory Authority and Delegation of Authority
IV. Background
V. This Action
    A. Hot-Mix Asphalt
    1. Hot-Mix Asphalt Exemption
    2. Alternative Options Considered
    B. Farms
    1. Exemption for Pesticide Application Equipment and Related Mix 
Containers
    2. Applicability of Mobile Refueler Requirements to Farm Nurse 
Tanks
    3. Differentiating the SPCC Requirements for Farms
    C. Residential Heating Oil Containers
    1. Exemption for Residential Heating Oil Containers
    2. Alternative Option Considered
    D. Definition of Facility
    1. Revisions to the Definition of Facility
    2. Determining the Components of a Facility: Examples of 
Aggregation or Separation
    3. Alternative Options Considered
    E. Facility Diagram
    1. Revision to the Facility Diagram Requirement Regarding Mobile 
or Portable Containers
    2. Indicating Complicated Areas of Piping or Oil-filled 
Equipment on a Facility Diagram
    F. Loading/Unloading Racks
    1. Loading/Unloading Rack Definition
    2. Requirements for Loading/Unloading Racks
    3. Exclusions
    4. Alternative Option Considered
    G. Tier I Qualified Facilities
    1. Eligibility Criteria
    2. Provisions for Tier I Qualified Facilities
    3. SPCC Plan Template
    4. Self-Certification and Plan Amendments
    5. Tier II Qualified Facility Requirements
    6. Alternative Option Considered
    H. General Secondary Containment
    1. Revisions to the General Secondary Containment Requirement
    I. General Secondary Containment for Non-Transportation-Related 
Tank Trucks
    J. Security
    1. Revisions to the Security Requirements
    K. Integrity Testing
    1. Amendments to Integrity Testing Requirements
    L. Animal Fats and Vegetable Oils
    1. Differentiated Requirements for AFVOs
    2. Differentiation Criteria: Containers Subject to FDA 
Regulations--21 CFR part 110
    3. Differentiation Criteria: Elevated Bulk Storage Containers
    4. Differentiation Criteria: Containers made from Austenitic 
Stainless Steel
    5. Differentiation Criteria: Containers with No External 
Insulation
    6. Differentiation Criteria: Shop-Fabricated Containers
    7. Required Recordkeeping
    8. Other Suggested Criteria and Options
    M. Oil Production Facilities
    1. Definition of Production Facility
    2. Modifications to Sec.  112.9 for Drilling and Workover 
Facilities
    3. SPCC Plan Preparation and Implementation
    4. Flowlines and Intra-facility Gathering Lines
    5. Flow-Through Process Vessels
    6. Alternative Qualified Facility Eligibility Criteria for Oil 
Production Facilities
    7. Produced Water Containers
    8. Clarification of the Definition of Permanently Closed 
Containers
    9. Oil and Natural Gas Pipeline Facilities
    N. Man-made Structures
    O. Underground Emergency Diesel Generator Tanks at Nuclear Power 
Stations

[[Page 74237]]

    P. Wind Turbines
    Q. Technical Corrections
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866--Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order--13132 Federalism
    F. Executive Order 13175--Consultation and Coordination with 
Indian Tribal Governments
    G. Executive Order 13045--Protection of Children from 
Environmental Health & Safety Risks
    H. Executive Order 13211--Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898--Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act

I. General Information

    The Environmental Protection Agency (EPA or the Agency) is amending 
the Spill Prevention, Control, and Countermeasure (SPCC) rule to 
address a number of issues that have been raised by the regulated 
community. These amendments are intended to clarify, tailor, and 
streamline certain requirements for those facility owners or operators 
who are required to prepare and implement an SPCC Plan (or ``Plan''). 
Specifically:
     EPA is exempting hot-mix asphalt (HMA) from the SPCC 
requirements. This material is unlikely to flow as a result of the 
entrained aggregate, such that there would be very few circumstances in 
which a discharge of HMA would have the potential to reach navigable 
waters or adjoining shorelines. EPA will continue to regulate asphalt 
cement (AC), asphalt emulsions, and cutbacks, which are not HMA (that 
is, they are not entrained with aggregate).
     EPA is exempting pesticide application equipment and 
related mix containers, regardless of ownership or where used, that may 
currently be subject to the SPCC rule when crop oil or adjuvant oil is 
added to formulations.
     EPA is exempting residential heating oil containers (that 
is, those used solely at single-family residences) from the SPCC 
requirements. This exemption applies to aboveground containers, as well 
as completely buried heating oil tanks, at single-family residences, 
including those located at farms.
     EPA is modifying the definition of ``facility'' to clarify 
that contiguous or non-contiguous buildings, properties, parcels, 
leases, structures, installations, pipes, or pipelines may be 
considered separate facilities, and to specify that the ``facility'' 
definition governs the applicability of 40 CFR part 112. These 
revisions will allow an owner or operator to separate or aggregate 
containers to determine the facility boundaries, based on such factors 
as ownership or operation of the buildings, structures, containers, and 
equipment on the site, the activities being conducted, property 
boundaries, and other relevant considerations.
     EPA is revising the facility diagram requirement at Sec.  
112.7(a)(3) to clarify how containers, fixed and mobile, are identified 
on the facility diagram. EPA is also clarifying that where facility 
diagrams become complicated due to the presence of multiple fixed oil 
storage containers or complex piping/transfer areas at a facility, the 
owner or operator can include that information separately in the SPCC 
Plan in an accompanying table or key. For any mobile or portable 
containers located in a certain area of the facility, an owner or 
operator can mark the area on the diagram. If the total number of 
mobile or portable containers changes, the owner or operator can 
indicate the potential range in number of containers and the 
anticipated contents and capacities of the mobile or portable 
containers maintained at the facility in the Plan.
     EPA is defining the term ``loading/unloading rack,'' and 
specifying that this definition governs the applicability of the 
provision at Sec.  112.7(h), Facility tank car and tank truck loading/
unloading rack. This amendment provides clarity to the regulated 
community on whether this provision applies to a facility. Furthermore, 
EPA is specifically excluding oil production facilities and farms from 
the requirements at Sec.  112.7(h), because loading/unloading racks are 
not typically found at these facilities (loading/unloading activities 
at these facilities will remain subject to the general secondary 
containment requirements of Sec.  112.7(c)). EPA also is finalizing 
editorial revisions to the provision at Sec.  112.7(h) for clarity.
     EPA is streamlining and tailoring the SPCC requirements 
for a subset of qualified facilities. Qualified facilities were 
addressed in a recent amendment to the SPCC rule (71 FR 77266, December 
26, 2006). The owner or operator of such a facility has the option to 
self-certify his SPCC Plan. This final rule further designates a subset 
of qualified facilities (``Tier I qualified facilities'') as those that 
meet the current qualified facility eligibility criteria and that have 
no oil storage containers with an individual aboveground storage 
capacity greater than 5,000 U.S. gallons. The owner or operator of a 
Tier I qualified facility has the option to complete a self-certified 
SPCC Plan template (found in Appendix G to 40 CFR part 112) in lieu of 
a full SPCC Plan. The owner or operator can complete the SPCC Plan 
template, which is comprised of a set of streamlined SPCC rule 
requirements, and implement those streamlined requirements, to comply 
with the SPCC regulation. All other qualified facilities will be 
designated as ``Tier II qualified facilities.''
     EPA is amending the general secondary containment 
requirements at Sec.  112.7(c) to clarify that the scope of secondary 
containment need only take into consideration the typical failure mode, 
and most likely quantity of oil that would be discharged, consistent 
with current Agency guidance. This amendment also provides additional 
examples of prevention systems for onshore facilities found at Sec.  
112.7(c)(1).
     EPA is extending the exemption from the sized secondary 
containment requirement for mobile refuelers provided in the December 
2006 SPCC rule amendments (71 FR 77266, December 26, 2006) to non-
transportation-related tank trucks at a facility subject to the SPCC 
rule.
     EPA is amending the facility security requirements at 
Sec.  112.7(g) to allow an owner or operator of a facility to tailor 
his security measures to the facility's specific characteristics and 
location. A facility owner or operator is required to describe in the 
SPCC Plan how he secures and controls access to the oil handling, 
processing, and storage areas; secures master flow and drain valves; 
prevents unauthorized access to starter controls on oil pumps; secures 
out-of-service and loading/unloading connections of oil pipelines; and 
addresses the appropriateness of security lighting to both prevent acts 
of vandalism and assist in the discovery of oil discharges. This action 
extends the streamlined security requirements that EPA provided to 
qualified facilities in the December 2006 SPCC rule amendments (71 FR 
77266, December 26, 2006) to all facilities subject to the security 
requirements.
     EPA is amending the requirements at Sec. Sec.  112.8(c)(6) 
and 112.12(c)(6) to provide flexibility in complying with the bulk 
storage container integrity testing requirements. That is, EPA is 
modifying the current provision to allow an owner or operator to 
consult and rely on industry standards to determine the appropriate 
qualifications for personnel performing tests and

[[Page 74238]]

inspections, as well as the type and frequency of integrity testing 
required for a particular container size and configuration. This action 
extends the streamlined bulk storage container inspection requirement 
that EPA provided to qualified facilities in the December 2006 SPCC 
rule amendments (71 FR 77266, December 26, 2006) to all facilities 
subject to the integrity testing provisions.
     EPA is differentiating the integrity testing requirements 
at Sec.  112.12(c)(6) for an owner or operator of a facility that 
handles certain types of Animal Fats and Vegetable Oils (AFVOs). EPA is 
providing the Professional Engineer (PE) or an owner or operator self-
certifying an SPCC Plan with the flexibility to determine the scope of 
integrity testing that is appropriate for containers that store AFVOs, 
based on compliance with certain FDA regulations and other criteria.
     EPA is finalizing several amendments to tailor the 
requirements for oil production facilities to address a number of 
concerns that have been raised by this sector. Specifically, EPA is: 
Modifying the definition of ``production facility'' to be consistent 
with the amendments to the definition of ``facility;'' extending the 
timeframe by which the owner or operator of a new oil production 
facility must prepare and implement an SPCC Plan; providing an 
alternative option for flow-through process vessels at oil production 
facilities to comply with the general secondary containment requirement 
and additional oil spill prevention measures in lieu of sized secondary 
containment requirements; providing an exemption for certain intra-
facility gathering lines subject to regulatory requirements of the U.S. 
Department of Transportation's (DOT's) pipeline regulations in 49 CFR 
parts 192 or 195; providing an alternative option for flowlines and 
intra-facility gathering lines at oil production facilities for 
contingency planning in lieu of all secondary containment requirements, 
while establishing more specific requirements for a flowline/intra-
facility gathering line maintenance program; exempting certain produced 
water containers that do not contain oil as certified by a Professional 
Engineer (PE); providing compliance alternatives to sized secondary 
containment for produced water storage containers that are not 
otherwise exempt; establishing an option for an oil production facility 
to be eligible to self-certify an SPCC Plan as a qualified facility; 
and clarifying the definition of ``permanently closed'' as it applies 
to oil production facilities and containers present at an oil 
production facility.
     EPA is exempting underground oil storage tanks deferred 
under 40 CFR part 280 that supply emergency diesel generators at 
nuclear power generation facilities and that are subject to design 
criteria under the Nuclear Regulatory Commission (NRC) regulations. 
This exemption includes both tanks that are completely buried and tanks 
that are below-grade and vaulted.
    In this notice, EPA is also reiterating clarifications to a number 
of issues of concern to the regulated community that were provided in 
the 2007 proposal (72 FR 58378, October 15, 2007), including the 
consideration of man-made structures in determining how to comply with 
the SPCC rule requirements and the applicability of the rule to wind 
turbines that are used to produce electricity. Additionally, EPA is 
explaining actions that will be taken in collaboration with DOT to 
clarify the jurisdiction over facilities, as defined in a Memorandum of 
Understanding (MOU) between the DOT and EPA (36 FR 24080, November 24, 
1971). EPA also is finalizing technical corrections to Sec. Sec.  112.3 
and 112.12. This rulemaking marks the completion of the SPCC-related 
improvements planned by the Agency at this time. EPA greatly benefited 
from the considerable public input in the recent SPCC rulemakings. 
Given the breadth of these changes, and the importance of the SPCC 
program, EPA plans to review the implementation of these changes after 
these latest revisions become effective. With regard to the oil 
production industry, this revision would include an examination of the 
utility and effectiveness of the new approaches for avoiding and 
minimizing spills.

II. Entities Potentially Affected by This Final Rule

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               Industry sector                         NAICS code
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Oil Production...............................  211111
Farms........................................  111, 112
Electric Utility Plants......................  2211
Petroleum Refining and Related Industries....  324
Chemical Manufacturing.......................  325
Food Manufacturing...........................  311, 312
Manufacturing Facilities Using and Storing     311, 325
 Animal Fats and Vegetable Oils.
Metal Manufacturing..........................  331, 332
Other Manufacturing..........................  31-33
Real Estate Rental and Leasing...............  531-533
Retail Trade.................................  441-446, 448, 451-454
Contract Construction........................  23
Wholesale Trade..............................  42
Other Commercial.............................  492, 541, 551, 561-562
Transportation...............................  481-488
Arts Entertainment & Recreation..............  711-713
Other Services (Except Public Administration)  811-813
Petroleum Bulk Stations and Terminals........  4247
Education....................................  61
Hospitals & Other Health Care................  621, 622
Accommodation and Food Services..............  721, 722
Fuel Oil Dealers.............................  45431
Gasoline stations............................  4471
Information Finance and Insurance............  51, 52
Mining.......................................  212
Warehousing and Storage......................  493
Religious Organizations......................  813110
Military Installations.......................  928110
Pipelines....................................  4861, 48691

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Government...................................  92
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    The list of potentially affected entities in the above table may 
not be exhaustive. The Agency's goal is to provide a guide for readers 
to consider regarding entities that potentially could be affected by 
this action. However, this action may affect other entities not listed 
in this table. If you have questions regarding the applicability of 
this action to a particular entity, consult the person listed in the 
preceding section titled FOR FURTHER INFORMATION CONTACT.

III. Statutory Authority and Delegation of Authority

    Section 311(j)(1)(C) of the Clean Water Act (CWA or the Act), 33 
U.S.C. 1321(j)(1)(C), requires the President to issue regulations 
establishing procedures, methods, equipment, and other requirements to 
prevent discharges of oil to navigable waters or adjoining shorelines 
from vessels and facilities and to contain such discharges. The 
President delegated the authority to regulate non-transportation-
related onshore facilities to EPA in Executive Order 11548 (35 FR 
11677, July 22, 1970), which was superseded by Executive Order 12777 
(56 FR 54757, October 22, 1991). An MOU between DOT and EPA (36 FR 
24080, November 24, 1971) established the definitions of 
transportation-related and non-transportation-related facilities. An 
MOU between EPA, the U.S. Department of the Interior (DOI), and DOT (59 
FR 34102, July 1, 1994) re-delegated the responsibility to regulate 
certain offshore facilities from DOI to EPA.

IV. Background

    The SPCC rule was originally promulgated on December 11, 1973 (38 
FR 34164). On July 17, 2002, EPA published a final rule amending the 
SPCC rule, formally known as the Oil Pollution Prevention regulation 
(40 CFR part 112). The July 2002 rule included revisions to the 
requirements for SPCC Plans and for Facility Response Plans (FRPs). It 
also included new subparts outlining the requirements for various 
classes of oil; revised the applicability of the regulation; amended 
the requirements for completing SPCC Plans; and made other 
modifications (67 FR 47042). The revised rule became effective on 
August 16, 2002. After publication of this rule, several members of the 
regulated community filed legal challenges to certain aspects of the 
rule.\1\ All of the issues raised in the litigation have been resolved; 
EPA published clarifications in the Federal Register to several aspects 
of the revised rule (69 FR 29728, May 25, 2004),\2\ and in a separate 
action in the Federal Register of November 26, 2008, (73 FR 71941), the 
Agency is announcing the vacatur of the July 17, 2002 revisions to the 
definition of ``navigable waters.'' In addition, concerns were raised 
about the ability to implement certain aspects of the July 2002 rule.
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    \1\ American Petroleum Institute v. Johnson, 571 F.Supp. 2d 165 
(D.D.C. 2008). The only issue resolved through litigation was the 
challenge to the definition of navigable waters in the 2002 rule 
amendment.
    \2\ Several commenters requested that the Agency codify the 
clarifications as part of this rulemaking. To the extent the subject 
matter of the clarification has been reflected in this rulemaking, 
the Agency has either incorporated the clarification in the 
regulatory text or reaffirmed the Agency's position in this 
preamble.
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    As a result, EPA proposed amendments to the SPCC rule in December 
2005 and finalized them in December 2006 to address a number of issues, 
including those pertaining to certain ``qualified'' facilities, 
qualified oil-filled operational equipment, motive power containers, 
mobile refuelers, removal of provisions inapplicable to AFVOs, and the 
compliance date for farms. See the rule amendment that was published in 
the Federal Register at 71 FR 77266 (December 26, 2006) for a more 
detailed discussion of these amendments.
    In addition, EPA released the SPCC Guidance for Regional Inspectors 
in December 2005. This guidance document is intended to assist regional 
inspectors in reviewing the implementation of the SPCC rule at a 
regulated facility. The guidance document is designed to facilitate an 
understanding of the rule's applicability, to help clarify the role of 
the inspector in the review and evaluation of a facility owner or 
operator's compliance with the performance-based SPCC requirements, and 
to provide a consistent national policy on several SPCC-related issues. 
The guidance is available on the Agency's Web site at http://
www.epa.gov/emergencies. EPA intends to issue revisions to this 
guidance document that address changes made to the SPCC rule, 
consistent with the regulatory amendments in this action and the 
December 2006 amendments (71 FR 77266, December 26, 2006).
    Furthermore, EPA has amended the dates for compliance with the July 
2002 amendments to the SPCC rule by extending the dates for preparing 
or amending, and implementing revised SPCC Plans in 40 CFR 112.3(a), 
(b), and (c), most recently by a rule published May 16, 2007 (72 FR 
27443). EPA took the most recent action to provide owners or operators 
of facilities the time necessary to fully understand the amendments to 
the SPCC rule finalized in December 2006, and to allow potentially 
affected owners and operators an opportunity to make any changes to 
their facilities and to their SPCC Plans, as well as to provide time 
for the Agency to take final action on this amendment. EPA expects that 
this extension will provide the regulated community time to review and 
understand any revised material presented in the SPCC Guidance for 
Regional Inspectors. Please see the Federal Register notice at 72 FR 
27443, May 16, 2007 for further discussion of the July 1, 2009 
compliance date. In a separate action in the Federal Register of 
November 26, 2008 (73 FR 72016), EPA is also proposing new dates by 
which the owners or operators of facilities must prepare or amend and 
implement their SPCC Plan.
    The December 2006 SPCC rule amendments (71 FR 77266, December 26, 
2006) addressed only certain areas of the SPCC requirements and 
specific issues and concerns raised by the regulated community. The EPA 
Regulatory Agenda and the 2005 Office of Management and Budget (OMB) 
report on ``Regulatory Reform of the U.S. Manufacturing Sector'' 
highlighted other areas where further changes may be appropriate. 
Therefore, in October 2007, EPA proposed additional amendments to the 
SPCC rule to address these changes (72 FR 58378, October 15, 2007). 
Section V of this notice describes EPA's final action on those proposed 
amendments and presents the major comments received on the proposal, as 
well as EPA's response to those comments. For a more complete 
discussion of the comments received, and the Agency's response to 
comments, see Comment and Response Document: Spill Prevention, Control, 
and Countermeasure Rule 2008 Amendments, a copy of which is available 
in the docket for this rulemaking.

[[Page 74240]]

V. This Action

A. Hot-Mix Asphalt

    Hot-mix asphalt (HMA) is a blend of asphalt cement (AC) and 
aggregate material, such as stone, sand, or gravel, which is formed 
into final paving products for use on roads and parking lots. All types 
of asphalt, including HMA, are petroleum oil products. Under this 
amendment to the SPCC rule, EPA is exempting HMA from SPCC rule 
applicability.
1. Hot-Mix Asphalt Exemption
    EPA is exempting HMA from SPCC rule applicability by adding a new 
paragraph (8) under the general applicability section, Sec.  112.1(d), 
and modifying Sec.  112.1(d)(2) so that the capacity of storage 
containers solely containing HMA is not counted toward the facility's 
oil storage capacity calculation. EPA is taking this action based on 
the fact that this material is unlikely to flow as a result of the 
entrained aggregate, such that there would be very few circumstances in 
which a discharge of HMA would have the potential to reach navigable 
waters or adjoining shorelines. This is particularly of concern at 
facilities subject to the SPCC requirements solely because of the 
presence of HMA. EPA never intended that HMA be included as part of a 
facility's SPCC Plan.
a. Comments
    Several commenters expressed general support for the exemption, and 
no comments were submitted that opposed the proposed exemption.
b. Response to Comments
    EPA agrees with the commenters and is finalizing the exemption for 
HMA, as proposed.
2. Alternative Options Considered
    As an alternate approach, EPA also considered exempting both HMA 
and AC from the requirements of the SPCC rule, but chose not to 
propose, nor finalize, such an option. Therefore, this exemption for 
HMA does not include AC. Although AC is semi-solid or solid at ambient 
temperature and pressure, it is generally stored at elevated 
temperatures. At such elevated temperatures, AC has fluid flow 
properties similar to other semi-solid oils, such as paraffin wax and 
heavy bunker fuels and therefore is capable of flowing. All of these 
oils are regulated under the SPCC rule to prevent discharges to 
navigable waters or adjoining shorelines.
a. Comments
    A number of alternative approaches focused on extending the 
exemption to other similar materials, such as AC, Group 5 oils (that 
is, those oils with specific gravities greater than or equal to 1.0), 
waxes and other heavy oils. One commenter suggested extending the 
exemption to all solid or non-flowing materials, such as whenever oil 
is mixed with material that will make the mixture unlikely to flow at 
ambient temperatures: Oil mixed with sorbents, gelled oils, etc. 
Another commenter suggested extending the exemption to other Group 5 
oils. Other commenters suggested extending this exemption to paraffin 
wax or to all waxes. One commenter requested that EPA clarify that any 
oils associated with asphalt production be regulated if their total 
volume exceeds 1,320 U.S. gallons.
b. Response to Comments
    The Agency disagrees with these commenters. Unlike HMA, these 
materials do have the potential to discharge into navigable waters or 
adjoining shorelines because they are generally stored at elevated 
temperatures and thus, are capable of flowing if there is a release 
from the container. No new or compelling data was provided by 
commenters who disagreed with this position. However, it should be 
noted that the SPCC rule only applies to facilities that, due to their 
location, can reasonably be expected to discharge oil to navigable 
waters or adjoining shorelines. In determining whether there is a 
reasonable expectation of discharge, an owner or operator of a facility 
may consider the nature and flow properties of the oils handled at the 
facility. If a facility owner or operator determines that there is a 
reasonable expectation of a discharge of oil to navigable waters or 
adjoining shorelines from any single oil container (including a 
container storing oil associated with hot-mix asphalt production), and 
other rule applicability criteria are met, then all oil containers at 
the facility are subject to the rule's requirements (except as 
otherwise exempted).
    In addition, as EPA noted in the preamble to the proposed rule, the 
Agency believes that the SPCC rule already provides the facility owner 
or operator with significant flexibility to select prevention and 
control measures that are appropriate and cost-effective for the 
facility and type of product being stored. For example, the secondary 
containment requirements of the SPCC rule may be satisfied if the 
secondary containment system, including walls and floor, are capable of 
containing the oil and are constructed so that any discharge from a 
primary containment system will not escape secondary containment before 
cleanup occurs (Sec.  112.7(c)) and diked areas are sufficiently 
impervious to contain the oil (Sec. Sec.  112.8(c)(2) and 
112.12(c)(2)). Therefore, the flow properties of Group 5 oils (as for 
any oil) may be considered in designing appropriate means of secondary 
containment. If, once cooled, the oil remains in place, an effective 
means of secondary containment may involve surrounding the bulk storage 
container with an earthen berm that will contain the oil until it can 
solidify.

B. Farms

    The owner or operator of a farm, by virtue of storing or using oil, 
is potentially subject to the SPCC requirements. EPA promulgated the 
definition of farm at Sec.  112.2 in the December 2006 amendments to 
the SPCC rule (71 FR 77266, December 26, 2006), which defined a farm as 
``* * * a facility on a tract of land devoted to the production of 
crops or raising of animals, including fish, which produced and sold, 
or normally would have produced and sold, $1,000 or more of 
agricultural products during a year.'' While the December 2006 
amendments streamlined the requirements for most of the farms that are 
subject to SPCC requirements, EPA believes further amendments to the 
SPCC regulations are appropriate given the unique characteristics of 
farms (for example, their geographic scale, configuration, land 
ownership and lease structure, and on-farm activities). Specifically, 
EPA recognizes that a farm: May be privately owned and may contain the 
residence of the owner or operator; has a configuration that varies 
across the country, from farm to farm and season to season; contains 
low-volume oil storage that is often dispersed across different land 
parcels separated by roads and natural barriers; may have multiple 
fueling sites; may be located in a remote area; stores oil on-site for 
on-farm use and not for further distribution; uses oil seasonally in 
different quantities; and leases a significant amount of land to or 
from secondary parties. EPA is finalizing a number of amendments to the 
SPCC rule potentially affecting farms and other facilities which were 
proposed in October 2007 (72 FR 58378, October 15, 2007), including an 
exemption for pesticide application equipment and related mix 
containers, and providing clarification on the applicability of the 
mobile refueler requirements to farm nurse tanks. Additionally farms 
are likely to benefit

[[Page 74241]]

from other amendments finalized in this rule, such as clarifications to 
the definition of facility; the option to allow a subset of qualified 
facilities (``Tier I qualified facilities'') to complete the SPCC Plan 
template in Appendix G of this part in lieu of preparing a full SPCC 
Plan; exemption of residential heating oil tanks at single family 
residences; amendments to the security and integrity testing 
requirements; exemption from the loading/unloading rack requirements; 
and amendments to the facility diagram requirements.
    In addition, EPA extended the compliance date for the owner or 
operator of a farm, as defined in Sec.  112.2, to prepare or amend and 
implement the farm's SPCC Plan until the effective date of a rule 
addressing whether to provide differentiated requirements for farms (71 
FR 77266, December 26, 2006). EPA believes that the amendments to the 
SPCC rule in this action address the concerns raised by the 
agricultural industry. In a separate action in the Federal Register of 
November 26, 2008, (73 FR 72016), EPA is proposing new dates by which 
the owner or operator of a farm that is a qualified facility must 
prepare or amend and implement his SPCC Plan.
1. Exemption for Pesticide Application Equipment and Related Mix 
Containers
    EPA is adding a new paragraph (10) under the general applicability 
section, Sec.  112.1(d), to exempt all pesticide application equipment 
and related mix containers. EPA is also modifying Sec.  112.1(d)(2) so 
that the capacity of these pesticide application equipment and related 
mix containers is not counted toward the facility's oil storage 
capacity calculation. Pesticide application equipment includes ground 
boom applicators, airblast sprayers, and specialty aircraft that are 
used to apply measured quantities of pesticides to crops and/or soil. 
Related mix containers are those used to mix pesticides with water and, 
as needed, adjuvant oils, just prior to loading into application 
equipment. In the October 2007 (72 FR 58378, October 15, 2007), 
proposal, EPA proposed to limit this exemption to pesticide application 
equipment and related mix containers used at farms. In this final rule, 
however, EPA is extending the exemption to all pesticide application 
equipment and related mix containers, regardless of ownership or where 
used, because the application of pesticides through the use of this 
equipment is the same at any location.
    EPA is taking this action consistent with its findings in 
evaluating the potential harm posed by pesticide containers and 
application equipment when promulgating the Standards for Pesticide 
Containment Structures in 40 CFR part 165, Subpart E (see 71 FR 47330, 
August 16, 2006). These regulations apply to retailers who repackage 
agricultural pesticides, custom blenders of agricultural pesticides, 
and commercial applicators of agricultural pesticides, but do not apply 
to pesticide application equipment and related mix containers, because 
they do not fit the definition of stationary pesticide containers. In 
the development of the proposed exemption to the SPCC rule (72 FR 
58378, October 15, 2007), EPA indicated that pesticide formulations may 
contain crop oil or adjuvant oil in the mix formulations just prior to 
application, which could subject certain pesticide containers to the 
SPCC requirements. This same condition could exist at agricultural 
retailers that provide custom application services, as well as 
commercial applicators. At these facilities, pesticide application 
equipment, such as ground boom sprayers and aerial applicators could be 
loaded with pesticide mix formulations with crop oil or adjuvant oil. 
In these instances, similar to on-farm pesticide application equipment, 
this equipment could have been subject to the SPCC requirements when 
oil is mixed with the pesticide formulation just prior to use.
    Under this amendment, containers (55 U.S. gallons or greater in 
capacity) storing oil prior to mixing it with a pesticide, or 
containers used to store pesticides that contain oil, are considered 
bulk storage containers and continue to be regulated as such under the 
SPCC rule.
a. Comments
    Several commenters expressed general support for the exemption of 
pesticide application equipment and related mix containers on farms 
from the SPCC requirements. Other commenters suggested that the 
exemption should be extended to all users of this equipment, arguing 
that this would limit the potential for duplicative regulation of 
pesticides by the Federal Insecticide, Fungicide and Rodenticide Act 
(FIFRA) and the SPCC program. For example, the energy utilities sector 
requested an exemption for the pesticide application equipment and 
related mix containers they use to maintain their right-of-way networks 
and to preserve treated wood poles used in electricity transmission and 
distribution. One commenter suggested that the Agency exempt pesticide 
mixtures with low concentrations of oil from SPCC regulation 
altogether.
b. Response to Comments
    EPA evaluated the merits of extending the exemption for all 
pesticide application equipment and related mix containers at farms to 
all such equipment, regardless of ownership or where used, based on the 
fact that this pesticide use, and certain pesticide containers, are 
already subject to ``similar'' regulation under FIFRA to assure the 
safe use, reuse, storage, and disposal of pesticide containers. As 
such, EPA agrees with the commenters that it would be appropriate to 
extend the exemption to pesticide application equipment and related mix 
containers, regardless of ownership or point of use.
    On the other hand, EPA does not agree that the Agency should exempt 
pesticide mixtures with low concentrations of oil from SPCC regulation. 
Pesticide mix formulations, such as those that contain crop oil or 
adjuvant oil, are potentially subject to the SPCC rule because they are 
considered oil mixtures. The statutory definition of oil includes oil 
of any kind and in any form (33 U.S.C. section 1321(a)(1)), and does 
not exclude oil mixtures. Discharges of oil mixtures to navigable 
waters or adjoining shorelines may be harmful as set forth in 40 CFR 
part 110.
2. Applicability of Mobile Refueler Requirements to Farm Nurse Tanks
    In the October 2007 notice of proposed rulemaking (72 FR 58378, 
October 15, 2007), EPA clarified that the definition of mobile 
refueler, as promulgated in the December 2006 amendments to the SPCC 
rule (71 FR 77266, December 26, 2006), includes a nurse tank, which is 
a mobile/portable container used at farms to store and transport fuel 
for transfers to or from farm equipment (such as tractors and combines) 
to other bulk storage containers (such as containers used to provide 
fuel to wellhead/relift pumps) at the farm. A nurse tank is often 
mounted on a trailer for transport around the farm; thus, EPA believes 
that this function is consistent with that of a mobile refueler. A 
nurse tank, like other types of mobile refuelers, is exempt from the 
sized secondary containment requirements at Sec. Sec.  112.8(c)(2) and 
112.12(c)(2), but is still subject to the general secondary containment 
requirements at Sec.  112.7(c).
a. Comments
    Several commenters supported the Agency's clarification that a 
nurse tank is considered a mobile refueler, and

[[Page 74242]]

thus exempt from the sized secondary containment requirements. Some 
commenters also requested that EPA clarify that the definition of 
mobile refuelers includes non-road licensed refueling equipment which 
are used to refuel farm equipment in the fields.
b. Response to Comments
    EPA agrees with those commenters supporting the clarification. EPA 
also understands that agricultural retail suppliers may provide 
refueling services via non-road licensed equipment to farm equipment in 
farm fields. As the Agency described in the preamble to the proposed 
rule (72 FR 58378, October 15, 2007), a nurse fuel tank is typically 
used at a farm to store and transport fuel to or from farm equipment. 
Therefore, EPA agrees with commenters that non-road licensed equipment 
that is used to refuel farm equipment functions as a mobile refueler, 
similar to a farm fuel nurse tank. Additionally, owners and operators 
of these nurse tanks may benefit from other amendments in this action 
regarding the extension of relief from sized secondary containment to 
all non-transportation-related tank trucks. For example, nurse tanks 
containing oils other than a fuel such as lubrication or hydraulic oil, 
would also be eligible.
3. Differentiating the SPCC Requirements for Farms
    In developing the amendments in the October 2007 proposed rule, EPA 
considered and took comment on a number of alternatives for 
differentiating the SPCC requirements for farms, but are not finalizing 
them, as discussed below.
a. No Further Action
    EPA evaluated whether any further action was necessary specific to 
farms, including no further action. As described in the proposal (72 FR 
58378, October 15, 2007), the Agency proposed amendments based on 
previous comments from agricultural stakeholders, farm-related site 
visits conducted by EPA and the August 16, 2006, action concerning 
pesticide containers (40 CFR part 165, Subpart E, 71 FR 47330). EPA is 
finalizing those actions; the Agency also is promulgating the following 
additional amendments to the SPCC regulation that could also benefit 
farmers: Clarifications to the definition of facility; the option to 
allow the owners and operators of a subset of qualified facilities 
(i.e., ``Tier I qualified facilities'') to complete the SPCC Plan 
template in Appendix G of this part in lieu of preparing a full SPCC 
Plan; exemption of residential heating oil tanks at single family 
residences, including at farms; amendments to the security and 
integrity testing requirements; exemption from the loading/unloading 
rack requirements; and amendments to the facility diagram requirements.
b. Exempt Farms Below a Certain Storage Capacity Threshold
    EPA considered exempting farms that stored oil below a certain oil 
storage capacity threshold (other than 1,320 U.S. gallons) from the 
SPCC requirements, but determined that there was insufficient data 
available to support an exemption exclusive to farms. While farming 
operations may be unique, the storage tanks found at farms are similar 
in function and design as those found at other types of facilities, and 
therefore have a similar potential for discharge. As a result, EPA 
chose not to propose this option, but did request comment on the merits 
of this approach.
c. Alternative Qualified Facility Eligibility Criteria for Farms
    Under Sec.  112.6, a facility that has an aggregate aboveground 
storage capacity of 10,000 U.S. gallons or less and has not had a 
single discharge exceeding 1,000 U.S. gallons or two discharges each 
exceeding 42 U.S. gallons within any twelve month period in the three 
years prior to Plan certification, or since becoming subject to 40 CFR 
part 112 if the facility has been in operation for less than three 
years is eligible for the qualified facility Plan requirements (i.e. a 
self-certified Plan in lieu of a PE certified Plan). The current 
criteria for qualified facilities, found at Sec.  112.3(g), treat farms 
like all other facilities. However, EPA considered whether there are 
alternative criteria unique to farms that would be appropriate for 
identifying qualified facilities. In the October 2007 proposed 
rulemaking, EPA requested comment on (1) whether a change in the 
criteria is appropriate for farms; and (2) whether a higher threshold 
is appropriate for farms.
d. Comments
    Several commenters recommended that the Agency provide an exemption 
for farms at a minimum of 10,000 U.S. gallons oil storage capacity, 
citing a lack of risk at such a volume and/or the potential for cost 
savings, although no specific data was provided to support this 
position. Other commenters suggested that EPA adopt a higher threshold, 
such as a 20,000-gallon threshold, as a criterion for qualified 
facility eligibility. Specifically, agricultural stakeholders requested 
that EPA raise the Tier I individual container threshold to 10,000 U.S. 
gallons and raise the Tier II total oil storage capacity threshold to 
20,000 U.S. gallons. These commenters supported this threshold by 
citing limitations on the lower limit for bulk purchase of oil, the 
need to maintain empty and/or seasonal-use tanks on a farm, the lack of 
financial resources to hire environmental managers, the low likelihood 
of oil spills in the industry, and general environmental stewardship 
practices inherently in place.
    Still other commenters provided additional comments and suggestions 
related to farms. One commenter requested that EPA remove the qualified 
facility approach so that all farmers, including small businesses and 
other small oil storage facilities are required to prepare a complete 
SPCC Plan certified by a PE based on 1,320-gallon storage capacity. 
Other commenters requested additional time for farms to comply with the 
SPCC regulation, stating that this additional time will provide farmers 
and others the opportunity to work with government agencies, including 
the U.S. Department of Agriculture (USDA), on the development of a 
model plan or guidelines. Finally, a commenter sought clarification 
that oil tanks not in use can be classified as out of service, without 
the need to remove the tanks from the facility.
e. Response to Comments
    EPA continues to believe that there is insufficient data to support 
an outright exemption exclusively for farms beyond the existing 
aboveground storage capacity threshold of 1,320 U.S. gallons that 
applies to all facilities (Sec.  112.1(d)(2)(ii)). As noted previously, 
no data was provided by the commenters to support such an exemption. In 
addition, EPA notes that a significant number of owners and operators 
of farms will benefit from the amendments finalized in this action and 
the December 2006 SPCC rule amendments (71 FR 77266, December 26, 
2006), which allow a significant number of farms to develop self-
certified SPCC Plans.
    With respect to an alternative ``qualified facility'' threshold, 
EPA considered the commenters' suggestions for modifying the existing 
qualified facilities threshold of 10,000 U.S. gallons total aboveground 
storage capacity. However, the agricultural community did not provide 
information that would lead the Agency to conclude that farms are 
sufficiently different to warrant further differentiation from other 
facilities that store oil. In fact, EPA believes that many non-farm 
facilities could have similar needs to purchase

[[Page 74243]]

fuel in bulk and may have similar if not identical storage needs as 
identified by agricultural stakeholders. Thus, EPA is not persuaded by 
these comments to raise the existing qualified facilities threshold 
solely for farms beyond 10,000 U.S. gallons. In setting the qualified 
facilities threshold at 10,000 U.S. gallons in the December 2006 
amendments, EPA sought to provide an alternative for facilities, among 
other things, with simple oil storage configurations and smaller 
quantities of oil handled (see 71 FR 77271, December 26, 2006). EPA 
continues to maintain that the focus of the qualified facilities 
alternative should be on simple configurations and small quantities of 
oil stored or handled.\3\
---------------------------------------------------------------------------

    \3\ Although the Agency chose not to raise the threshold for 
farms in identifying who is eligible as a ``qualified facility,'' 
the Agency estimates that under the current qualified facilities 
eligibility criteria, greater than 90 percent of farms subject to 
the SPCC rule could be eligible.
---------------------------------------------------------------------------

    It should also be noted that, as described in Section V.G of this 
notice, EPA is finalizing a multi-tiered approach to allow the owner or 
operator of a facility that meets the eligibility criteria for a 
qualified facility to self-certify his SPCC Plan, and allow the owners 
or operators of a subset of qualified facilities (i.e., ``Tier I 
qualified facilities'') to complete the SPCC Plan template in Appendix 
G of this part in lieu of preparing a full SPCC Plan. EPA believes that 
the Tier I qualified facility alternative should focus on facilities 
with the simplest configurations and smallest oil storage containers. 
Commenters did not provide sufficient data to support an increase in 
the Tier I threshold for farms higher than proposed. For more 
information on Tier I and Tier II qualified facilities, see Section V.G 
of this notice.
    EPA also disagrees that the amendments to the SPCC rule in December 
2006 provide ``special treatment'' to any eligible facility. Farmers, 
small businesses, and other small oil storage facilities may be 
eligible to self-certify their SPCC Plans if they meet the eligibility 
criteria for qualified facilities in Sec.  112.3(g). In providing this 
option for facilities handling smaller amounts of oil, the Agency 
sought to focus on those smaller, less complex operations that may be 
concerned about the impact of using a PE on their limited budget. Some 
of the current noncompliance with the SPCC regulation may be attributed 
to those concerns. The Agency believes that providing a streamlined 
option for owners and operators of these smaller, less complex 
facilities should improve the overall compliance for the SPCC 
regulation, ultimately resulting in greater environmental protection 
(71 FR 77270, December 26, 2006). The owners and operators of farms, 
small businesses and other small oil storage facilities may be eligible 
to self-certify their SPCC Plans if they meet the eligibility criteria 
for qualified facilities in Sec.  112.3(g).
    EPA defines permanently closed at Sec.  112.2. Any container that 
meets this definition is not subject to the SPCC regulation and 
therefore would not be included in the facility's aggregate oil storage 
capacity. The definition does not require that the permanently closed 
container be removed from the facility. Similarly, a new, empty tank 
that arrives at a farm or other SPCC-regulated facility is not to be 
counted towards a facility's aggregate oil storage capacity until the 
tank is actually used to contain oil. EPA discusses this clarification 
further in section V.M of this notice.
    In response to the commenters requesting additional time for farms 
to comply with the SPCC regulation, EPA believes that the amendments to 
the SPCC rule in this final action address the concerns raised by the 
agricultural industry. Farmers will benefit from many of the 
streamlined rule provisions including: Clarifications to the definition 
of facility; the option to allow the owners and operators of a subset 
of qualified facilities (i.e., ``Tier I qualified facilities'') to 
complete the SPCC Plan template in Appendix G of this part in lieu of 
preparing a full SPCC Plan; exemption of residential heating oil tanks 
at single family residences, including farmsteads; amendments to the 
security and integrity testing requirements; exemption from the 
loading/unloading rack requirements; and amendments to the facility 
diagram requirements. Furthermore, in a separate action in the Federal 
Register of November 26, 2008, (73 FR 72016), EPA is proposing a new 
compliance date for the owner or operator of a farm, as defined in 
Sec.  112.2, that also meets the eligibility criteria as a qualified 
facility, to prepare or amend and implement the farmer's SPCC Plan.

C. Residential Heating Oil Containers

    Many regulated facilities, including farms, may include the 
residence of the owner or operator within the geographical confines of 
the facility. EPA did not intend to regulate residential uses of oil 
(that is, those at non-commercial buildings) under the SPCC rule. 
Therefore, EPA is exempting residential heating oil containers at 
single family residences from the SPCC requirements.
1. Exemption for Residential Heating Oil Containers
    EPA is adding a new paragraph (9) under the general applicability 
section, Sec.  112.1(d) to exempt from SPCC applicability containers 
that are used to store oil for the sole purpose of heating single-
family residences (including a residence at a farm). EPA is also 
modifying Sec.  112.1(d)(2) so that the capacity of the single-family 
residential heating oil containers are not counted toward facility 
aggregate oil storage capacity. This action removes from SPCC 
applicability containers (both aboveground and completely buried) 
located at a single-family residence that are used solely to store 
heating oil used to heat the residence. Under this amendment, the owner 
or operator is not required to count any residential heating oil 
container as part of the facility's aggregate storage capacity for the 
purpose of determining SPCC applicability, and no SPCC requirements 
will apply to the exempt containers. The SPCC requirements continue to 
apply, however, to oil containers used to heat other non-residential 
buildings within a facility, because the exemption covers only 
residential heating oil containers at single family residences.
a. Comments
    Several commenters expressed support for the exemption of 
residential heating oil containers at single family residences from the 
SPCC requirements. However, some commenters suggested extending the 
exemption to locations beyond single-family residences. One commenter 
suggested that EPA exempt buildings and offices located remotely from 
mining operations. Another commenter suggested the exemption should 
include heating oil tanks at a facility occupied daily, with storage 
capacity not exceeding 5,000 gallons, in containers not exceeding 1,000 
gallons, because these facilities are regularly occupied, and thus 
would not pose any more likelihood of a release than a single-family 
residence. One commenter suggested exempting heating oil storage 
containers that serve four or fewer households, consistent with the 
Federal underground storage tank regulations.
b. Response to Comments
    EPA agrees with those commenters who supported the exemption, and 
is finalizing the exemption as proposed, because EPA views a single-
family residence as a household that has direct ownership of the oil 
stored in the heating oil container. The Agency did not intend, by 
itself, that a single-family

[[Page 74244]]

residence that stores heating oil for its use be subject to SPCC 
applicability, particularly because such residences generally do not 
have significant quantities of other types of oil. The preamble to the 
original 1973 SPCC rule (38 FR 34164, December 11, 1973), identified 
containers of 660 U.S. gallons as the normal domestic code size for 
non-buried heating oil containers, and that buildings may have two such 
containers. The storage capacity thresholds for SPCC rule applicability 
were initially established at 660 U.S. gallons for an individual 
container and 1,320 U.S. gallons total aboveground capacity for the 
facility, based on the possible capacity of residential heating oil 
containers. Thus, the presence of heating oil containers at a single-
family residence was generally not intended, by itself, to trigger SPCC 
applicability. On the other hand, EPA disagrees with those commenters 
who suggested extending the exemption beyond heating oil containers at 
single-family residences. Owners and operators of commercial 
facilities, such as mining operations and commercial multi-family 
structures (such as condominiums and apartment complexes), will 
generally store much larger volumes of oil, and if there is a 
reasonable expectation of an oil discharge to navigable waters or 
adjoining shorelines, EPA believes it needs to be addressed in the SPCC 
Plan. Of course, any facility that has an aggregate oil storage 
capacity of less than 1,320 U.S. gallons in aboveground containers or 
42,000 U.S. gallons in completely buried tanks are not subject to the 
SPCC regulation (see Sec.  112.1(d)(2)). In addition, if a commercial 
facility (for example, a university) includes a single-family residence 
on the premises, then any heating oil container associated solely with 
this residence is exempt from SPCC rule applicability.
2. Alternative Option Considered
    EPA invited comments on an exemption only for residential heating 
oil containers located at farms, because farms commonly include, within 
the geographical confines of the facility, the residence of the farmer. 
Under this option, only heating oil containers associated with single-
family residences on farms would benefit from an exemption from the 
SPCC rule.
a. Comments
    One commenter supported exempting heating oil storage containers 
located at a farm facility's single-family residence.
b. Response to Comments
    EPA agrees with the commenter that heating oil containers located 
at a single-family residence at a farm should be exempt from the SPCC 
rule and is finalizing such an exemption. However, the commenter did 
not provide any basis to limit the exemption solely to farms. Because 
EPA believes the same rationale applies to exempt heating oil 
containers to single-family residences at facilities other than farms, 
the exemption applies to all single-family residences.

D. Definition of Facility

    EPA first defined both ``facility'' and ``production facility'' at 
Sec.  112.2 in the July 2002 amendments to the SPCC rule (67 FR 47042, 
July 17, 2002). Under this action, EPA is modifying the definition of 
facility in three ways: (1) To clarify that this definition alone 
governs the applicability of 40 CFR part 112; (2) to clarify that 
containers can be separated or aggregated, based on various factors in 
defining ``facility''--that is, the owner or operator has discretion in 
identifying which contiguous or non-contiguous buildings, properties, 
parcels, leases, structures, installations, pipes, or pipelines make up 
the facility; and (3) to add the qualifier ``oil'' before the term 
``waste treatment.''
1. Revisions to the Definition of Facility
    EPA is amending the definition of ``facility,'' as found in Sec.  
112.2, in the following ways:
     To show that only the definition of ``facility'' rather 
than the definition of ``production facility'' determines applicability 
for purposes of part 112, and specifically in Sec.  112.20(f)(1) when 
applied to an oil production facility, EPA is adding the sentence 
``Only this definition governs whether a facility is subject to this 
part.'' to the definition of facility. This language is consistent with 
the clarification on the definition of facility published in a May 25, 
2004 Federal Register notice (69 FR 29728).
     To address concerns over how oil containers and equipment 
can be separated or aggregated for purposes of determining ``the 
facility,'' and thus, the applicability of the SPCC requirements to 
``the facility,'' EPA is inserting the sentence ``Contiguous or non-
contiguous buildings, properties, parcels, leases, structures, 
installations, pipes, or pipelines under the ownership or operation of 
the same person may be considered separate facilities.'' These 
revisions allow an owner or operator of a facility to separate or 
aggregate containers to determine the facility boundaries, based on 
such factors as ownership or operation of the buildings, structures, 
containers, and equipment on the site, and activities being conducted, 
property boundaries, and other relevant considerations. EPA is adding 
the terms ``property,'' ``parcel,'' and ``lease'' to the list of terms 
mentioned in the first sentence of the definition. EPA believes that 
adding these terms further distinguishes the attributes that can be 
considered in determining facility boundaries. These additions are 
merely examples of terms that might define a facility and are familiar 
to the regulated community, such as farmers or oil production facility 
owners. They are not meant to be exclusive.
     To clarify that the term ``waste treatment'' refers to oil 
waste treatment and not to treatment of any other type of waste that 
may be generated, EPA is amending the first sentence of the definition 
of facility to add the qualifier ``oil'' before the term ``waste 
treatment.''
a. Comments
    Many commenters expressed general support for the proposed 
amendments. Several commenters stated that these revisions would allow 
them the ability to prioritize compliance activities in environmentally 
and economically beneficial ways (for example, being able to plan for 
potential discharges in areas where they are more likely to occur). 
Several commenters indicated that certain types of facilities, such as 
those in the wind power, agriculture, electrical utility, forestry, 
aviation, and coal mining industries, might be managed by multiple 
operators, and that dividing a parcel of land into facilities on the 
basis of these individual operations makes sense.
    One commenter, however, objected to the amendment if it would 
result in a facility being disaggregated into more than one facility, 
thereby lowering the total oil capacity volume of the `new' facility to 
below the regulatory thresholds.
b. Response to Comments
    EPA agrees with those commenters who supported this approach. The 
Agency also agrees with the commenters that the owner or operator has 
the discretion to determine what constitutes a facility. That is, the 
rule may become applicable to a facility for the first time in cases of 
aggregation of buildings, structures or equipment and associated 
storage or type of activity, or the division of the facility may end 
applicability due to separation of buildings, structures or equipment 
and associated oil storage or type of activity. Thus, EPA recognizes 
that this

[[Page 74245]]

amendment may have the effect of removing a facility from being subject 
to the SPCC requirements. However, an owner or operator may not make 
facility determinations indiscriminately and in such a manner as to 
simply avoid applicability of the rule (for example, the division of 
one facility into separate facilities with one oil storage container 
located at each facility where all storage containers are located side-
by-side or close to each other, and are used for the same purpose). For 
further information on the definition of facility, see Chapter 2 of the 
SPCC Guidance for Regional Inspectors.
2. Determining the Components of a Facility: Examples of Aggregation or 
Separation
    The factors for determining the boundaries of a facility as listed 
in the definition of facility are not exclusive, but are merely 
examples. The SPCC Guidance for Regional Inspectors elaborates on 
additional factors that may be considered. Those factors may include, 
but are not limited to: Ownership, management, or operation of the 
containers, buildings, structures, equipment, installations, pipes, or 
pipelines on the site; similarity in functions, operational 
characteristics, and types of activities occurring at the site; 
adjacency; or shared drainage pathways. In the October 2007 proposed 
rule, EPA provided several examples and hypothetical scenarios of how a 
facility owner or operator may determine what is considered a 
``facility'' for the purposes of an SPCC Plan (see 72 FR 58387, October 
15, 2007).
a. Comments
    One commenter stated that, for oil and gas operations, owners and/
or operators often combine many leases together. These leases may not 
be associated with the same oil or gas field, but they are associated 
with the same operator. The commenter requested assurance that this 
practice is consistent with the amended definition of facility.
    While additional comments did not focus on the specific examples 
provided, several commenters raised questions about how the 
modification to the definition of facility may affect various types of 
facilities. One commenter supported flexibility to prepare single or 
multiple SPCC Plans for wind power plants, which potentially involve 
many landowners spread over large areas. One commenter requested 
clarity that a petroleum refinery owner may determine that refinery 
operations are a facility and ongoing remediation activities at the 
same petroleum refinery location can be considered a separate facility. 
Another commenter from the aviation sector requested that EPA clarify 
whether a tank at an exempt facility may be subject to regulation by 
transferring fuel from the tank to a regulated mobile refueler. Several 
commenters suggested that operators may prepare multi-facility SPCC 
Plans that combine common elements (such as structures, equipment, 
inspections, integrity testing, secondary containment designs, and 
response procedures), while retaining site-specific information; these 
commenters urge EPA to clarify that using a single Plan for multiple 
locations does not force facilities to be considered a single facility 
for FRP purposes.
b. Response to Comments
    As described in the hypothetical scenario (72 FR 58387, October 15, 
2007), the Agency reiterates that an owner or operator of an oil 
production facility may aggregate some or all of his leases into one 
Plan, at his discretion, whether or not they are associated with the 
same oil or gas field. Thus, this practice is consistent with the 
amended definition of facility being promulgated by this action.
    With respect to the other comments submitted on how the definition 
of facility may affect various types of facilities, EPA agrees that 
wind power plants, whether spread over large or small areas and which 
may involve multiple landowners, may be appropriately defined as single 
or multiple facilities, depending on the circumstances, at the owner or 
operator's discretion. Such facilities may be included in single or 
multiple facility SPCC Plans. EPA also generally agrees with the 
commenter that a petroleum refinery owner or operator may, at his 
discretion, decide that remediation activities at an operating 
petroleum refinery constitute a separate facility. Furthermore, EPA 
agrees with the commenter that the Agency does not regulate the 
transfer of fuel at an exempt facility. However, once the fuel is 
transferred to a regulated container at an otherwise regulated SPCC 
facility, the transfer activity becomes subject to the SPCC 
requirements.
    Finally, as noted previously, the definition of facility determines 
the applicability for all purposes under part 112. Thus, once an owner 
or operator defines the extent of his facility, that definition 
determines applicability for both SPCC and FRP purposes. The owner or 
operator may, at his discretion, create a Plan that includes more than 
one site, and define it as one facility which pertains to both FRP and 
SPCC applicability. An owner or operator may also combine multiple 
facilities into a single SPCC Plan, combining common elements, while 
retaining facility-specific information (a multi-facility Plan). While 
the Plan may encompass multiple facilities, the applicability of SPCC 
and FRP requirements is determined by the extent of each individual 
facility. The amendment to the definition of facility and the 
clarifications described in this action should not be viewed as a 
deterrent to the use of multi-facility SPCC Plans, a concern expressed 
by operators in the oil production sector.
3. Alternative Options Considered
    In developing the amendments finalized in this notice, EPA 
considered alternatives for addressing the definition of facility, 
including taking no action, and addressing concerns only through 
guidance. No comments were received on these specific alternative 
options. EPA also requested comments on other alternatives that could 
serve to address the needs of the regulated community, while at the 
same time maintain appropriate levels of environmental protection.
a. Comments
    A commenter suggested removing the terms ``* * * property, parcel, 
lease * * *'' from the definition of facility because the commenter 
believes these terms complicate and confuse the definition. Another 
commenter urged EPA to state that the determination of a ``facility'' 
for the purpose of preparing an SPCC Plan does not preclude the 
operator from making a different determination of the scope of the 
facility for the purposes of reporting or planning under any other 
Federal or state statute. Other commenters recommended that EPA clarify 
that a lease does not necessarily define a facility. Another commenter 
also requested that EPA clarify that the definition of facility 
excludes DOT and U.S. Coast Guard (USCG) components. Still another 
commenter suggested that EPA codify the litigation settlement language 
either as rule amendments or an appendix to the rule. Finally, one 
commenter recommended that EPA give 120 days to a facility owner or 
operator to resolve any compliance concerns, including a disputed 
facility determination.
b. Response to Comments
    EPA disagrees with the suggested edit to remove the terms ``* * * 
property, parcel, lease * * *'' from the definition of facility. Unlike 
the commenter, the

[[Page 74246]]

Agency believes that these terms serve as clarifying examples of what 
may constitute a facility.
    EPA agrees that the definition of facility, as defined in Sec.  
112.2, applies only for purposes of part 112, and not for purposes of 
any other Federal or state statute. However, this would not prevent the 
owner or operator of a facility from defining the facility boundaries 
in the same way that he defines it to comply with other regulations.
    EPA clarifies that a lease may, at the owner or operator's 
discretion, constitute a facility, but does not necessarily create a 
facility. According to the definition, contiguous or non-contiguous 
buildings, properties, leases, structures, installations, pipes, or 
pipelines under the ownership or operation of the same person may be 
considered separate facilities. The definition further lists several 
site-specific factors, including, but not limited to, ownership or 
operation of buildings, structures, and equipment on the same site and 
types of activity at the site.
    Generally, a facility for SPCC purposes excludes components which 
are not subject to EPA's jurisdiction, but are subject to the 
jurisdiction of other agencies, such as DOT or USCG. However, EPA and 
DOT recognize that in certain situations, dual jurisdiction has been 
applied to certain components of a facility, and that this approach can 
pose confusion to the regulated community. EPA and DOT thus are 
currently working to minimize overlapping regulation in accordance with 
their 1971 MOU regarding agency jurisdiction (36 FR 24080, November 24, 
1971) and will publish the results of that effort in the Federal 
Register at a later date. For more information, please refer to the 
proposed rule Federal Register notice (72 FR 58419, October 15, 2007).
    EPA believes that this action addresses the facility definition 
issue in the settlement of the 2002 SPCC rule litigation, because in 
the amended definition, EPA clarifies that only this definition is used 
to determine whether a facility is subject to 40 CFR part 112. EPA also 
has stated in this preamble that the positions that EPA has taken in 
the July 2002 SPCC rule litigation settlement are still the Agency's 
existing positions.
    Finally, EPA disagrees that owners or operators of SPCC regulated 
facilities should be given 120 days to address any possible compliance 
concerns, including but not limited to, differences of opinion on a 
facility determination. Whether or not a total or partial Plan is 
needed, or whether an existing SPCC Plan should be amended is a 
compliance issue, subject to the provisions of Sec.  112.1(f) or Sec.  
112.4(e) and (f). Both of these sections provide adequate time for 
appeal from an initial decision of the Regional Administrator to the 
Administrator. Therefore, a period of 120 days is not included in this 
final rule to allow the owner or operator to resolve compliance issues.

E. Facility Diagram

    Section 112.7(a)(3) of the SPCC rule requires that a facility owner 
or operator include in his SPCC Plan a facility diagram that identifies 
the location and contents of oil containers, connecting piping, and 
transfer stations. EPA is amending the SPCC rule to provide additional 
flexibility to the requirement that the facility diagram include the 
location and contents of each container.
    EPA is also requiring that certain containers and piping, exempted 
from SPCC requirements in this action, be identified on the facility 
diagram and marked as ``exempt.'' This includes intra-facility 
gathering lines subject to the requirements of 49 CFR part 192 or 195 
as described in Sec.  112.1(d)(11); and any produced water container, 
as defined in Sec.  112.2, that meets the requirements at Sec.  
112.9(c)(6)(i) as described in Sec.  112.1(d)(12). This will assist 
facility and EPA personnel in defining the jurisdictional boundaries at 
the facility and provide emergency response personnel with information 
that can be used to identify hazards during a spill response activity. 
EPA has not required that all containers exempted from the rule be 
marked on the facility diagram because in many cases it would be 
burdensome. For example, the mobility of motive power containers and 
mobile/portable containers with a capacity of less than 55 U.S. gallons 
would make them difficult to track on a facility diagram. For more 
information on these exemptions, see sections V.L and V.M of this 
preamble.
1. Revision to the Facility Diagram Requirement Regarding Mobile or 
Portable Containers
    EPA is amending Sec.  112.7(a)(3) to clarify that the facility 
diagram must include all fixed (that is, not mobile or portable) 
containers. For any mobile or portable containers (such as drums or 
totes), a facility owner or operator must mark the area of the facility 
on the diagram where such containers are stored. The facility owner or 
operator may mark the number of containers, contents and capacity of 
each container either on the facility diagram, or provide a separate 
description in the SPCC Plan. If the total number of mobile or portable 
containers changes, the owner or operator can include an estimate in 
the Plan of the number of containers, the anticipated contents, and 
capacities of the mobile or portable containers maintained at the 
facility.
    EPA believes that the revision to the facility diagram requirements 
for mobile or portable containers will simplify the process for 
developing a facility diagram by allowing for a general description of 
both the area of the facility where they are located and of their 
contents, rather than representing each container individually.
a. Comments
    Many commenters expressed general support for the amendments, while 
one commenter opposed the amendment because of increased cost estimates 
for facility diagram preparation. Several other commenters requested 
that EPA clarify, via rule language, which containers are considered 
mobile or portable (such as 55-gallon drums, intermodal bulk 
containers, mobile/portable maintenance tanks, and other small 
containers put into place and later moved). Other commenters suggested 
that EPA require only mobile or portable storage container locations 
that are ``fixed,'' ``permanent,'' or ``dedicated'' be included in the 
diagram. These commenters assert that internal facility tracking of 
these containers is sufficient for planning and emergency response 
purposes, that single drums are not reasonable to track on a diagram, 
and that their inclusion on the diagram does not provide increased 
environmental protection.
    Several additional approaches were suggested by commenters. One 
commenter suggested that EPA allow facility operators to use ``range 
reporting'' for the number of containers and their quantities that may 
be in use at the facility. One commenter recommended allowing the use 
of an administrative alternative, such as a computerized tracking 
system, to provide real-time information on the quantity, type, 
location, and person responsible for mobile/portable containers. One 
other commenter suggested that Sec.  112.5 should be amended to specify 
other examples of Plan changes that do not require re-certification. 
Finally, one commenter supported the use of facility diagrams for SPCC 
Plans that have already been prepared for other programs.
b. Response to Comments
    The Agency agrees with those commenters that support the proposal,

[[Page 74247]]

and believes that clarification and simplification of these 
requirements will reduce costs and facilitate compliance. Thus, EPA 
disagrees with the commenter who argued, without any supporting data, 
that the facility diagram amendments would increase the cost of 
preparing a facility diagram. In addition, the Agency does not believe 
that it needs to clarify, via rule language, which containers are 
considered mobile or portable. The Agency has already provided examples 
of mobile/portable containers in Section 4.4.4: Secondary Containment 
Requirements for Mobile/Portable Containers of the SPCC Guidance for 
Regional Inspectors (for example, 55 gallon drums, skid tanks, totes, 
and intermodal bulk containers). Some oil refinery tank trucks and 
fueling trucks dedicated to a particular facility (such as a 
construction site, military base, or similar large facility) may fall 
under this category.
    The Agency also disagrees with those commenters regarding the need 
to include on the facility diagram only those mobile or portable 
container locations that are ``fixed,'' ``permanent,'' or 
``dedicated.'' The Agency believes and clearly stated in preamble to 
the proposed rule (72 FR 58378, October 15, 2007) that mobile or 
portable containers should be marked on the facility diagram in their 
out-of-service or designated storage area, primary storage areas, or 
areas where they are most frequently located, and believes that the 
final rule language accomplishes this purpose.
    The Agency agrees with the comments supporting the flexibility of 
reporting an area on the facility diagram (such as a drum storage area) 
for these containers, as well as providing reasonable estimates 
(including ranges) for the potential number of mobile or portable 
containers, types of oil, and anticipated capacities in the SPCC Plan. 
The Agency believes that these estimates can be effectively used to 
determine the applicability of the rule thresholds and provide a 
general description of the mobile/portable containers in the Plan; this 
clarification may be particularly useful when the number of containers 
change frequently at the facility.
    While the idea of an internal computerized tracking system, 
utilizing container bar codes to provide real-time information on the 
quantity, type, location, and person responsible for oil containers of 
55 U.S. gallons or greater may suit some facilities, the Agency does 
not believe it can reasonably require such a system for all SPCC-
regulated facilities. However, EPA believes that the amendments allow a 
facility owner or operator to implement such a system to assist in 
their tracking of mobile or portable containers, and to use it to meet 
the SPCC Plan requirement for these types of containers, if desired.
    Also, the Agency does not believe it needs to expand the list of 
examples of compliance activities that do not require PE certification, 
as including every potential scenario is unreasonable. Owners or 
operators can refer to the existing list of changes that may require PE 
certification in Sec.  112.5 and to the SPCC Guidance for Regional 
Inspectors.
    Finally, the Agency does not require that a facility diagram be 
developed exclusively for the SPCC Plan, and does not agree that it 
needs to amend the rule language to allow for this. A facility diagram 
prepared for a state or Federal plan (including the FRP requirements 
under Sec.  112.20) or for other purposes (for example, construction 
permits, facility modifications, or other pollution prevention 
requirements) may be used in an SPCC Plan if it meets the requirements 
of the SPCC rule (for example, it includes the contents and capacities 
of containers; transfer areas; and piping). Thus, EPA believes that the 
existing regulations allow for a facility diagram developed for other 
programs to be used, which not only facilitates compliance with this 
requirement, but also reduces the cost of diagram preparation.
2. Indicating Complicated Areas of Piping or Oil-Filled Equipment on a 
Facility Diagram
    A facility diagram must also include all transfer stations and 
connecting pipes (Sec.  112.7(a)(3)). Associated piping and oil-filled 
manufacturing equipment present at an SPCC-regulated facility may be 
difficult to clearly present on a facility diagram, due to their 
relative location, complexity, or design. Therefore, in the October 
2007 proposal (72 FR 58378, October 15, 2007), EPA requested comment on 
whether a rule revision is appropriate to provide further clarification 
on how complicated areas of piping or oil-filled equipment may be 
indicated on the facility diagram.
    EPA believes that the SPCC Guidance for Regional Inspectors 
adequately addresses the flexibility inherent in the existing SPCC rule 
related to indicating these areas on a facility diagram, and that no 
additional rule amendment is necessary.
a. Comments
    Several commenters expressed general support for an amendment to 
the regulations to provide further clarification on how piping or oil-
filled equipment can be addressed on the facility diagram. These 
commenters noted the difficulties associated with including oil-filled 
equipment or piping detail on a diagram, and requested that EPA offer 
other options. Suggestions included a table identifying the oil-filled 
equipment and associated storage capacities; flow charts; piping 
inventories; summary statements; drawings; PE-required details; 
electrical one-line diagrams; and other means. One commenter suggested 
that the clarifications on flexibility provided in the SPCC Guidance 
for Regional Inspectors on the way the facility diagram can be drawn 
should be made part of the rule itself.
    Another commenter stated that oil-filled equipment located in 
buildings with multiple floors, or in process areas with numerous other 
pieces of equipment, should not be required to be shown in the facility 
diagram, because including such detail is impractical for a complex 
site (such as a petroleum refinery or chemical plant). The commenter 
recommended that EPA limit the diagram requirements exclusively to 
fixed bulk oil storage containers. Other commenters expressed 
difficulties with depicting complex hydraulic and lubricant tubing; 
older equipment attributes; and indoor and/or outdoor piping 
(particularly at older facilities) that pose no risk of discharge to 
navigable waters or adjoining shorelines.
b. Response to Comments
    The Agency interprets the requirement at Sec.  112.7(a)(3) to allow 
an owner or operator of a facility to represent such systems in a less 
detailed manner on the facility diagram in the SPCC Plan, as long as 
the information is contained in more detailed diagrams of the systems 
or is contained in some other form and such information is maintained 
elsewhere at the facility and this location is referenced in the SPCC 
Plan. The SPCC Guidance for Regional Inspectors describes the Agency's 
interpretation of the requirements for a facility diagram that allow an 
owner or operator to determine the scale and level of detail shown on a 
facility diagram according to the needs and complexity of the facility. 
Thus, the Agency agrees with those commenters who believe that the 
guidance adequately addresses the flexibility for complying with these 
requirements. The guidance document illustrates how the current 
regulatory requirement allows flexibility in the way the facility 
diagram is drawn to include complex

[[Page 74248]]

designs of oil-filled equipment or pipelines. As noted in the guidance 
document, schematic representations that provide a general overview of 
the piping service (for example, supply/return) may provide sufficient 
information when combined with a description of the piping in the SPCC 
Plan. Alternatively, overlay diagrams showing different portions of the 
piping system may be used where the density and/or complexity of the 
piping system would make a single diagram difficult to read. For areas 
of complicated piping, which often include different types, numbers, 
and lengths of pipes, the facility diagram may show a simplified box 
labeled ``piping'' or show a single line that identifies the service 
(for example, supply/return), as long as more detailed diagrams are 
available elsewhere at the facility. Therefore, because the existing 
regulations already provide adequate flexibility, which is further 
described in the SPCC Guidance for Regional Inspectors, and because the 
Agency believes that amending the regulatory text will not provide any 
greater clarity, EPA has decided not to provide further amendment to 
the rule.

F. Loading/Unloading Racks

    Tank car and tank truck loading/unloading racks are subject to 
specific requirements in Sec.  112.7(h), including sized secondary 
containment. EPA is finalizing a definition for the term ``loading/
unloading rack,'' which governs whether a facility is subject to Sec.  
112.7(h). Under this amendment, the requirements described at Sec.  
112.7(h) only apply to areas of a regulated facility where a loading/
unloading rack, as defined in Sec.  112.2, is located.
    A loading/unloading rack can be located at any type of facility; 
however, the loading and unloading areas associated with oil production 
tank batteries and farms generally do not have the equipment described 
in the definition of loading/unloading rack finalized in this action. 
Therefore, EPA is specifically excluding oil production facilities and 
farms from the requirements at Sec.  112.7(h).
1. Loading/Unloading Rack Definition
    EPA is finalizing the following definition for ``loading/unloading 
rack'' under Sec.  112.2: ``Loading/unloading rack means a fixed 
structure (such as a platform, gangway) necessary for loading or 
unloading a tank truck or tank car, which is located at a facility 
subject to the requirements of this part. A loading/unloading rack 
includes a loading or unloading arm and may include any combination of 
the following: Piping assemblages, valves, pumps, shut-off devices, 
overfill sensors, or personnel safety devices.'' This definition is a 
slightly modified version of the definition proposed in October 2007. 
In developing the proposed definition, EPA reviewed information from a 
number of different sources and reviewed various types of equipment 
considered components of loading racks (see 72 FR 58378, October 15, 
2007). The Agency sought comment on the proposed definition of 
``loading/unloading rack'' and requested suggestions on any other 
definitions for ``loading/unloading rack'' that would be more suitable. 
EPA also requested a description of a ``loading/unloading arm.''
a. Comments
    Many commenters expressed general support for the proposed 
definition of loading/unloading rack. However, other commenters opposed 
the proposed definition, suggesting that it is too broad and 
consequently includes many loading/unloading areas or equipment that 
would not normally be components of ``racks,'' such as storage 
containers equipped with safety platforms, piping assemblages, valves, 
pumps, shut-off devices, overfill sensors, or personnel safety devices. 
One commenter expressed concern that the proposed definition of loading 
rack could include a facility ``where filling/emptying is accomplished 
by direct connection to the same tanks.'' Another commenter expressed 
concern that, by not defining ``loading arm,'' EPA might inadvertently 
cause hoses used at loading racks to be identified as loading/unloading 
arms. Still another commenter stated that, in the state of Alaska, many 
rural facilities do not have a gangway and a fixed loading arm, so the 
proposed definition would leave these facilities not subject to Sec.  
112.7(h).
    Several commenters emphasized that a loading arm is an essential 
component of a loading/unloading rack, and that EPA's definition should 
be modified to reflect this fact. A commenter recommended that 
accessories, such as piping assemblages, valves, pumps, shut-off 
devices, overfill sensors, personnel safety devices be deleted from the 
definition, as these may or may not be a part of the rack, and one or 
more of these devices (for example, overfill sensors) are typically 
present on most tanks. The commenter also recommended that the 
definition of loading/unloading rack be narrowed to cover only 
permanently installed platforms, gangways or loading/unloading arms 
used in the loading or unloading of tack trucks or tank cars.
    Other commenters requested that EPA more clearly define the 
components, such as platforms, gangways, and loading/unloading arms, 
and confirm that flexible hoses used at a loading/unloading rack should 
not be considered loading/unloading arms. Two commenters provided a 
suggested definition for ``loading/unloading arm.'' Specifically, these 
commenters suggested that ``loading/unloading arm'' be defined as 
``consisting of at least two articulated parts that are connected in 
such a way that relative movement is feasible to transfer product via 
top or bottom loading/unloading to a transportation vehicle.''
    One commenter suggested that the definition of loading/unloading 
rack be changed to identify examples of what are not loading racks 
(i.e., a nozzled connection to a tank, connection consisting of a 
flexible hose, a single connection with a valve, or a loading structure 
that is not overhead). This commenter also requested that EPA remove 
references to ``unloading'' from the definition.
    Two commenters suggested a definition involving a throughput 
threshold for an area to be considered a loading rack (for example, 
limiting ``racks'' to those loading/unloading facilities with an annual 
average of 100 trucks, on a five-year rolling average; a throughput 
threshold of 800,000 gallons per month, based on the relatively low 
likelihood of a spill when petroleum product is transferred only 
occasionally). Another commenter suggested that EPA narrow the 
definition of loading/unloading racks by associating the definition 
with the flow-rate capacities of the associated pump systems, and 
clarify that loading/unloading racks are not typically associated with 
oil-filled operating equipment.
    One commenter suggested that small tank transfers--that is, using a 
small transfer hose to fill a shop-built tank, and therefore having the 
potential of only a small release--should be viewed as a loading area 
and be subject to Sec.  112.7(c), whereas large tank transfers--that 
is, using a larger hose equipped with a hose coupler and a stationary 
pump to transfer product at a rate greater than 50 gallons per minute, 
with the consequent likelihood of a larger release--should be viewed as 
a loading rack and be subject to Sec.  112.7(h). Another commenter 
suggested a definition that would require loading/unloading racks to be 
used only for transportation-related tank trucks, rail cars, or 
vessels, not intra-facility vehicles.

[[Page 74249]]

    Finally, one commenter suggested that EPA clarify that the 
requirement applies only to tank cars or tank trucks located within the 
loading/unloading rack and not to tank cars or trucks waiting to enter 
the loading/unloading rack.
b. Response to Comments
    EPA agrees that the proposed definition of ``loading/unloading 
rack'' should be refined to provide clarity and address the concerns 
about the scope of the definition. Therefore, EPA has modified the 
proposed definition to provide more clarity by addressing concerns that 
a loading/unloading arm is an essential component of a loading rack, 
while describing other components that may be found at a loading or 
unloading rack.
    The Agency does not intend this definition to include simple 
loading or unloading configurations, but rather to only include the 
associated equipment and structure associated with loading/unloading 
arms as part of a rack. Equipment present at a loading/unloading area 
where a pipe stand connects to a tank car or tank truck via a flexible 
hose, which is not equipped with a loading or unloading arm, is not 
considered a loading/unloading rack as defined in this action. However, 
the presence of flexible hoses on oil transfer equipment does not 
always indicate that the equipment is exempt from the definition of 
loading/unloading rack, as some top and bottom loading/unloading racks 
are made up of a combination of steel loading arms connected by 
flexible hosing.
    EPA believes that providing the list of equipment usually 
associated with a loading/unloading rack in the definition will be 
useful for the owner or operator and the PE in determining the 
applicability of the rule requirements at Sec.  112.7(h) to the 
facility. The Agency agrees with commenters that the key to the 
definition is the presence of a loading or unloading arm in association 
with a permanent structure and other equipment. Thus, the Agency has 
added the phrase ``a loading/unloading rack includes a loading or 
unloading arm'' in the definition to illustrate this point.
    A definition for ``loading/unloading arm'' was not proposed. 
However, EPA understands, consistent with comments, that a loading/
unloading arm is typically a movable piping assembly that may include 
fixed piping or a combination of fixed and flexible piping, typically 
with at least one swivel joint (that is, at least two articulated parts 
that are connected in such a way that relative movement is feasible to 
transfer product via top or bottom loading/unloading to a tank truck or 
rail car). However, certain loading/unloading arm configurations 
present at loading racks may include a loading/unloading arm that is a 
combination of flexible piping (hoses) and rigid piping without a 
swivel joint. In this case, a swivel joint is not present on the 
loading arm because flexible piping is attached directly to the rigid 
piping of the loading arm and the flexible hose provides the movement 
needed to conduct loading or unloading operations in lieu of the swivel 
joint.
    Commenters raised concerns that, because of the new loading/
unloading rack definition, many transfer operations (particularly those 
at rural facilities with no gangways or fixed loading arms) will not be 
regulated under the SPCC rule. The Agency disagrees with this 
assertion. Although the Agency intends the definition of loading/
unloading rack to clearly delineate those facilities subject to the 
Sec.  112.7(h) regulatory requirements (such as sized secondary 
containment), any otherwise regulated SPCC facility will still be 
subject to the general secondary containment requirements under Sec.  
112.7(c) for all areas where oil is transferred into or out of any 
regulated container.
    EPA received several alternatives to the definition of loading/
unloading rack contained in the October 2007 proposal. EPA considered 
these alternative definitions in developing the definition for loading/
unloading rack promulgated in this notice. Specifically, several 
commenters recommended that the definition of loading/unloading rack be 
based on throughput, offering various throughput numbers as a method of 
defining transfer operations that would be subject to the Sec.  
112.7(h) requirements. However, these suggestions included limited 
supporting data. The complexity in determining a rack's throughput for 
a given time period would add additional burden on the owner and 
operator of a facility. Furthermore, there is no basis for deciding on 
a specific time period for this determination. Thus, EPA is not basing 
its definition of loading/unloading rack on a rack's throughput. Other 
commenters suggested that the definition provide examples only of 
equipment that should not be considered a loading or unloading rack. 
The Agency believes that it is much clearer to define the equipment 
typically associated with a loading or unloading rack than to provide a 
list of equipment that are not considered a loading or unloading rack. 
Most of the suggested definitions, however, focused on the presence of 
a loading arm as indicative of a loading or unloading rack. Many of the 
definitions focused on the presence of a structure and a list of 
related equipment. EPA agrees with many of the concepts illustrated in 
the alternative definitions received from commenters. Thus, EPA is 
finalizing an equipment-based definition, as proposed, as a clearer 
method for identifying transfer activities subject to the requirements 
of Sec.  112.7(h).
    Commenters suggested that EPA delete reference to the accessories, 
such as piping assemblages, valves, pumps, shut-off devices, overfill 
sensors, and personnel safety devices from the definition, as these may 
or may not be a part of the rack, and one or more of these devices 
(such as overfill sensors) are typically present on most tanks. The 
definition is not intended to address oil containers (such as tanks); 
the list of equipment specifically addresses equipment associated with 
loading/unloading rack structures. EPA believes that providing examples 
of equipment usually associated with loading/unloading racks would be 
useful for the owner or operator of a facility, as well as the PE, for 
determining the applicability of the definition.
    EPA also is clarifying in this notice that tank cars and tank 
trucks are only subject to the requirements of Sec.  112.7(h) when 
conducting loading or unloading operations associated with a loading/
unloading rack as defined in this action. Otherwise, they are subject 
to the general secondary containment requirements at Sec.  112.7(c). In 
addition, the definition finalized in this action typically will not 
include oil-filled equipment; however, transfers associated with oil-
filled operational equipment where a rack is not present are still 
required to meet the general containment requirements of Sec.  
112.7(c).
2. Requirements for Loading/Unloading Racks
    Although the title of Sec.  112.7(h) refers to ``loading/unloading 
rack,'' the text of the requirement referred to ``loading/unloading 
areas.'' Therefore, to provide additional clarity, EPA is changing all 
references from loading/unloading ``area'' to loading/unloading 
``rack.'' For example, Sec.  112.7(h)(1) is modified as follows: 
``Where loading/unloading rack drainage does not flow into a catchment 
basin or treatment facility designed to handle discharges, use a quick 
drainage system for tank car or tank truck loading/unloading racks. You 
must design any containment system to hold at least the maximum 
capacity of any single compartment of a tank car or tank truck loaded 
or unloaded at the facility.'' Section 112.7(h)(2) is similarly

[[Page 74250]]

modified and includes a technical correction of the word ``break'' to 
``brake'' to correct a typographical error.
    In the preamble to the July 2002 amendments to the SPCC rule (67 FR 
47042, July 17, 2002), EPA stated that Sec.  112.7(h) ``applies to 
containers which are aboveground (including partially buried tanks, 
bunkered tanks, or vaulted tanks) or completely buried (except those 
exempted by this rule)'' (67 FR 47110, July 17, 2002). Thus, this 
statement seems to indicate that Sec.  112.7(h) does not apply to a 
loading/unloading rack (or any other transfer area) associated with a 
container that is exempted from the rule, such as an Underground 
Storage Tanks (USTs) that are subject to all of the technical 
requirements of 40 CFR part 280 or a state program approved under part 
281. As described in the October 2007 proposal (72 FR 58378, October 
15, 2007), EPA has reconsidered this position because a transfer to or 
from such a container at an SPCC-regulated facility is a potential 
source of discharge of oil into navigable waters or adjoining 
shorelines. Additionally, because a loading/unloading rack, or other 
transfer area, associated with an UST is not typically part of the UST 
system, it is not subject to all of the technical requirements of 40 
CFR part 280 or 281. Therefore, EPA believes that such a loading/
unloading rack should be regulated under the SPCC regulations in the 
same manner as any other transfer equipment or transfer activity 
located at an otherwise regulated SPCC facility.
a. Comments
    Two commenters expressed general support for the amendments to 
Sec.  112.7(h). However, one commenter suggested exempting loading/
unloading activity from SPCC regulation, because standard industry 
practice is to place the connection valve inside a secondary 
containment area during loading/unloading. Other commenters suggested 
that EPA eliminate the sized secondary containment requirements for 
loading/unloading racks. Another commenter requested that EPA codify 
the settlement language regarding loading/unloading rack (American 
Petroleum Institute v. Leavitt, No. 1:02CV02247 PLF and Marathon Oil 
Co. v. Leavitt, No. 1:02CV02254 PLF). One other commenter suggested 
revised text for Sec.  112.7(h) focusing on special control measures 
for portions of the facility with a higher likelihood of a discharge as 
described in Sec.  112.1(b) (such as transfer areas where containers 
are frequently open for filling, or where couplings are frequently 
connected and disconnected from containers).
    With regard to EPA's reconsideration of the applicability of Sec.  
112.7(h) to a loading/unloading rack associated with a container that 
is exempted from the rule, such as USTs that are subject to all of the 
technical requirements of 40 CFR part 280 or a state program approved 
under 40 CFR part 281, a commenter disagreed and stated that the 
provisions associated with 40 CFR 280.30(a) address spill prevention.
b. Response to Comments
    EPA did not propose: (1) To exempt (nor does the Agency agree that 
the final rule should exempt) loading or unloading activities conducted 
at loading/unloading racks from the SPCC rule or (2) that such loading/
unloading racks be exempted from the sized secondary containment 
requirements. Although the industry practices described by the 
commenter may be used to meet the rule requirements that exist for 
loading and unloading activities, these do not provide adequate 
justification to exempt this equipment from the SPCC regulation.
    Commenters also requested that EPA codify the settlement language 
on this issue. EPA has not done this; however, the modification to 
change the word ``area'' to ``rack'' in Sec.  112.7(h) is consistent 
with EPA's notice in the Federal Register in May 2004, which noted that 
Sec.  112.7(h) only applies at facilities with loading and unloading 
``racks'' (69 FR 29728, May 25, 2004). EPA also maintains its position, 
as clarified in a letter to the Petroleum Marketers Association of 
America (PMAA), that loading and unloading activities that take place 
beyond the rack area are not subject to the requirements of Sec.  
112.7(h), but are subject, where applicable, to the general secondary 
containment requirements of Sec.  112.7(c) (Letter to Daniel Gilligan, 
President, Petroleum Marketers Association of America, from Marianne 
Lamont Horinko, Assistant Administrator, Office of Solid Waste and 
Emergency Response, EPA, May 25, 2004 and 69 FR 29728, May 25, 2004).
    EPA also does not agree with the commenter who suggested that 
further revisions be made to the rule requirements at Sec.  112.7(h) to 
address special control measures for portions of the facility with a 
higher likelihood of a discharge as described in Sec.  112.1(b). The 
Agency believes the current requirements are appropriate to address a 
discharge at the loading/unloading rack. The clarifications to the 
language in Sec.  112.7(h) finalized in this action address the 
questions that have been raised by the regulated community on how these 
rule provisions apply to loading/unloading racks and do not apply to 
areas beyond the ``rack.''
    Finally, one commenter stated that the provisions associated with 
40 CFR 280.30(a) address spill prevention and thus, the requirements 
for loading/unloading racks should not apply to exempt USTs. While EPA 
recognizes that this provision (40 CFR 280.30(a)) describes spill and 
overfill control requirements when USTs are being filled, EPA still 
believes that the loading/unloading requirements should apply to these 
exempted USTs, for the reasons described earlier. However, EPA would 
note that to the extent that 40 CFR 280.30(a) addresses SPCC 
requirements, these measures can be described in the SPCC Plan, as 
appropriate. Therefore, transfers at loading/unloading racks and 
transfer areas associated with exempted USTs are considered regulated 
activities at an otherwise regulated SPCC facility. In addition, 
exempted USTs, at an otherwise regulated SPCC facility, equipped with a 
loading/unloading rack as defined in this action, are subject to the 
requirements of Sec.  112.7(h). Also, exempted USTs, at an otherwise 
regulated SPCC facility, equipped with a transfer area (for example, 
dispenser or other transfer equipment) are subject to the requirements 
of Sec.  112.7(c). Non-rack transfer areas are required to provide only 
general secondary containment for the most likely discharge, as 
discussed in Section V.H in this action, and may include active 
containment measures, such as response action or sorbent deployment. 
This interpretation is consistent with the approach EPA has taken with 
other exempt containers at an otherwise regulated SPCC facility. For 
example, in the preamble to the December 2006 amendments, EPA noted 
that although the amendment provided an exemption for motive power 
containers, the oil transfer activities to or from motive power 
containers occurring within an SPCC-regulated facility continue to be 
regulated (71 FR 77283, December 26, 2006). Consistent with the 
preamble to the December 2006 amendments, the Agency is therefore 
clarifying that at an SPCC-regulated facility, Sec.  112.7(h) 
(including the sized secondary containment provision) applies to 
transfers at any loading/unloading rack associated with any type of 
container, including one that is exempted from the rule, as long as the 
loading/unloading rack meets the definition finalized in this notice. A 
transfer not associated with a loading or unloading rack is subject to 
the general secondary containment provision at Sec.  112.7(c). No

[[Page 74251]]

rule change is needed to clarify this point, because a rule amendment 
to exempt a loading/unloading rack associated with an UST was never 
proposed or finalized. This clarification is intended to correct 
preamble language that was inconsistent with the Agency's position on 
other exempt containers and their associated transfer activities.
3. Exclusions
    EPA is specifically excluding onshore oil production facilities and 
farms from the loading/unloading rack requirements at Sec.  112.7(h) 
because the Agency and commenters alike believe that loading and 
unloading racks are not typically associated with these types of 
facilities. EPA is exempting these facilities from the requirements of 
Sec.  112.7(h) for clarity in order to avoid confusion for owners or 
operators of oil production facilities or farms. At other facilities 
that likewise do not have a loading/unloading rack, the provisions at 
Sec.  112.7(h) similarly do not apply.
    Oil transfer areas, such as loading/unloading areas at farms and 
oil production facilities that are subject to the SPCC rule, 
nevertheless remain subject to the general secondary containment 
requirements of Sec.  112.7(c). As EPA states in the SPCC Guidance for 
Regional Inspectors, ``Areas where oil is transferred but no loading or 
unloading rack is present are subject to Sec.  112.7(c), and thus 
appropriate containment and/or diversionary structures are required. 
EPA does not require specifically sized containment for transfer areas; 
however, containment size must be based on good engineering practice.''
a. Comments
    Several commenters expressed general support for the exclusions. In 
addition, one commenter requested that EPA also exclude agricultural 
retailers from Sec.  112.7(h) because they are already subject to FIFRA 
regulations.
b. Response to Comments
    The Agency agrees that it is appropriate to exclude onshore oil 
production facilities and farms from the loading/unloading rack 
requirements at Sec.  112.7(h). Commenters confirmed EPA's 
understanding that there are few, if any, loading/unloading racks at 
oil production facilities, and that agricultural oil and fuel transfers 
at farms are generally not associated with loading/unloading racks. 
However, if an agricultural retail facility conducts fuel transfers 
with equipment that meets the definition of a loading/unloading rack, 
then this facility would be subject to the loading/unloading rack 
requirements at Sec.  112.7(h). The Agency disagrees with the commenter 
who requested that agricultural retailers also be excluded for the 
loading/unloading requirements of Sec.  112.7(h), because the FIFRA 
requirements do not provide spill prevention requirements at a level 
equivalent to the SPCC rule.
4. Alternative Option Considered
    EPA considered not providing any amendments to the SPCC rule 
related to loading/unloading racks. Under this approach, EPA would not 
provide a regulatory definition for loading/unloading rack or an 
exclusion for farms and onshore oil production facilities from the 
loading/unloading rack requirements at Sec.  112.7(h), but would 
instead continue to follow the interpretation of loading/unloading 
rack, as stated in the SPCC Guidance for Regional Inspectors and the 
May 2004 Federal Register notice. However, EPA did not choose this 
approach because the Agency believes it was important to address some 
of the confusion and questions raised by the regulated community.
a. Comments
    Several commenters indicated that no rule change is necessary.
b. Response to Comments
    As noted above, EPA disagrees with the commenters and has finalized 
the new definition and associated editorial changes to the rule to 
provide additional clarity in describing the type of equipment and 
facilities subject to the loading/unloading rack requirements under 
Sec.  112.7(h).

G. Tier I Qualified Facilities

    In December 2006, EPA finalized an amendment to the SPCC rule to 
allow the owner or operator of a qualified facility to self-certify his 
SPCC Plan. The Agency is amending the SPCC rule to provide an 
additional option for the owners and operators of a subset of qualified 
facilities that meet an additional criterion to complete and implement 
a streamlined, self-certified SPCC Plan template (promulgated as 
Appendix G to 40 CFR part 112), in order to comply with the 
requirements of the SPCC rule. For clarity, EPA is now using the term 
``Tier II qualified facility'' to describe those qualified facilities 
as identified by and subject to the requirements promulgated in the 
December 2006 SPCC rulemaking (71 FR 77266, December 26, 2006) and the 
term ``Tier I qualified facility'' for a new subset of these qualified 
facilities. To qualify as a Tier I qualified facility in addition to 
meeting the eligibility criteria for a Tier II qualified facility, a 
facility must also have no individual aboveground oil storage 
containers with a capacity greater than 5,000 U.S. gallons.
    A Tier II qualified facility is one that meets the criteria 
described in the December 2006 amendments to the SPCC rule (71 FR 
77266, December 26, 2006): a facility that has an aggregate aboveground 
oil storage capacity of 10,000 U.S. gallons or less; and has had no 
single discharge as described in Sec.  112.1(b) exceeding 1,000 U.S. 
gallons or no two discharges as described in Sec.  112.1(b), each 
exceeding 42 U.S. gallons within any twelve-month period in the three 
years prior to the SPCC Plan self-certification date, or since becoming 
subject to 40 CFR part 112 if the facility has been in operation for 
less than three years (this criterion does not include discharges as 
described in Sec.  112.1(b) that are the result of natural disasters, 
acts of war, or terrorism). EPA is now further streamlining the SPCC 
requirements for certain qualified facilities that meet an additional 
criterion.
    The following table illustrates the tiers, criteria, and options 
for qualified facilities and all others as described in this notice:

------------------------------------------------------------------------
               Qualified facilities*
--------------------------------------------------- All other facilities
           Tier I                    Tier II
------------------------------------------------------------------------
10,000 U.S. gallons or less aggregate aboveground   More than 10,000
 oil storage capacity; and                           U.S. gallons
                                                     aggregate
                                                     aboveground oil
                                                     storage capacity,
                                                     or
------------------------------------------------------------------------

[[Page 74252]]

Within any twelve-month period, three years prior   Within any twelve-
 to the Plan certification date, or since becoming   month period, three
 subject to the SPCC rule if in operation for less   years prior to the
 than three years, there has been:                   Plan certification
(1) No single discharge of oil to navigable waters   date, or since
 or adjoining shorelines exceeding 1,000 U.S.        becoming subject to
 gallons; and                                        the SPCC rule if in
(2) No two discharges of oil to navigable waters     operation for less
 or adjoining shorelines each exceeding 42 U.S.      than three years,
 gallons**; and                                      there has been:
                                                    (1) A single
                                                     discharge of oil to
                                                     navigable waters or
                                                     adjoining
                                                     shorelines
                                                     exceeding 1,000
                                                     U.S. gallons; or
                                                    (2) Two discharges
                                                     of oil to navigable
                                                     waters or adjoining
                                                     shorelines each
                                                     exceeding 42 U.S.
                                                     gallons**; or
------------------------------------------------------------------------
No individual aboveground     Has individual        Owner or operator
 oil containers greater than   aboveground oil       eligible for
 5,000 U.S. gallons;           containers greater    qualified facility
                               than 5,000 U.S.       status, but decides
                               gallons; or           not to take the
                              Owner or operator      option;
                               eligible for Tier I
                               qualified facility
                               status, but decides
                               not to take the
                               option or chooses
                               to develop a
                               ``hybrid'' Plan;.
------------------------------------------------------------------------
Then: Complete and self-      Then: Prepare self-   Then: Prepare PE-
 certify Plan template         certified Plan in     certified Plan in
 (Appendix G to 40 CFR part    accordance with all   accordance with all
 112) in lieu of a full PE-    applicable            applicable
 certified Plan.               requirements of       requirements of
                               Sec.   112.7 and      Sec.   112.7 and
                               subparts B and C of   subparts B and C.
                               the rule, in lieu
                               of a PE-certified
                               Plan.
------------------------------------------------------------------------
* See Section V.M of this notice for more information on qualified
  facility eligibility criteria specific to the oil production sector.
** This criterion does not include discharges as described in Sec.
  112.1(b) that are the result of natural disasters, acts of war, or
  terrorism. Additionally, the gallon amount described in this criterion
  addresses the amount of the discharge that actually reaches navigable
  waters or adjoining shorelines.

1. Eligibility Criteria
    As proposed in October 2007, a Tier I qualified facility must meet 
all of the eligibility criteria for qualified facilities promulgated by 
EPA in December 2006 (71 FR 77266, December 26, 2006) with an 
additional criterion: A maximum individual aboveground oil storage 
container capacity of 5,000 U.S. gallons. EPA developed the Tier I 
category based on an individual container capacity in order to link any 
streamlined requirements with a reduced potential for oil discharge. 
That is, the maximum individual aboveground container capacity 
threshold is set at 5,000 U.S. gallons because this volume is 
consistent with industry consensus standards that call for varying 
levels of stringency based on container size and configuration. For 
example, the Steel Tank Institute's SP001, Standard for the Inspection 
of Aboveground Storage Tanks allows for periodic visual inspection 
alone, with no requirement for the inspector to be professionally 
certified, for containers of 5,000 U.S. gallons or less that are 
equipped with a spill control measure and a continuous release 
detection method. Furthermore, a facility with smaller storage 
containers often has less complicated operations, is typically an end-
user of oil (does not distribute the oil further), is involved in few 
oil transfers, and may have predominantly mobile or portable containers 
with a few low-capacity fixed oil storage containers. Smaller 
containers have a smaller potential maximum discharge size, and there 
may be little or no piping associated with these small containers.
a. Comments
    Several commenters expressed general support for the eligibility 
criterion. However, some commenters suggested increasing the container 
capacity eligibility criterion to 10,000 gallons, while other 
commenters suggested various other capacity thresholds. Several 
commenters expressed support for a three-tiered approach to the 
eligibility criteria for qualified facilities, with the use of a PE 
only in cases where the tank capacity is above 20,000 gallons.
    One commenter recommended that criteria be introduced that take 
into consideration a facility's proximity to environmentally sensitive 
area(s) either by distance or some other logical means. Another 
commenter suggested using actual oil storage volumes rather than 
capacity to determine eligibility. Still another commenter suggested 
that AFVOs that would solidify without heating be excluded from the 
5,000 U.S. gallon maximum individual container capacity.
    One other commenter requested that EPA confirm that oil-filled 
operational equipment is eligible for Tier I status. The commenter 
noted concern that the definition of Tier I qualified facility in Sec.  
112.3(g)(1) may cause confusion about whether facilities with oil-
filled operational equipment are eligible for the Tier I alternative, 
and whether the 5,000 gallon cap applies to oil-filled equipment.
    Several commenters provided alternative suggestions to the 
eligibility criteria for both tiers of qualified facilities. One 
commenter suggested that the criterion for discharge history should be 
more stringent and require that any discharge during the three-year 
period prior to the Plan certification date disqualify a facility from 
the self-certification option as either a Tier I or Tier II qualified 
facility. The discharge history criterion does not include discharges 
as described in Sec.  112.1(b) that are the result of natural 
disasters, acts of war, or terrorism. One commenter requested that EPA 
define the term ``terrorism'' in the explanation of the criteria to 
ensure regional consistency.
    Commenters also requested raising the Tier II threshold above the 
10,000 U.S. gallons aboveground oil storage capacity promulgated in the 
December 2006 amendments (71 FR 77266, December 26, 2006).
    Finally, commenters suggested that the qualification criteria do 
not benefit oil and gas production stakeholders because the oil storage 
capacity thresholds are too low to allow these facilities to qualify to 
develop either a self-certified Plan or a Plan following the template 
in Appendix G.

[[Page 74253]]

b. Response to Comments
    The majority of commenters supported this approach with additional 
suggestions. Several commenters suggested alternative thresholds to 
consider for Tier I qualified facilities; however, these commenters did 
not provide sufficient data to support increasing the thresholds beyond 
the proposed Tier I threshold of 5,000 U.S. gallons for a single oil 
storage container. Therefore, EPA is finalizing the Tier I qualified 
facilities criterion to require a maximum individual oil container of 
5,000 U.S. gallons.
    One commenter suggested considering proximity to sensitive 
environments in determining eligibility as a qualified facility. 
However, consideration of the impact of an oil discharge to the 
environment is made when determining the applicability of the SPCC 
regulation to the facility. Because the SPCC rule only applies to a 
facility when it has a reasonable potential to discharge oil in 
quantities that may be harmful to navigable waters or adjoining 
shorelines, EPA does not believe that an additional criterion is 
appropriate for an SPCC-regulated facility that may impact sensitive 
environments.
    EPA also disagrees with the commenter who suggested that EPA use 
the operational volumes of oil storage at the facility rather than the 
shell capacity of the oil storage containers. The applicability of the 
SPCC regulation to a facility has always been based on shell capacity 
when calculating total oil storage capacity of the facility and the 
same oil storage capacity is then considered in determining 
applicability of the self-certification SPCC Plan for the facility. The 
operational volume at a facility may change frequently and therefore 
create confusion on which SPCC requirements apply to the facility and 
how to certify the SPCC Plan.
    Other commenters requested that EPA consider excluding from both 
qualified facility thresholds--that is, Tier I and Tier II, the 
capacity of those containers containing AFVOs that would solidify 
without heating. The Agency disagrees because, similar to AC and other 
high viscosity oils, these AFVO containers are typically maintained at 
elevated temperatures to keep the oil in the liquid state. The AFVO 
could still spill, flow, and, depending on the location of the 
facility, could potentially reach navigable waters or adjoining 
shorelines.
    One commenter requested clarification as to whether the term ``oil 
storage container'' included oil-filled operational equipment. To 
clarify, the maximum individual oil storage container criterion applies 
to any aboveground container at the facility that contains oil. This 
includes bulk storage containers, such as tanks and mobile or portable 
containers, oil-filled operational equipment (such as transformers), 
and other oil-filled equipment, such as flow-through process equipment. 
Thus, oil-filled operational equipment is eligible for Tier I status.
    EPA disagrees with the commenter suggesting that the criterion for 
discharge history be more stringent, based on the fact that some 
discharges result despite adherence to the SPCC Plan. EPA chose a 
discharge history criterion similar to the reporting requirement in 
Sec.  112.4(a) because a discharge smaller than what must be reported 
to the EPA Regional Administrator (RA) under this section may result 
from normal handling of oil at the facility and may not indicate a 
recurring problem resulting from a deficiency in the Plan or improper 
Plan implementation. Therefore, the RA would not likely require the 
owner or operator to amend the Plan and the facility owner or operator 
should be eligible to self-certify the SPCC Plan as a qualified 
facility.
    EPA is not defining terrorism in the final rule. However, the 
Agency notes that the Homeland Security Act of 2002 defines terrorism 
as ``any activity that involves an act that is dangerous to human life 
or potentially destructive of critical infrastructure or key resources; 
and is a violation of the criminal laws of the United States or of any 
state or other subdivision of the United States; and appears to be 
intended to intimidate or coerce a civilian population, to influence 
the policy of a government by intimidation or coercion or to affect the 
conduct of a government by mass destruction, assassination, or 
kidnapping.'' See Section 2(15), Homeland Security Act of 2002, Public 
Law 107-296, 116 Stat. 2135 (2002). The Agency does not believe that 
vandalism and sabotage are examples of terrorism. In the December 2006 
amendments to the SPCC rule, EPA identified reportable discharges 
caused by external factors beyond the control of the facility owner or 
operator such as natural disasters, acts of war, or terrorism. The 
Agency specifically excluded these events from consideration in the 
reportable discharge history criterion for qualified facilities and 
qualified oil-filled operational equipment. At that time, EPA excluded 
sabotage and vandalism from the list of reportable discharge history 
extreme events because these are not necessarily beyond the control or 
planning ability of the facility owner or operator. (See 71 FR 77272, 
December 26, 2006.) The security provisions in Sec.  112.7(g) require 
consideration for acts of vandalism. The owner or operator of a 
facility must describe in the Plan how he controls access to the oil-
handling, processing and storage areas and the appropriateness of 
lighting to both prevent acts of vandalism and assist in the discovery 
of oil discharges.
    Additionally, EPA is not changing the Tier II threshold and is not 
amending the total aboveground oil storage capacity for Tier II 
qualified facilities in this final rule as requested by some 
commenters. The Agency maintains that the focus of the qualified 
facilities alternative is on facilities with simple configurations and 
small quantities of oil stored or handled. The Agency addressed the 
eligibility criteria for the Tier II qualified facilities in the 
December 2006 rulemaking. The Agency recognizes that regardless of the 
threshold quantity selected, there are likely to be facilities just 
above that threshold that will be excluded. To the extent that facility 
owners or operators want to meet the criteria for a qualified facility, 
they have the option of reducing oil storage capacity at their facility 
by either removing containers from the facility inventory, or 
permanently closing containers in accordance with Sec.  112.2.
    With regard to the commenter suggesting that the qualified 
facilities approach does not benefit the oil and gas sector, EPA has 
estimated that the Tier II approach does allow approximately 13 percent 
of the smallest oil and gas production stakeholders to qualify to self-
certify their SPCC Plans based on oil storage capacities below 10,000 
U.S. gallons. In addition, the Agency also is finalizing an alternative 
set of criteria to qualify for Plan self-certification (Tier II) 
specific for oil production facilities. See Section V.M of this 
preamble for further discussion on the alternative criteria for the oil 
and gas production sector.
2. Provisions for Tier I Qualified Facilities
    Under this amendment, in lieu of preparing a full SPCC Plan that is 
PE-or self-certified, an owner or operator of a Tier I qualified 
facility will have the option to complete the SPCC Plan template found 
in Appendix G of 40 CFR part 112. The Plan template is designed to be a 
simple SPCC Plan that includes only the requirements that apply to this 
tier of regulated facilities. This final rule streamlines the 
requirements for Tier I qualified facilities by eliminating and/or

[[Page 74254]]

modifying several SPCC requirements (for example, facility diagram 
(Sec.  112.7(a)(3)) and certain provisions that generally do not apply 
to facilities that store or handle smaller volumes of oil, such as 
requirements for transfers taking place at loading racks (Sec.  
112.7(h)).
    The list of applicable rule provisions for Tier I qualified 
facilities is included in Sec.  112.6(a)(3). For an owner or operator 
of a Tier I qualified facility completing the Plan template included in 
Appendix G of this part, the following existing requirements under 
Sec.  112.7 and in subparts B and C continue to apply: (1) Introductory 
paragraph of Sec.  112.7 \4\; (2) facility description (Sec.  
112.7(a)(3)(i), 112.7(a)(3)(iv), 112.7(a)(3)(vi), 112.7(a)(4), and 
112.7(a)(5)); (3) general secondary containment (Sec.  112.7(c)); (4) 
inspections, tests and records (Sec.  112.7(e)); (5) personnel, 
training, and discharge prevention procedures (Sec.  112.7(f)); (6) 
security (Sec.  112.7(g)); (7) qualified oil-filled operational 
equipment (Sec.  112.7(k)); (8) facility drainage (Sec. Sec.  
112.8(b)(1), 112.8(b)(2), 112.12(b)(1), and 112.12(b)(2)); (9) bulk 
storage containers (Sec. Sec.  112.8(c)(1), 112.8(c)(3), 112.8(c)(4), 
112.8(c)(5), 112.8(c)(6), 112.8(c)(10), 112.12(c)(1), 112.12(c)(3), 
112.12(c)(4), 112.12(c)(5), 112.12(c)(6), and 112.12(c)(10)); (10) 
piping inspections (Sec. Sec.  112.8(d)(4) and 112.12(d)(4)); (11) oil 
production facility requirements (Sec.  112.9(b), 112.9(c)(1), 
112.9(c)(2), 112.9(c)(3), 112.9(c)(4), 112.9(c)(5), 112.9(d)(1), 
112.9(d)(3), and 112.9(d)(4)); and (12) requirements for onshore oil 
drilling and workover facilities (Sec.  112.10(b), 112.10(c) and 
112.10(d)). This list of requirements reflects a set of currently 
existing requirements that apply to facilities subject to the SPCC 
rule. EPA found no basis to remove or modify these requirements for 
Tier I qualified facilities. As described below, EPA is finalizing a 
set of revised, or streamlined, requirements applicable to Tier I 
qualified facilities in lieu of certain other existing requirements.
---------------------------------------------------------------------------

    \4\ In the proposal to this rule, EPA inadvertently omitted from 
this list the introductory paragraph of Sec.  112.7, and for clarity 
is including it now.
---------------------------------------------------------------------------

    In particular:
     In lieu of the full failure analysis requirements in Sec.  
112.7(b), under new Sec.  112.6(a)(3)(i), an owner or operator of a 
Tier I qualified facility must examine areas where there is a 
reasonable possibility for equipment failure (such as where equipment 
is loaded or unloaded; where tank overflow, rupture, or leakage is 
possible; or at the location of any other equipment known to be a 
source of discharge) and include in the Plan the total quantity of oil 
that could be discharged and a prediction of the direction of flow. 
This amendment removes the requirement for an owner or operator of a 
Tier I qualified facility to predict the rate of flow that could result 
from an equipment failure.
     In lieu of the separate secondary containment requirements 
in Sec. Sec.  112.8(c)(2) and (c)(11) and 112.12(c)(2) and (c)(11), 
under new Sec.  112.6(a)(3)(ii), EPA is combining mobile/portable 
container requirements with the other bulk storage container secondary 
containment requirements, and eliminating the requirement for 
containment to be ``sufficiently impervious.'' Because EPA expects a 
Tier I qualified facility to be a small, simple operation, with oil 
storage containers being inside buildings, inside pre-engineered 
secondary containment, or a double-walled tank, the requirement for 
containment to be specifically designed as ``sufficiently impervious'' 
is unnecessary. Furthermore, the requirement for secondary containment 
to be capable of containing oil and constructed so that any discharge 
will not escape the containment system before cleanup occurs (Sec.  
112.7(c)) still applies, and is similar in nature to the ``sufficiently 
impervious'' requirement. Therefore, combining these requirements 
streamlines two similar provisions and simplifies the requirements for 
Tier I qualified facilities.
     In lieu of Sec. Sec.  112.8(c)(8) and 112.12(c)(8), the 
overfill prevention requirements, under new Sec.  112.6(a)(3)(iii), the 
owner or operator of a Tier I qualified facility must ensure each 
container is provided with a system or documented procedure to prevent 
overfills of containers, and that containers are regularly tested to 
ensure proper operation or efficacy. This modification provides more 
flexibility by allowing the use of alternative methods to prevent 
container overfills, rather than requiring an owner or operator to meet 
a prescribed set of overfill prevention procedures.
     As described elsewhere in this notice, EPA is extending 
the streamlined security and integrity testing requirements that were 
provided for qualified facilities in the December 2006 SPCC rule 
amendment (71 FR 77266) to all facilities. Both Tier I and Tier II 
qualified facilities are subject to the revised security (Sec.  
112.7(g)) and integrity testing (Sec. Sec.  112.8(c)(6) and 
112.12(c)(6)) provisions.
    The following requirements are not included in the SPCC Plan 
template because, for a facility with a smaller oil storage capacity or 
other facilities with a simple configuration, these requirements are 
inapplicable or unnecessary: (1) Facility diagram (Sec.  112.7(a)(3)); 
(2) facility description (Sec.  112.7(a)(3)(ii), 112.7(a)(3)(iii), and 
112.7(a)(3)(v)); (3) loading/unloading rack (Sec.  112.7(h)); (4) 
brittle fracture evaluation (Sec.  112.7(i)); (5) discussion of 
conformance with 40 CFR part 112 or other applicable State discharge 
prevention and containment regulations and guidelines (Sec.  112.7(j)); 
(6) facility drainage (Sec. Sec.  112.8(b)(3), 112.8(b)(4), 
112.8(b)(5), 112.12(b)(3), 112.12(b)(4), and 112.12(b)(5)); (7) 
monitoring internal heating coils (Sec. Sec.  112.8(c)(7) and 
112.12(c)(7)); (8) effluent treatment facilities (Sec. Sec.  
112.8(c)(9) and 112.12(c)(9)); (9) facility transfer operations 
(Sec. Sec.  112.8(d)(1), 112.8(d)(2), 112.8(d)(3), 112.8(d)(5), 
112.9(d)(2), 112.12(d)(1), 112.12(d)(2), 112.12(d)(3), and 
112.12(d)(5)); and (10) produced water container provisions (Sec.  
112.9(c)(6)).
    EPA believes no further differentiation is warranted for onshore 
oil production facilities in Sec.  112.9 (except for the produced water 
container provisions in Sec.  112.9(c)(6) which require PE 
certification and therefore do not apply for Tier I qualified 
facilities) and onshore oil drilling and workover facilities in Sec.  
112.10. An onshore oil production facility that qualifies as a Tier I 
qualified facility will generally have the same type of equipment as an 
oil production facility with larger oil storage capacity (i.e., a 
wellhead with a pumpjack, flowlines, oil separation equipment and oil 
storage containers) and therefore, no further differentiation is 
warranted. An onshore drilling or workover facility has three 
requirements under Sec.  112.10. The facility must: position or locate 
mobile drilling or workover equipment so as to prevent a discharge as 
described in Sec.  112.1(b); provide catchment basins or diversion 
structures to intercept and contain discharges of fuel, crude oil, or 
oily drilling fluids; and install a blowout prevention (BOP) assembly 
and well control system that is effective to control wellhead pressure. 
The presence of smaller oil storage containers does not support 
differentiation of these requirements; however, an onshore oil 
production, drilling or workover facility that is eligible as a Tier I 
qualified facility will benefit from the differentiated requirements 
under Sec.  112.7.
    EPA also believes that no further differentiation is warranted for 
offshore drilling, production, and workover facilities subject to Sec.  
112.11. Due to the nature of operations associated with

[[Page 74255]]

these types of facilities, they are not likely to meet the criterion of 
a maximum individual container capacity of 5,000 U.S. gallons.
    The Agency notes that under the existing SPCC requirements, the 
Regional Administrator (RA), after reviewing a facility's Plan, has the 
authority under Sec.  112.4 to require an owner or operator of a 
facility to amend the SPCC Plan if the RA finds that an amendment is 
necessary to prevent and contain discharges from the facility. Such an 
amendment may include requiring PE certification in accordance with 
Sec.  112.3(d). This provision also applies to Tier I qualified 
facilities. That is, an RA could, if warranted, require a Tier I 
qualified facility to prepare a full (i.e., not using the template) 
SPCC Plan with PE certification.
    The Agency also notes that use of the Plan template approach is 
optional. Under this final rule, an owner or operator of a Tier I 
qualified facility can choose to prepare and implement either a full 
PE-certified SPCC Plan or a self-certified SPCC Plan according to all 
of the requirements of Sec.  112.6(b) in order to comply with the 
requirements under 40 CFR part 112. In other words, if a Tier I 
qualified facility owner or operator chooses not to use the Plan 
template in Appendix G, he could comply with the Tier II qualified 
facility requirements in Sec.  112.6(b) or choose to prepare a full PE-
certified Plan instead of a self-certified one. EPA modified the 
introductory sentences to Sec.  112.6 and the text of Sec.  112.6(a)(1) 
slightly from the text that was proposed, in order to make this 
optional approach more clear.
a. Comments
    Many commenters expressed general support for the amended 
requirements for Tier I qualified facilities. However, a few commenters 
indicated that more stringent requirements would be appropriate for 
Tier I qualified facilities. One commenter suggested that a PE certify 
the SPCC Plan template for Tier I qualified facilities to ensure 
compliance. Another commenter suggested that EPA require review and 
approval of the Plan by someone who is familiar with industry standards 
and is ``certified'' to perform inspections following industry 
standards; the commenter believes this would address the potential 
liabilities and environmental impacts associated with self-
certification by inexperienced owners and operators. One other 
commenter suggested that Tier I qualified facilities should be required 
to have a facility diagram, because if Tier I qualified facilities are 
small and simple, a diagram should not be an excessive burden. Still 
another commenter requested that EPA remove the five-year review 
requirements; instead, the commenter suggested that the Plan should 
only be updated whenever there is a material change in the facility 
that may affect discharges.
    Many commenters also requested additional relief for Tier I or 
other regulated facilities. One commenter suggested that 
``streamlined'' regulatory provisions should be extended to all 
regulated facilities. One commenter suggested that Tier I qualified 
facilities should only be required to meet the general requirements 
under Sec.  112.7 and the security and integrity testing requirements 
for qualified facilities. Other commenters requested that EPA confirm 
that an Appendix G template may be certified by a PE, and that Tier I 
qualified facilities may complete a full self- or PE-certified Plan 
should they choose. Finally, one commenter suggested that the owner or 
operator of a regulated facility certify under oath that he has met the 
SPCC requirements.
b. Response to Comments
    EPA's basis for developing a self-certified Plan template which 
contains a streamlined set of requirements for facilities that meet the 
Tier I eligibility criteria is that the Agency believes that 
implementation of the requirements in the template can provide 
environmental protection and prevent the discharge of oil into 
navigable waters or adjoining shorelines. Therefore, EPA does not agree 
with commenters that a third-party representative (such as a PE or a 
certified inspector) should confirm compliance with the rule 
requirements. As stated earlier, due to the simplicity of these 
facilities and other factors described above, EPA believes it is 
appropriate to allow a facility owner or operator to self-certify the 
SPCC Plan. It is the responsibility of the owner or operator of any 
SPCC-regulated facility to ensure compliance with 40 CFR part 112 and 
ensure implementation of the Plan.
    The Agency also disagrees with the commenter who suggested that EPA 
require a facility diagram for Tier I qualified facilities. Although 
the Agency does not intend for a facility diagram to be an excessive 
burden for an owner or operator to develop, EPA believes the completed 
template provides the same information that would be available on a 
facility diagram for a Tier I qualified facility. The SPCC rule 
requirements for a facility diagram are: (1) To mark the location and 
contents of each fixed oil storage container (including containers and 
piping that are otherwise exempted from the rule) and storage areas 
where mobile or portable containers are located; and (2) to include all 
transfer stations and connecting pipes. In the case of a Tier I 
qualified facility, the visual representation of the diagram is not 
necessary because EPA believes that these facilities would have few 
aboveground oil storage containers with limited transfer areas and very 
little piping (if any). The ``Oil Storage Containers and Capacities'' 
table in Appendix G, Section III (Table G-2) of the template requires 
that all oil storage containers (such as aboveground containers, 
completely buried tanks, and oil-filled equipment) be listed, including 
the contents and oil storage capacity of each container. The 
``Containers with Potential for an Oil Discharge'' table in Appendix G, 
Section III (Table G-4) requests the following information for transfer 
areas and piping: the volume of oil that could potentially be 
discharged and the flow direction of an uncontained discharge (i.e., a 
description of where the discharge would flow if secondary containment 
fails). A facility diagram for a Tier I qualified facility would 
provide minimal additional planning benefit to prevent an oil discharge 
from the facility.
    EPA also disagrees that it should delete the five-year review 
requirements. The Agency agrees that the SPCC Plan should be updated 
whenever there is a material change in the facility that may affect 
discharges. However, Tier I qualified facilities should remain subject 
to the same requirement to periodically review and update the Plan to 
include more effective prevention and control technology in order to 
reduce the likelihood of a discharge as described in Sec.  112.1(b).
    A commenter suggested that all facilities should be eligible for 
streamlined provisions. While the Agency has amended the SPCC 
regulations in the past (71 FR 77266, December 26, 2006) and in this 
action to streamline certain SPCC rule requirements (for example, 
security and integrity testing) for all facilities, the streamlined 
provisions included in the Plan template in Appendix G are limited to 
Tier I qualified facilities based on the Agency's judgment that 
eliminating and/or modifying certain SPCC requirements was appropriate 
for facilities that store or handle smaller volumes of oil and that 
meet the eligibility criteria. Other facilities contain larger volumes 
of oil, have large oil storage containers on-site, or are more complex, 
and thus, applying the streamlined requirements adopted for

[[Page 74256]]

Tier I qualified facilities would be inappropriate.
    Another commenter suggested that EPA simplify the Plan requirements 
for a Tier I qualified facility to include only the general 
requirements under Sec.  112.7 and the security and integrity testing 
requirements. However, the commenter did not provide any data to 
support eliminating the specific requirements under Subparts B and C, 
such as those pertaining to facility drainage and bulk storage 
containers. Therefore, EPA did not incorporate this change into the 
final action.
    One commenter requested that EPA confirm that an Appendix G 
template may be certified by a PE. EPA recognizes that the owner or 
operator of a Tier I qualified facility may decide to obtain assistance 
in the development of an SPCC Plan and want to have a PE certify the 
Plan; however, the only required certification for a Plan following 
Appendix G is the self-certification completed by the owner or operator 
of the facility. EPA is not making the PE certification an additional 
option for compliance for Tier I qualified facilities because the 
Agency believes that this may suggest that it expects PE-certified 
Plans for this subset of qualified facilities. In addition, because the 
purpose of establishing the ``Tier I category'' was to allow facilities 
that met the Tier I eligibility criteria to meet the requirements of 
the SPCC rule in a streamlined manner, EPA believes it would complicate 
the rule, particularly if the owner or operator of the facility wants 
to request that environmental equivalence determinations be allowed for 
Tier I qualified facilities, such as allowed for Tier II facilities 
under the Tier II hybrid Plan. However, as EPA has noted previously, 
completion of the Appendix G template is optional. The owner or 
operator of a Tier I qualified facility may choose to have a PE-
certified SPCC Plan following all the requirements in Sec.  112.7 and 
subparts B and C, as applicable, or prepare a hybrid Plan that includes 
all applicable provisions under Tier II.
    Another commenter suggested requiring that the owner or operator of 
a regulated facility certify under oath that he has met the SPCC 
requirements. Section Sec.  112.6(a)(1) requires the owner or operator 
certify that: (i) He is familiar with the applicable requirements of 40 
CFR part 112; (ii) he has visited and examined the facility; (iii) he 
has prepared the Plan in accordance with accepted and sound industry 
practices and standards; (iv) he has established procedures for 
required inspections and testing in accordance with industry inspection 
and testing standards or recommended practices; (v) he will fully 
implement the Plan; (vi) the facility meets the qualification criteria 
in Sec.  112.3(g)(1); (vii) the Plan does not deviate from any 
requirement of this part as allowed by Sec.  112.7(a)(2) and Sec.  
112.7(d) or include an exemption/measures pursuant to Sec.  112.9(c)(6) 
for produced water containers and any associated piping and 
appurtenances downstream from the container; and (viii) the Plan and 
individual(s) responsible for implementing this Plan have the approval 
of management, and the facility owner or operator has committed the 
necessary resources to fully implement this Plan. EPA believes that 
inclusion of the self-certification statements in the Plan and 
signature of the owner or operator is sufficient to demonstrate that he 
understands his responsibilities under 40 CFR part 112.
3. SPCC Plan Template
    The SPCC Plan template for Tier I qualified facilities is found in 
Appendix G in this final rule. To facilitate the development of SPCC 
Plans at Tier I qualified facilities, EPA intends to make the Plan 
template available on its Web site, http://www.epa.gov/emergencies. 
Once completed and certified by the owner or operator, the Plan 
template serves as the SPCC Plan for the facility. As for any facility 
subject to the SPCC rule, the owner or operator must maintain a written 
copy of the Plan--which in this case would be the completed and self-
certified SPCC Plan template--at the facility or at the nearest field 
office if the facility is attended less than four hours per day (Sec.  
112.3(e)).
    The Agency emphasizes that use of the Plan template approach is 
optional. An owner or operator of a Tier I qualified facility can 
choose to prepare and implement either a full PE-certified SPCC Plan or 
a self-certified SPCC Plan according to all of the requirements of 
Sec.  112.6(b) (for a Tier II qualified facility) in order to comply 
with the requirements under 40 CFR part 112.
    In the October 2007 proposal, EPA sought comments on whether the 
SPCC Plan template addressed the concerns of owners and operators of 
facilities with relatively smaller volumes of oil, while maintaining 
the environmental protection intended by the regulation. The Agency 
also sought comments on the clarity and ease-of-use of the Plan 
template. The Agency has modified the Plan template based on specific 
comments received.
a. Comments
    Several commenters were generally supportive of the template format 
and/or content. However, one commenter indicated that the template is 
too easy to use, provides no assurance of compliance, and will be 
ignored by small facilities. Another commenter suggested that the 
template does not provide enough instruction and will encourage 
facility operators that have little knowledge of part 112 to develop 
SPCC Plans that are meaningless. On the other hand, several commenters 
expressed concern that the Appendix G template would be too burdensome.
    Other commenters suggested that EPA allow for a flexible Tier I 
qualified facility Plan format rather than require the owner or 
operator to use the template in Appendix G. Several other commenters 
suggested that EPA allow, as part of the Appendix G template, the Plan 
to take a ``hybrid'' approach, as allowed for Tier II qualified 
facilities, to provide flexibility to Tier I qualified facilities that 
need to deviate from the rule requirements when the owner or operator 
determines that secondary containment is impracticable or when there is 
an alternative measure that provides equivalent environmental 
protection to an SPCC rule requirement.
    A commenter suggested that operators preparing multi-facility SPCC 
Plans covering multiple facilities that are individually eligible for 
Tier I status should also be allowed to use the template, and that the 
rule should be specifically modified to reflect this. Another commenter 
suggested that EPA publish the template as guidance or an educational 
primer for Tier I qualified facilities, and make it readily available 
on the EPA Web site. Another commenter requested that EPA provide for 
an online submission of the template-based Plan for increased 
compliance.
    Finally, several commenters pointed out a number of areas where 
minor formatting, wording, or other corrections could be made to the 
template for simplification, clarity, or improved accuracy (as 
described in the response to comments section below).
b. Response to Comments
    EPA received several comments that the Plan template in Appendix G 
is too burdensome for Tier I qualified facilities, while other 
commenters argued that it is too easy to use. The Plan template is 
designed to be a simple and straightforward SPCC Plan that includes 
only the requirements that should apply to Tier I qualified facilities. 
EPA intends to provide supplementary guidance on the Agency's Web site 
to assist owners and operators of Tier I (and Tier II) qualified 
facilities in the development of an SPCC Plan for these facilities. 
Thus, EPA

[[Page 74257]]

expects that such additional guidance will help those facilities that 
choose to utilize the Appendix G template to comply with the SPCC Plan 
requirement.
    Several commenters suggested that EPA allow for a flexible Plan 
format rather than require the owner or operator to use the template in 
Appendix G. EPA agrees that it is appropriate to allow the use of a 
flexible Plan format for qualified facilities that, for example, want 
to combine multiple local, state or Federal regulatory requirements 
into one Plan, as long as a cross-reference is provided. Therefore, EPA 
is amending the rule language in Sec.  112.6(a)(1) to allow for a 
flexible Plan format for owners or operators of Tier I qualified 
facilities that do not choose to use the template provided in Appendix 
G of the rule. The amended rule text states that the template in 
Appendix G may be used as the SPCC Plan to meet the 40 CFR part 112 
requirements. However, if the Appendix G template is not used, then an 
equivalent Plan must be prepared in writing, and must be supplemented 
with a section that cross-references the location of requirements 
listed in this part. For example, the owner or operator of a facility 
that has developed a Stormwater Pollution Prevention Plan (SWPPP) under 
the National Pollutant Discharge Elimination System (NPDES) that meets 
all of the applicable SPCC regulatory requirements in Sec.  112.6(a)(3) 
and Appendix G may use the SWPPP as the SPCC Plan. However, the SWPPP 
must include a cross-reference and the self-certification statements in 
Sec.  112.6(a)(1) and Appendix G. An owner or operator of a Tier I 
qualified facility may use the template in Appendix G to comply with 
the regulation or use it as a model and modify it as necessary to meet 
the facility-specific needs, as long as all applicable rule 
requirements are included in the SPCC Plan. The following sample cross-
reference is intended to be an example of the owner/operator's 
development of such a cross-reference.

 Sample Cross-Reference for Plans Using Local, State, or Other Federal Regulations To Satisfy SPCC Requirements
----------------------------------------------------------------------------------------------------------------
               SPCC provision                              Description of requirement                 Plan page
----------------------------------------------------------------------------------------------------------------
Sec.   112.4...............................  Spill reporting requirements..........................  ...........
Sec.   112.5(b)............................  Five-year Plan review.................................  ...........
Sec.   112.6(a)(1).........................  Preparation and self-certification of the Plan........  ...........
Sec.   112.6(a)(2).........................  Certification of technical amendments.................  ...........
Sec.   112.6(a)(3)(i)......................  Failure analysis......................................  ...........
Sec.   112.6(a)(3)(ii).....................  Bulk storage container secondary containment..........  ...........
Sec.   112.6(a)(3)(iii)....................  Overfill prevention...................................  ...........
Sec.   112.7(a)(3)(i)......................  Address the type of oil in each container and its       ...........
                                              storage capacity.
Sec.   112.7(a)(3)(iv).....................  Address countermeasures for discharge discovery,        ...........
                                              response, and cleanup.
Sec.   112.7(a)(3)(vi).....................  Provide contact list and phone numbers for those to be  ...........
                                              contacted in case of a discharge.
Sec.   112.7(a)(4).........................  Provide NRC notification information..................  ...........
Sec.   112.7(a)(5).........................  Describe procedures you will use when a discharge       ...........
                                              occurs.
Sec.   112.7(c)............................  Provide appropriate containment and/or diversionary     ...........
                                              structures or equipment to prevent a discharge as
                                              described in Sec.   112.1(b).
Sec.   112.7(e)............................  Conduct inspections and tests in accordance with        ...........
                                              written procedures that you develop for the facility.
Sec.   112.7(f)............................  Train oil-handling personnel in the operation and       ...........
                                              maintenance of equipment to prevent discharges;
                                              discharge procedure protocols; applicable pollution
                                              control laws, rules, and regulations; general
                                              facility operations; and the contents of the facility
                                              Plan.
Sec.   112.7(g)............................  Implementation of security measures to prevent          ...........
                                              unauthorized access to oil handling, processing, and
                                              storage area.
Sec.   112.7(k)............................  Requirements related to oil-filled operational          ...........
                                              equipment.
Sec.  Sec.   112.8(b)(1), 112.12(b)(1).....  Restrain drainage from diked storage areas............  ...........
Sec.  Sec.   112.8(b)(2), 112.12(b)(2).....  Use valves of manual, open-and-closed design for the    ...........
                                              drainage of diked areas; if facility drainage drains
                                              into a watercourse, inspect and drain uncontaminated
                                              retained stormwater.
Sec.  Sec.   112.8(c)(1), 112.12(c)(1).....  Do not use a container for oil storage unless its       ...........
                                              material and construction are compatible with the
                                              material stored and conditions of storage such as
                                              pressure and temperature.
Sec.  Sec.   112.8(c)(3), 112.12(c)(3).....  Drainage of uncontaminated rainwater from the diked     ...........
                                              area into a storm drain or discharge of an effluent
                                              into an open watercourse.
Sec.  Sec.   112.8(c)(4), 112.12(c)(4).....  Protect completed buried storage tanks from corrosion   ...........
                                              and regularly leak test buried metallic storage tanks.
Sec.  Sec.   112.8(c)(5), 112.12(c)(5).....  Do not use partially buried or bunkered metallic tanks  ...........
                                              for the storage of oil unless protected from
                                              corrosion.
Sec.  Sec.   112.8(c)(6), 112.12(c)(6).....  Administer integrity testing for storage tanks........  ...........
Sec.  Sec.   112.8(c)(10), 112.12(c)(10)...  Promptly correct visible discharges which result in a   ...........
                                              loss of oil from the container.
Sec.  Sec.   112.8(d)(4), 112.12(d)(4).....  Regularly inspect all aboveground valves, piping and    ...........
                                              appurtenances.
Sec.   112.9(b)............................  Requirements for oil production facility drainage.....  ...........
Sec.   112.9(c)(1).........................  Material compatibility requirements for containers at   ...........
                                              oil production facilities.
Sec.   112.9(c)(2).........................  Secondary containment requirements for tank battery,    ...........
                                              separation, and treating facility installations at
                                              oil production facilities.
Sec.   112.9(c)(3).........................  Container inspection requirements at oil production     ...........
                                              facilities.
Sec.   112.9(c)(4).........................  Overfill prevention requirements at oil production      ...........
                                              facilities.
Sec.   112.9(c)(5).........................  Requirements for flow-through process vessels at oil    ...........
                                              production facilities.
Sec.   112.9(d)(1).........................  All aboveground valves and piping associated with       ...........
                                              transfer operations are inspected periodically and
                                              upon a regular schedule.

[[Page 74258]]

Sec.   112.9(d)(3).........................  For flowlines and intra-facility gathering lines that   ...........
                                              do not have secondary containment in accordance with
                                              Sec.   112.7(c), prepare an oil spill contingency
                                              plan and a written commitment of resources (except
                                              when the facility has submitted a Facility Response
                                              Plan in accordance with Sec.   112.20).
Sec.   112.9(d)(4).........................  Prepare and implement a written program of flowline/    ...........
                                              intra-facility gathering line maintenance.
Sec.   112.10(b)...........................  Position or locate mobile drilling or workover          ...........
                                              equipment so as to prevent a discharge as described
                                              in Sec.   112.1(b).
Sec.   112.10(c)...........................  Provide catchment basin or diversion structures to      ...........
                                              intercept and contain discharges.
Sec.   112.10(d)...........................  Install a blowout prevention assembly and well control  ...........
                                              system before drilling.
----------------------------------------------------------------------------------------------------------------

    Commenters also suggested that EPA allow Tier I qualified 
facilities, as part of the Appendix G template, to use the ``hybrid'' 
approach, as is currently allowed for Tier II qualified facilities to 
provide flexibility to Tier I qualified facilities that need to deviate 
from the rule requirements when the owner or operator determines that 
secondary containment is impracticable, when there is an alternative 
measure that provides equivalent environmental protection to an SPCC 
rule requirement, or when an owner or operator wants to include an 
exemption/measures pursuant to Sec.  112.9(c)(6) for produced water 
containers and any associated piping and appurtenances downstream from 
the container. EPA has decided not to allow Tier I facilities to 
utilize a ``hybrid approach,'' because the primary purpose of 
developing the ``Tier I'' category is to allow those facilities with 
simple oil storage configurations to have a relatively simple means to 
comply with the SPCC requirements. Allowing Tier I facilities to use a 
hybrid approach would seem to defeat that purpose. If a facility 
qualifies to use the Appendix G template but has site-specific factors 
that make it difficult to use the template as written, then the 
Appendix G Plan template may not be an appropriate tool for the 
facility to address the oil spill planning elements for the facility. 
Instead, the facility could elect to comply with the SPCC requirements 
as a Tier II qualified facility--that is, self-certify that they comply 
with the full set of rule requirements in Sec.  112.7(c) and subparts B 
and C, as applicable, rather than the differentiated requirements 
designed specifically for facilities with simple oil storage 
configurations. For example, if the owner or operator cannot provide 
secondary containment for a bulk storage container at a Tier I 
qualified facility because it is impracticable, then it is appropriate 
that the Plan include a facility diagram (Sec.  112.7(a)(3)) to show 
where the container is located at the facility and a prediction of the 
direction, rate of flow and quantity of oil that may be discharged from 
the container (Sec.  112.7(b)). EPA believes it is appropriate to 
require the owner or operator to comply with requirements that would 
not otherwise apply to Tier I qualified facilities because this 
information may be necessary as part of the spill prevention practices 
for the facility. Therefore, the owner or operator of the facility may 
choose to develop a hybrid Plan following the Tier II qualified 
facility requirements in Sec.  112.6(b) or a PE-certified SPCC Plan 
following Sec.  112.7 and subparts B and C, as applicable.
    Commenters also requested that EPA allow the owner or operator of 
several facilities that each individually meet the criteria for a 
qualified facility to develop a multi-facility SPCC Plan in accordance 
with the Tier I requirements. EPA agrees that this is appropriate and 
the final rule allows flexibility in the Plan format to accommodate a 
multi-facility Plan approach for Tier I qualified facilities. The owner 
or operator of the facility is still required to meet all applicable 
requirements of the rule in the Plan as described in Sec.  112.6(a)(3) 
and Appendix G.
    With respect to the comment that EPA allow such SPCC Plans to be 
submitted online, EPA does not believe that online submission of the 
template-based Plan will increase compliance with the SPCC regulation 
because there is currently no requirement for the owner or operator of 
a regulated facility to submit an SPCC Plan to the Agency, unless 
requested to do so by the Regional Administrator. The Agency requires 
that owners and operators maintain a copy of the Plan at the facility, 
in accordance with Sec.  112.3(e).
    EPA has amended the text that was proposed as Appendix G of 40 CFR 
part 112 to incorporate many of the suggested recommendations in the 
final rule. To simplify or clarify use of the template, these 
amendments will:
     Ensure the Table in Attachment 3.2 of Appendix G is 
consistent with the STI-SP001 requirements for Category I Tanks.
     Clarify which oil storage containers at the facility must 
be included when calculating the total facility oil storage capacity to 
determine eligibility of the facility for Tier I and II requirements--
that is, any aboveground container at the facility that contains oil 
and that is not otherwise exempt from the rule. This includes bulk 
storage containers, such as tanks and mobile or portable containers; 
oil-filled operational equipment (such as transformers); and other oil-
filled equipment, such as flow-through process equipment.
     Include formatting suggestions that make the template 
easier to use and technical corrections, such as providing letter 
references for the owner or operator's obligations in the certification 
statement; numbering tables; using numbered or lettered superscripts; 
identifying acronyms when they are first used in the document (for 
example, Regional Administrator (RA) in Section III, Part 6); and 
moving the spill reporting requirements to the correct section in the 
template (from Section III, Part 6 to Section III, Part 8.)
     Clarify that EPA means aboveground oil storage capacity in 
Section I, Part 6.a and 6.c of Appendix G.
     Clarify that the NRC Notification Procedures in Section 
III, Part 7 must be conducted immediately following identification of a 
discharge to navigable waters or adjoining shorelines.
     Clarify which containers are exempt from the regulation 
and not required to be included in the table in Section III, Part 1. 
Exempt containers that are not included in the capacity calculation 
include: Any container with a storage capacity of less than 55 U.S. 
gallons of oil; storage containers used exclusively for wastewater 
treatment; permanently closed containers; motive power containers; hot-
mix asphalt containers; heating oil containers used solely at a single-
family residence; and pesticide application equipment or related mix 
containers. Although the criteria to determine eligibility for 
qualified facilities focuses on the aboveground oil

[[Page 74259]]

storage containers at the facility, completely buried tanks at a 
qualified facility, unless they are otherwise exempt, such as USTs that 
are subject to all of the technical requirements of 40 CFR part 280 or 
a state program approved under 40 CFR part 281, are still subject to 
the rule requirements and must be addressed in the template. They are 
not counted towards the qualified facility threshold because they are 
not aboveground containers. Finally, certain produced water containers 
may be exempt from the rule; however, this exemption is based on 
certification by a PE and therefore produced water containers at a Tier 
I qualified facility SPCC Plan would not be eligible for the exemption. 
In other words, the owner or operator of a Tier I qualified facility 
would not be eligible to develop a self-certified SPCC Plan using the 
template in Appendix G and have a produced water container exempt from 
the regulation, because the exemption requires a PE certification. (See 
section V.M of this preamble for further discussion on produced water 
containers.)
     Amend the Onshore Facility Checklists to indicate that not 
all provisions may be applicable to all owners or operators, and 
provide instructions to indicate on the checklist when a provision is 
not applicable.
     Clarify the scope of the inspection requirements for bulk 
storage containers in the Inspection Log in Attachment 3 of Appendix G.
     Revise the discussion in Section III, Part 2 to include 
the word ``secondary.''
    Finally, EPA considered, but did not adopt the following 
recommendations to amend the template to:
     Revise the template in Appendix G to change ``navigable 
waters or adjoining shorelines'' to ``discharges as described in Sec.  
112.1(b).'' EPA refers to navigable waters or adjoining shorelines in 
the template to make the document easier to understand and more user-
friendly; the Agency does not consider this to be a limitation in the 
scope of the rule. The language in Sec.  112.7 also applies to these 
facilities and uses the term ``discharges as described in Sec.  
112.1(b).''
     Include a section for state and local requirements. The 
Agency does not believe that it is necessary for the owner or operator 
of a facility to address state or local requirements as part of the 
SPCC Plan. However, the Agency is amending the rule language to allow 
for a flexible Plan format for Tier I qualified facilities. This will 
allow a facility owner or operator to address local, state and/or other 
Federal requirements in one Plan for oil spill prevention planning 
purposes if he so chooses. The Agency will also clarify in rule text 
that Sec.  112.7(j) does not apply to Tier I qualified facilities.
     Remove mode of failure in the Secondary Containment table 
in Appendix G. This table addresses rule requirements for both Sec.  
112.7(b) and (c) along with the more specific secondary containment 
requirements under Subparts B and C. Therefore, the Agency believes it 
is appropriate to have the owner or operator identify `the mode of 
failure; the flow direction and quantity of the discharge; and the 
secondary containment method and containment capacity' for the 
containers listed. The owner or operator may use either active or 
passive approaches for complying with the secondary containment 
requirements (for more information, see the SPCC Guidance for Regional 
Inspectors).
     Refer to the Plan format in Appendix G as document rather 
than ``template.'' Once the owner or operator completes the Appendix G 
template to include site-specific information, the resulting document 
is an SPCC Plan for the facility.
     Amend the self-certification statement to specifically 
highlight the owner or operator's responsibility to provide secondary 
containment. The elements of the Tier I self-certification requirement 
are similar in scope to those required for an owner or operator of a 
Tier II qualified facility who chooses to self-certify a Plan (as 
promulgated in December 2006, 71 FR 77266). Additionally, the Agency 
has described the secondary containment requirements of the regulation 
in more detail in the SPCC Guidance for Regional Inspectors.
     Amend the table heading. ``Secondary containment capacity 
(gallons)'' with the superscript that identifies the secondary 
containment requirements for bulk storage containers. The Agency 
believes that the table appropriately identifies the secondary 
containment requirements for bulk storage containers and mobile/
portable containers. Additionally, the Agency has described the 
secondary containment requirements of the regulation in more detail in 
the SPCC Guidance for Regional Inspectors.
     Move footnotes to the discussion preceding the tables in 
the Appendix. The Agency believes it is appropriate to provide guidance 
to assist in the development of the SPCC Plan template in a separate 
document, if necessary, rather than increase the length of the 
template.
     Simplify secondary containment information (Section III, 
Tables 1 and 2). The Agency disagrees that additional simplification is 
appropriate for these tables. The tables are designed to address the 
various oil storage containers, equipment and oil-handling areas where 
secondary containment is required. For Tier I qualified facilities with 
only one or two oil storage containers, the tables should be easy to 
complete.
     Amend the information that must be reported to the NRC in 
Section III, Part 7. The bullets in the table cite the current 
regulatory requirements in Sec.  112.7(a)(4), which also conforms with 
the type of information that is collected by the NRC.
     Amend the Contingency Plan checklist included as an 
attachment to Appendix G. EPA did not propose to amend the contingency 
plan requirements under 40 CFR part 109 and the checklist is intended 
as a reminder for the owner or operator to address these requirements 
when developing the contingency plan for the facility (when 
applicable). This contingency plan checklist is intended as a guide to 
assist the owner or operator of a Tier I qualified facility to prepare 
a contingency plan in lieu of the general secondary containment 
requirements for qualified oil-filled operational equipment or as an 
alternative to sized secondary containment for specific equipment at an 
oil production facility (such as flowlines).
4. Self-Certification and Plan Amendments
    The elements of the Tier I self-certification requirement are 
similar in scope to those required for an owner or operator of a Tier 
II qualified facility who chooses to self-certify an SPCC Plan (as 
promulgated in December 2006, 71 FR 77266). An owner or operator of a 
Tier I qualified facility who chooses to complete an Appendix G 
template Plan (or some other equivalent Plan) is required to certify 
that: (1) He is familiar with the applicable requirements of the SPCC 
rule; (2) he has visited and examined the facility; (3) the Plan has 
been prepared in accordance with accepted and sound industry practices 
and standards; (4) the procedures for required inspections and testing 
have been established in accordance with industry inspection and 
testing standards and recommended practices; (5) the Plan is being 
fully implemented; (6) the facility meets the qualification criteria 
set forth under Sec.  112.3(g)(1); (7) the Plan does not utilize the 
environmental equivalence or impracticability provisions under Sec.  
112.7(a)(2) and 112.7(d), or include an

[[Page 74260]]

exemption/measures pursuant to Sec.  112.9(c)(6) for produced water 
containers and any associated piping and appurtenances downstream from 
the container; and (8) the Plan and the individual(s) responsible for 
implementing the Plan have the full approval of management and the 
facility owner or operator has committed the necessary resources to 
fully implement the Plan.
    Under Sec.  112.5 of the SPCC rule, an owner or operator must 
review and amend the SPCC Plan following any change in facility design, 
construction, operation, or maintenance that materially affects its 
potential for a discharge as described in Sec.  112.1(b). Consistent 
with the current requirement for qualified facilities, the owner or 
operator of a Tier I qualified facility is allowed to self-certify any 
of these technical amendments to the Plan under Sec.  112.6(a)(2), and 
document this certification in the Plan template (or some other 
equivalent Plan).
    If the owner or operator of a Tier I qualified facility makes 
changes to the facility such that the maximum individual aboveground 
oil storage container capacity is greater than 5,000 U.S. gallons, the 
facility no longer qualifies as a Tier I facility, even if the total 
oil storage capacity is less than 10,000 U.S. gallons, and is not 
eligible to implement the self-certified Appendix G template Plan (or 
some other equivalent Plan). The facility owner or operator must 
determine whether the facility still meets the eligibility criteria for 
a Tier II qualified facility (i.e., total aboveground storage capacity 
remains below 10,000 U.S. gallons). If the facility meets the Tier II 
qualified facility criteria, within six months following the change in 
the facility, the owner or operator is required to prepare and 
implement an SPCC Plan in accordance with Sec.  112.6(b) or prepare and 
implement an SPCC Plan in accordance with the general Plan requirements 
in Sec.  112.7, and the applicable requirements in subparts B and C, 
including having the Plan certified by a PE, as required under Sec.  
112.3(d). If, on the other hand, the facility is no longer a qualified 
facility, the owner or operator is required to, within six months 
following the change in the facility, prepare and implement an SPCC 
Plan in accordance with the general Plan requirements in Sec.  112.7, 
and the applicable requirements in subparts B and C, including have the 
Plan certified by a PE.
a. Comments
    A commenter noted that the self-certification statement ``should 
not be modeled after what EPA desires to see a licensed PE provide.'' 
The commenter noted that promoting or encouraging development of 
qualified facility SPCC Plans by non-licensed engineers violates codes 
in many states.
b. Response to Comments
    While the owner or operator of a qualified facility may choose to 
self-certify the SPCC Plan in lieu of a PE certified Plan, he is still 
required to comply with all of the SPCC requirements and to develop and 
implement a spill prevention program in accordance with good 
engineering practices. The owner or operator may do so by following 
guidance, industry standards, industry design specifications or 
industry recommended or best management practices. This is analogous to 
how a person with no accounting experience is expected to comply with 
applicable state and Federal tax laws. Many people choose to have a 
Certified Public Accountant (CPA) prepare their annual tax documents; 
however, the Internal Revenue Service (IRS) does not require that a CPA 
conduct this activity. A person that chooses to complete the tax forms 
on his own is not relieved from the liability to do so in accordance 
with all Federal and state requirements. That person is expected to 
understand the tax laws and regulations and prepare the documents 
following all applicable requirements. He may choose to use the forms 
and guidance provided by the IRS or state agency, or use software or 
other publicly available guidance to aid him in the correct completion 
of the tax forms.
    For SPCC, the Agency believes that an owner or operator who follows 
guidance; standard design and operational protocols; industry standards 
or recommended practices; or guidance developed by professional 
associations is following ``good engineering practices'' to comply with 
the SPCC rule requirements. Where operational changes at a facility are 
necessary to comply with the rule requirements, the owner or operator 
must follow all appropriate state and local requirements (such as for 
permitting and construction) and, if necessary, obtain the appropriate 
professional assistance. However, in the case of a qualified facility, 
EPA believes that the development of the SPCC Plan itself is not an 
engineering function and an owner or operator can prepare an SPCC Plan 
that describes how the facility complies with the SPCC rule 
requirements. For a qualified facility, the Agency believes it is 
appropriate for the owner or operator to attest that the information in 
the SPCC Plan is true and accurate following the self-certification 
language in Sec.  112.6. EPA modeled the certification statements after 
the PE certification provision in Sec.  112.3(d) with amendments to 
remove language specific to engineering certification. Although EPA 
agrees that the owner or operator of a facility should not be making 
engineering determinations without proper credentials, the Agency 
believes that there are elements of those attestations that are 
appropriate for an owner or operator, such as acknowledging that they 
are familiar with the requirements of this part. EPA also included 
additional attestations for the owner or operator of the facility 
pertaining to the qualification criteria and management approval of the 
SPCC Plan.
    Finally, to the extent that a state has adopted a law, regulation, 
or policy, such as one based on the National Council of Examiners for 
Engineering and Surveying, that requires a PE to perform certain 
functions, including certifying Plans, nothing in this action affects 
whether a facility owner or operator would be required to utilize a PE 
to meet the state or local requirements because this action does not 
preempt any state or local requirements. Therefore, in states where the 
engineer licensing boards have prohibited SPCC Plan self-certification, 
the owner or operator may not be able to utilize the Tier I and Tier II 
options to self-certify the Plan to comply with the SPCC requirements.
5. Tier II Qualified Facility Requirements
    EPA is designating qualified facilities that do not meet the 
additional criterion for Tier I qualified facilities (i.e., no 
individual aboveground oil storage container with a capacity greater 
than 5,000 U.S. gallons) as Tier II qualified facilities. Although the 
organization of the regulatory text in Sec.  112.6 has changed in order 
to accommodate the tiered approach, the requirements for Tier II 
qualified facilities remain the same as they were when these 
requirements were promulgated on December 26, 2006 (71 FR 77266). Tier 
II qualified facilities may choose to comply with the requirements in 
Sec.  112.6(b) by completing and implementing a self-certified SPCC 
Plan, in lieu of having a PE-certified Plan. The self-certified SPCC 
Plan must comply with all of the applicable requirements of section 
Sec.  112.7 and subparts B and C of the rule; any deviations as allowed 
pursuant to Sec.  112.7(c)(2) and (d) must be certified by a licensed 
PE (``hybrid Plan''). Also see

[[Page 74261]]

section V.M.7.d of this preamble, Overlap Between Produced Water 
Container Alternatives and Qualified Facilities, for information on 
using the ``hybrid Plan'' approach to self-certify an SPCC Plan using 
one of the alternative approaches for produced water containers (exempt 
a produced water container or take advantage of the alternative 
requirements in Sec.  112.9(c)(6)). Owners and operators of Tier II 
qualified facilities are not able to use the Appendix G template 
because it does not include all of the SPCC requirements that may apply 
for these facilities.
    Additionally, in order to address the concerns of the oil and gas 
sector, EPA is finalizing an alternative set of qualified facility 
eligibility criteria specific for onshore oil production facilities 
that does not rely on facility oil storage capacities. EPA believes 
these alternative criteria are more appropriate to qualify the oil 
production facilities for Plan self-certification. See Section V.M of 
this document for further discussion on the alternative criteria for 
the oil and gas production sector.
a. Comments
    Two commenters suggested that EPA allow Tier II qualified 
facilities to self-certify Plans. Additional commenters requested that 
Tier II qualified facilities be allowed to use the template.
b. Response to Comments
    EPA is designating qualified facilities that do not meet the 
additional criterion for Tier I qualified facilities (i.e., no 
individual aboveground oil storage container with a capacity greater 
than 5,000 U.S. gallons) as Tier II qualified facilities. The 
requirements for Tier II qualified facilities remain the same as they 
were when they were promulgated in December 2006. Only Tier I qualified 
facilities will be able to use the template in Appendix G of 40 CFR 
part 112 to comply with the SPCC rule. The streamlined provisions 
included in the Plan template in Appendix G are limited to Tier I 
qualified facilities because they were specifically analyzed and 
designed for facilities that store limited quantities of oil, in small 
oil storage containers and generally have simple configurations. Other 
facilities contain larger volumes of oil, have large oil storage 
containers on-site, or are more complex and thus, applying the 
streamlined requirements adopted for Tier I qualified facilities would 
be inappropriate.
6. Alternative Option Considered
    In the October 2007 proposal (72 FR 58378, October 15, 2007), EPA 
described an option wherein the Agency would exempt a certain subset of 
qualified facilities from the SPCC requirements altogether, based on a 
lower facility storage capacity threshold (such as 5,000 U.S. gallons).
    a. Comments
    One commenter supported this option.
    b. Response to Comments
    EPA did not receive any data to support an exemption of a subset of 
qualified facilities. Therefore, the Agency is not finalizing this 
amendment.

H. General Secondary Containment

    At a facility subject to the SPCC rule, all areas with the 
potential for a discharge as described in Sec.  112.1(b) are subject to 
the general secondary containment provision, Sec.  112.7(c). These 
areas may have loading/unloading areas (also referred to as transfer 
areas), piping, and/or mobile refuelers, and may include other areas of 
a facility where oil is present. The general secondary containment 
requirement requires that these areas be designed with appropriate 
containment and/or diversionary structures to prevent a discharge of 
oil in quantities that may be harmful (that is, as described in 40 CFR 
part 110; see Sec.  112.1(b)). EPA is amending the general secondary 
containment provision to provide additional clarity, consistent with 
the guidance published in the SPCC Guidance for Regional Inspectors. 
EPA is also amending Sec.  112.7(c) to provide an alternative to the 
sized secondary containment requirements for flowlines and intra-
facility gathering lines at oil production facilities, as described in 
Section V.M of this notice.
1. Revisions to the General Secondary Containment Requirement
    EPA is amending the general secondary containment requirement at 
Sec.  112.7(c) in three ways: (1) By adding text regarding the method, 
design and capacity of secondary containment; (2) by specifically 
allowing both active and passive measures of secondary containment; and 
(3) by including additional examples of prevention systems. Section V.M 
of this notice describes an additional modification to the provision to 
address flowlines and intra-facility gathering lines at oil production 
facilities.
    Specifically, EPA is amending Sec.  112.7(c) by adding the text 
``In determining the method, design, and capacity for secondary 
containment, you need only to address the typical failure mode, and the 
most likely quantity of oil that would be discharged. Secondary 
containment may be either active or passive in design.'' This addition 
is intended to make clear that the scope of the general secondary 
containment requirement takes into consideration the typical failure 
mode, and most likely quantity of oil that would be discharged, 
consistent with current EPA guidance (SPCC Guidance for Regional 
Inspectors).
    EPA is also amending Sec.  112.7(c) to make it clear that the 
requirement allows for the use of both active and passive secondary 
containment measures to prevent a discharge to navigable waters or 
adjoining shorelines. Active containment measures are those that 
require deployment or other specific action by the operator. These 
measures may be deployed either before an activity involving the 
handling of oil starts, or in reaction to a discharge, so long as the 
active measure is designed to prevent an oil discharge from reaching 
navigable waters or adjoining shorelines. Passive measures are 
permanent installations and do not require deployment or action by the 
owner or operator.
    EPA is further amending the general secondary containment provision 
at Sec.  112.7(c)(1) to include the following additional examples of 
prevention systems for onshore facilities: Drip pans, sumps, and 
collection systems. Drip pans are typically used to isolate and contain 
small drips or leaks until the source of the leak is repaired. They are 
commonly used with product dispensing containers (such as drums), 
uncoupling of hoses during bulk transfer operations, and for pumps, 
valves, and fittings. Sumps and collection systems generally involve a 
permanent pit or reservoir and the connected troughs/trenches that 
collect oil. By expanding the list of examples of secondary containment 
methods found in Sec.  112.7(c)(1), EPA intends to increase the clarity 
and better represent current prevention practices. EPA emphasizes that 
the list of prevention systems are examples only; other containment 
methods may be used, consistent with good engineering practice.
a. Comments
    Many commenters expressed general support for the amendments to 
Sec.  112.7(c). However, one commenter suggested that allowing 
secondary containment for the most likely quantity of oil discharged 
instead of worst case discharge contradicts Sec.  112.7(c) and is 
inconsistent with 33 U.S.C. 1321(j)(5)(D).
    In addition, some commenters indicated that this amendment would 
increase the number of calculations

[[Page 74262]]

necessary to determine likely release scenarios. The commenter 
requested that EPA provide latitude to the certifying PE in developing 
the different release scenarios and secondary containment requirements 
that are appropriate for the facility, stating that calculations should 
not have to be included. A commenter also suggested that EPA allow the 
use of a common collection area or containment area, rather than 
individual containment when there are several tanks located in close 
proximity to each other. Another commenter suggested that EPA should 
clarify in the rule text whether general secondary containment is 
required for buried piping. Other commenters suggested changes to a 
sentence in Sec.  112.7(c) to replace the word ``tank'' with ``piping 
or oil-filled equipment.''
    Additionally, a commenter requested further examples on the 
elements that can comprise an acceptable secondary containment system, 
and commenters suggested that EPA clarify that the list of examples is 
not all-inclusive.
b. Response to Comments
    The Agency's authority to promulgate the SPCC rule is found in 33 
U.S.C. 1321(j)(1)(C) and requires the Agency to promulgate regulations 
establishing procedures, methods, equipment and other requirements for 
equipment to prevent discharges of oil and to contain those discharges. 
The statutory provision gives the Agency broad discretion to establish 
the requirements under the SPCC rule. Nowhere in this statutory 
provision is a requirement that the SPCC regulations address worst case 
discharges. Section 1321(j)(5)(D), however, directs the Agency to issue 
regulations to require owners or operators to prepare and submit plans 
to respond to worst case discharges. Consistent with this statutory 
provision, EPA has promulgated facility response plan regulations in 40 
CFR part 112 Subpart D. Therefore, EPA does not agree with the 
commenter who suggested that this amendment is inconsistent with 33 
U.S.C. 1321(j)(5)(D).
    Commenters also requested clarification on how much supporting 
documentation is necessary (for example, calculations) to demonstrate 
compliance with the general secondary containment requirements. In 
order to determine that the facility has provided appropriate secondary 
containment that complies with Sec.  112.7(c), an EPA inspector may 
review the supporting documentation in the SPCC Plan (see the SPCC 
Guidance for Regional Inspectors, Chapter 4). If calculations are not 
included with the SPCC Plan, and the inspector suspects the general 
secondary containment is inadequate, the inspector may request 
supporting documentation from the owner or operator. Industry guidance 
recommends that facility owners or operators include any secondary 
containment capacity calculations and/or design standards with the 
Plan. API Bulletin D16, ``Suggested Procedure for Development of Spill 
Prevention Control and Countermeasure Plans,'' contains example 
calculations to which inspectors may refer (see Exhibit E of 
``Suggested Procedure for Development of Spill Prevention Control and 
Countermeasure Plans,'' API Bulletin D16. Third Edition, December 
2002). Calculations may be provided as part of the documentation to 
support the adequacy of containment measures employed at the facility, 
although they are not required. Nevertheless, the Plan preparer must 
include enough detail in the SPCC Plan to describe the efficacy of the 
measures used to comply with the general secondary containment 
requirements in Sec.  112.7(c).
    With respect to the use of common containment systems, the Agency 
wants to make clear that it is not necessary to provide separate 
containment systems for each individual container or equipment. 
Instead, the Plan preparer may choose to design facility drainage to 
provide a common collection area for multiple containers, piping or 
oil-filled equipment located at the facility. In order to comply with 
the general secondary containment requirements, the owner or operator 
must first identify the typical failure mode and quantity of oil that 
could be discharged. Based on site-specific conditions, he can 
determine what capacity is needed and design the secondary containment 
system accordingly.
    Commenters also requested clarification on the type of equipment 
subject to the general secondary containment requirements. The general 
secondary containment provision in Sec.  112.7(c) is intended to 
address the potential for oil discharges from all regulated parts of a 
facility. Containment method, design, and capacity are determined by 
good engineering practice to contain an oil discharge until cleanup 
occurs. This determination should consider all areas of the facility 
with a potential to discharge oil, including, but not limited to, 
piping (both aboveground and buried), transfer areas and oil-filled 
operational equipment.
    The Agency does not agree that it is necessary to replace the word 
``tank'' with ``piping or oil-filled equipment'' in Sec.  112.7(c), as 
suggested. Tanks, piping and oil-filled equipment are all examples of 
primary containment systems and the Agency does not believe it is 
necessary to replace one example with another in the rule language. 
However, the word ``secondary'' is being added for clarity and 
accomplishes the point raised by the commenter.
    EPA also is amending the language in Sec.  112.7(c)(1) to include 
additional examples of secondary containment methods, as proposed. One 
commenter requested additional clarification on other methods that may 
be used to comply with the secondary containment requirements, such as 
surface impoundments, on their own, or in connection with other 
elements, such as oil/water separators or water treatment. Section 
112.7(c) states that ``at a minimum, you must use one of the following 
prevention systems or its equivalent * * *.'' EPA clarified in Chapter 
4 of the SPCC Guidance for Regional Inspectors that the list of 
secondary containment methods in Sec.  112.7(c) are examples only and 
not meant to be all-inclusive. Other containment methods may be used, 
consistent with good engineering practice. For example, a facility 
could use an oil/water separator, combined with a drainage system, to 
collect and retain discharges of oil within the facility. Surface 
impoundments, oil/water separators, and wastewater treatment systems 
that are designed and maintained in a way to meet the requirements of 
Sec.  112.7(c) to prevent a discharge as described in Sec.  112.1(b) 
would also serve as equivalent prevention systems. Additionally, 
certification of the SPCC Plan verifies that secondary containment 
methods are appropriate for the facility and that they follow good 
engineering practice.

I. General Secondary Containment for Non-Transportation-Related Tank 
Trucks

    In the December 2006 amendments to the SPCC rule (71 FR 77266, 
December 26, 2006), EPA exempted mobile refuelers from the sized 
secondary containment requirements applicable to bulk storage 
containers. EPA recognizes that other non-transportation-related tanker 
trucks may operate similarly to mobile refuelers, though not 
specifically transferring fuel (i.e., transformer oils, lubrication 
oils, or certain AFVOs). Therefore, they may have the same difficulty 
in complying with the sized secondary containment requirements. EPA is 
now extending the amendment provided to mobile refuelers in the 
December 2006 amendments (i.e., an exemption from the sized secondary

[[Page 74263]]

containment requirements) to non-transportation-related tank trucks at 
a facility subject to the SPCC rule. Specifically, Sec. Sec.  
112.6(a)(3)(ii), 112.8(c)(2), 112.8(c)(11), 112.12(c)(2), and 
112.12(c)(11) have been amended to include the phrase ``except mobile 
refuelers and other non-transportation-related tank trucks.'' Such non-
transportation-related tank trucks include those used to store (for 
short periods of time) and transport fuel, crude oil, condensate, non-
petroleum, or other oils for transfer to or from bulk storage 
containers; for example, a truck used to refill oil-filled equipment at 
an electrical substation or a pump truck at an oil production facility. 
Under this approach, the general secondary containment requirements at 
Sec.  112.7(c) will still apply.
1. Comments
    Commenters generally supported extending the exemption for mobile 
refuelers from the sized secondary containment requirements in 
Sec. Sec.  112.8(c)(6) and 112.12(c)(6) to non-transportation-related 
tank trucks. However, a number of commenters requested that EPA expand 
the scope of the relief or clarify its applicability. Specifically, 
commenters requested that the relief be given to various other types of 
vehicles and equipment, including tank cars or rail cars; mobile 
refueling tank trucks at drilling and workover facilities; vehicles 
associated with oil-filled electrical/operational equipment; mobile/
portable tanks used for maintenance activities associated with oil-
filled electrical equipment; vehicles involved in transloading (as 
defined in 49 CFR 171.8); and small truck-mounted refueling and oil 
tanks, up to 220 gallons, that are used to transport oils and fuels to 
various remote facilities and construction sites.
    One commenter opposed extending the regulatory relief to non-
transportation-related tank trucks because there are technically-
feasible methods for facility owners or operators to conform with the 
requirements, such as double-lined tanks, and that regulatory relief 
would effectively punish those facilities that have already incurred 
the costs of conforming with the sized secondary requirements for tank 
trucks. The commenter further stated that tank trucks are high-risk oil 
containers and that to relax the SPCC requirements would not serve to 
protect the environment.
2. Response to Comments
    EPA agrees with the commenters who argued that non-transportation-
related tank trucks at a facility subject to the SPCC rule should be 
exempted from the sized secondary containment requirements, but should 
remain subject to the general secondary containment requirements. EPA 
also agrees with commenters who suggested that the exemption from the 
sized secondary containment requirements should cover small truck-
mounted oil tanks and other tank trucks, such as bulk chemical trucks 
and vacuum trucks. These trucks are similar to mobile refuelers and are 
included in the exemption from sized secondary containment when the 
truck-mounted oil tank is used to refill a fuel container, an 
electrical transformer, or a hydraulic reservoir on a combine or piece 
of mining equipment. Similarly, mobile refueling tank trucks at 
drilling and workover facilities are included in the exemption from the 
sized secondary containment requirements.
    However, EPA disagrees with commenters that the exemption should be 
extended to tank cars or rail cars. EPA believes that tank cars and 
rail cars typically operate in fixed areas of a facility where sized 
secondary containment can be provided, given the land area that is 
generally dedicated to a rail spur. Similarly, the exemption is not 
being extended to mobile/portable containers because the Agency 
believes that sized secondary containment can be provided for 
containers that generally operate in fixed locations at a facility, but 
are occasionally moved to other fixed locations within the facility for 
similar service.
    One commenter suggested that transloading activities, as defined by 
DOT at 49 CFR 171.8, should be exempted from the sized secondary 
containment requirements. ``Transloading'', which for the purposes of 
hazardous materials regulations means the transfer of a hazardous 
material from one packaging to another packaging for contained shipment 
of the material (see 49 CFR 171.8). This rulemaking, however, focuses 
on clarifying SPCC requirements applicable to non-transportation-
related trucks and the specific topic of ``transloading'' falls outside 
this scope.
    EPA also disagrees with the commenter who opposed extending 
regulatory relief to non-transportation-related tank trucks. EPA 
believes that sized secondary containment is not necessary, and in some 
cases, not appropriate, for the same reasons the Agency exempted mobile 
refuelers from the sized secondary containment requirements. In 
addition, the general secondary containment requirement in Sec.  
112.7(c) still applies, which provides adequate flexibility for the 
prevention of oil discharges as described in Sec.  112.1(b). For 
example, active measures to respond to an oil discharge from a 
vehicular accident may be used to comply with the general secondary 
containment requirement.

J. Security

    EPA is amending the facility security requirements at Sec.  
112.7(g) to allow an owner or operator of a facility to tailor his 
security measures to the facility's specific characteristics and 
location. Thus, this amendment extends the streamlined security 
requirements that EPA provided to qualified facilities in the December 
2006 SPCC rule amendments (71 FR 77266, December 26, 2006) to all 
facilities subject to the security requirements.
1. Revisions to the Security Requirements
    The application of the SPCC security requirements is often 
determined by the facility's geographical/spatial factors, such that 
there is no ``one-size-fits-all'' method to comply with this 
requirement. Therefore, EPA is modifying the security requirements at 
Sec.  112.7(g) to allow the owner or operator to design the security 
arrangements at the facility to address the specific circumstances that 
apply. Thus, this amendment allows an owner or operator to describe in 
his SPCC Plan how he will:
     Secure and control access to all oil handling, processing 
and storage areas;
     Secure master flow and drain valves;
     Prevent unauthorized access to starter controls on oil 
pumps;
     Secure out-of-service and loading/unloading connections of 
oil pipelines; and
     Address the appropriateness of security lighting to both 
prevent acts of vandalism and assist in the discovery of oil 
discharges.
    A facility owner or operator is required to document in his SPCC 
Plan how these security measures are implemented. These requirements 
replace the more prescriptive fencing and other requirements, 
previously found in Sec.  112.7(g)(1) through (5), and allow the 
facility owner or operator to determine how best to secure and control 
access to areas where a discharge to navigable waters or adjoining 
shorelines may originate.
    EPA believes that this amendment will eliminate the need for PE-
certified environmentally equivalent alternatives to the specified 
security requirements, because the provision provides the flexibility 
for the owner or operator to provide whatever measures are most 
appropriate for the facility, as long as

[[Page 74264]]

they accomplish the stated security goals. For example, with this rule 
revision, the Agency allows the facility owner or operator to determine 
how lighting and/or fencing can be used to deter intruders and to 
assist in the discovery of oil discharges, or whether taking a 
different, site-specific approach is most appropriate. The Agency 
believes the added flexibility will not have a negative impact on the 
protection of the environment, and that it will assist the regulated 
community to better tailor the security requirements to their 
particular situation.
    Because the revised requirements at Sec.  112.7(g) apply to all 
facilities (excluding oil production facilities), EPA is removing the 
security requirements previously found at Sec.  112.6(c)(3) for 
qualified facilities; the provision would be redundant.
a. Comments
    Many commenters expressed general support for the amendments to the 
security requirements. One commenter noted that it is important to 
allow the operator to determine the security and lighting needs for 
safety reasons. Another commenter agreed that flexibility is warranted 
given increased security measures due to the requirements from the 
Department of Homeland Security (DHS) or DOT.
    Still another commenter suggested that EPA should not establish 
security requirements because DHS has recently published a rule 
affecting the security of farms and is expected to promulgate 
additional rules; EPA's efforts may be duplicative. Several other 
commenters suggested that EPA avoid duplication of security 
requirements if existing security plans are in place as required by 
other Federal or state regulations. Finally, one commenter requested 
that EPA provide additional clarification to identify the security 
benefits of fencing.
b. Response to Comments
    The Agency agrees with the commenters' general support for the 
amendment and is finalizing the amendment to the security requirements, 
as proposed. With this amendment, the Agency recognizes that there is 
no one single approach to ensure proper facility security. The Agency 
believes that replacing the more prescriptive fencing and other 
security requirements, previously found at Sec.  112.7(g), will allow 
the facility owner or operator to determine how best to secure and 
control access to oil handling and storage areas at the facility. This 
approach provides the flexibility suggested by several commenters to 
prevent unauthorized access to the facility using whatever method is 
most appropriate. Thus, the owner or operator of the facility can 
comply with DHS security requirements, other existing Federal, state or 
local security requirements, or an industry recommended practice and 
describe these measures in the Plan to comply with the SPCC security 
requirement.
    The Agency does not believe it needs to provide additional 
clarification to identify the security benefits of fencing, as the 
flexibility in this rule allows that determination to be made by the 
owner or operator based on his facility's specific circumstances.

K. Integrity Testing

    EPA is amending the requirements at Sec. Sec.  112.8(c)(6) and 
112.12(c)(6) to provide flexibility in complying with the bulk storage 
container integrity testing requirements. Specifically, EPA is 
modifying the provision to allow an owner or operator to consult and 
rely on industry standards to determine the appropriate qualifications 
for tank inspectors/testing personnel and the type and frequency of 
integrity testing required for a particular container size and 
configuration. Thus, this action extends the streamlined bulk storage 
container integrity testing requirement that EPA provided to qualified 
facilities in the December 2006 SPCC rule amendments (71 FR 77266, 
December 26, 2006) to all facilities subject to the integrity testing 
provision.
1. Amendments to Integrity Testing Requirements
    EPA is replacing the previous regulatory requirements at Sec. Sec.  
112.8(c)(6) and 112.12(c)(6) with the integrity testing requirements 
promulgated in December 2006 for qualified facilities (Sec.  
112.6(c)(4)). This amendment requires a facility owner or operator to:
     Test/inspect each aboveground container for integrity on a 
regular schedule and whenever material repairs are made.
     Determine, in accordance with industry standards, the 
appropriate qualifications of personnel performing tests and 
inspections and the frequency and type of testing and inspections, 
which take into account container size, configuration, and design.
    Because the revised requirements at Sec. Sec.  112.8(c)(6) and 
112.12(c)(6) apply to all facilities (excluding oil production 
facilities), EPA is removing the integrity testing requirements 
previously found at Sec.  112.6(c)(4) for qualified facilities; this 
provision is redundant. These revised provisions allow, for example, an 
owner or operator to adopt integrity testing requirements that are 
outlined in industry standards in lieu of integrity testing without the 
need for environmental equivalence determinations certified by a PE. An 
owner or operator is still required to keep comparison records (records 
of inspections and tests kept under usual and customary business 
practices will suffice) and to inspect the container's supports and 
foundations. The owner or operator also is still required to conduct 
frequent inspection of the outside of the container for signs of 
deterioration, discharges, or accumulation of oil inside diked areas.
    Under the revised provision, a facility owner or operator may still 
deviate from the rule provision, or from an industry standard, if the 
alternate measure is equivalent to the environmental protections 
provided by the rule requirement (as provided in Sec.  112.7(a)(2)). In 
this case, a PE would need to certify the reason for the deviation and 
that the alternate measures are environmentally equivalent.
    These amendments apply only to the integrity testing requirements 
in Sec. Sec.  112.8(c)(6) and 112.12(c)(6). The bulk storage container 
inspection requirements for onshore oil production facilities in Sec.  
112.9(c)(3) are not affected by this amendment.
a. Comments
    Many commenters expressed general support for the amendments to the 
integrity testing provisions. Some commenters suggested that a 
requirement for visual inspections with weekly or monthly frequency 
would be inappropriate because such a schedule is impracticable; they 
agreed that the frequency and documentation of visual inspections 
should be based upon PE judgment and site-specific conditions. Other 
commenters agreed that the PE should determine the appropriate testing/
inspection requirements for each container and that industry standards 
should be used as appropriate.
    Two commenters suggested that the amendments are too prescriptive, 
and not performance-based, and that the amendment detracts from a PE's 
ability to assess site-specific conditions. Other commenters disagreed 
with EPA's reference to industry standards in setting environmental 
regulations and objected to the use of the term ``industry standards'' 
for inspector qualifications and integrity testing methods because 
these standards are unnecessarily strict.
    In addition, several other approaches were suggested by commenters. 
One commenter suggested that tank integrity testing criteria should be 
limited to

[[Page 74265]]

visual inspections. One commenter suggested extending ``environmental 
equivalence of visual-only testing to all elevated tanks and tanks on 
release prevention barriers (RPBs), regardless of volume.'' One 
commenter suggested that EPA should allow the owner or operator of a 
facility with indoor tanks to adopt different inspection requirements 
(not outlined by industry standards); the facilities would still have 
to keep records and perform monthly visual inspections, but not be 
required to hire third-party inspectors.
    One commenter suggested that EPA should codify the PMAA standards; 
these standards allow operators, who are not certified tank inspectors, 
but who have training and experience to visually inspect tanks at 
petroleum production facilities, refineries, and terminals, to conduct 
such inspections. Several other commenters specifically recommended 
using standards, such as Steel Tank Institute (STI) SP001 and American 
Petroleum Institute (API) Standard 653. One commenter suggested that 
EPA should eliminate the phrase ``qualified personnel'' from the 
amended rule text. A few other commenters recommended that EPA 
incorporate API/EPA litigation settlement language concerning 
inspection requirements for smaller containers, specifically allowing 
visual inspection in certain site-specific circumstances, into the 
regulation at Sec.  112.12(c)(6).
b. Response to Comments
    EPA agrees with those commenters who supported amending the 
integrity testing requirements at Sec. Sec.  112.8(c)(6) and 
112.12(c)(6). EPA disagrees that the amendments are too prescriptive. 
The amended integrity testing requirements are intended to provide more 
flexibility to the owner or operator of an SPCC-regulated facility in 
the selection of the appropriate scope and frequency of integrity 
testing for all classes of bulk storage containers, including indoor 
and outdoor tanks and portable containers (such as 55-gallon drums and 
totes). The July 2002 rule revisions (67 FR 47042, July 17, 2002) 
amended the integrity testing requirements in Sec. Sec.  112.8(c)(6) 
and 112.12(c)(6) to require visual inspections, plus some other form of 
testing, for each bulk storage container 55 U.S. gallons or greater; 
this amendment modifies this requirement to allow the owner or operator 
to determine the frequency and type of testing and inspections that are 
appropriate, according to site-specific conditions (for example, type 
and age of tanks, condition of tanks, and overall tank/secondary 
containment configuration), while also considering relevant integrity 
testing standards.
    EPA maintains that inspection of containers storing oil in 
accordance with recognized industry inspection (integrity testing) 
standards is an important aspect of oil spill prevention. Industry 
standards are technical guidelines created by experts in a particular 
industry for use throughout that industry. These guidelines assist in 
establishing common levels of safety and common practices for 
manufacture, maintenance, and repair. Created by standard-setting 
organizations using a consensus process, the standards establish the 
minimum accepted industry practice. EPA recognizes that some industry 
standards now provide differentiated inspection requirements for 
various container sizes and configurations that may allow for visual 
inspection of certain types of oil storage containers, such as drums 
and totes and certain tanks up to 5,000 U.S. gallons. EPA's amendments 
to the integrity testing requirements are intended to allow the use of 
these industry standards without the need for environmental equivalence 
discussions in an SPCC Plan when a recognized industry standard is 
followed. EPA notes that use of a particular standard is voluntary; 
however, when a standard (or any part of a standard) is incorporated 
into a facility's SPCC Plan, then adherence to that standard (or part 
of a standard) is mandatory for implementation of the SPCC Plan.
    It should also be noted that these amendments do not restrict the 
use of environmental equivalence, including establishing differentiated 
inspection requirements for shop-built tanks versus field-erected 
tanks, and other alternatives suggested by commenters. Owners or 
operators still have the ability to develop alternative, 
environmentally equivalent integrity testing procedures for bulk 
storage containers in accordance with Sec.  112.7(a)(2). These 
equivalent measures must be in accordance with good engineering 
practice and are subject to certification by a PE.
    EPA described the environmental equivalence flexibility available 
to a PE with respect to integrity testing in a letter to the PMAA.\5\ 
While the policy and approach for the use of environmental equivalence 
described in this letter is still valid, the approach taken in this 
final rule amending the integrity testing requirements allows 
inspection requirements outlined in industry standards to be used 
without the need for environmental equivalence determinations certified 
by a PE. A major industry standard for integrity testing (STI SP001) 
was modified since the letter to PMAA was written to outline ``good 
engineering practice'' for integrity testing of shop-built containers. 
This may affect a PE's decision whether to certify an environmentally 
equivalent approach as described in the PMAA letter, or to follow the 
industry standard as provided by the amendment finalized in this rule.
---------------------------------------------------------------------------

    \5\ Letter to Daniel Gilligan, President, Petroleum Marketers 
Association of America, from Marianne Lamont Horinko, Assistant 
Administrator, Office of Solid Waste and Emergency Response, EPA, 
May 25, 2004.
---------------------------------------------------------------------------

    In response to the comment that EPA should clarify acceptable 
industry standards for all integrity testing procedures, the Agency 
provided a list of organizations that may be helpful in the 
identification and explanation of industry standards in the Federal 
Register notice for the July 2002 SPCC rule revisions (67 FR 47058, 
July 17, 2002). In addition, EPA also provided an overview and 
description of the scope and key elements of pertinent industry 
standards in Chapter 7 of the SPCC Guidance for Regional Inspectors. 
While the Agency is allowing industry to rely on industry standards to 
assess the inspection and integrity testing scheme, EPA does not 
believe that any specific industry standards should be incorporated, by 
reference, into the rule. As EPA noted in the preamble to the July 2002 
SPCC rule revisions (67 FR 47070, July 17, 2002), while facility owners 
or operators should look to specific industry standards as a guide for 
preparing SPCC Plans, EPA does not believe that incorporating specific 
standards into this rule is appropriate. Such incorporation freezes 
standards into rules, which may become outdated or obsolete. The 
decision in every case as to the applicability of any industry standard 
will be one for the PE, or the owner or operator of the facility who 
self-certifies an SPCC Plan.
    Finally, commenters suggested allowing the use of alternative 
inspection techniques and the qualification requirements for 
inspectors; however EPA believes that these amendments are consistent 
with industry standards related to integrity testing.

L. Animal Fats and Vegetable Oils

    Under this final rulemaking, EPA is differentiating the integrity 
testing requirements at Sec.  112.12(c)(6) for an owner or operator of 
a facility that handles certain types of AFVOs.
    EPA is providing the PE or an owner or operator self-certifying an 
SPCC Plan with the flexibility to use a visual

[[Page 74266]]

inspection program for integrity testing that is appropriate for 
containers that store AFVOs that meet certain criteria. This 
flexibility applies to those bulk storage containers that are subject 
to the applicable sections of the Food and Drug Administration (FDA) 
regulation 21 CFR part 110, Current Good Manufacturing Practice in 
Manufacturing, Packing or Holding Human Food, and that meet the 
following additional criteria: (1) The containers are elevated; (2) the 
containers are made from austenitic stainless steel; (3) the containers 
have no external insulation; and (4) the containers are shop-built. 
That is, an owner or operator with containers meeting these criteria 
can use visual inspection of these containers equivalent to industry 
standards, in lieu of the revised integrity testing requirements found 
at Sec.  112.12(c)(6), without having to make an environmental 
equivalence determination in accordance with Sec.  112.7(a)(2). The 
owner or operator is required to document the procedures for 
inspections and testing in their SPCC Plan, including those for AFVO 
bulk storage containers that are eligible for the differentiated 
requirements described in this amendment.
1. Differentiated Requirements for AFVOs
    Stakeholders have commented that AFVOs merit differentiated 
requirements under the SPCC regulation. In particular, the regulated 
community has pointed to differences between the toxicity and 
biodegradation profiles of AFVOs and those of petroleum oils. Because 
of these claims, and in response to the Edible Oil Regulatory Reform 
Act (EORRA), the Agency has on several occasions formally requested 
information and supporting scientific data that would inform such a 
determination. (See 72 FR 58400, October 15, 2007, for a discussion of 
EPA's data review.) EPA then considered whether an alternative approach 
to differentiation that is not based on the oil's toxicity and its 
inherent physical/chemical properties, but rather based on the way 
these oils are stored and handled at a facility would be appropriate. 
EPA focused specifically on the integrity testing requirements for bulk 
storage of AFVOs to address concerns raised by the regulated community. 
As a result, this final rule establishes differentiated integrity 
testing requirements for certain bulk storage containers that store 
AFVOs and that meet specific design and operational criteria.
    Because this is an alternative, EPA is not requiring that an owner 
or operator use this option. The alternative provides additional 
flexibility in meeting the provisions set forth in Sec.  112.12(c)(6) 
to address stakeholder concerns. In addition, an owner or operator may 
make an environmental equivalence determination, in accordance with 
Sec.  112.7(a)(2) for integrity testing of a bulk storage container.
a. Comments
    Several commenters expressed support for EPA's efforts to reduce 
the regulatory burden to facilities storing AFVOs because these 
substances are different from petroleum oils. One commenter appreciated 
EPA's clarification regarding reasonable expectation of discharge for 
AFVOs that are solid or semi-solid at ambient temperature and pressure. 
However, one commenter suggested the current criteria are too limiting 
to provide relief, because many AFVO storage containers would not meet 
the criteria and thus, would not be eligible. Another commenter, on the 
other hand, indicated the proposal was overly lax and should be 
reconsidered.
b. Response to Comments
    EPA notes that this alternative option is based not on the 
differences between petroleum oil and AFVOs, but on the way these oils 
are stored and handled at a facility. With regard to the comment about 
certain AFVOs solidifying at room temperature, EPA notes that the 
applicability of the SPCC rule must be made in accordance with the 
provisions set forth in Sec.  112.1. The Agency notes that the SPCC 
rule only applies to facilities that, due to their location, can 
reasonably be expected to discharge oil to navigable waters or 
adjoining shorelines. In determining whether there is a reasonable 
expectation of discharge, an owner or operator of a facility may 
consider the nature and flow properties of the oils handled at the 
facility. However, if a facility owner or operator determines that 
there is a reasonable expectation to discharge oil to navigable waters 
or adjoining shorelines for any single oil container, all oil 
containers at the facility are subject to the rule's requirements, 
except as otherwise exempted.
    The Agency acknowledges comments on the criteria being both too 
limiting and also overly lax, but EPA believes that the criteria 
developed strikes the appropriate balance between regulatory 
requirements and environmental protection.
2. Differentiation Criteria: Containers Subject to FDA Regulations--21 
CFR Part 110
    The differentiated integrity testing requirements finalized in this 
action are available only to those bulk storage containers that are 
subject to the applicable sections of the FDA regulation at 21 CFR part 
110. When developing an integrity testing program for AFVO bulk storage 
containers, FDA rule requirements may substitute for an industry 
standard. Applicable requirements within 21 CFR part 110, when taken 
together with the additional criteria in this amendment, serve as 
equivalent alternative measures that include the main elements of an 
integrity testing program under the SPCC regulation. The minimal 
elements for an integrity testing program can be separated into three 
main structural integrity areas: (1) Container foundations, (2) 
container support structures, and (3) the container itself.
     Container foundations. FDA requires that facilities be 
constructed in such a manner that the floor, walls, and ceilings be 
adequately cleaned and kept clean and in good repair (21 CFR 
110.20(b)(4)). Bulk storage containers that sit atop floors that fall 
under this requirement are expected to be maintained and kept in good 
repair.
     Container support structure. FDA requires all plant 
equipment, including the container's structural supports, to be 
designed of such material and workmanship as to be adequately 
cleanable, and for it to be properly maintained (21 CFR 110.40(a)). 
Periodic maintenance of the structural support(s) of a bulk storage 
container is also an oil spill preventive measure.
     Container itself. FDA requires the design, construction, 
and use of equipment to preclude the adulteration of food with, among 
other potential contaminants, metal fragments (21 CFR 110.40(a)). FDA 
further requires that food contact surfaces be corrosion resistant when 
in contact with food. FDA also requires equipment that is in the 
manufacturing or food-handling area and that does not come into contact 
with food must be constructed and kept in a clean condition (21 CFR 
110.40(c)). The exterior surface of bulk storage containers that are 
located in the manufacturing or food-handling area and that are subject 
to this requirement are expected to be maintained to a higher standard 
than other bulk storage containers, which are not subject to a similar 
requirement.

[[Page 74267]]

a. Comments
    One commenter agreed with the logic that container foundations and 
support structures meeting the FDA requirements may also meet the 
intent and practicality of the SPCC requirements. Another commenter 
agreed that offering options for environmental equivalence is a good 
step, but suggested that the options should go beyond the FDA standards 
and include other industry standards that offer equivalent protection.
b. Response to Comments
    EPA agrees with those comments supporting the use of FDA's 
regulations as a basis for establishing a qualifying criterion for 
differentiated integrity testing requirements for AFVOs. The Agency 
also agrees that compliance with industry standards and requirements 
other than 21 CFR part 110 may also meet the SPCC inspection, 
evaluation, and testing requirements. In the preamble to the July 2002 
SPCC rule amendments, EPA provided examples of industry standards that 
may constitute good engineering practice for assessing the integrity of 
different types of containers for oil storage (67 FR 47120, July 17, 
2002). Additionally, the SPCC rule provides flexibility regarding the 
integrity testing requirements of bulk storage containers, as long as 
the alternatives provide equivalent environmental protection per Sec.  
112.7(a)(2).
3. Differentiation Criteria: Elevated Bulk Storage Containers
    The differentiated integrity testing requirements finalized in this 
action are available only to those bulk storage containers that are 
elevated. Food equipment, by design, is generally elevated above the 
floor using legs or another means of support so that the space between 
the equipment and the floor can be cleaned. For the purposes of oil 
spill prevention, elevated bulk storage containers allow visual 
inspections for oil discharges all around the container. An elevated 
bulk storage container used for food oils also facilitates complete 
drainage because they are designed such that the oil is withdrawn from 
the lowest point in the container, so that foreign substances or 
materials do not accumulate and contaminate the food oil. For the 
purposes of oil spill prevention, self-draining containers operating 
using gravity flow allows complete drainage and prevents substances 
other than oil (such as water) from accumulating at the bottom of the 
container, thus minimizing corrosion. EPA believes that the self-
drainage design, in conjunction with the applicable regulatory 
requirements, is likely to prevent the corrosion of the internal 
contact surface in food-grade AFVO bulk storage containers.
a. Comments
    Several commenters suggested including non-elevated containers in 
EPA's criteria for the integrity testing provision. Commenters 
reference non-elevated food industry tanks that are positioned on pads 
so long as the area can be adequately cleaned and kept in good repair, 
and vessels that incorporate a bottom-discharge design which eliminates 
the build-up of water and materials in the bottom of the tank and 
prevents corrosion.
b. Response to Comments
    While EPA recognizes similarities between elevated and bottom-
discharge designs, the Agency does not agree with the request to expand 
the scope of the AFVO alternative criterion to include non-elevated 
bulk storage containers. Although some food industry facilities may use 
non-elevated tanks, food equipment is generally designed to be elevated 
(for example, to stand on legs); this elevated design allows the space 
between the plant equipment and the floor to be easily cleaned. FDA 
also recommends that all equipment should be so installed and 
maintained so as to facilitate cleaning of the equipment and of all 
adjacent spaces.
    Bottom-discharge designs similarly eliminate the build-up of water 
and materials in the bottom of the tanks. However, the Agency believes 
that having the tanks elevated facilitates maintenance, inspections, 
and monitoring for oil discharges all around the bulk storage 
container, all of which are critical in allowing for the differentiated 
integrity testing requirements. It is important to note that the 
differentiated requirements are an available alternative. The owner or 
operator may choose to include bulk storage container designs that 
provide equivalent environmental protection in their SPCC Plan, in 
accordance with Sec.  112.7(a)(2). For example, bulk storage containers 
built according to industry standards (such as 3-A Sanitary Standards) 
may provide additional features that facilitate visual inspection (such 
as manholes for internal inspection) that may provide comparable 
environmental protection.
4. Differentiation Criteria: Containers Made From Austenitic Stainless 
Steel
    The differentiated integrity testing requirements finalized in this 
action are available only for those bulk storage containers that are 
made of austenitic stainless steel. EPA believes that non-homogenous 
container systems (for example, containers with external insulation, an 
external coating, a mild-carbon steel shell, an internal liner) are 
more complex than homogenous container systems (such as containers 
constructed solely of austenitic stainless steel) and may require 
additional inspection measures to ensure the integrity of the 
container. Furthermore, austenitic stainless steel containers are often 
used because cleaning agents and acidic detergents used to clean food 
and non-food contact surfaces can be corrosive if used on incompatible 
surfaces. Therefore, EPA is limiting this alternative approach for 
integrity testing to AFVO bulk storage containers made of austenitic 
stainless steel.
a. Comments
    A commenter agreed with EPA to limit the alternative integrity 
testing requirements to austenitic stainless steel tanks and vessels. 
However, several commenters suggested that EPA consider including 
carbon steel tanks in the eligibility criteria for the flexibility to 
determine the scope of integrity testing, especially considering the 
widespread use of these containers and the consistency with EPA's 
current SPCC guidance. A commenter also cited the cost difference 
between a mild steel tank (commonly used in the industry) and a 
stainless steel tank.
b. Response to Comments
    EPA agrees with the commenter who supported limiting the 
alternative integrity testing requirements to bulk storage containers 
made of austenitic stainless steel for the reasons stated above. As one 
commenter noted, carbon steel tanks that are interior-lined may pose 
more significant inspection requirements because the interior lining 
may fail to adhere to the tank, and not provide the intended protection 
of the carbon steel. Other commenters believed that limiting 
alternative testing requirements to austenitic stainless steel would 
limit the usefulness of the alternative option. While this assertion 
may be correct, the Agency nevertheless believes that expanding this 
alternative to include carbon steel containers is not appropriate, 
because non-austenitic stainless steels, including but not limited to 
carbon steel, are not as inherently corrosion resistant as austenitic 
stainless steel to the materials stored or handled in them (that is, 
they are more susceptible to internal corrosion) or to the operating 
environment (that is, they are more

[[Page 74268]]

susceptible to external corrosion). Furthermore, non-austenitic 
stainless steel containers may require a liner; these liners can fail 
or delaminate, promoting the potential for internal or external 
corrosion. Thus, the Agency believes the austenitic stainless steel 
criterion is an integral part of the criteria for differentiated 
requirements. Again, these differentiated requirements are an available 
alternative that the owner or operator may choose to include in their 
SPCC Plan. The owner or operator may choose to make an environmental 
equivalence determination, in accordance with Sec.  112.7(a)(2), for 
similar corrosion resistant materials.
5. Differentiation Criteria: Containers With No External Insulation
    The differentiated integrity testing requirements finalized in this 
action are available only to those bulk storage containers with no 
external insulation. The Agency believes that inspections based on 
frequent monitoring of the exterior surface of a bulk storage container 
for corrosion and/or other mechanisms that can threaten a container's 
integrity is a minimum criterion for an alternative measure that 
provides equivalent environmental protection. External insulation 
covering the outside of a bulk storage container acts as a physical 
barrier to effective visual examination of the exterior surface. If not 
properly sealed, insulating materials covering the exterior surface of 
a bulk storage container and/or any associated equipment and piping can 
become damp. Insulation that retains moisture and that is adjacent to a 
container's exterior surface can cause significant corrosion, which may 
threaten the integrity of the container.
    EPA is unaware of any sanitation provision or regulatory 
requirement that requires an inspection between the insulation and the 
exterior surface of a bulk storage container. Furthermore, the Agency 
does not know of any established industry methods or procedures, or 
industry standards specific to AFVOs, to evaluate the exterior surface 
of a bulk storage container that is covered by insulation. Therefore, 
EPA believes only containers with no external insulation should be 
eligible for this alternative for integrity testing.
a. Comments
    One commenter stated that effective visual examination is difficult 
for tanks with external insulation; therefore, the commenter agreed 
that the alternative integrity testing requirements should only be 
applied to tanks with no external insulation. However, several 
commenters suggested that EPA revise its AFVO alternate integrity 
testing criteria to allow insulated or jacketed tanks to be used under 
this amendment, as long as there are sufficient access ports installed 
in key locations to observe an appropriate quantity of the exterior of 
the tank. Commenters cite the need for this type of tank to maintain 
product viscosity. Commenters also note that there is an established 
industry practice allowing for visual inspection of insulated tanks. In 
addition, one commenter suggested insulation is very prevalent in the 
industry and the increased energy cost for non-insulated containers 
would be prohibitive.
b. Response to Comments
    The Agency agrees with those commenters that supported limiting the 
alternative criterion to bulk storage containers that have no external 
insulation because external insulation is a barrier to visual 
examination, making effective visual inspection difficult. At the same 
time, EPA recognizes that some AFVO bulk storage containers need 
insulation to maintain temperatures. However, the Agency disagrees with 
the commenters that suggested this criterion should be expanded to 
include jacketed tanks that have sufficient access ports installed at 
key locations.
    The Agency believes it is important that the criteria for 
differentiated requirements account for the effect of corrosion under 
the thermal insulation, including but not limited to, the effect of 
moisture, chloride leaching, and/or temperature. The effects of 
corrosion under thermal insulation are well documented in the technical 
literature. (See, for example, National Association of Corrosion 
Engineers (NACE) Standard RP0198-2004.) Thus, because external 
insulation covering the outside of a bulk storage container acts as a 
barrier to effective visual examination, EPA believes this is a minimum 
criterion for this alternative, the Agency is limiting the alternative 
criterion to those containers that have no external insulation. 
However, bulk storage containers that store food oil and are built 
according to industry standards (such as 3-A Sanitary Standards) may 
have additional design features that provide equivalent environmental 
protection and thus meet the intent of the criteria. For example, 
container configurations built according to 3-A Sanitary Standards 
typically include ``manholes'' that facilitate complete access for 
examination of the entire internal surface. These containers also 
typically have an outer shell (that is, a double wall) that is sealed 
completely (for example, with completely welded seams) so that the 
container integrity is maintained by removing any potential for the 
insulation to be exposed to moisture. In addition, some AFVO bulk 
storage containers that are refrigerated may suppress corrosion 
potential, whereas containers that are heated to facilitate oil flow 
may promote corrosion potential. The Agency believes the rule provides 
the facility owner or operator with significant flexibility to make an 
environmental equivalence determination, in accordance with Sec.  
112.7(a)(2), which may be used to address those insulated bulk storage 
containers that have alternative configurations, including access 
ports.
    Finally, the Agency disagrees with those commenters who suggested 
that the alternative criterion should include insulated containers 
because they are prevalent in the industry or because the increased 
energy cost for non-insulated containers would be prohibitive. The 
Agency is not mandating the use of any type of container, but rather is 
allowing flexibility for the owner or operator of facilities that have 
containers that meet the alternative criterion.
6. Differentiation Criteria: Shop-Fabricated Containers
    The differentiated integrity testing requirements finalized in this 
action are available only to shop-fabricated containers (i.e., shop-
built). Shop-fabricated containers are those containers that are shop-
assembled in one piece before they are transported to the installation 
site; this limits the maximum capacity of the container so that it can 
be transported over the road by truck. Shop-fabricated containers 
generally have lower volume capacities, smaller tank diameters, and a 
fewer number of welds than field-erected containers, and they are 
typically comprised of a single type of material with a single wall 
thickness.
    Field-erected (i.e., field-constructed) containers, on the other 
hand, can store much larger volumes of oil. They have larger container 
capacities because individual pieces of the container can be 
transported to and assembled at the installation site. Because of their 
greater size and complexity, field-erected containers generally have 
more stringent engineering requirements than shop-fabricated 
containers, which would need to be considered in developing an 
appropriate integrity testing program. For example, field-erected 
containers may have variable shell-wall

[[Page 74269]]

thicknesses, and/or be comprised of different materials to account for 
variations in the stresses caused by hydrostatic pressure. These field-
erected containers generally have a significantly greater number of 
welds as compared to a shop-fabricated container because they are 
fabricated on-site from individual pieces. The stress on the container 
walls and joints is greater as the diameter and/or height of the 
container increases. A brittle fracture evaluation of a field-erected 
container may be necessary if the thickness of the shell wall is above 
a certain value and the container undergoes a repair, alteration, 
reconstruction, or a change in service that might affect the likelihood 
of a discharge or failure (Sec.  112.7(i)).
    This option, therefore, is limited to shop-fabricated containers 
because they are simpler in design and construction (they are typically 
subject to less stress, have fewer welds, and are less likely to be 
subject to brittle fracture failure) than field-erected containers. The 
Steel Tank Institute's (STI) SP001, Standard for the Inspection for 
Aboveground Storage Tanks, establishes the scope and frequency for 
visual inspections of shop-fabricated containers. This rule amendment 
is consistent with past regulatory guidance and current industry best 
practices for this particular class of bulk storage containers.
a. Comments
    One commenter suggested that EPA should not limit consideration of 
alternative integrity testing to only shop-fabricated containers. The 
commenter indicated that while field-erected tanks are larger than 
shop-fabricated tanks, they are designed to meet industry standards; 
there are no data to support a higher failure rate; and industry 
standards for visual inspections apply to field-erected tanks.
    Two commenters also suggested that EPA modify the rule to clarify 
that tanks that are pre-fabricated in sections, and then field-erected 
in a limited number of places, should qualify for the alternative 
provisions, since many AFVO facilities utilize these tanks and there 
are fewer field welds than for a completely field-erected tank. In 
addition, one commenter suggested that these partial field-assembled 
tanks are not necessarily the large capacity containers that EPA may 
seek to exclude from the integrity testing provision.
b. Response to Comments
    For the reasons stated above, EPA believes it is appropriate to 
limit the alternative integrity testing criterion to shop-fabricated 
containers: They are simpler in design and construction in relation to 
field-erected containers, including those bulk storage containers that 
are partially field assembled. EPA believes this criterion 
distinguishes between more complex bulk storage containers, which may 
require greater integrity testing scrutiny, and smaller, less complex 
containers.
    EPA disagrees with the commenter who questioned whether this 
criterion was relevant, by asserting that the industry standards for 
visual inspection apply to field-erected tanks. While visual inspection 
may be a component of an integrity testing program for field-erected 
tanks, EPA is unaware of any industry standard which limits integrity 
testing for a field-erected bulk storage container to visual inspection 
only. Industry standards typically incorporate visual inspection into a 
broader integrity testing program which typically also includes non-
destructive testing on a regular schedule and includes inspection of 
the tank's shell and bottom plate. EPA believes this criterion, in 
combination with the others, limits the applicability of the integrity 
testing relief to those AFVO containers that, because of equipment 
design and handling requirements already provide environmentally 
equivalent protection. In contrast, containers that are partially shop-
fabricated and then finalized in the field may be subject to additional 
inspection requirements to bring these containers into service and for 
continued service beyond fully shop-fabricated containers. It should 
also be noted that the rule provides sufficient flexibility to make an 
environmental equivalence determination, in accordance with Sec.  
112.7(a)(2), which may be used to address fielded-erected containers 
that may vary in complexity, including field-erected containers 
comprised of pre-fabricated sections.
7. Required Recordkeeping
    The SPCC regulations require that inspections and tests be 
conducted in accordance with the written procedures that the owner or 
operator or the certifying PE develop for the facility and that records 
of inspections and testing be kept with the SPCC Plan in accordance 
with the recordkeeping provisions of Sec.  112.7(e). EPA believes that 
visual inspection that is part of the periodic maintenance of the bulk 
storage container's support and foundation must be documented. Records 
of inspections and tests kept under usual and customary business 
practices will suffice. To take advantage of this alternative option 
for AFVOs, the owner or operator or PE should refer to the appropriate 
requirements under 21 CFR part 110 to develop an appropriate 
inspection, evaluation, and testing program for an SPCC-regulated 
facility.
    No comments were submitted in reference to this requirement.
8. Other Suggested Criteria and Options
    EPA received a number of comments with suggestions for other 
approaches to provide integrity testing relief to certain AFVO 
containers.
a. Comments
    Two commenters suggested extending the testing frequency for AFVO 
containers based upon the internal corrosion differences between AFVO 
and petroleum-based oils. Other commenters suggested that EPA exempt 
from the integrity testing requirements storage containers used for 
AFVO in compliance with the secondary containment provisions and that 
undergo visual inspection on a routine basis. The commenters noted that 
a leak would be discovered before it could escape into the environment 
due to the inspection frequency.
    Another commenter requested that EPA use the same approach for AFVO 
as detailed in the SPCC Guidance for Regional Inspectors (Chapter 7) 
where it is explained that other design approaches, other industry 
standards, or other good engineering practices may be used alone or as 
a `hybrid' program where equivalent results in meeting the SPCC 
requirements is obtained. The commenter suggested that the language 
should be expanded to allow the same alternatives for similar 
containers of all oil covered by the regulation.
    One commenter recommended that EPA require a certified external 
tank and vessel inspection every ten years for tanks/vessels greater 
than 10,000 gallons capacity when non-hazardous substances are stored 
and annual inspections are conducted by a preventive maintenance 
inspector who is familiar with the equipment and the FTPI 2007-1 
standard.
    Several commenters suggested exempting milk storage containers from 
SPCC requirements based on additional regulations which address storage 
for on-farm milk storage containers. Specifically, these commenters 
identified the Grade ``A'' Pasteurized Milk Ordinance (PMO), which 
addresses milk intended for human consumption.
b. Response to Comments
    Regarding the comment on extending inspection frequency for AFVO 
containers, the rule does not establish a required frequency and the 
owner or

[[Page 74270]]

operator of the facility or PE can establish an inspection schedule to 
account for the chemical and physical characteristics of the oil being 
stored and for any other factors which may affect the integrity of a 
bulk storage container. In response to the comment requesting that EPA 
allow visual inspection and secondary containment instead of integrity 
testing on AFVO storage containers, EPA notes that the revisions to 
Sec.  112.12(c)(6) may allow the owner or operator to conduct visual 
inspections to satisfy the integrity testing requirements, as long as 
they are conducted in accordance with industry standards.
    EPA is also finalizing changes to Sec.  112.12(c)(6) incorporating 
industry standards into an integrity testing program for AFVO bulk 
storage containers (consistent with the provision finalized at Sec.  
112.8(c)(6) for other oils). EPA also believes there is sufficient 
flexibility provided in Sec.  112.7(a)(2) to make an environmental 
equivalence determination with respect to developing a hybrid integrity 
testing program. Therefore, EPA believes that the rule already allows 
other design approaches, other industry standards, or other good 
engineering practices to be used alone or as a 'hybrid' program where 
equivalent results in meeting the SPCC requirements are obtained.
    Regarding the comments suggesting that integrity testing should 
follow specific fiberglass tank and pipe industry standards (FTPI 2007-
1), the SPCC rule requires that the Plan be prepared in accordance with 
good engineering practices, including consideration of applicable 
industry standards (Sec.  112.3(d)(1)(iii)). An owner or operator may 
follow the fiberglass tank and pipe standards, if appropriate for the 
particular facility's characteristics. Thus, the rule already provides 
for this. However, it should be noted that when a standard (or any part 
of a standard) is incorporated into a facility's SPCC Plan, then 
adherence to that standard (or part of a standard) is mandatory for 
implementation of the Plan.
    In response to the proposed differentiated integrity testing 
requirements for certain AFVO bulk storage containers, several 
commenters requested an exemption for bulk storage containers holding 
milk. The Agency considered comments supporting an exemption of certain 
milk bulk storage containers from the SPCC requirements. PMO is a model 
ordinance maintained through a cooperative agreement between the 
states, the FDA, and the regulated community. States typically adopt it 
either by reference or by directly incorporating its requirements into 
statutes or regulations. EPA agrees with commenters that milk 
containers merit further consideration with respect to SPCC rule 
applicability and the PMO. Thus, in the near future, EPA intends to 
publish a proposed rule on alternative regulatory approaches for milk, 
including an exemption based upon the PMO.

M. Oil Production Facilities

    Since its original promulgation in 1973, the SPCC rule has included 
differentiated requirements for oil production facilities (Sec.  
112.9), as compared to other types of facilities (Sec. Sec.  112.8, 
112.10, 112.11, and 112.12). Based on issues presented by the regulated 
community, EPA is finalizing certain revisions that further streamline, 
tailor or clarify the SPCC requirements for oil production facilities. 
Specifically, EPA is finalizing the following modifications for oil 
production facilities: excluding oil production facilities from the 
loading/unloading rack requirements at Sec.  112.7(h), as described in 
Section V.F of this action; revising the definition of ``production 
facility''; extending the timeframe by which the owner or operator of a 
new oil production facility must prepare and implement an SPCC Plan; 
providing an alternative option for flow-through process vessels at oil 
production facilities to comply with the general secondary containment 
requirement and additional oil spill prevention measures in lieu of 
sized secondary containment requirements; providing an exemption for 
certain intra-facility gathering lines from the SPCC requirements; 
providing an alternative option for flowlines and intra-facility 
gathering lines at oil production facilities for contingency planning 
in lieu of all secondary containment requirements, while establishing 
more prescriptive requirements for a flowline/intra-facility gathering 
line maintenance program; providing compliance alternatives for certain 
produced water containers that do not contain oil as certified by a PE; 
providing compliance alternatives to sized secondary containment for 
produced water storage containers that are not otherwise exempt; 
establishing alternative criteria for an oil production facility to be 
eligible to self-certify an SPCC Plan as a qualified facility; and 
clarifying the definition of ``permanently closed'' as it applies to an 
oil production facility.
1. Definition of Production Facility
    As described in Section V.D of this action, EPA is modifying the 
definition of ``facility'' to clarify that contiguous or non-contiguous 
buildings, properties, parcels, leases, structures, installations, 
pipes, or pipelines may be considered separate facilities, and to 
specify that the ``facility'' definition governs the applicability of 
40 CFR part 112. To provide clarity consistent with these revisions, 
EPA is also finalizing modifications to the definition of ``production 
facility.'' A ``production facility'' is a type of ``facility'' as 
defined in Sec.  112.2. The revised definition reads as follows: 
``Production facility means all structures (including but not limited 
to wells, platforms, or storage facilities), piping (including but not 
limited to flowlines or intra-facility gathering lines), or equipment 
(including but not limited to workover equipment, separation equipment, 
or auxiliary non-transportation-related equipment) used in the 
production, extraction, recovery, lifting, stabilization, separation or 
treating of oil (including condensate) and associated storage or 
measurement and is located in an oil or gas field, at a facility. This 
definition governs whether such structures, piping, or equipment are 
subject to a specific section of this part.''
    With these revisions, EPA is adding a sentence at the end of the 
definition to clarify that while only the definition of ``facility'' 
governs the overall applicability of 40 CFR part 112, the definition of 
``production facility'' is used to determine which sections of the rule 
may apply at a particular facility. (The sections for administrative 
and general rule requirements continue to apply to all facilities under 
40 CFR part 112.) This change to the definition of production facility 
addresses concerns raised during litigation challenging the 2002 rule 
amendments and discussed in the May 25, 2004 Federal Register notice 
(69 FR 29728). EPA has also modified the phrase ``and located in a 
single geographical oil or gas field operated by a single operator'' to 
clarify that a production facility ``is located in an oil or gas 
field.'' This is consistent with this rulemaking's revisions to the 
definition of ``facility'' that emphasize the flexibility in how a 
facility owner or operator can determine the boundaries of a facility.
a. Comments
    Several commenters expressed general support for EPA's proposed 
amendments to the definition of ``production facility.'' However, one 
commenter stated that the reference to `* * * property, parcels, leases 
* * *' in the definition of ``facility'' causes uncertainty because 
leases regularly extend beyond the size of a production facility. 
Several commenters also

[[Page 74271]]

suggested that the proposed addition of the phrase ``may be,'' would 
cause the definition to become ambiguous.
    The Agency also received comment on various other suggested 
options. For example, operators of facilities producing AFVO requested 
that EPA clarify that this section applies only to petroleum oil 
production by adding the word ``petroleum'' to the definition of 
production facility, while several other commenters suggested removing 
the reference to ``a single geographical oil or gas field'' to reduce 
confusion. Several commenters expressed concerns regarding multi-
facility Plans for production facility operations. Another commenter 
requested EPA remove the phrase ``gathering line'' from the definition 
of production facility to avoid dual jurisdiction. Two commenters 
requested additional clarity regarding natural gas and the definition 
of production facility. Finally, two commenters suggested that EPA 
include additional infrastructure, activities and equipment that 
support production operations under the specific requirements of Sec.  
112.9, or requested use of a ``primary function'' test of a facility to 
determine the facility's applicability to specific sections of the SPCC 
regulation.
b. Response to Comments
    EPA agrees with those commenters who supported the modifications to 
the definition, and is finalizing revisions to the definition of 
``production facility,'' with certain changes as described in this 
section. The Agency disagrees that the revised definition leads to 
industry uncertainty. The changes clearly indicate that the definition 
of production facility specifically identifies which rule requirements 
apply to a facility. For example, oil production facilities are 
excluded from the rule requirements in Sec.  112.8: ``Spill Prevention, 
Control, and Countermeasure Plan requirements for onshore facilities 
(excluding production facilities),'' whereas the rule requirements in 
Sec.  112.9: ``Spill Prevention, Control, and Countermeasure Plan 
requirements for onshore oil production facilities'' specify that these 
requirements only apply to production facilities.
    EPA also disagrees with the commenter who suggested that the 
addition of the term ``petroleum'' to the definition of production 
facility is necessary. The addition of the term ``petroleum'' is 
unnecessary because the definition itself indicates that the type of 
facilities addressed in the definition is one that is involved with 
petroleum crude oil production and not any other type of oil 
production, such as AFVO production. EPA's intent has always been that 
the definition of production facility addresses petroleum crude oil 
production, extraction, recovery, lifting, stabilization, separation or 
treatment and associated storage or measurement. For example, the 
definition includes terms associated with petroleum crude oil 
production, such as gathering lines and flowlines which are exclusively 
associated with upstream petroleum crude oil/gas production, not AFVO 
production or processing facilities. The term ``oil or gas field'' is 
used exclusively in upstream crude oil and gas production, not in AFVO 
production. This language further clarifies that the definition of 
production facility is specific to petroleum crude oil and gas 
production operations rather than AFVO production.
    Several commenters expressed concern regarding multi-facility Plans 
for oil production operations. The Agency does not intend to require an 
owner or operator who uses one SPCC Plan to address multiple SPCC-
regulated facilities to aggregate the storage capacity of the 
individual facilities covered in the multi-facility SPCC Plan. However, 
the method in which an owner or operator defines the boundaries of 
individual facilities must be consistent in determining both FRP and 
SPCC applicability. The Agency believes that the changes to the 
definitions of ``facility'' and ``production facility'' will not 
discourage the use of multi-facility Plans because the Agency does not 
require the aggregation of individual facility capacities covered under 
a multi-facility Plan. To provide further clarity, EPA has removed the 
limiting term ``single geographic'' from the production facility 
definition. This change together with the other modifications finalized 
in this action, make it clear that an owner or operator is not 
compelled, by the definition of production facility, to aggregate 
separate facilities located in a ``single geographic'' oil production 
field into a single facility. If an owner or operator has several 
distinct operations in one oil field, he is not required to consolidate 
these operations into a single facility. On the other hand, the owner 
or operator does have the flexibility to consolidate these operations 
if he so chooses.
    To address the commenter's concerns that EPA is adding the terms 
``intra-facility'' in front of the term gathering line, the Agency 
notes that the addition of this term clarifies that EPA only regulates 
those gathering lines located within a facility, as determined by the 
owner or operator. The Agency disagrees with commenters who suggested 
removing the term ``gathering lines'' from the production facility 
definition to avoid dual jurisdiction. Gathering lines that are located 
within the boundaries of an SPCC-regulated facility are considered to 
be ``intra-facility gathering lines'' and are subject to EPA's 
jurisdiction. However, EPA is exempting intra-facility gathering lines 
subject to the regulatory requirements of DOT's pipeline regulations in 
49 CFR parts 192 or 195 from this regulation. See section V.M.4 of this 
notice for more information.
    EPA does agree that clarification on how these rules address 
natural gas facilities is appropriate. In some cases, a natural gas 
production facility may store condensate (petroleum oil) in quantities 
that meet the applicability criteria for the SPCC requirements and 
should be considered a production facility when determining 
applicability of specific requirements in the rule (such as Sec.  
112.9). In this final rule, therefore, EPA is adding the phrase 
``(including condensate)'' to the definition. This clarification is 
consistent with the current definition and provides additional clarity. 
Gaseous phase hydrocarbons, such as natural gas, present at SPCC-
regulated facilities are not regulated under the SPCC rule. A detailed 
explanation of this interpretation can be found at 69 FR 29729-29730, 
May 25, 2004.
    EPA does not agree with the ``primary function'' approach to 
determine the applicability to specific sections of the SPCC regulation 
or the commenters' interpretation that, where geographic considerations 
warrant, the definition of production facility should include all 
infrastructure associated with activities and equipment that support 
operations (such as base camps, airports, vehicle/equipment repair 
operations, electrical generating facilities, construction equipment). 
The definition of ``production facility'' is used to determine which of 
the sections of the rule apply for these support operations. The 
definition of production facility extends to all containers and 
equipment directly related to the production of crude oil; it does not 
include infrastructure (containers and equipment) not uniquely 
associated with or in support of crude oil production. This is 
consistent with the approach the Agency has taken in other EPA 
regulations, such as the Resource Conservation and Recovery Act (RCRA) 
Subtitle C regulations for oil and natural gas exploration, development 
and production (53 FR 25447, July 6, 1988).

[[Page 74272]]

Thus, the Agency is clarifying in this notice that only the 
infrastructure, containers and equipment uniquely associated with the 
production of crude oil is subject to the specific requirements for a 
production facility (Sec.  112.9). Containers, equipment and piping 
containing crude oil used in the production, extraction, recovery, 
lifting, stabilization, separation or treatment of oil or gas 
condensate, or their associated storage or measurement is considered 
part of an oil production facility and subject to the specific 
requirements of Sec.  112.9. Specific examples of containers, piping or 
equipment uniquely associated with or in support of the production of 
crude oil include, but are not limited to: Well heads; flowlines and 
intra-facility gathering lines; manifolds; heater treaters, free-water 
knockout or other primary separation vessels; bulk storage containers 
for crude oil or condensate; produced water containers; containers or 
pits storing drilling fluids; drilling oil storage/use; containers used 
for drilling completion operations; and hydraulic, dielectric, and 
lubrication oils used exclusively to support oil production operations. 
All other infrastructure or equipment that indirectly support crude oil 
production must meet the specific bulk storage requirements under Sec.  
112.8 or specific AFVO requirements under Sec.  112.12, as applicable. 
(Any infrastructure and equipment at a facility subject to the SPCC 
rule, whether in direct support of crude oil production operations, or 
not, are also subject to the general rule requirements of Sec. Sec.  
112.1-112.7.)
    For example, containers storing oil that support vehicle repair or 
maintenance (such as gasoline, lubricating oil) at a production 
facility are subject to both the general rule requirements and the 
specific requirements of Sec.  112.8 because they are not directly or 
uniquely associated with crude oil production. Similarly, heating oil 
storage containers that support offices, oil storage to support 
construction activities, oil storage in transformers or electrical 
utility stations, or oil storage/processing to support refining 
operations (for example, topping facilities) and other bulk storage or 
the operational use of oil in containers, equipment and piping not used 
in the production, extraction, recovery, lifting, stabilization, 
separation or treatment of oil or gas condensate, or their associated 
storage or measurement are not considered part of an oil production 
facility and therefore are subject to both the general rule 
requirements and the rule requirements for onshore facilities under 
Sec.  112.8 (or Sec.  112.12 for AFVO).
    The 1971 MOU memorialized the agencies' intent to minimize 
overlapping regulation by ``assign[ing] one agency the responsibility 
for regulating a complete operation at any one facility.'' EPA and DOT 
will revise the 2000 guidance memorandum, acknowledging that it has not 
provided a clear basis for implementing the 1971 MOU or delineating EPA 
and DOT jurisdiction (36 FR 24080, November 24, 1971). EPA will 
continue its work to improve SPCC guidance for pipeline operators and 
will communicate the results of discussions in a manner that affords 
further opportunity for public comment.
2. Modifications to Sec.  112.9 for Drilling and Workover Facilities
    To clarify that drilling and workover activities are not subject to 
the provisions at Sec.  112.9, EPA is amending the title of Sec.  112.9 
to read ``Spill Prevention, Control, and Countermeasure Plan 
requirements for onshore oil production facilities (excluding drilling 
and workover facilities).'' EPA is also amending the introductory 
sentence of the section accordingly.
    As described in the October 2007 proposed rule (72 FR 58378, 
October 15, 2007), during the life of an oil well, maintenance or 
remedial work may be necessary to improve productivity. A specialized 
workover rig, and associated containers and equipment are brought on-
site to perform maintenance or remedial activities on the well. 
Workover operations that perform maintenance or remedial activities on 
oil wells are distinct from the normal production operations, and as 
such are not subject to the requirements of Sec.  112.9, but are 
subject to the applicable requirements in Sec.  112.10 (for onshore 
facilities) or Sec.  112.11 (for offshore facilities). Workover 
activities are a distinct operation and, if conducted by a separate 
owner or operator, may be considered a separate mobile facility. 
Workover facilities may have a different SPCC Plan, separate from the 
production facility. EPA notes that although production activities may 
temporarily cease during workover, if the production equipment and 
containers (such as those found in a tank battery) remain in operation 
or storing oil (that is, they are not ``permanently closed''), then the 
production facility owner or operator must maintain his own SPCC Plan 
during workover activities.
a. Comments
    Two commenters expressed support for EPA's clarification excluding 
drilling and workover facilities from the provisions of Sec.  112.9.
b. Response to Comments
    The Agency agrees with the commenters and is finalizing the 
amendment as proposed.
3. SPCC Plan Preparation and Implementation
    As described in the October 2007 proposed rule (72 FR 58378, 
October 15, 2007), the variables associated with the start of 
operations at new oil production facilities could lead to significant 
changes in necessary storage capacity and facility design. In this 
rulemaking, EPA is finalizing an amendment to allow a new oil 
production facility (that is, one that becomes operational after July 
1, 2009) a period of six months after the start of operations to 
prepare and implement an SPCC Plan. EPA is excluding oil production 
facilities from the current requirements at Sec.  112.3(b)(1), and is 
adding a new paragraph at Sec.  112.3(b)(3) to require the owner or 
operator of a new oil production facility to prepare and implement an 
SPCC Plan six months after the start of operations.
    The rule amendment applies at a new oil production facility that 
begins operating after July 1, 2009. The amendment does not apply to 
drilling or workover activities at a production facility. Drilling and 
workover operations are subject to the requirements at Sec.  112.3(c) 
for mobile facilities and may implement a general SPCC Plan. Therefore, 
both during the initial drilling of the well, as well as during any 
workover activity, there are measures required for spill prevention and 
response for any oil discharges that occur from a drilling or workover 
facility subject to this rule. This amendment would not apply to an 
existing production facility in which a new well is drilled, and added 
to the existing tank battery/facility. In this case, the facility owner 
or operator must amend the SPCC Plan in accordance with Sec.  112.5(a), 
which requires the Plan to be amended within six months of the facility 
change, and implementation within six months of the amendment.
    With this amendment, EPA recognizes that for some oil fields, based 
on the often variable conditions of the oil reservoir, the type and 
proportion of products may be uncertain until after the process of 
extraction has started. During this timeframe, additional equipment may 
be added or removed

[[Page 74273]]

from the facility which would require an amendment to the SPCC Plan and 
the owner or operator of a new oil production facility may need to make 
multiple revisions to the Plan. The Agency believes that allowing a new 
oil production facility six months after the start of operations to 
prepare and implement an SPCC Plan properly addresses these concerns. 
The ``start of operations'' for an oil production facility is indicated 
by the start of well fluid pumping, transfer via flowlines, separation, 
treatment or storage of crude oil, or the storage of other oils in 
capacities that exceed the rule's current oil storage capacity 
thresholds for applicability.
a. Comments
    Several commenters expressed support for EPA's proposed amendment 
to allow new oil production facilities six months to prepare and 
implement an SPCC Plan. Two commenters, however, suggested that EPA 
allow owners and operators one year for sufficient time for Plan 
preparation and implementation. Another commenter suggested that EPA 
provide an automatic extension for a facility owner or operator based 
on his inability to obtain the services of a PE.
b. Response to Comments
    The Agency agrees with those commenters supporting an extension of 
six months to the timeframe by which an oil production facility must 
prepare and implement an SPCC Plan. The Agency disagrees with the 
suggested alternative of one year for the owner or operator to prepare 
and implement an SPCC Plan after the start of production operations. 
The Agency recognizes the unique characteristics of an oil production 
facility, but given that an oil production facility is likely to 
stabilize operations within six months from start-up, a one-year time 
period for Plan preparation and implementation is inappropriate. If a 
facility owner or operator needs additional time to prepare and 
implement the SPCC Plan, the existing rule already provides the owner 
or operator the opportunity to request an extension of time to come 
into compliance in accordance with Sec.  112.3(f) when circumstances 
are beyond his control. This may occur, for example, when there are no 
qualified personnel available or if there are equipment delivery 
delays.
4. Flowlines and Intra-Facility Gathering Lines
    EPA is finalizing a conditional exemption from secondary 
containment requirements under the SPCC rule for flowlines and intra-
facility gathering lines. That is, in lieu of general secondary 
containment, an owner or operator may opt to prepare a contingency plan 
and written commitment of manpower, equipment, and materials. 
Additionally, EPA is finalizing specific requirements for a flowlines 
and intra-facility gathering lines maintenance program. EPA is also 
exempting intra-facility gathering lines that are subject to the 
regulatory requirements at 49 CFR parts 192 or 195 from the SPCC 
requirements. EPA is not promulgating definitions of flowlines and 
intra-facility gathering lines in this action.
a. Definition of Flowline and Intra-Facility Gathering Line and 
Exemption
    In the October 2007 proposal (72 FR 58378, October 15, 2007), EPA 
requested comments as to whether regulatory definitions for 
``flowline'' and ``intra-facility gathering line'' are necessary, and 
if so, suggestions for appropriate definitions. This request was 
intended to determine whether clarification of the scope of the terms 
and their applicability under the SPCC rule was necessary. EPA 
indicated in the proposal that the Agency did not believe that such 
definitions were necessary because there is a common understanding of 
these terms within the affected industry. The Agency is clarifying the 
scope of the SPCC rule's applicability to gathering lines and 
finalizing an amendment that exempts the ``intra-facility'' gathering 
lines that are subject to both EPA and DOT regulatory requirements from 
the SPCC rule in response to comments on the proposed conditional 
exemption from secondary containment requirements for flowlines and 
intra-facility gathering lines. The Agency believes that this exemption 
is a logical outgrowth of the proposal and the comments received. In 
the October 2007 proposal, EPA acknowledged that given the 
characteristics of certain intra-facility gathering lines, these 
pipelines may be regulated under requirements of both EPA and DOT (72 
FR 58407, October 15, 2007). EPA also recognized in the proposal that 
DOT requirements for pipelines may be similar in scope to SPCC 
regulations, so that compliance with DOT requirements may be considered 
environmentally equivalent to certain SPCC requirements. EPA also 
recognized in the proposal that DOT requirements for pipelines may be 
similar in scope to SPCC regulations, so that compliance with DOT 
requirements may be considered environmentally equivalent to certain 
SPCC requirements. DOT has promulgated regulations for pipelines under 
49 CFR parts 192 (Transportation of Natural and Other Gas by Pipeline), 
194 (Response Plans for Onshore Oil Pipelines) and 195 (Transportation 
of Hazardous Liquids by Pipeline). DOT has the statutory authority over 
gas or hazardous liquid pipelines of any diameter within 
environmentally sensitive rural areas (defined as ``unusually sensitive 
areas''), and liquid pipelines above six inches in diameter operating 
at low pressure. While many gathering lines are under DOT's statutory 
authority, only a subset of them has DOT regulatory requirements.
    EPA recognizes that gathering lines can be outside the Agency's 
jurisdiction because they ``transport'' oil outside of an oil 
production facility. EPA has jurisdiction only over non-transportation-
related facilities, which includes pipelines that transport oil within 
a facility. Any inter-facility pipeline, including a gathering line, 
that transports oil between facilities or from a facility to a vessel, 
or from a facility to a transportation-related pipeline facility, such 
as a transmission line, or a pipeline breakout tank, is considered 
transportation-related and is therefore outside the jurisdiction of EPA 
and not subject to the SPCC rule. However, the definition of 
``facility'' as it applies to the SPCC rule is flexible. Depending upon 
how an owner/operator defines his facility under the SPCC rule, an oil 
production facility may also include gathering lines. While gathering 
lines within the SPCC facility boundaries are intra-facility piping, 
EPA is maintaining the term intra-facility gathering lines because it 
is a term that is well recognized within the production sector. For 
those intra-facility gathering lines that are regulated by both EPA and 
DOT, EPA is exempting them from the SPCC requirements. In other words, 
the exemption is for intra-facility gathering lines present at a 
facility where the piping is subject to both EPA and DOT jurisdiction 
and regulations. EPA's focus with the SPCC rule is the regulation of 
oil storage at facilities engaged in activities related to drilling, 
producing, gathering, processing, refining, transferring, distributing 
and use of oil, while DOT's focus is in the area of pipeline 
regulation; therefore, EPA believes it is appropriate to defer to DOT's 
technical regulation in lieu of EPA's intra-facility gathering line 
requirements. EPA believes this change is appropriate and is a logical 
outgrowth of the proposal and several comments received regarding 
jurisdiction of intra-facility gathering lines.
    Only those lines that are subject to DOT regulations are eligible 
for the exemption finalized in this action.

[[Page 74274]]

Those intra-facility gathering lines located at a facility that are not 
subject to the regulatory requirements at 49 CFR parts 192 and 195 
remain subject to the requirements in 40 CFR part 112. Other equipment 
and piping at an oil production facility (such as flowlines), remain 
subject to the SPCC requirements. In addition, this exemption requires 
that owners or operators of a facility identify and mark as ``exempt'' 
the location of exempt piping on the facility diagram. This requirement 
will assist facility and EPA personnel in defining the boundaries of 
EPA and DOT jurisdiction and provide response personnel with 
information used to identify hazards during a spill response activity.
    As discussed in Section V.D of this notice, an owner or operator 
has the flexibility under the definition of facility to determine the 
boundaries of their SPCC facility; thus, the facility may include 
intra-facility gathering lines. DOT defines a production facility under 
49 CFR parts 195 as ``piping or equipment used in the production, 
extraction, recovery, lifting, stabilization, separation or treating of 
petroleum or carbon dioxide, or associated storage or measurement. (To 
be a production facility under this definition, piping or equipment 
must be used in the process of extracting petroleum from the ground, 
and preparing it for transportation by pipeline.)'' (49 CFR 195.2) This 
definition is similar in scope to EPA's definition of production 
facility described above. However, DOT provides additional specificity 
regarding the endpoints of a production operation for the purpose of 
defining a gathering line. Under 49 CFR part 192, DOT clarifies that 
the beginning of gathering may not extend beyond the furthermost 
downstream point in a production operation (49 CFR 192.8(a)(1)).
    Comments. Two commenters suggested clarifications of the term 
flowline, one of whom suggested a definition. Two other commenters 
stated that definitions for flowline or intra-facility gathering line 
were not needed, while several commenters suggested that the references 
to ``gathering lines'' with flowlines be eliminated, citing the 
confusion of using the term and noting the MOU with DOT, which 
specifically limits EPA's jurisdiction of these lines. Another 
commenter requested that EPA clarify that post-separation gas gathering 
lines are exempt from the SPCC rule. One other commenter suggested that 
EPA modify Sec.  112.1(d)(1)(ii) to include an exemption for all 
gathering lines.
    Response to comments. EPA disagrees with those commenters that 
suggest there is a need to define the terms ``flowline'' and 
``gathering line.'' EPA believes the oil production sector has a common 
understanding of these terms and that specific definitions are not 
needed. ``Flowlines'' are piping that transfer crude oil and well 
fluids from the wellhead to the tank battery where separation and 
treatment equipment are typically located. Flowlines may also connect a 
tank battery to an injection well. Depending on the size of the oil 
field, flowlines may range in diameter and run from hundreds of feet to 
miles between the wellheads and the tank batteries or primary 
separation operations. The term ``gathering lines'' refers to piping or 
pipelines that transfer crude oil product between tank batteries, 
within or between facilities. Gathering lines often originate from an 
oil production facility's lease automatic custody transfer (LACT) unit, 
which transfers oil to other facilities involved in gathering, refining 
or pipeline transportation operations.
    EPA considers gathering lines subject to EPA's jurisdiction if they 
are located within the boundaries of an otherwise regulated SPCC/FRP 
facility (that is, intra-facility gathering lines). Therefore, to 
address the concerns raised by commenters, the Agency is including the 
phrase ``intra-facility'' in front of the term gathering lines to 
clarify that EPA only has the authority to regulate piping, in this 
case intra-facility gathering lines, which are located within a 
facility boundary. The Agency also is finalizing an amendment that 
excludes from regulation those ``intra-facility'' gathering lines 
subject to both EPA and DOT regulatory requirements. Specifically, one 
commenter suggested that EPA modify Sec.  112.1(d) to include an 
exemption for all gathering lines. While EPA does not agree that all 
intra-facility gathering lines, located within a production facility, 
should be excluded from the SPCC requirements, the Agency does agree 
that minimizing dual regulation, where appropriate, is beneficial to 
the regulated community. Therefore, EPA is finalizing a new exemption 
under Sec.  112.1(d)(2)(i) and 112.1(d)(11) for intra-facility 
gathering lines subject to DOT regulation. The Agency believes this 
change is appropriate and is a logical outgrowth of the proposal and 
several comments received regarding jurisdiction of intra-facility 
gathering lines.
    However, the Agency does not want to create a regulatory ``gap'' 
with this action. Gathering lines, as well as flowlines are a source of 
oil spills, as demonstrated in EPA's study of the exploration and 
production sector, ``Considerations for the Regulation of Onshore Oil 
Exploration and Production Facilities Under the Spill Prevention, 
Control, and Countermeasure Regulation (May 30, 2007; located in the 
docket for this rulemaking: EPA-HQ-OPA-2007-0584-0015). Currently, EPA 
has only a limited set of requirements for flowlines and intra-facility 
gathering lines, whereas DOT has more comprehensive requirements for 
pipelines (which are only applicable to a subset of gathering lines 
within DOT jurisdiction). Additionally, there are no industry standards 
for flowline or gathering line maintenance. Therefore, intra-facility 
gathering lines located at a facility that are not subject to the 
regulatory requirements under 49 CFR parts 192 or 195 remain subject to 
EPA's SPCC regulations under 40 CFR part 112. These lines also remain 
subject to EPA jurisdiction and the Agency, if appropriate, can use 
existing rule mechanisms under Sec.  112.1(f) to bring exempted intra-
facility gathering lines back under the SPCC rule requirements.
    One commenter requested that EPA clarify that post-separation gas 
gathering lines are exempt from the rule. EPA maintains its position 
that hydrocarbons in a gaseous phase under ambient temperature and 
pressure, such as natural gas, are not regulated under the SPCC rule. 
However, production facilities can include piping with both oil and gas 
phases. In this instance, such a facility's dual-phase flowlines and 
intra-facility gathering lines (that is, those carrying both gas and 
liquid phase hydrocarbon) are subject to the SPCC requirements (unless 
they are subject to 49 CFR parts 192 or 195 and are therefore exempt) 
because if the lines were to rupture or leak, they may discharge oil to 
navigable waters or adjoining shorelines in quantities that may be 
harmful as defined in 40 CFR part 110.
b. Exemption From Secondary Containment
    EPA believes that secondary containment is, in most cases, 
impracticable for flowlines and intra-facility gathering lines. 
Therefore, the Agency is amending Sec.  112.7(c) to provide an 
alternative (which is optional) to the general secondary containment 
requirements for flowlines and intra-facility gathering lines (unless 
they are exempt from regulation). In lieu of secondary containment, the 
Agency will require the implementation of an oil spill contingency plan 
in accordance with 40 CFR part 109 (Criteria for State, Local and 
Regional Oil Removal Contingency Plans) and a written

[[Page 74275]]

commitment of manpower, equipment, and materials required to 
expeditiously control and remove any quantity of oil discharged that 
may be harmful, without having to make an impracticability 
determination for each piece of piping. The Agency is tailoring the 
requirements in an effort to improve compliance and enhance 
environmental protection.
    Comments. Several commenters expressed support for EPA's proposed 
amendment to remove the secondary containment requirements for 
flowlines and intra-facility gathering lines at oil production 
facilities. Several commenters requested, however, that EPA acknowledge 
the option for owners or operators to select sized secondary 
containment based on site conditions and recommendations of the PE 
under certain circumstances. One commenter suggested a modification to 
allow collection areas rather than individual containment along 
gathering lines. Another commenter, however, stated that the proposed 
amendment to exempt flowlines and intra-facility gathering lines at oil 
production facilities from the secondary containment requirements is 
inconsistent with 33 U.S.C. 1321(j)(5)(D).
    Response to comments. EPA agrees with the majority of commenters 
that secondary containment for flowlines and intra-facility gathering 
lines is, in most cases, impracticable and that providing secondary 
containment for these lines can be difficult and expensive for an owner 
or operator. Flowlines and intra-facility gathering lines are often 
several miles long, can be buried, can extend far from the main 
facility, and are often placed across land that is not owned by the 
owner or operator of the oil production facility. Providing secondary 
containment structures for these lines may result in soil erosion and 
negative impacts to the land (such as when they are located in farm 
fields). Buried flowlines present additional difficulty, because their 
exact location may be uncertain, especially at an oil production 
facility that has changed ownership since the original installation of 
the lines.
    The Agency also recognizes that some facilities have already 
installed containment for flowlines and intra-facility gathering lines 
and therefore should not be required to provide a contingency plan in 
addition to secondary containment. Therefore, EPA agrees with those 
commenters who suggested that the requirement for a contingency plan in 
lieu of secondary containment should be an option.
    Contingency planning is one of the many tools that the Agency has 
provided in the SPCC regulatory requirements. The Agency disagrees with 
the comment arguing that a contingency plan requirement is inconsistent 
with the intent of 33 U.S.C. 1321(j)(5)(D). The Agency's authority to 
promulgate the SPCC regulations is found in Section 311(j)(1)(C) of the 
Clean Water Act, 33 U.S.C. 1321(j)(1)(C). Section 311(j)(1)(C) requires 
the President to issue regulations establishing procedures, methods, 
equipment, and other requirements to prevent discharges of oil to 
navigable waters or adjoining shorelines from vessels and facilities 
and to contain such discharges. The statutory provision gives the 
Agency broad discretion to establish the requirements under the SPCC 
rule. Also, Section 311(j)(5)(D), 33 U.S.C. 1321(j)(5)(D), lists the 
requirements for facility response plans. The Agency has promulgated 
regulations for facility response plans in 40 CFR 112.20 and 112.21. 
The purpose of the SPCC program is to prevent and control oil 
discharges from reaching navigable waters or adjoining shorelines. 
However, it is important to recognize that despite best prevention 
efforts, discharges may occur. The contingency plan requirements under 
the SPCC program have dual purposes. They include components to prevent 
oil that has escaped its container or secondary containment from 
reaching navigable waters or adjoining shorelines, and also include 
components that address the timely and appropriate response actions to 
be implemented when an oil discharge does impact navigable waters or 
adjoining shorelines.
c. Contingency Plan in Lieu of Secondary Containment
    EPA is amending Sec. Sec.  112.7(c) and 112.9(d)(3) to provide an 
alternative to the secondary containment requirements for flowlines and 
intra-facility gathering lines at an oil production facility. In lieu 
of secondary containment, a facility owner or operator may opt to 
implement an oil spill contingency plan in accordance with 40 CFR part 
109 (Criteria for State, Local and Regional Oil Removal Contingency 
Plans) and prepare a written commitment of manpower, equipment, and 
materials required to expeditiously control and remove any quantity of 
oil discharged that may be harmful, without having to make an 
impracticability determination for each piece of piping. The Agency is 
amending this provision in an effort to improve compliance and enhance 
environmental protection. The use of a contingency plan does not 
relieve the owner or operator of liability associated with an oil 
discharge to navigable waters or adjoining shorelines that violates the 
provisions of Section 311(b)(3) of the Clean Water Act, 33 U.S.C. 
1321(b)(3). EPA is also amending Sec.  112.7(a) to make it clear that 
the contingency plan provisions under Sec.  112.9(d)(3) are not subject 
to the environmental equivalence provision.
    Comments. Several commenters expressed support for EPA's proposal 
to require an oil spill contingency plan in lieu of secondary 
containment. One commenter, however, suggested an option to require 
annual physical inspections and the installation of isolation valves. 
Two other commenters requested that EPA reduce the burden of using this 
alternative option, because the documentation effort for a contingency 
plan is extensive.
    Response to comments. The Agency does not agree that annual 
physical inspections and the installation of isolation valves are 
appropriate, because this could prove to be impracticable for some 
lines, specifically those that are buried.
    With respect to the comments regarding the additional burden that a 
contingency plan requirement would impose on facilities, the Agency 
recognizes that this amendment would require additional documentation. 
However, EPA believes that a contingency plan is necessary when 
secondary containment is not provided. This final rule allows the owner 
or operator of the facility to develop a contingency plan as an option 
to general secondary containment. The contingency plan required when 
secondary containment is not practicable for flowlines and intra-
facility gathering lines should rely on strong maintenance, corrosion 
protection, testing, recordkeeping, and inspection procedures to 
prevent and quickly detect discharges from such lines. It should also 
ensure quick availability and deployment of response equipment. The 
complexity or simplicity of a facility's contingency plan is subject to 
good engineering practice as determined by the certifying PE. EPA 
developed a model contingency plan as part of the SPCC Guidance for 
Regional Inspectors. This model plan is intended only as an example and 
inspectors should only use the document for this purpose. Additionally, 
EPA acknowledges that given the characteristics of certain intra-
facility gathering lines, these pipelines may be regulated under 
requirements of both EPA and DOT. Because DOT requirements for 
pipelines may be similar in purpose and scope, EPA

[[Page 74276]]

recognizes that compliance with the DOT requirements (for example, 49 
CFR part 194) for these gathering lines may be considered to satisfy 
the contingency planning requirement. Therefore a contingency plan 
developed for 49 CFR part 194 may serve to meet the SPCC Plan 
requirements. In addition, as previously discussed, the Agency is 
exempting intra-facility gathering lines that are subject to the 
regulatory requirements under 49 CFR part 192 or 195 from 40 CFR part 
112. Furthermore, the owner or operator of an oil production facility 
who has prepared an FRP under Sec.  112.20 satisfies the contingency 
planning requirement for flowlines and intra-facility gathering lines 
because an FRP is more comprehensive than a contingency plan under 40 
CFR part 109. If such a facility owner or operator has already 
developed an FRP to comply with Sec.  112.20, then he does not need to 
develop a contingency plan in accordance with 40 CFR part 109. The 
certifying PE must ensure that the FRP is adequate for the facility and 
prepared in accordance with good engineering practice. Similarly, the 
owner or operator of an oil production facility who has prepared a 
state spill or pollution prevention contingency plan that meets the 
requirements of 40 CFR part 109 may opt to use this state plan to 
comply with the SPCC contingency plan requirements.
    It should also be noted that the contingency planning requirement 
is an alternative to the requirement for general secondary containment 
for flowlines and intra-facility gathering lines and the facility owner 
or operator can decide which option to comply with. The purpose of this 
action is to provide options and streamlined requirements that should 
improve compliance with the rule. The Agency recognizes that flowlines 
and intra-facility gathering lines are a source of oil discharges and 
believes that this action provides an alternative method for owners/
operators to develop spill prevention and response practices for this 
equipment to maintain environmental protection.
d. Requirements for a Flowline and Intra-Facility Gathering Line 
Maintenance Program
    EPA is amending the requirement for an owner or operator to prepare 
and implement a written flowline and intra-facility gathering line 
maintenance program under Sec.  112.9(d)(4). This action specifies that 
the requirements apply to intra-facility gathering lines, as well as 
flowlines at an oil production facility. Intra-facility gathering lines 
pose the same potential for discharge as flowlines. EPA never intended 
to regulate the two types of piping differently. Under the amended 
provisions, a maintenance program must address procedures to:
     Ensure that such flowlines and intra-facility gathering 
lines and associated valves and equipment are compatible with the type 
of production fluids, their potential corrosivity, volume, and 
pressure, and other conditions expected in the operational environment.
     Visually inspect and/or test flowlines and intra-facility 
gathering lines and associated appurtenances on a periodic and regular 
schedule for leaks, oil discharges, corrosion, or other conditions that 
could lead to a discharge as described in Sec.  112.1(b). The frequency 
and type of testing must allow for the implementation of a contingency 
plan as described under part 109 of this chapter, if there is no 
secondary containment.
     Take corrective action or make repairs to any flowlines 
and intra-facility gathering lines and associated appurtenances as 
indicated by regularly scheduled visual inspections, tests, or evidence 
of a discharge.
     Promptly remove or initiate actions to stabilize and 
remediate any accumulations of oil discharges associated with 
flowlines, intra-facility gathering lines, and associated 
appurtenances.
    Comments. Several commenters expressed support for EPA's proposed 
revisions to the flowline/intra-facility gathering line program, 
although some commenters suggested the addition of corrosion protection 
for these lines. A number of commenters expressed concern that the 
requirement for a contingency plan and maintenance program would be 
burdensome. Some of these commenters suggested using a maintenance 
program based on risk levels and good industry practices, as determined 
by a PE. Another commenter requested that the current language be 
maintained for a program of flowline maintenance.
    Other commenters provided suggested other revisions. Specifically, 
some commenters provided alternative language for the provisions under 
Sec.  112.9(d)(4). One commenter stated that the proposed requirement 
under the design and development requirements of Sec.  112.9(d)(4)(i) 
is vague and unnecessary given the responsibility of a PE certifying 
the Plan. Other commenters also suggested adding language that would 
acknowledge that other methods of immobilizing hydrocarbons in soil 
matrices such as physical, chemical and/or biological treatment methods 
to address oil accumulations associated with flowlines rather than 
``prompt removal.'' Finally, commenters expressed concern with the 
phrase ``promptly remove'', as associated with actions to stabilize and 
remediate any accumulations of oil discharges. Commenters suggested 
replacing this phrase with ``upon discovery''.
    Response to comments. EPA is finalizing the amended requirements 
for a flowline and intra-facility maintenance program under Sec.  
112.9(d)(4), specifying that the requirements apply to intra-facility 
gathering lines, as well as flowlines at an oil production facility. 
The Agency believes that an effective flowline maintenance program is 
necessary to detect a discharge in a timely manner so that the oil 
discharge response operations described in the contingency plan may be 
implemented effectively. Additionally, eliminating the requirement for 
secondary containment necessitates more prescriptive requirements for 
discharge prevention to ensure the integrity of the primary containment 
of the pipe itself.
    EPA is finalizing requirements under Sec.  112.9(d)(4) to require a 
performance-based program of flowline and intra-facility gathering line 
maintenance that addresses the facility owner or operator's procedures, 
that must be documented in their SPCC Plan. EPA agrees with several 
comments on the language associated with these requirements and has 
made several changes to the proposed rule in response to these 
comments. EPA is finalizing the requirement under Sec.  112.9(d)(4)(iv) 
with some modifications to the proposed regulatory text. The finalized 
rule states: ``Promptly remove or initiate actions to stabilize and 
remediate any accumulations of oil discharges associated with 
flowlines, intra-facility gathering lines, and associated 
appurtenances.'' This measure is intended to ensure the removal of oil 
accumulations in order to prevent a discharge. The Agency disagrees 
with the comment that suggested replacing ``Promptly remove'' with 
``Upon discovery.'' ``Promptly remove'' indicates that the owner or 
operator of the facility has both the responsibility and flexibility to 
outline an inspection program under Sec.  112.9(d)(4)(ii) which puts 
the timeframe for ``prompt removal'' in the context of the inspection 
frequency. Commenters also suggested, however, that language be added 
that would acknowledge that other methods of immobilizing

[[Page 74277]]

hydrocarbons in soil matrices, such as physical, chemical and/or 
biological treatment methods can be used. The Agency agrees that other 
methods may be used to stabilize and remediate, and thus, the 
regulatory text has been revised by adding the phrase, ``remove or 
initiate actions to stabilize and remediate'' to the rule. EPA 
considers the removal of oil-contaminated soil as a method to prevent 
oil from becoming a discharge as described in Sec.  112.1(b). Disposal 
of oil must be in accordance with applicable Federal, state, and local 
requirements; under Sec.  112.7(a)(3)(v), a facility owner or operator 
is required to describe the methods of disposal of recovered materials 
in accordance with applicable legal requirements. For the purposes of 
this provision, EPA believes that the removal of recoverable oil can be 
combined with physical, chemical, and/or biological treatment methods 
to address any residual oil. These treatment methods must be consistent 
with other Federal, state or local requirements as applicable, and must 
be properly managed to prevent a discharge as described in Sec.  
112.1(b).
    EPA believes that the variations in production facility piping 
design, layout and location makes flexibility important in order to 
encourage compliance with this requirement, and believes that this 
flexibility is already available. However, the flowline and intra-
facility gathering line maintenance program requirements also are 
subject to the environmental equivalence provision found at Sec.  
112.7(a)(2). That is, the facility owner or operator may deviate from 
the requirements if an environmentally equivalent alternate measure is 
implemented. EPA recognizes that other Federal or state requirements 
may be environmentally equivalent to certain SPCC requirements, 
including the flowline and intra-facility gathering line maintenance 
program requirement. An environmental equivalence determination is 
subject to review and certification by a PE.
5. Flow-Through Process Vessels
    EPA is modifying the requirements at Sec.  112.9(c) to provide an 
alternative to the sized secondary containment requirements for flow-
through process vessels at oil production facilities. Flow-through 
process vessels, such as horizontal or vertical separation vessels--for 
example, heater-treater, free-water knockout, gun-barrel, etc.--have 
the primary purpose of separating the oil from other fractions (water 
and/or gas) and sending the fluid streams to the appropriate container. 
Specifically, in lieu of sized secondary containment, a facility owner 
or operator may opt to provide general secondary containment, inspect 
or test flow-through process vessels and components for leaks, 
corrosion or other conditions that could lead to a discharge, as 
described in Sec.  112.1(b), promptly remove or initiate actions to 
stabilize and remediate any oil accumulations, and take corrective 
action should a discharge occur. EPA also would require that sized 
secondary containment be installed if the facility discharges more than 
1,000 U.S. gallons of oil in a single discharge as described in Sec.  
112.1(b), or discharges more than 42 U.S. gallons of oil in each of two 
discharges as described in Sec.  112.1(b) within any twelve month 
period, from flow-through process vessels (excluding discharges that 
are the result of natural disasters, acts of war, or terrorism) within 
six months of such a discharge.
    EPA is taking this action because the Agency agrees with concerns 
regarding the requirement to provide sized secondary containment around 
flow-through process vessels, such as heater-treaters, due to a 
potential fire hazard if spilled oil collects around such equipment. 
EPA also recognizes that similar flow-through process equipment (i.e., 
oil-filled manufacturing equipment, such as reaction vessels, 
fermentors, high pressure vessels, mixing tanks, dryers, heat 
exchangers, and distillation columns) at non-production facilities are 
not subject to the more stringent sized secondary containment and 
inspection requirements required for bulk storage containers; only the 
general secondary containment requirements at Sec.  112.7(c) apply. 
However, EPA recognizes that process equipment at non-production 
facilities, such as at manufacturing facilities, is typically attended 
during hours of operation and there is a greater potential to 
immediately discover and correct a discharge at non-production 
facilities than at oil production facilities, which are generally 
unattended. Therefore, EPA is requiring additional measures for flow-
through process vessels at oil production facilities that do not have 
sized secondary containment, including inspection or testing of 
components, prompt removal or initiation of actions to stabilize and 
remediate any oil accumulations, and corrective action.
a. Exemption From Sized Secondary Containment
    EPA is amending the requirements in Sec.  112.9(c)(2) to add the 
phrase ``Except as described in paragraph (c)(5) of this section for 
flow-through process vessels'' at the beginning of the provision. This 
amendment removes the requirement to provide sized secondary 
containment for flow-through process vessels at oil production 
facilities without making an impracticability determination, and allows 
the facility owner or operator the option to comply with the alternate 
requirements in Sec.  112.9(c)(5) instead.
    The general secondary containment requirement of Sec.  112.7(c) 
still applies to flow-through process vessels; they must be provided 
with secondary containment so that any discharge does not escape the 
containment system before cleanup occurs. As described in Section V.H 
of this notice, EPA is amending Sec.  112.7(c) to clarify that the 
provision allows for the use of both active and passive secondary 
containment measures to prevent a discharge to navigable waters or 
adjoining shorelines. Active containment measures are those that 
require deployment or other specific action by the operator. These 
measures may be deployed either before an activity involving the 
handling of oil starts, or in reaction to a discharge, so long as the 
active measure is designed to prevent an oil discharge from reaching 
navigable waters or adjoining shorelines. However, active measures 
would generally have limited applicability at oil production facilities 
because these facilities are typically not attended and owners or 
operators may not be able to detect a discharge in a timely manner to 
successfully implement the active measures. In contrast, passive 
measures are installations that do not require deployment or action by 
the owner or operator and may be more appropriate for unattended 
production operations. The SPCC Guidance for Regional Inspectors 
provides several examples of the use of active and passive measures at 
an SPCC-regulated facility.
    With this action, owners or operators of oil production facilities 
are no longer required to locate flow-through process vessels within a 
secondary containment system sized for the entire capacity of the 
largest single container and sufficient freeboard to contain 
precipitation. However, EPA believes that oil production facility 
owners and operators may want to provide secondary containment (such as 
berms) around the entire tank battery, as many oil production 
facilities currently do. These batteries can include flow-through 
process vessels, such as separators, along with oil stock tanks and 
other bulk storage containers. Such a facility design would provide the 
maximum environmental protection.
    Comments. Several commenters expressed support for EPA's 
alternative option for flow-through process vessels

[[Page 74278]]

in lieu of sized secondary containment. Two commenters, however, 
requested that EPA clarify whether secondary containment is an 
alternative to the proposed option, while one commenter requested 
clarification on whether EPA means containment would hold the single 
largest process vessel and not containment sized to hold all vessel 
fluids. Another commenter expressed concern that the proposed 
requirements are burdensome; DOE generally supported that position and 
encouraged EPA to consider existing state regulatory programs in lieu 
of additional requirements.
    Another commenter expressed concern that flow-through process 
vessels at production facilities cause pollution that can not be 
remediated to the pre-spill condition. Still another commenter was 
concerned that more oil than the contents of the vessels may be 
discharged because oil may be constantly flowing into these vessels 
from the wells. Finally, one commenter expressed concern that the 
proposed exemption from sized secondary containment is inconsistent 
with 33 U.S.C. 1321(j)(5)(D), which the commenter believes requires 
every SPCC Plan to identify the resources necessary to ``mitigate or 
prevent a substantial threat of'' a worst case discharge. The commenter 
expressed concern that general secondary containment for a ``most 
likely'' spill would fail to prevent the worst case discharge.
    Response to comments. EPA recognizes that some facilities have 
already provided sized secondary containment in accordance with Sec.  
112.9(c)(2) for flow-through process vessels at productions facilities. 
EPA agrees with commenters that facility owners or operators who have 
installed such containment should not be required to comply with the 
additional requirements for these vessels. Therefore, EPA is amending 
the rule to indicate that flow-through process vessels equipped with 
sized secondary containment in accordance with Sec.  112.9(c)(2) and 
(c)(3) are not required to comply with the alternate requirements under 
Sec.  112.9(c)(5).
    In response to the commenter who asked about the size of 
containment required, EPA notes that in determining how to provide 
appropriate general secondary containment for flow-through process 
vessels, a production facility owner or operator may consider the 
typical failure mode and most likely quantity of oil that would be 
discharged (see Sec.  112.7(c)). Based on these site-specific 
conditions, the owner or operator can determine what capacity of 
secondary containment is needed, and design the containment method 
accordingly. The design for general secondary containment should 
address site-specific factors, including, but not limited to, frequency 
of site visits, rate of flow of the wells, capacity of the containers, 
and whether the facility is equipped with automatic shut-off devices to 
prevent an overflow. However, as discussed elsewhere in this preamble, 
general secondary containment is based on the most likely discharge, 
not the worst case discharge. EPA agrees with the commenter who 
expressed concern regarding the effects of a discharge from flow-
through process vessels, but the Agency believes that this alternative 
approach, which requires general secondary containment in accordance 
with Sec.  112.7(c) and the additional requirements to inspect, repair 
equipment, and address oil accumulations that may occur following a 
discharge from flow-through process vessels, addresses this concern. 
The Agency also believes the alternative requirements for flow-through 
process vessels address the concern that these facilities are 
constantly operating and have constant flow of fluids through this 
equipment because the owner or operator must inspect the equipment and 
take corrective action to address a discharge following procedures 
described in the SPCC Plan.
    As part of this action, EPA considered whether existing state 
regulatory programs could satisfy the amended requirements. Although a 
number of states do have requirements for oil production facilities to 
prevent spills, they do not provide a comprehensive, national approach 
that would be equivalent to the SPCC requirements, as these programs 
have been developed to meet states' individual goals. Therefore, EPA 
believes that relying solely on state programs would not provide 
nationwide consistent requirements for spill prevention. However, the 
Agency recognizes the benefits of allowing the owner or operator of a 
regulated facility to take credit for compliance with state program 
requirements when these serve to meet certain SPCC requirements and can 
be referenced in accordance with 40 CFR part 112.
    The Agency also disagrees with those commenters who characterized 
the amended requirements as excessive, and the requests for EPA to 
reconsider the necessity of additional measures in lieu of sized 
secondary containment. The amendment allows an owner or operator to 
provide general secondary containment for flow-through process vessels 
and requires new prevention measures as an alternative to the rule's 
existing sized secondary containment requirement. The alternative 
measures are optional--that is, the owner or operator may still choose 
to comply with the sized secondary containment requirement, and the 
facility owner or operator decides which option is best suited to the 
design and operation of the facility. The Agency believes that the 
alternative approach finalized in this rule for flow-through process 
vessels allows the owner or operator of an oil production facility 
flexibility in how to design secondary containment for this equipment 
and in how to comply with the additional requirements that maintain 
environmental protection.
    The Agency disagrees with the commenter who argued that the revised 
option for flow-through process vessels at production facilities is 
inconsistent with the intent of 33 U.S.C. 1321(j)(5)(D). The Agency's 
authority to promulgate the SPCC regulations is found in Section 
311(j)(1)(C) of the Clean Water Act, 33 U.S.C. 1321(j)(1)(C). Section 
311(j)(1)(C) requires the President to issue regulations establishing 
procedures, methods, equipment, and other requirements to prevent 
discharges of oil to navigable waters and adjoining shorelines from 
vessels and facilities and to contain such discharges. The statutory 
provision gives the Agency broad discretion to establish the 
requirements under the SPCC rule. The purpose of the SPCC program is to 
prevent and control oil discharges from reaching navigable waters or 
adjoining shorelines. Also, Section 311(j)(5)(D), 33 U.S.C. 
1321(j)(5)(D), lists the requirements for facility response plans. The 
Agency has promulgated regulations for facility response plans in 40 
CFR 112.20-21and this action does not impact the requirement for an 
owner/operator to prepare and implement an FRP when the facility meets 
the substantial harm criteria in Sec.  112.20(f). Therefore, this 
amendment does not conflict with the requirements under 33 U.S.C. 1321 
(j)(5)(D).
b. Additional Requirements
    Because oil production facilities are typically unattended while 
operating, EPA is adding a provision at Sec.  112.9(c)(5) to provide 
additional requirements for flow-through process vessels at those 
facilities that do not provide sized secondary containment. These 
additional requirements include periodic inspection and/or testing for 
leaks, corrosion, or other conditions that could lead to a discharge as 
described in Sec.  112.1(b); corrective action or repairs to flow-
through process vessels and any associated components as indicated by

[[Page 74279]]

regularly scheduled visual inspections, tests, or evidence of an oil 
discharge; and prompt removal or initiation of actions to stabilize and 
remediate any accumulations of oil discharges associated with flow-
through process vessels.
    Comments. One commenter recommended not mandating routine 
inspection of flow-through vessels, because oil and gas operators 
routinely visit tank batteries and wells and the lease operator would 
observe leaks from the vessels. The commenter also stated that weather 
conditions require aerial inspections during the winter months, which 
may not be possible given the proposed requirement. Another commenter 
expressed concern with the burden of complying with the additional 
inspection requirements.
    Several commenters provided alternative language for promptly 
removing any accumulations of oil discharges as described under Sec.  
112.9(c)(5). Specifically, commenters suggested adding language that 
would acknowledge other methods of immobilizing hydrocarbons in soil 
matrices (such as physical, chemical and/or biological treatment 
methods) to address oil accumulations associated with flowlines. 
Commenters also expressed concern with the phrase ``promptly remove'' 
and suggested replacing it with the phrase ``upon discovery.''
    Response to comments. The requirement of periodic inspection and/or 
testing of flow-through process vessels and associated appurtenances on 
a regular schedule for leaks, corrosion, or other conditions that could 
lead to a discharge as described in Sec.  112.1(b) is intended to 
increase the likelihood that a discharge will be prevented or detected 
promptly. This is especially true for components that typically cause 
discharges, such as dump valves. These requirements are consistent with 
the inspection requirements for bulk storage containers under Sec.  
112.9(c)(3). EPA recognizes that because oil production facilities are 
typically unattended, remote, and have a constant flow of oil and well 
fluids, sized secondary containment measures provide environmental 
protection for any potential discharge. EPA does not intend for 
inspections to create a public safety concern for personnel conducting 
inspections and EPA expects that the SPCC Plan will include provisions 
to address weather-related concerns that may impact the inspection 
schedule. Because EPA is revising the rule such that flow-through 
process vessels are subject to the general secondary containment 
requirement (Sec.  112.7(c)) instead of the sized secondary containment 
requirement, the Agency seeks to ensure that any leak, or potential for 
a leak, is detected promptly enough to prevent a discharge of the 
entire contents of the separation or treating equipment. Therefore, EPA 
believes it is important to require that inspections be completed and 
documented in accordance with the requirements in Sec.  112.7(e).
    EPA is amending the requirement under Sec.  112.9(c)(5)(iii) with 
some modifications to the proposed language, in response to comments 
regarding removal of oil accumulations. Specifically, commenters 
suggested adding language that would acknowledge that other methods of 
immobilizing hydrocarbons in solid matrices, such as physical, chemical 
and/or biological treatment methods should be allowed. EPA agrees that 
other methods may be used to stabilize and remediate and thus, the 
Agency is adding the phrase, ``remove or initiate actions to stabilize 
and remediate'' to address this concern. EPA considers the removal of 
oil-contaminated soil as a method to prevent oil from becoming a 
discharge as described in Sec.  112.1(b). Disposal of oil must be in 
accordance with applicable Federal, state, and local requirements; 
under Sec.  112.7(a)(3)(v), a facility owner or operator is required to 
describe the methods of disposal of recovered materials in accordance 
with applicable legal requirements. For the purposes of this provision, 
removal of recoverable oil may be combined with physical, chemical, 
and/or biological treatment methods to address any residual oil. These 
treatment methods must be consistent with other Federal, state or local 
requirements as applicable, and must be properly managed to prevent a 
discharge as described in Sec.  112.1(b). However, the Agency disagrees 
with the comment that suggested replacing ``Promptly remove'' with 
``Upon discovery.'' ``Promptly remove'' indicates that the owner or 
operator of a facility has both the responsibility and flexibility to 
outline an inspection program under Sec.  112.9(c)(5)(i) which puts the 
timeframe for ``prompt removal'' in the context of the inspection 
frequency.
    Finally, EPA believes that variations in oil production facility 
piping design, layout, and location make flexibility important in order 
to encourage compliance with these additional measures. However, such 
flexibility is already available in that these requirements for flow-
through process vessels are subject to the environmental equivalence 
provision found at Sec.  112.7(a)(2). For example, other Federal or 
state requirements may be environmentally equivalent to certain SPCC 
requirements. Thus, the facility owner or operator may deviate from the 
requirements if an environmentally equivalent alternate measure, 
subject to review and certification by a PE, is implemented. The 
environmental equivalence provision found at Sec.  112.7(a)(2) cannot 
be used for any containment provision associated with flow-through 
process vessels.
c. Reportable Discharge
    EPA is finalizing a provision at Sec.  112.9(c)(5)(iv) to require 
that a production facility owner or operator ensure that all flow-
through process vessels subject to this subpart (that is, are using the 
new alternative to sized secondary containment) comply with Sec.  
112.9(c)(2) and (c)(3) within six months from the discovery of a 
discharge from a flow-through process vessel of more than 1,000 U.S. 
gallons of oil in a single discharge as described in Sec.  112.1(b), or 
more than 42 U.S. gallons of oil in each of two discharges as described 
in Sec.  112.1(b), occurring within any twelve month period. When 
determining spill history, the amount specified in the criterion 
(either 1,000 or 42 U.S. gallons) refers to the amount of the discharge 
that actually reaches navigable waters or adjoining shorelines, and not 
the total amount of the discharge. Discharges as described in Sec.  
112.1(b) that are the result of natural disasters, acts of war, or 
terrorism are not considered toward this requirement. A flow-through 
process vessel using this alternative approach must already comply with 
Sec.  112.9(c)(1) and Sec.  112.9(c)(4) and therefore these 
requirements were not added to Sec.  112.9(c)(5)(iv).
    Comments. Two commenters expressed concern with the reportable 
discharge criterion because Sec.  112.4 already requires a facility 
with a discharge as described in this provision to submit a report to 
the Regional Administrator within 60 days.
    Response to comments. While the Agency acknowledges that EPA 
continues to require a facility that has had a discharge as described 
in Sec.  112.1(b) to submit a report to the Regional Administrator 
within 60 days, EPA believes that the owner or operator of a facility 
that has had such a discharge, as described in this criterion, should 
be required to comply with the sized secondary containment requirement 
because it would appear that the facility was not able to prevent 
discharges to navigable waters or adjoining shorelines by complying 
with the alternative standard--that is, general

[[Page 74280]]

secondary containment with additional measures. If a facility owner or 
operator is unable to successfully prevent oil discharges using general 
containment requirements and additional measures, EPA believes that 
requiring sized secondary containment provides a fail-safe method to 
address the risk of discharges. The Agency's preferred method for 
preventing discharges from flow-through process vessels at these 
constantly-flowing, unattended facilities is the use of sized secondary 
containment. Sized secondary containment provides a buffer to allow for 
containment of fluids from these vessels until a discharge is 
discovered. Thus, the owner or operator would be required to 
automatically amend the SPCC Plan and provide sized secondary 
containment for all flow-through process vessels at the production 
facility within six months of the discharge. This containment must be 
sized to contain the contents of the single largest container, with 
sufficient freeboard for precipitation. Additionally, the owner or 
operator must submit a report to the EPA Regional Administrator as 
required under Sec.  112.4(a).
    The discharge criterion is a well-established threshold in the SPCC 
rule. This discharge criterion is similar to the provision in Sec.  
112.4(a) for discharges that must be reported to the EPA Regional 
Administrator. Under Sec.  112.4, a facility owner or operator must 
report certain information to the Regional Administrator whenever the 
facility experiences a discharge reportable under Sec.  112.4. The 
Agency has used this criterion for eligibility for alternative measures 
in the past, such as to allow the owner or operator of a qualified 
facility to self-certify the SPCC Plan and to allow the use of 
contingency planning and other measures in lieu of secondary 
containment for qualified oil-filled operational equipment (see 71 FR 
77266, December 26, 2006). The Agency believes that finalizing this 
criterion to trigger the requirement to redesign secondary containment 
is consistent with other spill history criteria used elsewhere in the 
SPCC rule.
6. Alternative Qualified Facility Eligibility Criteria for Oil 
Production Facilities
    In December 2006 (71 FR 77266, December 26, 2006), EPA promulgated 
an amendment to the SPCC rule to allow the owner or operator of a 
qualified facility to self-certify his SPCC Plan, which in this final 
rule EPA identifies as a Tier II qualified facility. Furthermore, as 
described in Section V.G of this notice, EPA is establishing an 
additional option for a subset of qualified facilities (designated as 
Tier I qualified facilities) that meet an additional criterion. The 
owner and operator of a Tier I qualified facility may complete and 
implement a streamlined, self-certified SPCC Plan template (promulgated 
as Appendix G to 40 CFR part 112).
    The following table illustrates the tiers, criteria, and options 
for production facilities meeting the qualified facilities eligibility 
criteria and all other production facilities, as described in this 
notice:

------------------------------------------------------------------------
     Production facilities that are qualified
                    facilities                      All other production
---------------------------------------------------      facilities
           Tier I                    Tier II
------------------------------------------------------------------------
Oil production facility and:                        Oil production
(1) No more than two producing wells per single      facility with an
 tank battery / ten barrels or less of crude oil     aggregate
 per well per day / if the facility has an           aboveground oil
 injection well; or                                  storage capacity
(2) No more than four producing wells per single     greater than 10,000
 tank battery / ten barrels or less of crude oil     gallons and:
 per well per day / no injection wells; or          (1) More than two
(3) The facility has10,000 U.S. gallons or less      producing wells per
 aggregate aboveground oil storage capacity; and     single tank battery
                                                     with one or more
                                                     injection wells;
                                                    (2) More than four
                                                     producing wells per
                                                     single tank
                                                     battery; or
                                                    (3) More than ten
                                                     barrels of crude
                                                     oil produced per
                                                     well per day; or
------------------------------------------------------------------------
Within any twelve-month period, three years prior   Within any twelve-
 to the Plan certification date, or since becoming   month period, three
 subject to the SPCC rule if in operation for less   years prior to the
 than three years, there has been:                   Plan certification
(1) No single discharge of oil to navigable waters   date, or since
 or adjoining shorelines exceeding 1,000 U.S.        becoming subject to
 gallons; and                                        the SPCC rule if in
(2) No two discharges of oil to navigable waters     operation for less
 or adjoining shorelines each exceeding 42 U.S.      than three years,
 gallons*; and                                       there has been:
                                                    (1) A single
                                                     discharge of oil to
                                                     navigable waters or
                                                     adjoining
                                                     shorelines
                                                     exceeding 1,000
                                                     U.S. gallons; or
                                                    (2) Two discharges
                                                     of oil to navigable
                                                     waters or adjoining
                                                     shorelines each
                                                     exceeding 42 U.S.
                                                     gallons*; or
------------------------------------------------------------------------
No individual aboveground     Has individual        Owner or operator
 oil containers greater than   aboveground oil       eligible for
 5,000 U.S. gallons;           containers greater    qualified facility
                               than 5,000 U.S.       status, but decides
                               gallons; or           not to take the
                              Owner or operator      option;
                               eligible for Tier I
                               qualified facility
                               status, but decides
                               not to take the
                               option or chooses
                               to develop a
                               ``hybrid'' Plan;.
------------------------------------------------------------------------
Then: Complete and self-      Then: Prepare a self- Then: Prepare a PE-
 certify Plan template         certified Plan in     certified Plan in
 Appendix G to 40 CFR part     accordance with all   accordance with all
 112) in lieu of a full PE-    applicable            applicable
 certified Plan.               requirements of       requirements of
                               Sec.   112.7 and      Sec.   112.7 and
                               subparts B and C of   subparts B and C.
                               the rule, in lieu
                               of a PE-certified
                               Plan.
------------------------------------------------------------------------
* This criterion does not include discharges as described in Sec.
  112.1(b) that are the result of natural disasters, acts of war, or
  terrorism. Additionally, the gallon amount described in this criterion
  addresses the amount of the discharge that actually reaches navigable
  waters or adjoining shorelines.

[[Page 74281]]

    In the October 2007 proposed rule, EPA solicited comment on whether 
the Agency should consider alternative criteria in identifying a 
``qualified facility,'' and thus, allow the owner or operator of an oil 
production facility to self-certify the SPCC Plan, notwithstanding the 
tank storage capacity at the facility. Specifically, EPA requested 
comment on an approach that was suggested by EPA and two approaches 
that were suggested by DOE (see 72 FR 58411, October 15, 2007 for a 
more detailed description of the specific approaches on which EPA 
solicited comment.) Based on the comments received, and the Agency's 
evaluation of this industry sector, EPA is finalizing in this rule an 
amendment that provides alternative criteria for identifying qualified 
facilities in the oil production sector for onshore facilities. EPA 
believes that alternative eligibility criteria for identifying a 
qualified facility for certain onshore oil production facilities is 
appropriate because, notwithstanding their simple configurations, many 
of these small oil production facilities cannot meet the 10,000 gallon 
aggregate aboveground oil storage capacity threshold for Tier I and II 
qualified facility designation. Given (1) the large number of marginal 
or stripper wells in the U.S.\6\; (2) that they contribute a 
significant portion of the country's oil production; and (3) EPA's 
understanding of the particular aboveground oil storage container 
capacities and the nature of the fluids handled at certain small oil 
production facilities, other criteria beyond oil storage container 
capacity are more appropriate in determining whether an owner or 
operator of such a facility should self-certify his SPCC Plan. These 
other criteria, unique to small oil production facilities, serve to 
identify a qualified facility consistent with the intent of this 
approach as promulgated on December 26, 2006 (71 FR 77266), by 
identifying the simplest operations by factors other than strictly 
capacity.
---------------------------------------------------------------------------

    \6\ The Interstate Oil and Gas Compact Commission estimates that 
there are 422,255 marginal oil wells as of January 1, 2007 (IOGCC 
Marginal Wells: 2007 Report).
---------------------------------------------------------------------------

    A qualified oil production facility is one that meets all of these 
conditions: (1) No more than two producing wells per single tank 
battery if the facility has an injection well; or no more than four 
producing wells per single tank battery with no injection wells at the 
facility; (2) each well produces no more than ten barrels of crude oil 
per day; and (3) the facility has not had a single discharge as 
described in Sec.  112.1(b) exceeding 1,000 U.S. gallons or two 
discharges as described in Sec.  112.1(b) each exceeding 42 U.S. 
gallons within any twelve month period in the three years prior to Plan 
certification, or since becoming subject to 40 CFR part 112 if the 
facility has been in operation for less than three years. Facilities 
with no more than two producing wells are eligible to be a qualified 
facility regardless of whether they have injection wells. Discharges as 
described in Sec.  112.1(b) that are the result of natural disasters, 
acts of war, or terrorism do not disqualify a facility owner or 
operator from the alternative option described above.
    The Tier II qualified facility eligibility criteria at Sec.  
112.3(g)(2) have been amended to include these criteria for oil 
production facilities. The owner or operator of a qualified oil 
production facility may choose to prepare a self-certified SPCC Plan in 
lieu of a Plan certified by a PE. An oil production facility owner or 
operator exercising this option may be required to make production or 
shipping records available to support his eligibility. Records kept 
under usual and customary business practices will suffice, and must be 
kept for a period of three years, in accordance with Sec.  112.7(e).
    Owners or operators of oil production facilities may meet Tier II 
qualified facility eligibility through either criterion--has an 
aggregate aboveground oil storage capacity of 10,000 U.S. gallons or 
less (Sec.  112.3(g)(2)(i)); or the criteria described above for an 
onshore oil production facility (Sec.  112.3(g)(2)(ii)). An oil 
production facility that also meets the Tier I qualified facility 
eligibility criteria in Sec.  112.3(g)(1) (that is, the facility has no 
individual oil storage container with a capacity greater than 5,000 
U.S. gallons) would be eligible to develop an SPCC Plan following the 
template in Appendix G to the SPCC rule finalized in this rulemaking 
(see Section V.G of this notice).
    Elsewhere in today's preamble, EPA clarified that a natural gas 
production facility storing condensate (petroleum oil), in quantities 
that meet the SPCC applicability criteria, is considered an oil 
production facility. Since such an onshore natural gas production 
facility, as described above, is considered an onshore oil production 
facility, it may be eligible for the qualified facility relief for 
marginal wells if it meets the other new criteria finalized today in 
Sec.  112.3(g)(2)(ii). Additionally, since a natural gas production 
facility can often store smaller quantities of oil, the facility may 
already meet the existing ``capacity based'' qualified facility 
criteria in Sec.  112.3(g)(2)(i), available to all facility types.
    Additionally, in order to provide the owner or operator of a 
production facility that meets the qualified facility criteria with the 
necessary time to fully understand the new regulatory options finalized 
in today's action, EPA is proposing, in a separate action in the 
Federal Register of November 26, 2008 (73 FR 72016), a new compliance 
date to prepare or amend and implement the production facility's SPCC 
Plan.
a. Alternative Qualified Facility Eligibility Criteria for Oil 
Production Facilities
    This approach is intended as an alternative to the existing 10,000 
gallon aggregate aboveground oil storage capacity eligibility criteria. 
It provides tailored qualified facility eligibility criteria based on 
process operating conditions and equipment unique to oil production 
facilities rather than static oil storage capacity. The owner or 
operator of an oil production facility that meets the 10,000 gallon 
threshold may already self-certify his SPCC Plan and does not also need 
to meet the differentiated criterion for oil production facilities 
finalized in this action.
    Ten barrels or less of crude oil produced per well per day. The ten 
barrels or less per well per day criteria was chosen because this 
production rate is consistent with the definition of a ``stripper 
well.'' EPA established differentiated requirements for ``stripper 
wells'' under the CWA, which were codified in 1979 (see 40 CFR 435.60). 
The Interstate Oil and Gas Compact Commission (IOGCC) also defines 
``stripper wells'' as wells that produce ten barrels of oil per day or 
less.\7\ This production rate limits the qualified oil production 
facility approach to those facilities with smaller quantities of oil 
and associated fluids.
---------------------------------------------------------------------------

    \7\ See Interstate Oil and Gas Compact Commission, 2006: 
``Marginal Wells: Fuels for Economic Growth'', p. 4 (defining 
``stripper wells'' as wells that produce 10 barrels of oil per day 
or less).
---------------------------------------------------------------------------

    Maximum of two producing wells per single tank battery (if the 
facility has an injection well) or maximum of four producing wells per 
single tank battery (with no injection wells at facility). In the 
October 2007 proposal, EPA suggested that the criterion used to 
identify qualified oil production facilities should be a maximum of 
four wells at a single tank battery producing no more than ten barrels 
of oil per day (72 FR 58378, October 15, 2007). The Agency requested 
comment on this approach. While commenters expressed

[[Page 74282]]

support generally for a definition of ``qualified facility'' specific 
to the oil production sector, they also argued that limiting the 
definition to those facilities with four wells or fewer would not allow 
many facilities to take advantage of this approach. However, the Agency 
analyzed comments provided on the original proposal that established 
qualified facilities (70 FR 73524, December 12, 2005) together with the 
comments provided on the approach described in the October 2007 
proposed rule (72 FR 58378) relative to the overall reason for 
identification of a qualified facility; that is, that owners and 
operators of facilities that handle small oil quantities, with simple, 
straightforward processes and equipment, should be capable of 
developing, implementing, and self-certifying an SPCC Plan without the 
services of a PE. With this underlying principle in mind, EPA 
considered the type and scale of operations and the equipment involved 
at small, marginal well oil production facilities and concluded that 
when there are no injection wells at the facility, four producing wells 
per single tank battery is an appropriate criteria to define a simple 
oil production facility configuration.
    One or more injection wells are typically used to inject produced 
water underground for disposal or to enhance recovery of oil from 
production wells. The underground injection process can add additional 
piping to the design of an oil production facility. Consequently, EPA 
has included a ``no injection wells'' criterion for qualified oil 
production facilities with more than two wells per single tank battery. 
The injection well process typically consists of piping extending from 
a produced water container to the injection wellhead, valves, and pumps 
and may include tank level indicators, floats, flow controls, and 
actuators/switches that add additional equipment to the oil production 
facility. EPA believes the integration of such injection equipment and 
its operation into the design and operation of the production facility 
calls for PE certification rather than the owner or operator self-
certifying of the SPCC Plan at facilities that have more than two 
production wells and injection wells. EPA also does not believe it is 
reasonable or appropriate for an owner or operator to designate the 
injection well and its associated piping a separate facility just to 
meet the alternative qualified facility eligibility criteria. However, 
as noted in section V.M.7, an injection well that injects fluids that 
were stored in a container that is exempt from the SPCC regulation 
under Sec.  112.9(c)(6)(i) will not preclude a facility from being 
eligible for treatment as a qualified facility under Sec.  
112.3(g)(2)(ii). Therefore, the Agency believes that at a facility with 
no injection wells and a maximum of four producing wells per single 
tank battery, each of which produce ten barrels or less of crude oil 
per well per day, captures the oil production operations targeted by 
the self-certification option because these facilities, with a limited 
number of producing wells per tank battery operating at a low flow 
rate, and no injection wells or associated equipment, are less complex 
than other oil production facilities.
    Commenters also argued that ``no injection wells'' is not part of 
an established definition and that small facilities that utilize 
injection for secondary or tertiary recovery would not qualify. As EPA 
considered the type and scale of operations, and the likely quantities 
of oil handled, EPA also analyzed whether marginal well oil production 
facilities with an injection well that handle small oil quantities 
could be similarly less complex than other oil production facilities. 
The Agency established the threshold of two wells per single tank 
battery if there is one or more injection wells at the facility because 
field observation and professional judgment suggests that with two 
wells, the tank battery is typically situated near the well head to 
minimize the length of flowlines. As the number of wells flowing to a 
single tank battery decreases to two wells, the footprint of the 
facility potentially decreases and the lesser area encompassed by a 
facility with fewer wells flowing to the tank battery means that 
significantly shorter flowlines are needed to move well fluids to 
separation and storage processes. EPA also understands that as the 
number of wells in a lease (the term used for the area of wells run by 
an owner or operator) decreases, the number of tanks and separators 
typically decreases. Depending on the flow rates and well locations, 
separate tank batteries serving widely separated wells may be installed 
on one lease. Fewer valves, smaller separation equipment and fewer or 
smaller storage tanks in the tank battery are also expected at a 
facility with two wells than those with four wells per single tank 
battery. Finally, based on the Agency's best professional judgment and 
experience in the field, pumpers and well service operations typically 
occur once or twice per week; on this basis, the likely quantities of 
well fluids and marketable oil generated by a two-well operation per 
single tank battery is more consistent with the quantities expected at 
qualified facilities that are not oil production facilities. By 
limiting the overall number of producing wells, and therefore the 
associated equipment and piping at an oil production facility, the 
Agency is targeting those production facilities that should be eligible 
to self-certify SPCC Plans. In order to strike a balance between those 
operations with injection wells and those without, EPA is allowing oil 
production facilities with no more than two producing wells that also 
have injection wells an option to self certify the Plan. Regardless of 
the presence of injection wells at these facilities, the overall number 
of wells and associated equipment is still limited by this approach. In 
addition, the likely smaller oil quantities stored at a two-well 
facility with injection wells captures the smaller operators targeted 
by the self-certification option because these facilities are similar 
in complexity to an oil production facility with four producing wells 
per tank battery with no injection wells. Similarly, the specification 
of ``per single tank battery'' is intended to make clear that the self-
certification option for production facilities does not extend to a 
central processing area (a production treatment and separation 
operation that receives fluids from a qualified facility tank battery).
    Although the criterion limits the number of wells per single tank 
battery, it does not limit the number of tank batteries located at the 
oil production facility. That is, EPA believes that tank batteries 
within an oil production facility may still have simple configurations 
and the presence of multiple tank batteries does not add complexity to 
the overall oil production facility. As EPA discussed previously in 
Section V.D of the preamble, the owner or operator of a production 
facility has the flexibility to define the facility's boundaries such 
that it can include multiple tank batteries. Therefore, if the oil 
production facility meets one of the two alternative criteria described 
in this section (that is, it has no more than two producing wells per 
single tank battery each of which produce ten barrels or less of crude 
oil per well per day if there are injection wells; or the facility has 
no more than four producing wells per single tank battery, each of 
which produce ten barrels or less of crude oil per well per day, and 
has no injection wells at the facility; and meets the reportable 
discharge history criterion) the owner or operator can self-certify the 
SPCC Plan.
    Comments. Many commenters expressed general support that EPA

[[Page 74283]]

utilize other relevant criteria in identifying a ``qualified facility'' 
in the oil production sector, although most of the commenters did not 
support the approach EPA is promulgating in this final rule. However, 
other commenters questioned why oil production facilities would have 
different criteria than facilities in other industries when they 
already have less stringent requirements under the SPCC rule. Two 
commenters opposed any alternative eligibility criteria for production 
facilities, arguing that the basis of the qualified facility approach 
is to provide an alternative for the truly small operator to avoid the 
cost of PE certification of his SPCC Plan. Commenters questioned why 
EPA would reduce requirements for oil production facilities given the 
sector's spill history and operational complexity. These commenters 
requested that all facilities above 1,320 gallons of total aboveground 
oil storage capacity should be certified by a PE.
    Still other commenters questioned the number of wells and other 
conditions that EPA described in the preamble to the proposal. One 
commenter stated that limiting the option to facilities with four wells 
is of concern because the number is not well-established and would 
restrict the applicability of this option. Several commenters also 
expressed concern with the ``no injection wells'' criterion, noting 
that injection does not add complexity to the facility, is a common 
practice, and the produced water that is reinjected is of low oil 
content. Commenters also stated that ``no injection wells'' is not part 
of an established definition and that small facilities that utilize 
injection for secondary or tertiary recovery would not qualify.
    Other commenters suggested other approaches or options that EPA 
could pursue. For example, one commenter suggested the alternative 
eligibility criteria should be a production rate less than five barrels 
per day per well, and very simple operations consisting of no more than 
three wells flowing to one tank battery and no injection wells. Two 
other commenters provided support for oil production facilities to 
qualify for Tier I, although some commenters suggested that the Tier I 
qualified facility threshold discussed in the October 2007 proposal 
would be too limiting, and suggested that a facility with one 400 
barrel (16,800 U.S. gallons) oil tank should be eligible for the Tier I 
category.
    Response to comments. EPA agrees in principle with the commenters 
who supported alternative qualified facility eligibility criteria for 
oil production facilities and is finalizing the option described in the 
proposal with some modifications. The Agency does not agree that PE 
certification should be required for all facilities with more than 
1,320 U.S. gallons oil storage capacity, given that the Agency has 
already promulgated an approach allowing owners and operators of 
facilities that meet certain criteria, including a total aboveground 
oil storage capacity of 10,000 U.S. gallons or less to self-certify 
Plans. A number of commenters pointed out that oil production 
facilities are already subject to a differentiated set of requirements 
under the SPCC rule. While the Agency recognizes this, it continues to 
believe that a differentiated alternative for facilities with simple 
configurations has merit, and that providing the added flexibility of 
self-certification for the smaller oil handlers/simpler operations, 
along with the other streamlined requirements tailored to the unique 
features of this sector (as described elsewhere in the preamble to this 
final rule) should improve overall spill prevention and environmental 
protection.
    Because the configuration of an oil production facility is 
variable, complexity depends upon a number of factors, including, but 
not limited to: The oil field, production rate, type of fluid, 
operating equipment and conditions, and viscosity of the oil. Because 
oil production facilities do not have a ``typical'' configuration, the 
Agency has finalized eligibility criteria intended to minimize the 
complexity of the operations where self-certification seems 
appropriate. By setting the maximum number of wells at four producing 
wells if there are no injection wells at the facility, or two producing 
wells if there are injection wells at the facility, there is a greater 
likelihood that those wells are located near the tank battery. EPA 
believes that the four-well criterion targets those oil production 
facilities with less complex operations and configurations, consistent 
with other qualified facilities. Similarly, the criterion that excludes 
underground injection for a facility with four producing wells 
eliminates the complexity associated with injection related equipment. 
By limiting the number of producing wells per single tank battery to 
two producing wells at facilities that have injection, EPA believes 
that because of the smaller oil storage capacities and the greater 
likelihood that those wells are located near the tank battery, a 
marginal well oil production facility with two producing wells is 
consistent with other qualified facilities. In addition, the reduced 
complexity in decreasing from four to two producing wells is similar to 
the change in complexity associated with injection wells. As noted 
above, EPA believes a PE need not be involved in the SPCC Plan at 
facilities with a limited number of wells and associated equipment and 
piping.
    A number of commenters noted that by limiting the number of wells 
per tank battery and not allowing injection wells to be utilized in 
designating a qualified facility for the oil production sector, it 
would limit the number of oil production facilities that could self-
certify their SPCC Plan. First, it should be noted that in designating 
a ``qualified facility'' in the oil production sector, the purpose is 
to identify those facilities that should be eligible to self-certify 
their SPCC Plan without the involvement of a PE-that is, those 
facilities that handle small quantities of oil, with simple and 
straightforward processes and equipment, and not to maximize the number 
of oil production facilities that could be eligible to self-certify 
their SPCC Plan. However, EPA also estimated the number of facilities 
that would meet the eligibility criteria for a qualified facility under 
the eligibility criteria promulgated today for the oil production 
sector. Based on our analysis (which can be found in the Regulatory 
Impact Analysis for this action, located in the docket for this 
rulemaking), EPA estimates that approximately one third of oil 
production facilities would meet the alternative eligibility criteria. 
If those oil production facilities that meet the eligibility criteria 
for self-certification based on the 10,000 gallon threshold are also 
included, EPA estimates that almost half of oil production facilities 
could take advantage of self-certifying their SPCC Plan. Thus, EPA does 
not agree with commenters that the eligibility criteria being 
promulgated today for defining a qualified facility in the oil 
production sector is too narrow.
    The Agency also agrees that oil production facilities should also 
be eligible as Tier I qualified facilities. Thus, the owner or operator 
of an oil production facility that meets the criteria finalized under 
this rulemaking and additionally meets the Tier I qualified facility 
eligibility criteria in Sec.  112.3(g)(1) (that is, the facility has no 
individual oil storage container with a capacity greater than 5,000 
U.S. gallons) is also eligible to use the streamlined Tier I qualified 
facility SPCC Plan template (Appendix G to the SPCC rule). The Agency 
also does not agree that the eligibility criteria for Tier I are too 
limiting, as the relief provided by the SPCC Plan template and other 
streamlined requirements are targeted to

[[Page 74284]]

a specific segment of the universe of facilities based upon simplicity 
of configuration and a 5,000-gallon limit on the total aboveground 
storage capacity for any single container. EPA believes that facilities 
that qualify for Tier I have a reduced risk of discharge in harmful 
quantities due to this limit on aboveground single container total 
storage capacity. Thus, the Agency does not agree that a 400-barrel 
container (16,800 U.S. gallons) should qualify for Tier I, as this 
quantity is three times the container threshold for other Tier I 
qualified facilities (with a maximum aboveground oil storage container 
of 5,000 U.S. gallons). Commenters did not provide data to support the 
larger tank size or demonstrate how this would maintain environmental 
protection. Larger containers have the potential for a larger 
discharge, may have more stringent requirements for inspection and 
maintenance in accordance with industry standards, and therefore, EPA 
believes should not be eligible for the Tier I streamlined 
requirements.
b. Alternative Approaches for Addressing Small Oil Production 
Facilities as Suggested by the Department of Energy (DOE): Alternative 
Eligibility Criteria
    In the proposal to this rulemaking (72 FR 58378, October 15, 2007), 
the Agency sought input on different eligibility criteria, as suggested 
by DOE, to identify a small oil production facility as a qualified 
facility. The criteria would allow for the development of a self-
certified SPCC Plan, and allow the use of a streamlined SPCC Plan 
template for a certain set of facilities, similar to that found in 
proposed Appendix G to the SPCC rule. Under the qualified facility 
criteria at Sec.  112.3(g), a facility that has an aggregate 
aboveground oil storage capacity of 10,000 U.S. gallons or less and has 
not had a single discharge as described in Sec.  112.1(b) exceeding 
1,000 U.S. gallons or two discharges as described in Sec.  112.1(b) 
each exceeding 42 U.S. gallons within any twelve-month period in the 
three years prior to Plan certification, or since becoming subject to 
40 CFR part 112 if the facility has been in operation for less than 
three years is eligible for the qualified facility Plan requirements at 
Sec.  112.6 (i.e., a self-certified Plan in lieu of a PE certified 
Plan). DOE suggested that because of the unique characteristics of 
small oil production facility operations, such facilities may merit the 
establishment of small oil production facility-specific eligibility 
criteria, including a different aggregate oil storage capacity 
threshold or stripper well definition for identifying qualified 
facilities. For example, DOE suggested that a stripper well be defined 
using the IRS tax code definition of 15 barrels or less of oil per day 
equivalence (see 26 U.S.C. 613A). In light of this request, EPA sought 
comment on whether there are unique circumstances at small or 
marginally economic oil production facilities and the alternative 
criteria based on these circumstances for the possible establishment of 
a ``qualified facility'' provision specific to small oil production 
facilities that would serve to increase SPCC spill prevention and 
reduce the likelihood of a harmful oil discharge.
    Comments. Several commenters argued that the current threshold 
requirements are too low to provide significant benefit for marginal 
oil production facilities. For example, one commenter suggested a total 
aboveground oil storage capacity of 50,000 gallons where no single 
container is greater than 21,000 gallons, whereas another commenter 
suggested removing consideration of this approach unless produced water 
storage is eliminated from the threshold calculation.
    Concerning the stripper well definition, two commenters supported 
DOE's suggestion to use the IRS tax code definition for marginal 
production to ease compliance. One commenter indicated that the EPA 
definition remains linked to facility storage capacity, and storage 
capacity at marginal wells is not sized based on current production 
levels and in fact decreases over time.
    Concerning other regulatory programs addressing the objectives of 
the SPCC rule, one commenter suggested that state spill prevention 
regulatory programs should serve small production facilities rather 
than one Federal program. However, another commenter noted that states 
in general simply do not address equivalent requirements of the SPCC 
regulations and especially not to the extent of the SPCC regulations 
with respect to prevention of oil discharges. Two commenters suggested 
that EPA consider other regulatory requirements, including DOT Carrier 
Requirements for Spills, Spill Reporting, Transportation Security 
Planning, and EPA's Stormwater Discharge Permitting program, the 
National Pollutant Discharge and Elimination System (NPDES) program, 
and Underground Injection Control (UIC) program. Another commenter 
suggested allowing all SPCC facilities to have the option of using 
other equivalent prevention plans to meet SPCC planning requirements. 
Finally, one commenter suggested that EPA remove the self-certification 
provision from the rules so that all farmers, small businesses and 
other oil storage facilities are required to prepare a complete SPCC 
Plan certified by a PE to ensure ``equal and fair treatment for all 
owners and operators.''
    Response to comments. The Agency disagrees with commenters who 
suggest establishing a new capacity based Tier II criterion for oil 
production facilities greater than the already established 10,000-
gallon threshold for all facilities. While the Agency received a number 
of comments regarding a wide variety of thresholds for defining a Tier 
II qualified facility in the oil production sector, the comments did 
not provide sufficient data to support the threshold numbers other than 
it would increase the number of facilities that would be eligible as a 
qualified facility and thus, self-certify their SPCC Plan. More 
importantly, the commenters did not demonstrate how these new 
thresholds would maintain environmental protection. EPA does not agree 
with the commenters to base a new Tier II qualified facility threshold 
for oil production operations solely on an increased capacity 
threshold, as there was no justification for providing oil production 
facilities with a higher threshold than non-production facilities or 
for how the higher threshold relates to simplicity in facility 
configuration or operations.
    Nevertheless, EPA agrees with commenters that the oil production 
sector has unique characteristics and that other criteria may better 
serve in defining a Tier II qualified facility. For example, the fact 
that oil production facilities have flow-through process vessels 
suggests that flow rate (in the form of an oil production rate) may be 
a better approach for setting a new criterion for identifying the 
simplest oil production facility operations. However, EPA disagrees 
with commenters who argued that the IRS tax code definition of 15 
barrels or less of oil per day should be used in defining flow rate. 
Specifically, the IRS definition of 15 barrels of oil or less per day 
equivalent is calculated by dividing the average daily production of 
domestic crude oil and domestic natural gas from producing wells on 
such property for such calendar year by the number of such wells. Thus, 
under this approach, a facility will contain wells with marginal 
production, such as 15 barrels of oil per day, but also will likely 
contain wells that produce much greater quantities of oil, because the 
IRS definition calculates the average daily production of oil over all 
producing wells, as opposed to the amount of oil

[[Page 74285]]

that flows from any individual well. EPA believes that using such a 
definition defeats the purpose of identifying a qualified facility, 
which is to allow those small facilities that have relatively simple 
operations to self-certify their SPCC Plans. Thus, the Agency has 
adopted a per well approach that places a flow rate cap of ten barrels 
or less of oil produced per well per day, as this is consistent with 
the definition of ``stripper well'' codified at 40 CFR 435.60.
    Additionally, because the source of the oil for production 
facilities is through extraction wells, the number of wells better 
identifies the complexity of a production operation. Finally, some of 
these facilities are unique as they reinject fluids in the reservoir 
for disposal purposes or for enhanced oil recovery. The presence of 
these injection wells is a characteristic unique to oil production 
facilities that can help to determine the complexity of the operation. 
These characteristics, unique to the oil production sector, provided 
the Agency with the basis for a tailored set of criteria to identify 
oil production facilities with simple configurations. Developing a 
criterion based solely on raising the oil storage capacity criterion 
would be inconsistent with the rationale established for the original 
10,000-gallon criterion and would not necessarily maintain 
environmental protection. Thus, while EPA does not agree that raising 
the oil storage capacity threshold is appropriate, the Agency does 
agree with commenters that the unique characteristics of an oil 
production facility allow EPA to establish alternative criteria for a 
Tier II qualified facility, and EPA has finalized provisions to that 
effect.
    Finally, EPA disagrees with commenters who suggested that the SPCC 
regulations are not needed because of other regulatory programs, such 
as state programs, or the NPDES or UIC programs. EPA conducted a 
comparison of a number of these programs with the SPCC program and 
found that they were not nationally uniform (see Review of State 
Regulations Pertaining to Oil Spill Prevention at Onshore Production 
Facilities and Produced Water Containers, prepared by Abt Associates 
Inc., June 6, 2008, and found in the docket for today's rulemaking). 
Further, under the Oil Pollution Act and CWA, EPA is required to 
promulgate oil spill prevention regulations, and it cannot delegate its 
responsibilities to other Federal or state programs, but has 
streamlined SPCC requirements or provided targeted exemptions from SPCC 
regulation when such regulations provide comparable or equivalent 
environmental protection. However, EPA has stated previously that if a 
facility owner or operator must comply with a state or Federal 
requirement that also satisfies an SPCC requirement, the owner or 
operator can include and reflect such effort in his SPCC Plan and not 
duplicate it solely for SPCC. EPA wants to minimize duplicative 
requirements where possible and is working to tailor requirements, 
where appropriate.
c. Alternative Approaches for Addressing Small Oil Production 
Facilities as Suggested by the Department of Energy (DOE): Exempt 
Existing Stripper Oil and Natural Gas Wells From all SPCC Requirements
    The other approach that DOE requested that EPA solicit comment on 
in the proposal to this rulemaking (72 FR 58378, October 15, 2007) was 
to exempt stripper oil and natural gas wells from all SPCC 
requirements, except those applicable to crude oil and condensate tanks 
(e.g., tanks which store gas condensate (which is an oil) at oil and 
gas production facilities). The eligibility criteria for the exemption 
would include those facilities that meet the IRS tax code definition of 
stripper well property at 26 U.S.C. 613A. In addition, the eligibility 
criteria would not be limited, for example, to those facilities that 
did not have injection wells or used injection wells as secondary or 
tertiary recovery techniques, which DOE has indicated may be regulated 
under existing Federal and state regulatory programs. DOE believes that 
such criteria have no direct relationship to the spill risk posed by 
marginal wells facilities and may serve as a disincentive to enhanced 
oil and gas recovery and well maintenance.
    Comments. Many of the commenters expressed support for an exemption 
of stripper oil and natural gas wells from all SPCC requirements. 
Commenters expressed concerns that implementation of the SPCC rule may 
cause oil production wells to be shut in. One other commenter suggested 
regulating only crude oil and condensate containers, given that the 
releases reported to the NRC from this industry sector are low and EPA 
``has never conducted a comprehensive environmental analysis of the 
risks associated with these proposed regulations and whether they 
significantly change from the current regulatory program to this 
proposed one.''
    Response to comments. While the majority of comments the Agency 
received supported an outright exemption for stripper oil and natural 
gas wells from the SPCC requirements, the commenters did not provide 
sufficient data to justify an exemption or demonstrate how an exemption 
would maintain environmental protection. EPA also disagrees with the 
commenters that the SPCC requirements and compliance costs alone would 
cause small oil production facilities to shut down, reducing U.S. oil 
production (see memorandum dated April 11, 2008, Preliminary Assessment 
of SPCC Compliance Costs and Energy Impacts on Oil Exploration and 
Production). As EPA has noted elsewhere, these facilities, which are 
generally unattended, can store large quantities of oil and oil/water 
mixtures in a variety of containers that may have large capacities. 
These factors, as well as others, highlight the hazard potential posed 
by these operations (see Considerations for the Regulation of Onshore 
Oil Exploration and Production Facilities Under the Spill Prevention, 
Control, and Countermeasures Regulation, May 30, 2007, in the docket 
for this rulemaking (EPA-HQ-OPA-2007-0584-0015)). Thus, based on this 
hazard, and without sufficient rationale, the Agency believes it 
inappropriate to grant an outright exemption for such stripper oil and 
natural gas wells from the SPCC requirements. However, EPA does agree 
that performance-based requirements tailored to the unique 
characteristics of marginal oil production facilities are justified, as 
EPA has described previously, which the Agency believes will lead to 
the prevention of oil spills.
7. Produced Water Containers
    In the proposal for this rulemaking (72 FR 58378, October 15, 
2007), EPA requested comment including appropriate rationale, 
information, and data, on three approaches related to produced water 
containers. The first approach required general secondary containment 
combined with additional requirements in lieu of sized secondary 
containment. The second approach, advanced by DOE, required inspection, 
maintenance, and periodic oil skimming of produced water containers in 
lieu of both sized and general secondary containment. Finally, comment 
was requested on a third approach, again advanced by DOE, that exempted 
produced water treatment facilities altogether.
    Produced water containers are typically located within a tank 
battery at

[[Page 74286]]

an oil production facility \8\ where they are used to store well fluids 
that result after marketable crude oil is separated from fluids 
extracted from the reservoir and prior to subsequent use (e.g., re-
injection or beneficial reuse), further treatment, or disposal. Under 
normal operating conditions, a layer of oil may be present on top of 
the fluids in these containers. The amount of oil by volume observed in 
produced water containers varies, but based on EPA's understanding, is 
generally estimated to range from less than one to up to ten percent, 
and can be greater. However, the Department of Energy (DOE) and the oil 
production sector indicate that the oil layer may be much less, 
depending on the type of oil/water separation technology used, if any. 
Many commenters claim that the SPCC oil spill prevention requirements 
are inappropriately applied to produced water containers, arguing that 
in certain cases these containers hold mostly water with very low 
concentrations of oil or that produced water containers should be 
exempt under the exemption for wastewater treatment. EPA agrees that 
the SPCC regulations should not regulate the storage of oil if the 
discharge of that oil is not prohibited under section 311 of the Clean 
Water Act. Section 311(b)(3) prohibits the discharge of oil into or 
upon navigable waters of the United States or adjoining shorelines in 
such quantities as may be harmful, as determined by the President. That 
determination is made in 40 CFR part 110. EPA does not agree that 
produced water containers are eligible for the wastewater treatment 
exemption. However, the Agency recognizes that, depending on the use, 
some produced water containers may serve as oil/water separators, 
rather than bulk storage tanks, and such containers should be regulated 
in a similar fashion as other oil/water separators. To address these 
concerns, EPA is providing an exemption for certain produced water 
containers holding oil that would not violate section 311(b)(3) if 
discharged, and a differentiated set of requirements for other produced 
water containers at oil production facilities that are used for oil/
water separation. EPA is also promulgating a definition of produced 
water container to clarify which containers will be eligible for this 
rule amendment. The Agency believes that the approaches for produced 
water containers promulgated in this rule amendment are a logical 
outgrowth of the three approaches discussed in the proposal and the 
comments received.
---------------------------------------------------------------------------

    \8\ A wet gas facility that stores condensate and meets the 
other SPCC qualifying criteria is considered an oil production 
facility. Otherwise, a wet gas facility falls outside the scope of 
the Agency's SPCC jurisdiction.
---------------------------------------------------------------------------

    Specifically, EPA is finalizing two approaches for produced water 
containers at oil production facilities. Under the first approach, EPA 
is exempting produced water containers at oil production facilities 
from the requirements of the SPCC rule when a PE certifies, as part of 
the SPCC Plan, that based on the efficiency of the oil/water separation 
technology used, the contents of a produced water container, if 
completely discharged, does not contain oil in amounts that may be 
harmful, as described in 40 CFR part 110; the capacity of the exempted 
containers would not be counted in oil storage capacity.
    Under the second alternative, which is drawn from two of the 
approaches presented in the proposal, for those produced water 
containers that cannot meet the criterion for the exemption under this 
rule, the facility owner/operator has the option to apply general 
secondary containment requirements and conduct visual inspections, 
maintenance and corrective action, in lieu of sized secondary 
containment, when a PE describes in the Plan and certifies that a 
practice is established that is designed to remove the amount of free-
phase oil from the produced water container on a scheduled and routine 
basis. These containers are counted toward the aggregate storage 
capacity. As described below, if the production facility has certain 
types of oil discharges or fails to meet the requirements of this part 
of the rule, the facility will no longer be eligible for the exemption 
or the streamlined requirements.
    EPA is taking this action because the Agency believes that there 
are alternative options for produced water containers that can provide 
the regulated community compliance flexibility while continuing to 
effectively protect the environment from discharges of quantities of 
oil that may be harmful. The options the Agency is providing for 
produced water containers are based on the facility's site-specific 
characteristics, and an owner or operator may still choose to comply 
with the sized secondary containment requirements of Sec.  112.9(c)(2). 
For example, if a produced water container at an existing facility is 
already located within sized secondary containment, the owner/operator 
may elect to not follow the alternative requirements in Sec.  
112.9(c)(6). The comments received on the produced water options and 
the Agency's responses are located in section V.M.7.e. below.
a. Exemption for Produced Water Containers
    A new subsection at Sec.  112.9(c)(6) has been added to the rule to 
address the streamlined requirements for produced water containers. 
Paragraph 112.9(c)(6)(i) includes an exemption for those produced water 
containers and any associated piping and appurtenances downstream of 
the container that do not contain oil that would cause harm as 
described in 40 CFR 110.3 if the contents of the container are 
completely discharged.
    EPA recognizes that some oil production facilities may have (or may 
want to install) separation equipment that performs at a highly 
efficient rate. In these cases, the contents of the produced water 
containers downstream of such separation equipment may not contain oil 
in quantities that may cause harm, as described in 40 CFR part 110. 
Under 40 CFR part 110, a discharge of oil in such quantities as ``may 
be harmful'' is defined as one that may violate applicable water 
quality standards; or cause a film or sheen upon or discoloration of 
the surface of the water or adjoining shorelines; or cause a sludge or 
emulsion to be deposited beneath the surface of the navigable water or 
upon adjoining shorelines. To make this determination, the PE should 
apply the same standard as is set forth in 40 CFR 112.1, which allows 
the owner or operator (and the PE) to determine if a container could 
reasonably be expected to discharge oil in quantities that may be 
harmful as described in part 110 into or upon navigable waters. This 
determination is made by reference to the volume of oil reasonably 
expected to reach navigable waters or adjoining shorelines, if the 
entire contents of the container are completely discharged, and not by 
reference to the volume of oil in the container.
    EPA understands that meeting the standard described above may 
require oil/water separation equipment and/or techniques such as 
hydrocyclones, induced gas floatation, ultra-filtration, and micro-
filtration. Because of the level of separation efficiency and treatment 
required to meet the Part 110 standard, EPA believes that the 
involvement of a PE is necessary. Therefore, EPA is requiring owners/
operators who take advantage of this exemption to have this part of 
their SPCC Plan certified by a PE, even for a qualified facility. EPA 
has amended the PE attestation in Sec.  112.3(d)(1) to add a provision 
at (1)(vi) so that the PE specifically certifies that exempted produced 
water containers and any

[[Page 74287]]

associated piping and appurtenances downstream of the container (which 
may include flowlines and other appurtenances associated with injection 
and discharge) meet the 40 CFR part 110 ``no harm'' criterion and these 
containers are identified in the Plan and that appropriate produced 
water characteristics in the container, piping and appurtenances; 
procedures; or maintenance required to meet the standards of Part 110 
are identified. The PE must use his professional judgment in applying 
the necessary procedures to determine that the contents of the 
container, if completely discharged, will meet the ``no harm'' criteria 
of 40 CFR part 110 and documents them in the Plan. Additionally, in 
accordance with Sec.  112.5, the owner or operator must verify on an 
annual basis that the produced water characteristics in the container, 
piping and appurtenances; procedures; or maintenance required to meet 
the standards of Part 110 that formed the basis for the PE 
certification are maintained. The owner or operator must document the 
verification and sign a statement that the produced water 
characteristics in the container, procedures, or maintenance that 
formed the basis for the PE certification are maintained. The following 
words will suffice, ``I verify that the produced water characteristics 
in the container, and any associated piping and appurtenances 
downstream from the container; procedures; or maintenance required to 
meet the standards of Part 110 are maintained in accordance with the PE 
certification.'' This rule text provides an example of how the owner or 
operator can document the required annual verification for the exempt 
produced water containers. The verification must be maintained in 
accordance with Sec.  112.7(e).
    If the facility experiences a discharge from an exempt produced 
water container or any associated piping and appurtenances downstream 
from the container in quantities that may be harmful to navigable 
waters or adjoining shorelines (as described in 40 CFR part 110) then 
the produced water container is no longer exempt from the rule and must 
comply with all provisions of the SPCC rule within six months of the 
discharge, including the sized secondary containment requirements at 
Sec.  112.9(c)(2). The final rule, as described above, focuses on a 
``container'' and related to discharges under part 110. Under the 
requirements of 40 CFR part 110, such a discharge must also be reported 
to the National Response Center (NRC) at 1-800-424-8802.
    This exemption does not change the current requirement for an 
owner/operator of a facility to mark the location and contents of all 
containers, including both exempt and non-exempt produced water 
containers, on the facility diagram. This requirement is necessary not 
only to assist response personnel in identifying hazards during spill 
response activities, but also to assist facility and Agency personnel 
in determining whether the exemption criteria are being met.
b. Alternative Option for Non-Exempt Produced Water Containers
    For those produced water containers that do not meet the criteria 
for being exempt as described above, the facility owner/operator now 
has the option to comply with an alternative set of requirements in 
lieu of providing sized secondary containment. This new alternative 
compliance option, which is drawn from two of the approaches presented 
in the proposal, is provided in paragraph Sec.  112.9(c)(6)(ii) and is 
described below.
    The first approach described in the proposal would allow the owner 
or operator of a production facility to comply with the general 
secondary containment requirements along with additional measures as an 
option in lieu of sized secondary containment for existing produced 
water containers. Generally, the additional measures were requirements 
for periodic inspections, examination and integrity testing, prompt 
removal of oil discharges and corrective action. The second approach 
described in the proposal would allow the owner or operator of a 
production facility to comply with additional measures in lieu of both 
general and sized secondary containment. Generally, the additional 
measures under this approach were visual inspection, implementation of 
a skimming program, prompt removal of oil discharges and corrective 
action. In response to comments, the Agency developed this alternative 
compliance option which includes (1) compliance with general secondary 
containment requirements along with additional measures and (2) 
implementation of a procedure or process to remove free-phase oil or 
skimming program.
    Specifically, the general secondary containment requirement at 
Sec.  112.7(c) calls for secondary containment to be designed to hold 
the most likely quantity of oil potentially discharged in an event, 
rather than installation of sized secondary containment designed to 
hold the contents of the largest container with sufficient freeboard. 
Typically, the quantity of oil contained by general secondary 
containment is expected to be smaller than the amount of oil that would 
need to be contained by sized secondary containment. EPA believes that 
good general secondary containment practices can be successfully 
implemented if such practices are designed by a PE in consideration of 
the site specific factors and in combination with additional oil spill 
prevention practices including inspections, procedures to minimize the 
amount of free-phase oil in the container and procedures to remove/
remediate discharged oil.
    The piping and appurtenances downstream of the produced water 
containers addressed by this section are also subject to the general 
secondary containment requirements in Sec.  112.7(c) and are not 
subject to sized secondary containment requirements. However, the owner 
or operator of the facility may choose to address the downstream piping 
and appurtenances using the optional approach offered under new Sec.  
112.9(d)(3). These provisions are noted in the rule under Sec.  
112.9(c)(6)(ii)(A) for clarity.
    Procedure to separate free-phase oil. Under this alternative, the 
facility owner or operator must implement a process and/or procedure 
for the produced water container(s) that is designed to remove free-
phase oil that accumulates on the surface of the produced water 
container. EPA expects this procedure or process will be implemented on 
a periodic basis so that the amount of free phase oil that collects in 
these produced water containers is within the amounts managed by the 
general secondary containment scheme designed by the PE and implemented 
by the facility owner/operator. The SPCC Plan must include a 
description of the free-phase oil separation and removal procedure or 
process, the frequency it is implemented or operated, the amount of 
free-phase oil expected to be maintained inside the container, and a 
description of the adequacy of the general secondary containment 
approach for the produced water container, including the anticipated 
typical failure mode and the method, design, and capacity for general 
secondary containment. Additionally, the owner or operator must keep 
records of the implementation of these procedures in accordance with 
Sec.  112.7(e).
    Like the amendment for exempt produced water containers, EPA has 
amended the PE attestation in Sec.  112.3(d)(1) to add a provision at 
(1)(vii) so that the PE specifically certifies that an oil removal 
procedure for non-exempt produced water containers is designed 
according to good engineering practice to reduce the accumulation of 
free-phase oil, and that

[[Page 74288]]

the procedures and frequency for required inspections, maintenance and 
testing have been established.
    Because this removal procedure is essential for reducing the amount 
of free-phase oil in the produced water tank, EPA requires that if, 
upon inspection, it is discovered that the removal procedure is not 
implemented, then the facility owner/operator may no longer take 
advantage of this alternative option and must comply with the sized 
secondary containment requirements at Sec.  112.9(c)(2) within six 
months after EPA informs the facility owner/operator of this 
determination of ineligibility for the option.
    Additional requirements. EPA believes that the combination of 
general secondary containment, a free-phase oil removal methodology as 
certified by a PE, and the additional requirements listed below provide 
the appropriate amount of environmental protection for these containers 
in lieu of sized secondary containment. The additional requirements 
include periodic inspection and/or testing of produced water containers 
and any associated piping and appurtenances downstream from the 
container for leaks, corrosion, or other conditions that could lead to 
a discharge as described in Sec.  112.1(b); corrective action or 
repairs to produced water containers and any associated piping as 
indicated by regularly scheduled visual inspections, tests, or evidence 
of an oil discharge; and prompt removal or initiation of actions to 
stabilize and remediate any accumulations of oil discharges associated 
with produced water containers.
    Periodic inspection and/or testing of produced water containers and 
any associated piping and appurtenances downstream from the container 
is necessary to increase the likelihood that a discharge will be 
prevented or detected promptly when general secondary containment 
measures are used instead of sized secondary containment.
    Corrective action is necessary to prevent a discharge from 
occurring, as well as in response to a discharge. This measure is 
intended to prevent discharges by ensuring that produced water 
containers are adequately maintained.
    The requirement to promptly remove or initiate actions to stabilize 
or remediate any accumulations of oil discharges is intended to ensure 
the removal of oil accumulations around the container and any 
associated piping and appurtenances downstream from the container that 
may contribute to a discharge as described in Sec.  112.1(b). EPA also 
considers the removal of oil-contaminated soil as a method to prevent 
oil from becoming a discharge as described in Sec.  112.1(b). Disposal 
of oil and/or oil-contaminated media must be in accordance with 
applicable Federal, state, and local requirements.
    The intent of these regulatory revisions is to treat produced water 
containers used for oil/water separation in a manner similar to that of 
a separator or flow-through process vessel, such as a heater-treater, 
free water knock-out, or gun barrel, because these produced water 
containers are being used for the same purpose. Use for oil/water 
separation is the basis for the differentiated treatment of flow-
through process vessels as discussed in section V.M.5 above. 
Accordingly, these requirements are similar to those found at Sec.  
112.8(c)(5) for flow-through process vessels.
    Reportable discharge. If the facility experiences a discharge of 
more than 1,000 U.S. gallons of oil in a single discharge as described 
in Sec.  112.1(b), or discharges more than 42 U.S. gallons of oil in 
each of two discharges as described in Sec.  112.1(b), occurring within 
any twelve month period (excluding discharges that are the result of 
natural disasters, acts of war, or terrorism) from a non-exempt 
produced water container, then the facility owner/operator may no 
longer take advantage of this alternative option and must comply with 
the sized secondary containment requirements at Sec.  112.9(c)(2) and 
the inspection requirements at Sec.  112.9(c)(3) within six months. 
Section 112.9(c)(6)(ii)(E) has been added to provide this requirement. 
A non-exempt produced water container must already comply with Sec.  
112.9(c)(1) and Sec.  112.9(c)(4) and therefore these requirements were 
not added to Sec.  112.9(c)(6)(ii)(E).
c. Definition of Produced Water Container
    A production facility typically includes, at a minimum, a wellhead, 
a tank battery, and flowlines connecting the wellhead to the tank 
battery. The tank battery includes separation equipment, a crude oil or 
condensate container (stock oil tank), and typically a produced water 
container, which receives both oil and produced water from the 
separator, respectively. Produced water containers are typically 
located within the tank battery.
    Produced water containers are located at a facility as part of the 
process that separates the oil from other fractions (water and/or gas). 
A produced water container is generally the last container in the 
separation process, as there may be more than one separator (e.g., 
heater-treater, gun barrel, free water knock-out) used in succession or 
in combination to separate the oil/water fraction.
    To clarify which containers are subject to the requirements of 
Sec.  112.9(c)(6), EPA provides a definition of a produced water 
container in Sec.  112.2. EPA did not propose a definition for produced 
water containers in October 2007, but EPA believes that the definition 
promulgated in this notice is a logical outgrowth of the proposal. In 
the October 2007 proposal, EPA described produced water containers as 
bulk storage containers ``typically located within a tank battery at a 
production facility where they are used to store well fluids after 
separation and prior to subsequent use (e.g., re-injection or reuse), 
further treatment, or disposal.'' 72 FR 58413. EPA asked for and 
received comments on the characteristics of produced water containers 
(72 FR 58414) and crafted a definition to establish the specific 
containers eligible for this exemption consistent with the description 
in the proposal. A produced water container is a bulk storage container 
at an oil production facility used to store the produced water after 
initial oil/water separation, and prior to reinjection, beneficial 
reuse, discharge, or transfer for disposal. Piping and appurtenances 
downstream of the produced water container may include flowlines and 
other appurtenances associated with injection and discharge.
d. Overlap Between Produced Water Container Alternatives and Qualified 
Facilities
    Some production facilities with produced water containers will meet 
the eligibility criteria for qualified facilities, under the previous 
eligibility criteria (see 71 FR 77266, December 26, 2006) or the 
additional criteria finalized in this notice exclusively for oil 
production facilities. EPA notes that both of the optional alternatives 
for a produced water container finalized in this notice (the exemption 
or the alternative requirements in lieu of sized secondary containment) 
require PE certification and are not amendments which can be self-
certified. Therefore, if the owner or operator of an oil production 
facility qualifies as a Tier II qualified facility, and wants to self-
certify his Plan and use one of the alternative approaches for produced 
water containers (exempt a produced water container or take advantage 
of the alternative requirements in Sec.  112.9(c)(6)), then he must use 
a ``hybrid'' SPCC Plan. Sections of the Plan satisfying the produced 
water container requirements of Sec.  112.9(c)(6)

[[Page 74289]]

must be certified by a PE, who completes the attestation in Sec.  
112.3(d)(1)(vi) and/or (vii). Section 112.6(b)(4)(ii) has been modified 
to emphasize this point. An owner or operator of an oil production 
facility which qualifies as a Tier I qualified facility may not use the 
self-certified SPCC Plan template found in Appendix G to 40 CFR part 
112 if he wishes to exempt a produced water container or take advantage 
of the alternative requirements in Sec.  112.9(c)(6), because the 
exemption or alternative requirements for produced water containers 
require PE certification and the template is for self-certification 
only.
    In addition, the exemption for produced water containers meeting 
the criteria under Sec.  112.9(c)(6)(i) can affect the applicability of 
the alternative qualified facility eligibility criteria for oil 
production facilities under Sec.  112.3(g)(2)(ii). Under that section, 
an oil production facility with injection wells does not meet the 
alternative definition of qualified facility. However, if the injection 
well is to inject fluids from a container that is exempt under Sec.  
112.9(c)(6)(i), the presence of that injection well does not make the 
facility ineligible for regulation as a qualified facility under Sec.  
112.3(g)(2)(ii).
    Comments. Many commenters expressed support for exempting produced 
water containers from the secondary containment requirements, SPCC 
regulation and/or an exemption for produced water treatment facilities. 
Some commenters suggested that the produced water containers at these 
facilities be subject to the wastewater treatment exemption. Other 
commenters suggested exempting produced water containers according to 
their location, upstream or downstream of separation, because the 
amount of oil remaining in the water after primary separation and 
treatment is minimal. In fact, several commenters indicated that EPA 
has authority to regulate discharges of oil, not water. Additionally, 
one commenter specifically noted that for older oil fields, produced 
water comprises a large amount of water or brine with extremely low oil 
content, ``perhaps 0.1% or less.'' One commenter claimed that produced 
water containers always have a layer of oil. Another commenter urged 
EPA to allow the certifying engineer to make the determination whether 
a given produced water tank or oil/water separator should have 
secondary containment, rather than including tanks that may or may not 
include measurable amounts of oil. Several commenters suggested 
produced water located at oil and gas facilities should be subject to 
the wastewater treatment exemption.
    Two commenters suggested using ``primary separation'' as the 
difference between upstream and downstream production, while two other 
commenters noted it should be ``after the last separation.'' Two other 
commenters noted that if the facility is relying on gravity separation, 
the atmospheric storage tank should be considered bulk storage.
    Several commenters suggested that discharges are already regulated 
by state law, the National Pollutant Discharge Elimination System 
(NPDES) program, or the Safe Drinking Water Underground Injection 
Control (UIC). DOE cited published information used to establish 
national effluent limitations for coastal oil and gas production 
facilities, discussed the efficiency of control and treatment 
technologies and found that numerous end-of-the-pipe treatment methods 
can achieve this level of effluent quality. One commenter suggested 
exempting NPDES-permitted ponds from storage capacity calculation for 
SPCC and FRP applicability due to their very low oil content.
    Several other commenters addressed the proposed approach for 
additional requirements for produced water containers in lieu of sized 
secondary containment. One commenter supported the inspection, 
maintenance and periodic skimming proposed approach as a second option 
to an exemption. One commenter stated that field operators maintain a 
constant watch over the amount of oil carryover to the produced water 
tanks and when the oil layer reaches the point of being recoverable, 
the oil is skimmed and pumped. One commenter suggested ensuring that 
integrity testing is not required for produced water containers, 
because integrity testing of the typically closed-top fiberglass would 
be problematic, expensive, and difficult. However, other commenters 
opposed reduced requirements for produced water containers and 
expressed concerns about the potential for harmful discharges.
    Response. After evaluating the comments received, EPA is modifying 
the requirements at Sec.  112.9(c) to exempt produced water containers 
that meet certain conditions, and to allow an alternative management 
scheme (which is optional) for produced water containers that are used 
for oil/water separation in lieu of sized secondary containment. In 
deciding how to proceed, EPA acknowledges that the amount of oil by 
volume observed in produced water storage containers varies depending 
on a number of factors, including, but not limited to, separator 
efficiency, age and formation of the oilfield, and use of heat or 
chemical separation. EPA agrees with commenters that after separation, 
the amount of oil remaining in produced water can be minimal given the 
characteristics of the oilfield and facility/separator configuration. 
Therefore, EPA agrees with commenters that certain produced water 
containers with minimal amounts of oil may be eligible for exemption, 
and that certain produced water containers that are used for oil/water 
separation should be subject to differentiated requirements; EPA is 
allowing a PE to make the determination whether a given produced water 
container should be eligible for an exemption from the rule or for 
alternative requirements as described in Sec.  112.9(c)(6)(ii). EPA 
believes the exemption criteria (certification by the PE that no 
discharge from the produced water container, including a complete loss 
of the capacity of the container, could cause a discharge in quantities 
that may be harmful as described in part 110) addresses the commenters' 
concerns about regulating produced water containers that do not contain 
oil in harmful quantities. Further, EPA believes the approach for non-
exempt containers, featuring differentiated requirements and general 
secondary containment, provides appropriate regulatory requirements for 
these produced water containers.
    The Agency does not agree, however, with commenters that produced 
water located at oil and gas facilities should be subject to the 
wastewater treatment exemption. The basis for the conditional exemption 
in these finalized amendments is whether oil is present in quantities 
that may be harmful. As stated in the preamble to the 2002 amendments 
to the SPCC rule, the goal of an oil production, recovery or recycling 
facility is to maximize the production and recovery of oil, which 
presumes that oil is present in quantities that may be harmful (67 FR 
47068, July 17, 2002).
    EPA has created a new section that describes alternative 
requirements for produced water containers (Sec.  112.9(c)(6)) in lieu 
of the sized secondary containment requirements of Sec.  112.9(c)(2) 
and inspection requirements under Sec.  112.9(c)(3). Produced water 
containers are typically found after the primary separation conducted 
by flow-through process vessels at an oil production facility. In order 
to address commenters who suggested using the term ``primary 
separation,'' the Agency has indicated

[[Page 74290]]

in the definition for produced water container that the container is 
used to store produced water after ``initial'' oil/water separation. 
The Agency agrees that produced water containers, including those used 
to separate oil from water by means of gravity separation, are bulk 
storage containers, and are therefore subject to requirements under 
Sec.  112.9(c), including those specifically for produced water 
containers under paragraph (c)(6) of that section.
    EPA agrees with commenters that oil production facilities may be 
regulated under the NPDES, UIC, other Federal regulations, and state 
regulations. However, the Agency's review of the scope of these 
programs and regulations indicates that these regulations do not 
necessarily provide an equivalent level of protection from accidental 
and incidental discharges of harmful quantities of oil to those 
required under the national SPCC requirements. Therefore these programs 
cannot serve solely as a substitute for an SPCC Plan at a facility. EPA 
acknowledges that onshore oil production facilities may discharge 
directly to surface waters pursuant to an NPDES permit and that 
technology-based discharge standards (effluent guidelines) for onshore 
produced water is ``zero discharge'' (with two exceptions: Produced 
water generated west of the 98th meridian that is put to beneficial use 
during the period of discharge (set to 35 mg/L), and stripper wells). 
An NPDES permit typically includes the guideline that the discharge 
``shall be free from substances in amounts which would cause a visible 
sheen or visible deposits in the receiving water or adjoining 
shoreline.'' Because these permitted facilities are required to 
eliminate harmful quantities of oil in produced water, a produced water 
container at the facility may be eligible for the exemption finalized 
in this notice. Additionally, the NPDES requirements may be used by a 
PE to address the certification elements (produced water 
characteristics in the container and any associated piping and 
appurtenances downstream of the container, procedures or maintenance) 
required for the exemption.\9\
---------------------------------------------------------------------------

    \9\ As noted above, because the definition of discharge under 
section 311(a)(2) excludes discharges subject to an NPDES permit, 
SPCC regulations promulgated under section 311(j) do not, and are 
not intended to, prevent such discharges.
---------------------------------------------------------------------------

    The Agency is finalizing an alternative to sized secondary 
containment requirements for a produced water container that does not 
meet the conditional exemption criteria described above. The alternate 
requirements finalized in this action take into consideration the 
commenters suggestions regarding the proposed alternatives. The 
finalized set of requirements include: Implementation of a procedure 
designed to separate the free-phase oil that may accumulate on the 
surface of the produced water, inspection or testing of the produced 
water container and components, prompt removal of or initiation of 
actions to contain and stabilize any oil accumulations, and corrective 
action should a discharge occur. The Agency did not include integrity 
testing in the finalized set of additional requirements. Produced water 
containers used specifically for oil/water separation serve the same 
purpose as separators or flow-through process vessel and thus, EPA is 
applying similar requirements to these containers.
    EPA also agrees with the comment that when an oil layer in a 
produced water container becomes recoverable, the oil is typically 
skimmed and pumped. Consequently, EPA's final rule requiring removal 
and reduction of free-phase oil from the produced water container is 
consistent with industry practice. Whatever procedure is used must be 
developed by a PE, described in the Plan, and implemented by the owner 
or operator to reduce the amount of free-phase oil which may 
accumulate. Records of implementation of these procedures must be 
maintained in accordance with Sec.  112.7(e).
8. Clarification of the Definition of Permanently Closed Containers
    The Agency is addressing concerns expressed by the regulated 
community over the requirements for permanently closing a container, as 
described in the definition of ``permanently closed'' at Sec.  112.2. 
EPA does not believe that further regulatory action is needed to 
address this issue. Specifically, the SPCC rule exempts from 
applicability and from capacity threshold determinations any oil 
storage container that is ``permanently closed.'' For a container to be 
permanently closed, all liquid and sludge must be removed from the 
container and connecting lines, all connecting lines and piping must be 
disconnected from the container and blanked off, all valves, except 
ventilation valves, must be closed and locked, and conspicuous signs 
must be posted on each container stating that it is a permanently 
closed container and noting the date of closure. Once permanently 
closed, a container is no longer required to be counted toward the 
total facility storage capacity, nor is it subject to the other 
requirements under the SPCC rule. The definition does not require that 
a permanently closed container be removed from the facility. In 
addition, any new container brought on to a facility that has never 
stored oil is not subject to the SPCC rule, nor is it counted toward 
the facility capacity until it stores oil. Furthermore, any other 
container that at one time stored oil but no longer contains oil or 
sludge, which is brought on to a facility and meets the definition of 
permanently closed, is not subject to the SPCC rule nor is it counted 
toward the facility capacity until it stores oil.
    EPA also is clarifying that the permanent closure requirements 
under the SPCC rule are separate and distinct from the closure 
requirements in regulations promulgated under Subtitle C of the 
Resource Conservation and Recovery Act (RCRA) (i.e., Standards For 
Owners and Operators of Hazardous Waste Treatment, Storage, and 
Disposal Facilities at 40 CFR part 264 and Interim Status Standards for 
Owners and Operators of Hazardous Waste Treatment, Storage, and 
Disposal Facilities) at 40 CFR part 264 and 265. These regulations 
describe the requirements for operators of facilities that use tank 
systems for storing or treating hazardous waste, as well as the 
requirements for tank closure and post-closure care (Sec. Sec.  264.197 
and 265.197). These requirements generally do not apply to an oil 
production facility. According to the applicability provision in Sec.  
264.1(b), ``the standards in this part apply to owners and operators of 
all facilities which treat, store, or dispose of hazardous waste, 
except as specifically provided otherwise in this part or part 261 of 
this chapter'' (emphasis added). 40 CFR part 261 states that ``Drilling 
fluids, produced waters, and other wastes associated with the 
exploration, development, or production of crude oil, natural gas or 
geothermal energy'' are not hazardous waste (Sec.  261.4(b)(5)). 
Therefore, an oil production facility does not have to undergo the 
expense of permanent closure under Part 264 or 265 of RCRA, because 
these wastes (i.e. drilling fluids, produced waters, and other wastes 
associated with the exploration, development, or production of crude 
oil) are not subject to these regulations.
    Comments. Two commenters expressed support for EPA's proposed 
clarification that permanently closed containers need neither be 
removed from the facility nor be rendered permanently out of use in the 
future. One commenter suggested additional clarification stating that 
permanently sealed, unused oil containers can remain on-site at the 
facility with a minimum of cleaning and preparation.

[[Page 74291]]

Another commenter expressed concern, however, that the cost of closing 
a container would be prohibitive, and suggested it may cause premature 
abandonment of the operation. The commenter suggested that requiring a 
container to be cleaned is not necessary since the container would 
remain within the diked area.
    Several commenters provided other suggested options. One commenter 
suggested that EPA clarify that sealing an empty container removes the 
container from being part of the production facility according to the 
definition of production facility. Agricultural stakeholders suggested 
that EPA modify its position on permanently closed containers so that a 
container removed from service can be placed back into service with 
minimal operational effort so that farmers and agribusiness can acquire 
storage capacity flexibility in response to variable production rates 
and economic conditions. One commenter suggested that small containers 
with a capacity between 500 and 1,500 gallons used for fueling and 
maintenance be allowed to be temporarily closed and exempt from the 
SPCC requirements when closed.
    Response to comments. The Agency recognizes that variable economic 
conditions and production rates at an oil production facility may cause 
certain containers to be unused for long periods of time. However, EPA 
does not believe that it is appropriate to exempt containers from the 
SPCC requirements without requiring that all liquid and sludge be 
removed, even if the container remains in an area that is diked and it 
is for a temporary period of time. A ``temporary closure'' would be 
intended for situations where containers would only be closed for short 
periods of time, and arguably need less stringent requirements than a 
permanent closure. The significant difference in closure requirements 
between EPA's current ``permanent'' closure requirements and the 
suggested ``temporary'' closure requirements appears to be the removal 
of liquid and sludge from the container and connecting lines. EPA 
believes that allowing liquid and sludge to remain in the container, 
without the benefit of the SPCC rule protections, creates the potential 
for a discharge, regardless of the size of the container. One commenter 
suggested that such containers would remain in the diked area and thus, 
the potential for oil to be discharged would be minimal. However, if a 
container was no longer subject to the SPCC rule, there would be no 
requirement that it be contained in a diked area or that any 
precautions be taken to prevent the discharge of oil to navigable 
waters or adjoining shorelines. Finally, EPA believes that the 
permanent closure provisions require actions that render the container 
unavailable for oil storage, by requiring that all connecting lines and 
piping must be disconnected from the container and blanked off, and 
that all valves (except ventilation valves) must be closed and locked, 
thus preventing accidental spills where the container is inadvertently 
filled with oil. These provisions also serve as a clear indicator as to 
the status of a container and whether it is considered a regulated 
container under this rule and part of the storage capacity of the 
facility. EPA believes that these requirements are reasonable and 
provide the flexibility of allowing the container to remain on site for 
future use. EPA does not agree that cleaning a tank is cost-prohibitive 
and may shut in wells prematurely. The decision to clean and close a 
container in accordance with the SPCC provision is typically made by an 
owner or operator who can determine whether it is cost-effective to 
close the tank or to let it remain in service and not incur the costs 
associated with closure, including cleaning.
    The Agency also disagrees with the comments suggesting that an 
owner or operator need only ``seal'' a tank without requiring that all 
liquid and sludge be removed in an effort not to be subject to the SPCC 
rule. For a container to be considered permanently closed at an oil 
production facility, as well as at any other SPCC-regulated facility, 
all liquid and sludge must be removed from the container and connecting 
lines, all connecting lines and piping must be disconnected from the 
container and blanked off, all valves, except ventilation valves, must 
be closed and locked, and conspicuous signs must be posted on each 
container stating that it is a permanently closed container and noting 
the date of closure. Once permanently closed, a container is no longer 
required to be counted toward the total facility storage capacity, nor 
is it subject to the other requirements under the SPCC rule (such as 
secondary containment).
    EPA reiterates the statement it made in the preamble to the July 
2002 amendments to the SPCC rule: ``If a tank is not permanently 
closed, it is still available for storage and the possibility of a 
discharge as described in Sec.  112.1(b), remains. Nor does a short 
time period of storage eliminate the possibility of such a discharge. 
Therefore, a prevention plan is necessary. A tank closed for a 
temporary period of time may contain oil mixed with sludge or residues 
of product, which could be discharged. Discharges from these facilities 
could cause severe environmental damage during such temporary storage 
and are therefore subject to the rule'' (67 FR 47059, July 17, 2002).
    Finally, as noted previously, the definition of ``permanently 
closed'' does not require that a container be removed from the 
facility; permanently closed containers may be brought back into use as 
needed for variations in production rates and economic conditions. 
However, a facility owner or operator should review state and local 
regulations, which may have additional requirements when the container 
is brought back into service.
9. Oil and Natural Gas Pipeline Facilities
    EPA's current SPCC rules exempt ``equipment, or operation of a 
vessel or transportation-related onshore or offshore facility'' that is 
subject to DOT authority under the November 24, 1971 EPA-DOT MOU (1971 
MOU; Appendix A of 40 CFR part 112). The 1971 MOU memorialized the 
agencies' intent to minimize overlapping regulation by ``assign[ing] 
one agency the responsibility for regulating a complete operation at 
any one facility.'' The final rule makes no change in these provisions 
and is not otherwise intended to impose new requirements on DOT-
regulated oil and natural gas pipelines. Rather, by granting operators 
new flexibility in delineating facility boundaries, the final rule 
should reduce uncertainty and minimize, if not eliminate, overlapping 
enforcement. To the same ends, as EPA stated in the NPRM, EPA and DOT 
have committed to realize the goal of the 1971 MOU to more clearly 
define the jurisdictional scope of the SPCC requirements over oil and 
gas related infrastructure.
    Comments. Several commenters expressed support for EPA and DOT in 
committing to a revision of the 1971 MOU, noting that a guideline 
memorandum issued by EPA and DOT in 2000 failed to achieve its intended 
purpose and has created confusion concerning the application of SPCC 
requirements to breakout tanks that are subject to DOT's pipeline 
safety regulation (49 CFR part 195). These commenters urged EPA and DOT 
to withdraw or modify the 2000 memorandum and develop additional 
guidance, with industry input, for eliminating dual regulation of 
pipeline systems. Commenters representing natural gas pipeline 
operators urged EPA and DOT to designate the specific equipment and 
appurtenances that are part of natural gas pipeline systems subject to 
the SPCC exemption in 40

[[Page 74292]]

CFR 112.1. Other commenters suggested that EPA specifically include an 
exemption for dry gas production facilities in the rule language to 
prevent any difference in regional interpretation. Still other 
commenters suggested that EPA determine Agency jurisdiction according 
to the primary function of the facility: one commenter suggested that 
DOT should exert sole jurisdiction over facilities that primarily 
provide breakout or pipeline terminus tankage, and another commenter 
suggested that the percentage of throughput by a particular mode can be 
used to delineate jurisdiction. Finally, other commenters suggested 
that the jurisdiction for all gathering lines should be under the sole 
jurisdiction of DOT, as these gathering pipelines would include both 
pipelines transporting product from a production facility, as well as 
pipelines gathering production from satellite storage locations to a 
central storage location.
    Response to comments. The Agency has consulted with DOT in the 
development of this rulemaking, and will continue these consultations 
to address the EPA/DOT jurisdictional issues. EPA and DOT will revise 
the 2000 guidance memorandum, acknowledging that it has not provided a 
clear basis for implementing the 1971 MOU or delineating EPA and DOT 
jurisdiction. The agencies, as part of that effort, are evaluating the 
viability of a ``primary function'' approach described by commenters. 
EPA will continue work to improve guidance for pipeline operators and 
will communicate the results of discussions in a manner that affords 
public comment.
    With respect to a `dry gas production facility,' the Agency 
maintains its position that a dry gas production facility is not an oil 
production, oil recovery, or oil recycling facility, as described in 
the clarification published May 25, 2004 in the Federal Register notice 
(69 FR 29728) regarding the applicability of the wastewater treatment 
exemption to dry gas facilities. In that notice, EPA stated, ``A dry 
gas production facility is a facility that produces natural gas from a 
well (or wells) from which it does not also produce condensate or crude 
oil that can be drawn off the tanks, containers or other production 
equipment at the facility. As discussed in the preamble to the July 
2002 rulemaking, `the goal of an oil production, oil recovery, or oil 
recycling facility is to maximize the production or recovery of oil. * 
* *' 67 FR 47068. A dry gas facility does not meet this description.'' 
As such, dry gas facilities as defined here are not subject to the SPCC 
requirements and therefore, do not need to be addressed in the EPA/DOT 
MOU.
    EPA disagrees with commenters that all gathering lines should be 
under the jurisdiction of DOT. As explained elsewhere in this notice 
(see discussion on flowlines and intra-facility gathering lines), EPA 
will continue to regulate only those intra-facility gathering lines not 
subject to DOT regulation. EPA is also finalizing an exemption to 
address the concern of commenters regarding dual regulatory 
requirements for these piping systems.

N. Man-made Structures

    The preamble to the October 2007 notice of proposed rulemaking (72 
FR 58378, October 15, 2007) addressed the consideration of man-made 
structures in determining the SPCC rule's applicability. Consistent 
with statements made in the preamble to a 1976 amendment to the rule 
(41 FR 34164, December 11, 1976), EPA maintains that man-made features, 
such as drainage control structures and dikes, are not to be used to 
conclude that there is no reasonable expectation that a discharge from 
the facility will reach navigable waters or adjoining shorelines. If 
there is a reasonable expectation that a discharge from the facility 
would reach navigable waters or adjoining shorelines in the absence of 
such containment or other structures, the facility is subject to the 
SPCC requirements. Secondary containment is required as part of an SPCC 
Plan and man-made structures, such as dikes, berms and retaining walls 
are often used to meet this planning requirement. However, unless 
properly implemented and maintained (as required by the SPCC rule), 
man-made structures may fail, thus putting the environment at risk in 
the event of a discharge. Therefore, it would defeat the preventative 
purpose of the rule to consider these structures (i.e., those required 
by the regulation) when determining applicability of the rule to a 
facility.
    Nevertheless, EPA believes that it is appropriate for a facility 
owner or operator to consider man-made structures (for example, dikes, 
equipment, buildings, basements or other containment structures) to 
determine how to comply with the SPCC rule. More specifically, if an 
oil storage container at a regulated facility is located inside a 
building, the PE or facility owner or operator self-certifying the SPCC 
Plan may take into consideration the ability of the building walls and/
or drainage systems to serve as secondary containment for the 
container. Furthermore, if, at a regulated facility, indoor conditions 
are such that they reduce external corrosion and potential for 
discharges, these operating conditions may be considered in the 
development of a site-specific container integrity inspection program. 
Given the clarifications provided in the preamble discussion of the 
proposal, EPA does not believe that further regulatory action is needed 
to address this issue.
1. Comments
    Many commenters expressed general support for the clarifications on 
man-made structures related to secondary containment and integrity 
testing. One commenter, however, requested additional discussion and 
clarification on ``locationally exempt facilities,'' that is, 
facilities that may not be subject to the SPCC regulations because of 
their low likelihood of discharge to navigable waters or adjoining 
shorelines. The commenter recommended that consideration of man-made 
features that predate construction of an otherwise regulated facility 
should be allowed for a locational exemption.
    Other commenters, however, did not believe that EPA's clarification 
goes far enough and requested specific exemptions based on EPA's 
reasoning regarding the potential ability for building features to 
serve as secondary containment. Thus, these commenters recommended 
exempting certain oil storage units located wholly within buildings, 
such as containers storing hydraulic oil for an elevator, emergency 
generators with a day tank, or machining coolant systems. Finally, one 
commenter recommended clarifying text in Sec.  112.1(d)(1)(i) to 
``allow consideration of such man-made features when conducting a 
reasonable expectation to discharge determination.''
2. Response to Comments
    With regard to the commenter requesting clarification on 
``locationally exempt facilities,'' in 1976, EPA amended the SPCC rule 
to clarify that when determining applicability of the rule to a 
facility, consideration must be based solely upon the geographical 
aspects of the facility, and that consideration of man-made features, 
such as dikes, equipment, or other structures that may serve to 
restrain, hinder, contain or otherwise prevent a discharge as described 
in Sec.  112.1(b) should not be considered. When an owner or operator 
determines that the facility could not reasonably be expected to 
discharge oil in quantities that may be harmful to navigable waters or 
adjoining shorelines based upon geographic and locational aspects of 
the facility, then no SPCC Plan is required,

[[Page 74293]]

such as when a facility is located in a topographic low area or on flat 
land far from navigable waters or adjoining shorelines.
    EPA disagrees with those commenters requesting an exemption for 
oil-filled equipment or other oil storage containers located inside 
buildings. That is, the requirements apply to all containers, unless 
otherwise specifically exempted, whether they are located inside or 
outside a building. Thus, EPA does not agree that text be included in 
Sec.  112.1(d)(1)(i) to allow the consideration of man-made features 
when conducting a reasonable expectation to discharge because, as 
discussed above, the rule already allows the facility owner or operator 
to consider geographical and locational aspects of the facility (such 
as proximity to navigable waters or adjoining shorelines, land contour, 
drainage, etc.) in the determination. However, the SPCC Plan preparer 
may consider whether the building design provides adequate secondary 
containment to meet the general secondary containment requirements 
under Sec.  112.7 for oil storage containers located indoors at a 
regulated facility. The owner or operator of a facility with oil-filled 
equipment may also be eligible for alternative compliance measures 
under Sec.  112.7(k) for qualified oil-filled operational equipment if 
it meets the criteria in Sec.  112.7(k)(1).

O. Underground Emergency Diesel Generator Tanks at Nuclear Power 
Stations

    Under this final action, EPA is exempting underground oil storage 
tanks deferred under 40 CFR part 280, as originally promulgated, that 
supply emergency diesel generators at nuclear power generation 
facilities licensed by Nuclear Regulatory Commission (NRC) and that 
meet the NRC design criteria and quality assurance criteria. This 
exemption includes both tanks that are completely buried and tanks that 
are below-grade and vaulted. An underground storage tank or UST is 
defined in 40 CFR part 280 as ``any one or combination of tanks * * * 
the volume of which is 10 percent or more beneath the surface of the 
ground.'' Below-grade vaulted tanks and completely buried tanks that 
serve as underground emergency diesel generator tanks at nuclear power 
plants fall within this definition. Part 280 also states that a 
``storage tank situated in an underground area (such as a basement, 
cellar, mineworking, drift, shaft, or tunnel) if the storage tank is 
situated upon or above the surface of the floor'' is not an UST. Under 
the NRC regulations, a nuclear power generation facility must meet 
certain design criteria to ensure that the plant will be operated in a 
manner protective of the public's health and safety (such as 10 CFR 
part 50, Appendix A). These NRC design criteria cover the design, 
fabrication, installation, testing and operation of structures, 
systems, and components important to safety. Future construction 
permits and operating licenses for nuclear power stations may be issued 
per 10 CFR part 52, Early Site Permits; Standard Design Certifications; 
and Combined Licenses for Nuclear Power Plants. EPA compared the NRC 
regulations and guidelines with the relevant SPCC requirements. Under 
10 CFR part 50, Appendices A and B, nuclear power generation facility 
operators must identify the relevant codes and standards, develop and 
implement a quality assurance program, and maintain appropriate records 
of the design, fabrication, erection, and testing throughout the life 
of the nuclear unit. The quality assurance program required per 
Appendix B must be documented by written policies, procedures or 
instructions and implemented as documented. To assist nuclear power 
unit licensees in complying with the license requirements, the NRC has 
developed a number of guidance documents, including documents 
pertaining to the operation of standby diesel generators. NRC 
Regulatory Guide 1.137, ``Fuel-Oil Systems for Standby Diesel 
Generators'' details the requirements for inspection and testing of 
fuel oil systems, corrosion protection, and the periodic cleaning of 
fuel supply tanks. These measures are similar to the measures required 
under the SPCC regulation for completely buried tanks, which include 
corrosion protection of buried tanks (Sec.  112.8(c)(4)) and of buried 
piping (Sec.  112.8(d)(1)), and inspection and testing of buried piping 
(Sec.  112.8(d)(4)). According to NRC, this guideline represents one 
acceptable method to meet the NRC requirements for these standby 
systems. If a licensee chooses an alternative approach, then 
equivalency must be demonstrated through an engineering review by the 
NRC as part of the licensing process.
    EPA notes that nuclear power plants have unique characteristics 
that differentiate them from other types of SPCC-regulated facilities. 
Thus, EPA understands that certain actions necessary to comply with the 
SPCC rule could be impracticable at NRC facilities, because they may 
compromise the availability of the emergency diesel generation tank and 
consequently affect the reliability of the nuclear power supply and 
result in the shut down of a nuclear power plant. EPA believes that the 
NRC operating safety requirements best address the specific and unique 
operational challenges at nuclear power plants. EPA is, therefore, 
exempting underground oil storage tanks deferred under 40 CFR part 280 
that supply emergency diesel generators at licensed NRC nuclear power 
generation facilities and that are subject to design criteria and 
quality assurance criteria under the NRC regulations. Below-grade 
vaulted tanks and completely buried tanks that serve as underground 
emergency diesel generator tanks at nuclear power plants fall within 
this exemption. This is consistent with 40 CFR 280.10(c)(3) which 
indicates that ``Any UST system that is part of an emergency generator 
system at nuclear power generation facilities regulated by the Nuclear 
Regulatory Commission under 10 CFR part 50, appendix A'' is deferred 
from regulation under certain parts of part 280. Note also that due to 
this exemption, these tanks are no longer counted toward the aggregate 
oil storage capacity under Sec.  112.1(d)(2)(i).
1. Comments
    Many commenters expressed general support for the amendments. One 
commenter specifically supports the revision in order to avoid dual 
regulation by EPA and NRC. Some commenters, however, expressed concern 
that EPA's proposed language was too narrow, because NRC's licensing 
program does not only regulate tanks under 10 CFR part 50; new 
facilities' tanks are likely to fall under the alternate regulation of 
10 CFR part 52, and some older facilities might not be regulated by 
Appendix A or B of 10 CFR part 50. One commenter suggested that EPA 
remove the specific reference to the text of 10 CFR part 50, replacing 
with more general language.
    Some commenters also suggested that vaulted tanks, which are 
usually aboveground or in a below-grade structural vault, should be 
exempted because of the impracticability of inspecting those tanks. One 
commenter suggested that EPA can use the phrase ``completely below-
grade tank'' in Sec.  112.1(d)(2)(i) and (d)(4) to identify the 
exempted tank universe as including below-grade vaults.
2. Response to Comments
    EPA proposed language (72 FR 58378, October 15, 2007) to exempt 
completely buried tanks at a nuclear power generation facility that 
meet the NRC design criteria specifically at 10 CFR part 50, Appendices 
A and B. The Agency agrees with those commenters

[[Page 74294]]

that suggested this language is too limiting, and that because of this 
narrow reference to specific regulatory citation, grandfathered and/or 
newly constructed tanks at nuclear power generation facilities that are 
licensed by the NRC may not be eligible for the exemption under the 
SPCC rule. The language may also cause future confusion if NRC 
restructures its requirements or imposes new ones; the narrow reference 
may render this amended language obsolete. Therefore, EPA has modified 
the final rule language to address these concerns by not including 
references to 10 CFR Part 50. This will avoid future amendments to the 
SPCC rule in the event that NRC modifies the specific regulatory 
citations regarding design and/or operating requirements for completely 
buried tanks.
    EPA agrees with the commenters who argued that the exemption should 
be extended to below-grade, vaulted tanks that do not meet the 
definition of a completely buried tank as defined in Sec.  112.2. 
Commenters argue that there is insufficient space for physical 
inspection of the emergency diesel generator tanks at nuclear power 
plants that are located in below-grade structural vaults. EPA however, 
disagrees that all below-grade, vaulted tanks should be included in the 
exemption because some of these tanks can be physically inspected. In 
those cases, an inspector can routinely walk into the room and view the 
sides of the tank, while in other cases, the design of the vault is 
such that the space between the vault and the tank makes it impractical 
for an inspector to enter the confined space surrounding the tank on a 
routine basis. Therefore, EPA is extending the exemption to these 
below-grade, vaulted tanks that do not provide enough space for 
physical inspection. By way of background, 40 CFR part 280.12 defines 
an ``underground area'' as ``an underground room, such as a basement, 
cellar, shaft or vault, providing enough space for physical inspection 
of the exterior of the tank situated on or above the surface of the 
floor.'' Thus, where there is insufficient space for physical 
inspection, tanks have been removed from UST regulation. Therefore, EPA 
is basing the exemption on the definition of an UST under part 280, 
which encompasses below-grade, vaulted tanks that cannot be physically 
inspected.

P. Wind Turbines

    The Agency was requested to address the applicability of the SPCC 
rule to wind turbines used to produce electricity. As discussed in the 
October 2007 notice of proposed rulemaking (72 FR 58378, October 15, 
2007), the Agency believes that wind turbines meet the definition of 
oil-filled operational equipment promulgated in the December 2006 SPCC 
rule amendments (71 FR 77266, December 26, 2006), and thus can take 
advantage of the alternative compliance option provided for this type 
of equipment, to the extent that the wind turbines meet the oil storage 
capacity threshold in the rule. The amendments to the SPCC rule 
promulgated in December 2006 allow owners and operators of facilities 
with eligible oil-filled operational equipment the option to prepare an 
oil spill contingency plan and a written commitment of manpower, 
equipment, and materials to expeditiously control and remove any oil 
discharged that may be harmful without having to make an individual 
impracticability determination as required in Sec.  112.7(d). If an 
owner or operator takes this option, he is also required to establish 
and document an inspection or monitoring program for this qualified 
oil-filled operational equipment to detect equipment failure and/or a 
discharge in lieu of providing secondary containment.
1. Comments
    Several commenters agreed that the discussion in EPA's proposal 
added sufficient clarity on the applicability of the SPCC rule to wind 
turbines. One commenter also suggested that the discussion about 
turbines with gearbox capacities of 55 gallons or more meeting the 
definition of oil-filled equipment be included in EPA's SPCC Guidance 
for Regional Inspectors. Finally, one commenter considers a wind farm a 
facility and, asserted that because the total oil stored in the turbine 
gear cases plus the lubricant replacement storage may exceed the 1,320-
gallon threshold, a full SPCC Plan should be required.
2. Response to Comments
    The Agency agrees with those commenters who supported EPA's 
clarification on the applicability of the SPCC requirements to wind 
turbines. In addition, EPA will update the SPCC Guidance for Regional 
Inspectors to reflect the clarifications regarding the applicability of 
the SPCC rule to wind turbines that were discussed in the preamble to 
the proposed rule amendments (72 FR 58378, October 15, 2007). In 
response to the commenter who requested clarity on whether a wind farm 
is a facility, the owner or operator should refer to the definition of 
``facility'' at Sec.  112.2, to determine how to aggregate or 
disaggregate groups of turbines in order to define the boundaries of 
his facility (or facilities). A wind farm facility that meets the 
rule's oil storage capacity threshold and, due to its location, could 
reasonably be expected to have a discharge to navigable waters or 
adjoining shorelines, is subject to the SPCC rule and must prepare and 
implement an SPCC Plan. The clarification provided in this notice does 
not affect the applicability of the rule to wind farm facilities, but 
explains how wind turbines are considered under the rule and what 
provisions may apply to this type of equipment.

Q. Technical Corrections

    EPA is finalizing a technical correction to the introductory 
paragraph of Sec.  112.3 to move the phrase ``in writing'' after ``must 
prepare'' and then insert the phrase ``and implement'' after the phrase 
``in writing,'' in order to provide an explicit requirement for a 
facility owner or operator to both prepare and implement an SPCC Plan. 
This paragraph describes the requirement for an owner or operator of an 
onshore or offshore facility subject to the rule to prepare an SPCC 
Plan, in writing, and in accordance with Sec.  112.7 and any other 
applicable section of the rule. Adding the term ``and implement'' to 
this paragraph is consistent with the subsequent subsections, which 
provide compliance dates to both prepare or amend, and implement, an 
SPCC Plan for various categories of facility owners and operators. In 
describing the requirement to prepare a Plan in the introductory 
paragraph of Sec.  112.3, the Agency inadvertently excluded the 
explicit requirement to also implement that Plan. Clearly, a facility 
owner or operator must implement his SPCC Plan in order for it to be 
effective in preventing discharges of oil to navigable waters or 
adjoining shorelines.
    EPA also is finalizing a technical correction to the introductory 
paragraph of Sec.  112.12 to delete the phrase ``(excluding a 
production facility).'' In the December 2006 amendments to the SPCC 
rule (71 FR 77266, December 26, 2006), EPA amended Subpart C of 40 CFR 
part 112 by removing several sections because they were not appropriate 
for AFVOs. At that time, as a point of clarification, EPA also removed 
the phrase ``for onshore facilities (excluding production facilities)'' 
from the title of Sec.  112.12, because, having removed the 
inapplicable production facility requirements from Subpart C, it was no 
longer necessary to differentiate onshore oil production facilities 
from other facilities in Sec.  112.12. However, EPA inadvertently 
neglected to remove the

[[Page 74295]]

corresponding phrase from the introductory paragraph of the section. 
EPA is correcting this inadvertent omission. Finally, the Agency is 
amending the regulation to include ``U.S.'' before gallons in several 
places, to indicate that the Agency means the U.S. gallon unit of 
measure and not the Imperial unit of measure.
1. Comments
    One commenter expressed support for the technical corrections. 
Another commenter specifically supported the technical correction to 
Sec.  112.12.
2. Response to comments
    The Agency agrees with the need for these technical corrections and 
is finalizing them in this rulemaking.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866--Regulatory Planning and Review

    Under section 3(f)(1) of Executive Order (EO) 12866 (58 FR 51735, 
October 4, 1993), this action is an ``economically significant 
regulatory action'' because it is likely to have an annual effect on 
the economy of $100 million or more. Accordingly, EPA submitted this 
action to the Office of Management and Budget (OMB) for review under EO 
12866 and any changes made in response to OMB's recommendations have 
been documented in the docket for this rulemaking. In addition, EPA 
prepared an analysis of the potential costs and benefits associated 
with this action. This analysis is contained in the regulatory impact 
analysis (RIA) entitled, ``Regulatory Impact Analysis for the Final 
Amendments to the Oil Pollution Prevention Regulations (40 CFR part 
112)'' (July 2008). A copy of the analysis is available in the docket 
for this rulemaking and the analysis is briefly summarized below.
    For the economic impact analysis of these amendments, EPA used the 
SPCC rule requirements at 40 CFR part 112, as amended in July 2002 (67 
FR 47042, July 17, 2002) as the baseline to estimate the potential cost 
savings to regulated facilities from these amendments. The cost savings 
are not adjusted for the estimated, potential cost savings for the 2006 
rule amendments and may overestimate the cost savings for these 
amendments, particularly for Tier I qualified facilities, revisions to 
the integrity testing requirement, and the proposed amendments to delay 
SPCC Plan preparation and implementation for new oil production 
facilities. The regulatory impact analysis developed in support of this 
final rule compares the compliance costs for owners and operators of 
facilities affected by the amendments in this rule to the costs owners 
and operators would face under the July 2002 SPCC rule amendments. The 
regulatory amendments have fourteen major components: (1) Exempt hot-
mix asphalt; (2) exempt pesticide application equipment and related mix 
containers; (3) exempt residential heating oil containers at single-
family residences; (4) amend the definition of ``facility'' to clarify 
the currently existing flexibility associated with describing a 
facility's boundaries; (5) amend the facility diagram requirement to 
provide additional clarity; (6) define ``loading/unloading rack'' to 
clarify the equipment subject to the provisions for facility tank car 
and tank truck loading/unloading racks, as well as amending the 
provision for this equipment; (7) provide streamlined requirements for 
a subset of qualified facilities; (8) amend the general secondary 
containment requirement to provide more clarity; (9) exempt non-
transportation-related tank trucks from the sized secondary containment 
requirements; (10) amend the security requirements; (11) amend the 
integrity testing requirements to allow a greater amount of flexibility 
in the use of industry standards; (12) amend the integrity testing 
requirements for containers that store AFVOs that meet certain 
criteria; (13) tailor a number of requirements at oil production 
facilities; and (14) exempt underground oil storage tanks at nuclear 
power generation facilities. EPA is also providing clarification in the 
preamble to this rule on two additional issues identified by the 
regulated community: (1) The consideration of man-made structures in 
determining how to comply with the SPCC rule requirements and (2) the 
applicability of the rule to wind turbines for electricity generation.
    For each of these components, EPA estimated potential cost savings 
to regulated facilities that may result from reductions in compliance 
costs. The main steps used to estimate the compliance cost impacts of 
this final rule are as follows:
     Develop the baseline universe of SPCC-regulated 
facilities;
     Estimate the number of facilities affected by the rule 
amendments;
     Estimate changes in unit compliance cost for each 
regulated facility affected by the rule;
     Estimate total compliance cost savings to owners and 
operators of potentially affected facilities; and
     Annualize compliance cost savings over a ten-year period, 
2010 through 2019, and discount the estimates using three and seven 
percent discount rates.
    Based on these steps, EPA estimated the annualized compliance cost 
savings to potentially affected facilities associated with each of the 
major components of the rule, and presents the results of the economic 
analysis in Exhibit 1. EPA uses four key assumptions in its regulatory 
impact analysis. First, the Agency assumes that cost minimization 
behavior applies to all owners and operators of facilities that qualify 
for reduced regulatory requirements, whereby all those affected would 
seek burden relief. Second, EPA assumed, consistent with EPA's 
guidelines for conducting economic analyses, that all existing owners 
and operators of facilities are in full compliance with the July 17, 
2002 amendments to the SPCC rule (67 FR 47042). Third, EPA assumes that 
owners and operators of existing SPCC-regulated facilities would forgo 
compliance activities offered as alternatives where there is only a 
one-time initial investment because they would have already incurred 
the one-time cost. For example, EPA assumes that an owner or operator 
of an existing facility who would qualify for reduced security 
requirements under the final rule that allows facility owners or 
operators to tailor their security measures to the facility's specific 
characteristics and location, would have already provided the security 
measures as per the July 2002 rule amendments or demonstrated 
environmental equivalence for tailored security measures. Therefore, 
owners and operators of existing facilities would not take advantage of 
the provided alternative. Fourth, EPA assumes that compliance is 
nationally consistent although EPA recognizes that there is variability 
in state regulations and the distribution of affected facilities.
    Exhibit 1 presents the estimated cost savings for each rule 
component and for the final rule amendments in total. For several rule 
amendments, such as the security requirements and facilities handling 
AFVOs, EPA did not have numeric data on the number of affected 
facilities within a general industry sector; thus, it developed three 
scenarios to evaluate a range of cost savings.\10\ The exhibit below 
presents

[[Page 74296]]

the estimated cost savings for these regulatory amendments which EPA 
estimates to be about $176 million on an annualized basis (2007$). The 
total potential cost savings are calculated taking into account the 
mid-point values of the estimated ranges of statistical distributions 
for unit costs. These estimates are not necessarily additive, given 
that they do not account for interactions that might exist among the 
various components of the rule.\11\
---------------------------------------------------------------------------

    \10\ For example, to develop a range for the number of affected 
AFVO facilities, EPA contacted industry experts who determined that 
40 percent to 90 percent of containers at AFVO facilities are made 
of stainless steel and almost all containers have bottom drainage. 
Therefore, based on professional judgment, the Agency considered 
three scenarios: 40% (low), 65% (medium) and 90% (high) of all AFVO 
facilities would have food oil tanks that are eligible.
    \11\ Certain industry sectors are affected by multiple rule 
components. As a result, taking advantage of one new requirement 
might preclude a facility from benefiting from other proposed 
requirements. The estimate also takes into account the overlap of 
the six-month delay with the relief for new small production 
facilities. The six-month delay is specifically designed to allow 
time for the facility production operations to stabilize in order to 
avoid the need for multiple certifications of the Plan by a PE. 
However, because small production facilities that meet the new 
qualified facility criteria would not have to have their SPCC Plan 
certified by a PE, they will not incur cost savings from the six-
month delay in preparing SPCC Plan.
---------------------------------------------------------------------------

    The oil production sector and farms will benefit from multiple 
components of the final rule. Specifically, farms will benefit from the 
amendments to: requirements for qualified facilities (i.e., Tier I); 
and security requirements, integrity testing requirements, and the 
facility diagram requirements. Farms will also benefit from the 
exemption from loading/unloading rack requirements; the exemption for 
pesticide application equipment and related mix containers, and single-
family residential heating oil containers; and clarifications for nurse 
tanks and the definition of ``facility.'' The total cost savings to 
farm owners and operators from these amendments are estimated at $13 
million on an annualized basis (2007$).
    The oil production sector will also benefit from a number of the 
revisions to the SPCC rules, including the facility diagram 
requirements; an exemption from the loading/unloading rack requirements 
and for certain produced water containers when certified by a PE; some 
will benefit from the new requirements for Tier I qualified facilities; 
and amendments specific to the oil production sector (for example, the 
six-month delay in preparation and implementation of SPCC Plans and the 
exemption of flow-through process vessels from sized secondary 
containment requirements). The total savings to owners and operators of 
oil production facilities from all of the amendments that affect this 
sector are estimated at $116 million on an annualized basis (2007$).

                   Exhibit 1--Estimated Compliance Cost Savings for the Regulatory Amendments
----------------------------------------------------------------------------------------------------------------
                                                              Annualized cost savings  ($2007, in millions, 7%
                  Rule component/scenario                                      discount rate)
----------------------------------------------------------------------------------------------------------------
Hot-Mix Asphalt:
    Exempt HMA containers.................................  $8
Farms:
    Exempt pesticide application equipment and related mix  $4
     containers.
    Applicability of Mobile Refueler Requirements to Farm   ....................................................
     Nurse Tanks.
Residential Heating Oil Containers:
    Exempt single-family residential heating oil            $2
     containers.
Definition of Facility:
    Revise the definition of ``facility''.................  No cost impact.
Facility Diagram:
    Revise facility diagram requirement...................  $3
Loading/Unloading Racks \1\:
    Define ``loading/unloading rack''.....................  $51
Tier I Qualified Facilities:
    Provide streamlined requirements for Tier I qualified   $24
     facilities.
General Secondary Containment:
    Revisions to the general secondary containment          No cost impact.
     provision.
General Secondary Containment for Non-Transportation-
 Related Tank Trucks:
    Extend regulatory relief for mobile refuelers to the    No cost impact.
     non-transportation-related tank trucks.
Security Requirements:
    Revise security requirements \2\......................  $9
Integrity Testing:
    Amend the integrity testing requirements to allow a     $11
     greater amount of flexibility in the use of industry
     standards at all facilities.
Animal Fats and Vegetable Oil:
    Amend integrity testing requirements for AFVO           $2
     containers that meet certain criteria \3\.
Oil Production Facilities:
    Six-month delay for Plan preparation and                $24
     implementation.
    Exempt flowlines and gathering lines from secondary     No net cost impact.
     containment.
    Flow-through process vessels..........................  $7
    Streamlined requirements for small production           $30
     facilities with marginal wells.
    Produced water containers.............................  No cost savings estimated.
Man-Made Structures:
    Consider manmade structures in determining SPCC rule    No cost impact.
     applicability.
Nuclear Power Stations:
    Exempt underground oil storage tanks at nuclear power   Less than $1.
     generation facilities..
Wind turbines:
    Clarify applicability of the rule to wind turbines      No cost impact.
     used to produce electricity.
        Total.............................................  $176
----------------------------------------------------------------------------------------------------------------
\1\ Mid-point estimate (17% of oil production facilities, 50% of AFVO facilities, and 8% of medium and large
  farms affected). Cost savings might be higher or lower using different assumptions.
\2\ Mid-point estimate (50% of farms affected). Cost savings might be higher or lower using different
  assumptions.
\3\ Mid-point estimate (65% of facilities affected). Cost savings might be lower using different assumptions.

[[Page 74297]]

    EPA recognizes that the economic analysis is constrained by limited 
availability of data and information. The SPCC regulation does not have 
a notification requirement for regulated facilities and thus, EPA 
relies on state information; Federal and proprietary databases; and 
information from industry experts as a basis for the cost information 
included in the analysis.

B. Paperwork Reduction Act

    The information collection requirements for this final rule have 
been submitted for approval to OMB under the Paperwork Reduction Act, 
44 U.S.C. 3501 et seq. The information collection requirements are not 
enforceable until OMB approves them. The Information Collection Request 
(ICR) document prepared by EPA has been assigned EPA ICR number 
0328.14.
    EPA does not collect the information required by the SPCC rule on a 
routine basis. SPCC Plans ordinarily need not be submitted to EPA, but 
must generally be maintained at the facility. Preparation, 
implementation, and maintenance of an SPCC Plan by the facility owner 
or operator helps prevent oil discharges to navigable waters or 
adjoining shorelines and mitigate the environmental damage caused by 
such discharges. Therefore, the primary user of the data is the 
facility personnel. While EPA may, from time to time, request 
information under these regulations, such requests are not routine.
    Although facility personnel are the primary data user, EPA also 
uses the data in certain situations. In particular, EPA reviews SPCC 
Plans: (1) When it requests a facility owner or operator to submit 
required information in the event of certain discharges of oil or to 
evaluate an extension request; and (2) as part of EPA's inspection 
program. State and local governments also may use the data, which are 
not necessarily available elsewhere and can greatly assist local 
emergency preparedness efforts. Preparation of the information for 
affected facilities is required under section 311(j)(1) of the Clean 
Water Act as implemented by 40 CFR part 112.
    EPA estimates that in the absence of this rulemaking, approximately 
623,000 existing facilities would be subject to the SPCC rule in 2010 
and have SPCC Plans. In addition, EPA estimates that approximately 
17,400 new facilities would become subject to the SPCC requirements 
during that year, resulting in a total of about 640,000 regulated 
facilities in 2010.\12\
---------------------------------------------------------------------------

    \12\ To estimate the number of SPCC-regulated facilities in 
2010, EPA used the estimated number of facilities for 2005 (571,000) 
and applied annual, industry-specific growth rates that resulted in 
about 640,000 facilities.
---------------------------------------------------------------------------

    Under this final rule, the storage capacity of containers solely 
containing HMA, residential heating oil containers at single-family 
residences, pesticide application equipment and related mix containers, 
and underground oil storage tanks at nuclear power generation 
facilities are exempt from the SPCC requirements; EPA is amending the 
definition of ``facility'' to clarify that contiguous or non-contiguous 
buildings, properties, parcels, leases, structures, installations, 
pipes, or pipelines may be considered separate facilities, and to 
specify that the ``facility'' definition governs the applicability of 
40 CFR part 112; EPA is amending the facility diagram requirement to 
provide additional clarity for all facilities; EPA is providing a 
definition for the term ``loading/unloading rack,'' which determines 
whether a facility is subject to the provisions at Sec.  112.7(h), as 
well as specifically excluding onshore oil production facilities and 
farms from the requirements of Sec.  112.7(h); providing an option that 
allows a subset of qualified facilities (Tier I) to complete and 
implement an SPCC Plan template (Appendix G to 40 CFR part 112) in 
order to comply with the SPCC rule requirements; amending the general 
secondary containment requirements to provide more clarity; exempting 
non-transportation-related tank trucks from the sized secondary 
containment requirements; modifying the security requirements to allow 
an owner or operator to tailor his security measures to the facility's 
specific characteristics and location; replacing the current integrity 
testing requirements with the requirements provided for qualified 
facilities, as promulgated in December 2006; providing flexibility in 
the rule for determining the scope of integrity testing that is 
appropriate for containers that store AFVOs that are intended for human 
consumption and that meet other criteria; and finally, this rulemaking 
streamlines the requirements for oil production facilities by modifying 
the definition of production facility to be consistent with the 
amendments to the definition of facility, extending the timeframe by 
which a new oil production facility must prepare and implement an SPCC 
Plan, providing an alternative option for flow-through process vessels 
at oil production facilities to comply with the general secondary 
containment requirements and additional oil spill prevention measures 
in lieu of sized secondary containment requirements, establishing more 
specific requirements for contingency planning and a flowline/intra-
facility gathering line maintenance program, while exempting such 
flowlines and intra-facility gathering lines at oil production 
facilities from the secondary containment requirements, providing an 
exemption for certain intra-facility gathering lines, exempting certain 
produced water storage containers at oil production facilities that do 
not contain oil as certified by a Professional Engineer (PE), 
establishing alternative criteria for an oil production facility to be 
eligible to self-certify an SPCC Plan as a qualified facility, and 
clarifying the definition of ``permanently closed'' as it applies to an 
oil production facility.
    Under this action, an estimated 640,000 regulated facilities are 
subject to the SPCC information collection requirements of this rule in 
2010.\13\ The Agency estimates that as a result of these amendments to 
tailor, clarify, and streamline certain SPCC requirements, the 
reporting and recordkeeping burden would decrease by approximately 1.3 
million hours. The final rule amendments would reduce capital and 
operation and management costs by approximately $53 million on an 
annualized basis.\14\ Burden is defined at 5 CFR 1320.3(b).
---------------------------------------------------------------------------

    \13\ To estimate the number of SPCC-regulated facilities in 
2010, EPA used the estimated number of facilities for 2005 (571,000) 
and applied annual industry-specific growth rates.
    \14\ The paperwork burden reduction does not include the 
reduction associated with the amendment for milk bulk storage 
containers, because EPA only accounted for containers storing 
petroleum-based oil and not milk or related substances, when 
estimating the universe of affected facilities.
---------------------------------------------------------------------------

    An agency may not conduct or sponsor, and a person is not required 
to respond to a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR part 9. When this ICR is 
approved by OMB, the Agency will publish a technical amendment to 40 
CFR part 9 in the Federal Register to display the OMB control number 
for the approved information collection requirements contained in this 
final rule.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act generally requires an agency to 
prepare a regulatory flexibility analysis of any rule subject to notice 
and comment rulemaking requirements under the Administrative Procedure 
Act or any other statute unless the agency certifies that the rule will 
not have a significant economic impact on a substantial number of small 
entities. Small entities

[[Page 74298]]

include small businesses, small organizations, and small governmental 
jurisdictions.
    For purposes of assessing the impacts of this final rule on small 
entities, a small entity is defined as: (1) A small business as defined 
in the U.S. Small Business Administration's (SBA) regulations at 13 CFR 
121.201--the SBA defines small businesses by category of business using 
North American Industry Classification System (NAICS) codes, and in the 
case of farms and oil production facilities, which constitute a large 
percentage of the facilities affected by this rule, generally defines 
small businesses as having less than $0.5 million to $27.5 million per 
year in sales receipts, depending on the industry, or 500 or fewer 
employees, respectively; (2) a small governmental jurisdiction that is 
a government of a city, county, town, school district or special 
district with a population of less than 50,000; and (3) a small 
organization that is any not-for-profit enterprise that is 
independently owned and operated and is not dominant in its field.
    After considering the economic impacts of this rule on small 
entities, the Agency certifies that this action would not have a 
significant economic impact on a substantial number of small entities. 
In determining whether a rule has a significant economic impact on a 
substantial number of small entities, the impact of concern is any 
significant adverse economic impact on small entities, since the 
primary purpose of the regulatory flexibility analyses is to identify 
and address regulatory alternatives ``which minimize any significant 
economic impact of the rule on small entities'' (5 U.S.C. 603 and 604). 
Thus, an agency may certify that a rule would not have a significant 
economic impact on a substantial number of small entities if the rule 
relieves regulatory burden, or otherwise has a positive economic effect 
on all of the small entities subject to the rule.
    Under the final rule amendments, the following issues are 
addressed: Exempt HMA and HMA containers, pesticide application 
equipment and related mix containers, residential heating oil 
containers at single-family residences, and underground oil storage 
tanks at nuclear power generation facilities from the SPCC 
requirements; amend the definition of ``facility'' to clarify the 
flexibility associated with the existing definition in describing a 
facility's boundaries; clarify how containers, fixed and mobile, are 
identified on the facility diagram; define ``loading/unloading rack'' 
to clarify whether a facility is subject to the SPCC rule requirements 
of Sec.  112.7(h); streamline the requirements for a subset of 
qualified facilities (Tier I qualified facilities); amend the general 
secondary containment requirements to provide more clarity; exempt non-
transportation-related tank trucks from the sized secondary containment 
requirements; amend the facility security requirements to allow an 
owner or operator to tailor security measures to his facility's 
specific characteristics and location; replace the current integrity 
testing requirements with the regulatory requirements for a qualified 
facility promulgated on December 26, 2006 (71 FR 77266); provide 
flexibility in the rule to determine the scope of integrity testing 
that is appropriate for containers that store AFVOs that are intended 
for human consumption and that meet other criteria; and initiate 
several amendments to tailor the requirements for oil production 
facilities to address concerns raised by the production sector, 
respectively.
    Overall, EPA estimates that this action will reduce annual 
compliance costs by approximately $176 million on an annualized basis 
(2007$) for owners and operators of affected facilities. Total costs 
were annualized over a 10-year period using a seven percent discount 
rate. EPA derived these savings by estimating the number of facilities 
affected by each amendment; identifying the specific behavioral changes 
that may occur (for example, choosing to prepare an SPCC Plan template 
instead of a full SPCC Plan); estimating the unit costs of compliance 
measures under the baseline and amended scenarios; and applying the 
change in unit costs to the projected number of affected facilities.
    EPA has therefore concluded that this rule will relieve regulatory 
burden for small entities and therefore, certify that this rule will 
not have a significant economic impact on a substantial number of small 
entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on state, local, and tribal 
governments and the private sector. Under section 202 of UMRA, EPA 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to state, local, and tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
one year. Before promulgating an EPA rule for which a written statement 
is needed, section 205 of UMRA generally requires EPA to identify and 
consider a reasonable number of regulatory alternatives and adopt the 
least costly, most cost-effective, or least burdensome alternative that 
achieves the objectives of the rule. The provisions of section 205 do 
not apply when they are inconsistent with applicable law. Moreover, 
section 205 allows EPA to adopt an alternative other than the least 
costly, most cost-effective, or least burdensome alternative if the 
Administrator publishes with the rule an explanation why that 
alternative was not adopted.
    Before EPA establishes any regulatory requirements that may 
significantly or uniquely affect small governments, including tribal 
governments, it must have developed under section 203 of UMRA a small 
government agency plan. The plan must provide for notifying potentially 
affected small governments, enabling officials of affected small 
governments to have meaningful and timely input in the development of 
EPA regulatory proposals with significant Federal intergovernmental 
mandates, and informing, educating, and advising small governments on 
compliance with the regulatory requirements.
    EPA has determined that this rule amendment does not contain a 
Federal mandate that may result in expenditures of $100 million or more 
for state, local, and tribal governments, in the aggregate, or the 
private sector in any one year. This final rule would reduce compliance 
costs on owners and operators of affected facilities by approximately 
$176 million on an annualized basis (2007$), although EPA acknowledges 
this total estimate is derived from analyses of individual major 
components of the rule that are not necessarily additive, given that 
they do not account for interactions that may exist among the various 
components. Thus, this rule amendment is not subject to the 
requirements of sections 202 and 205 of the UMRA.
    EPA has determined that this rule amendment contains no regulatory 
requirements that might significantly or uniquely affect small 
governments. As explained above, the effect of the rule amendment will 
be to reduce burden for facility owners and operators, including 
certain small governments that are subject to the rule.

E. Executive Order--13132 Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), requires EPA to develop an accountable process to ensure 
``meaningful and timely input by State

[[Page 74299]]

and local officials in the development of regulatory policies that have 
federalism implications.'' ``Policies that have federalism 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.''
    This rule amendment does not have federalism implications. It would 
not have substantial direct effects on the states, on the relationship 
between the national government and the states, or on the distribution 
of power and responsibilities among the various levels of government, 
as specified in Executive Order 13132. Under CWA section 311(o), states 
may impose additional requirements, including more stringent 
requirements, relating to the prevention of oil discharges to navigable 
waters or adjoining shorelines. EPA recognizes that some states have 
more stringent requirements (56 FR 54612, October 22, 1991). This rule 
amendment will not preempt state law or regulations. Thus, Executive 
Order 13132 does not apply to this action.

F. Executive Order 13175--Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Governments'' (65 FR 67249, November 9, 2000), 
requires EPA to develop an accountable process to ensure ``meaningful 
and timely input by tribal officials in the development of regulatory 
policies that have tribal implications.'' This rule amendment does not 
have tribal implications, as specified in Executive Order 13175. This 
rule amendment will not significantly or uniquely affect communities of 
Indian trial governments. Thus, Executive Order 13175 does not apply to 
this action.

G. Executive Order 13045--Protection of Children from Environmental 
Health & Safety Risks

    Executive Order 13045,'' Protection of Children from Environmental 
Health Risks and Safety Risks'' (62 FR 19885, April 23, 1997) applies 
to any rule that: (1) Is determined to be ``economically significant'' 
as defined under Executive Order 12866, and (2) concerns an 
environmental health or safety risk that EPA has reason to believe may 
have a disproportionate effect on children. If the regulatory action 
meets both criteria, the Agency must evaluate the environmental health 
or safety effects of the planned rule on children, and explain why the 
planned regulation is preferable to other potentially effective and 
reasonably feasible alternatives considered by the Agency.
    Although this final rule is economically significant in that it 
would reduce compliance costs on owners or operators of affected 
facilities by approximately $176 million on an annualized basis 
(2007$), it is not subject to the Executive Order because the Agency 
does not have reason to believe the environmental health or safety risk 
addressed by this action presents a disproportionate risk to children.

H. Executive Order 13211--Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This rule amendment is not a ``significant energy action'' as 
defined in Executive Order 13211, ``Actions Concerning Regulations that 
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 
28355, May 22, 2001) because it is not likely to have a significant 
adverse effect on the supply, distribution, or use of energy. The 
overall effect of the action is to decrease the regulatory burden on 
facility owners or operators subject to its provisions.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 
note) directs EPA to use voluntary consensus standards in its 
regulatory activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. Voluntary consensus standards 
are technical standards, such as materials specifications, test 
methods, sampling procedures, and business practices that are developed 
or adopted by voluntary consensus standards bodies. The NTTAA directs 
EPA to provide Congress, through OMB, explanations when the Agency 
decides not to use available and applicable voluntary consensus 
standards.
    The owner or operator of a facility subject to the SPCC rule has 
the flexibility to consider applicable industry standards in the 
development of an SPCC Plan, in accordance with good engineering 
practice. However, this rulemaking does not involve technical 
standards, as it does not set or incorporate by reference any one 
specific technical standard. Therefore, the NTTAA does not apply.

J. Executive Order 12898--Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629, February 16, 1994) establishes 
Federal executive policy on environmental justice. Its main provision 
directs Federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States. EPA has determined that this final 
rule will not have disproportionately high and adverse human health or 
environmental effects on minority or low-income populations because it 
does not affect the level of protection provided to human health or the 
environment. The overall effect of the action is to decrease the 
regulatory burden on facility owners or operators subject to its 
provisions.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is a ``major rule'' as defined by 5 U.S.C. 804(2) 
because it will likely result in an annual effect on the economy of 
$100 million or more. This rule will be in effect on February 3, 2009.

List of Subjects in 40 CFR Part 112

    Environmental protection, Animal fats and vegetable oils, Hot-mix 
Asphalt, Farms, Flammable and combustible materials, Integrity testing, 
Loading racks, Materials handling and storage, Natural gas, Oil 
pollution, Oil and gas exploration and production, Oil spill response, 
Penalties, Petroleum, Reporting and recordkeeping requirements, 
Secondary containment, Security, Tanks, Unloading racks, Water 
pollution control, Water resources.

[[Page 74300]]

    Dated: November 20, 2008.
Stephen L. Johnson,
Administrator.

0
For the reasons stated in the preamble, the Environmental Protection 
Agency amends 40 CFR part 112 as follows:

PART 112--OIL POLLUTION PREVENTION

0
1. The authority citation for part 112 continues to read as follows:

    Authority: 33 U.S.C. 1251 et seq.; 33 U.S.C. 2720; and E.O. 
12777 (October 18, 1991), 3 CFR, 1991 Comp., p. 351.

Subpart A--[Amended]

0
2. Amend Sec.  112.1 as follows:
0
a. By revising paragraphs (d)(2)(i) and (d)(2)(ii);
0
b. By revising paragraph (d)(4); and
0
c. By adding paragraphs (d)(8) through (d)(12).

Sec.  112.1  General applicability.

* * * * *
    (d) * * *
    (2) * * *
    (i) The completely buried storage capacity of the facility is 
42,000 U.S. gallons or less of oil. For purposes of this exemption, the 
completely buried storage capacity of a facility excludes the capacity 
of a completely buried tank, as defined in Sec.  112.2, and connected 
underground piping, underground ancillary equipment, and containment 
systems, that is currently subject to all of the technical requirements 
of part 280 of this chapter or all of the technical requirements of a 
State program approved under part 281 of this chapter, or the capacity 
of any underground oil storage tanks deferred under 40 CFR part 280 
that supply emergency diesel generators at a nuclear power generation 
facility licensed by the Nuclear Regulatory Commission and subject to 
any Nuclear Regulatory Commission provision regarding design and 
quality criteria, not limited to 10 CFR part 50. The completely buried 
storage capacity of a facility also excludes the capacity of a 
container that is ``permanently closed,'' as defined in Sec.  112.2 and 
the capacity of intra-facility gathering lines subject to the 
regulatory requirements of 49 CFR part 192 or 195.
    (ii) The aggregate aboveground storage capacity of the facility is 
1,320 U.S. gallons or less of oil. For the purposes of this exemption, 
only containers with a capacity of 55 U.S. gallons or greater are 
counted. The aggregate aboveground storage capacity of a facility 
excludes:
    (A) The capacity of a container that is ``permanently closed'' as 
defined in Sec.  112.2;
    (B) The capacity of a ``motive power container'' as defined in 
Sec.  112.2;
    (C) The capacity of hot-mix asphalt or any hot-mix asphalt 
container;
    (D) The capacity of a container for heating oil used solely at a 
single-family residence;
    (E) The capacity of pesticide application equipment and related mix 
containers.
    (F) The capacity of a produced water container, as defined in Sec.  
112.2, and any associated piping or appurtenances downstream of the 
container, that meets the requirements at Sec.  112.9(c)(6)(i).
* * * * *
    (4) Any completely buried storage tank, as defined in Sec.  112.2, 
and connected underground piping, underground ancillary equipment, and 
containment systems, at any facility, that is subject to all of the 
technical requirements of part 280 of this chapter or a State program 
approved under part 281 of this chapter, or any underground oil storage 
tanks including below-grade vaulted tanks, deferred under 40 CFR part 
280, as originally promulgated, that supply emergency diesel generators 
at a nuclear power generation facility licensed by the Nuclear 
Regulatory Commission, except that such a tank may qualify for the 
exemption if it is subject to any Nuclear Regulatory Commission 
provision regarding design and quality criteria, not limited to 10 CFR 
part 50. Such emergency generator tanks must be marked on the facility 
diagram as provided in Sec.  112.7(a)(3), if the facility is otherwise 
subject to this part.
* * * * *
    (8) Hot-mix asphalt, or any hot-mix asphalt container.
    (9) Any container for heating oil used solely at a single-family 
residence.
    (10) Any pesticide application equipment or related mix containers.
    (11) Intra-facility gathering lines subject to the regulatory 
requirements of 49 CFR part 192 or 195, except that such a line's 
location must be identified and marked as ``exempt'' on the facility 
diagram as provided in Sec.  112.7(a)(3), if the facility is otherwise 
subject to this part.
    (12) A produced water container, as defined in Sec.  112.2 and any 
associated piping or appurtenances downstream of the container, that 
meets the requirements at Sec.  112.9(c)(6)(i), except that such a 
tank's location must be identified and marked as ``exempt'' on the 
facility diagram as provided in Sec.  112.7(a)(3), if the facility is 
otherwise subject to this part.
* * * * *

0
3. Amend Sec.  112.2 by revising the definitions for ``Facility,'' 
``Production facility,'' and adding definitions for ``Loading/unloading 
rack'' and ``Produced water container'' in alphabetical order to read 
as follows:

Sec.  112.2  Definitions.

* * * * *
    Facility means any mobile or fixed, onshore or offshore building, 
property, parcel, lease, structure, installation, equipment, pipe, or 
pipeline (other than a vessel or a public vessel) used in oil well 
drilling operations, oil production, oil refining, oil storage, oil 
gathering, oil processing, oil transfer, oil distribution, and oil 
waste treatment, or in which oil is used, as described in Appendix A to 
this part. The boundaries of a facility depend on several site-specific 
factors, including but not limited to, the ownership or operation of 
buildings, structures, and equipment on the same site and types of 
activity at the site. Contiguous or non-contiguous buildings, 
properties, parcels, leases, structures, installations, pipes, or 
pipelines under the ownership or operation of the same person may be 
considered separate facilities. Only this definition governs whether a 
facility is subject to this part.
* * * * *
    Loading/unloading rack means a fixed structure (such as a platform, 
gangway) necessary for loading or unloading a tank truck or tank car, 
which is located at a facility subject to the requirements of this 
part. A loading/unloading rack includes a loading or unloading arm, and 
may include any combination of the following: piping assemblages, 
valves, pumps, shut-off devices, overfill sensors, or personnel safety 
devices.
* * * * *
    Produced water container means a storage container at an oil 
production facility used to store the produced water after initial oil/
water separation, and prior to reinjection, beneficial reuse, 
discharge, or transfer for disposal.
    Production facility means all structures (including but not limited 
to wells, platforms, or storage facilities), piping (including but not 
limited to flowlines or intra-facility gathering lines), or equipment 
(including but not limited to workover equipment, separation equipment, 
or auxiliary non-transportation-related equipment) used in the 
production, extraction, recovery, lifting, stabilization, separation or 
treating of oil (including condensate), or associated storage or 
measurement, and is located in an oil or gas field, at a facility. This 
definition governs whether such structures, piping, or equipment

[[Page 74301]]

are subject to a specific section of this part.
* * * * *

0
4. Amend Sec.  112.3 as follows:
0
a. By revising the introductory text;
0
b. By revising paragraph (b)(1);
0
c. By adding paragraph (b)(3);
0
d. By adding paragraph (d)(1)(vi) and (d)(1)(vii); and
0
e. By revising paragraph (g).

Sec.  112.3  Requirement to prepare and implement a Spill Prevention, 
Control, and Countermeasure Plan.

    The owner or operator or an onshore or offshore facility subject to 
this section must prepare in writing and implement a Spill Prevention 
Control and Countermeasure Plan (hereafter ``SPCC Plan'' or 
``Plan''),'' in accordance with Sec.  112.7 and any other applicable 
section of this part.
* * * * *
    (b)(1) If you are the owner or operator of an onshore or offshore 
facility (excluding oil production facilities) that becomes operational 
after July 1, 2009, and could reasonably be expected to have a 
discharge as described in Sec.  112.1(b), you must prepare and 
implement a Plan before you begin operations.
* * * * *
    (3) If you are the owner or operator of an oil production facility 
that becomes operational after July 1, 2009, and could reasonably be 
expected to have a discharge as described in Sec.  112.1(b), you must 
prepare and implement a Plan within six months after you begin 
operations.
* * * * *
    (d) * * *
    (vi) That, if applicable, all exempted produced water containers 
and any associated piping and appurtenances downstream of the 
container, including flowlines and other appurtenances associated with 
injection or discharge, meet the criteria described in Sec.  
112.9(c)(6)(i) and are identified in the Plan; and appropriate produced 
water characteristics in the container and any associated piping and 
appurtenances downstream of the container, procedures, or maintenance 
required to meet the standards of Part 110 required for the produced 
water container are identified in the Plan.
    (vii) That, if applicable, for a produced water container subject 
to Sec.  112.9(c)(6)(ii), any procedure to minimize the amount of free-
phase oil is designed to reduce the accumulation of free-phase oil and 
the procedures and frequency for required inspections, maintenance and 
testing have been established and are described in the Plan.
* * * * *
    (g) Qualified Facilities. The owner or operator of a qualified 
facility as defined in this subparagraph may self-certify his 
facility's Plan, as provided in Sec.  112.6. A qualified facility is 
one that meets the following Tier I or Tier II qualified facility 
criteria:
    (1) A Tier I qualified facility meets the qualification criteria in 
paragraph (g)(2) of this section and has no individual aboveground oil 
storage container with a capacity greater than 5,000 U.S. gallons.
    (2) A Tier II qualified facility is one that has had no single 
discharge as described in Sec.  112.1(b) exceeding 1,000 U.S. gallons 
or no two discharges as described in Sec.  112.1(b) each exceeding 42 
U.S. gallons within any twelve month period in the three years prior to 
the SPCC Plan self-certification date, or since becoming subject to 
this part if the facility has been in operation for less than three 
years (other than discharges as described in Sec.  112.1(b) that are 
the result of natural disasters, acts of war, or terrorism), and 
either:
    (i) Has an aggregate aboveground oil storage capacity of 10,000 
U.S. gallons or less; or
    (ii) Is an onshore oil production facility with:
    (A) No more than two producing wells per single tank battery, each 
of which produce ten barrels or less of crude oil per well per day, if 
the facility has an injection well; or
    (B) No more than four producing wells per single tank battery, each 
of which produce ten barrels or less of crude oil per well per day, and 
with no injection wells at the facility.

0
5. Amend Sec.  112.5 as follows:
0
a. By redesignating paragraphs (b) and (c) as paragraph (d) and (e);
0
b. By revising the newly redesignated paragraph (d) and;
0
c. Adding new paragraphs (b) and (c).
    The additions and revisions read as follows:

Sec.  112.5  Amendment of Spill Prevention, Control, and Countermeasure 
Plan by owners or operators.

* * * * *
    (b) For onshore oil production facilities with produced water 
containers exempted pursuant to the requirements at Sec.  
112.9(c)(6)(i), on an annual basis, the owner or operator must verify 
that the produced water characteristics in the container and any 
associated piping and appurtenances downstream of the container, 
procedures, or maintenance required to meet the standards of Part 110 
that formed the basis for the PE certification described in that 
section are maintained. If an owner or operator fails to maintain the 
produced water characteristics in the container, or in the associated 
downstream piping and appurtenances; procedures; or maintenance 
required to meet the standards of 40 CFR part 110 that formed the basis 
for the PE's certification, then the produced water container and any 
associated piping and appurtenances downstream are ineligible for this 
exemption, and you must, within six months, comply with all provisions 
under this part applicable to the container and amend your Plan. A 
technical amendment made under this section must be prepared within 
three months and implemented as soon as possible, but not later than 
three months following the preparation of the amendment.
    (c) The owner or operator of an onshore oil production facility 
with produced water containers exempted according to the requirements 
at Sec.  112.9(c)(6)(i), must maintain the verifications in accordance 
with Sec.  112.7(e). You must document your verification and sign a 
statement that the produced water characteristics in the container and 
any associated piping and appurtenances downstream from the container, 
procedures, or maintenance required to meet the standards of Part 110 
are maintained in accordance with the PE certification. The following 
words will suffice, ``I verify that the produced water characteristics 
in the container and any associated piping and appurtenances downstream 
of the container, procedures, or maintenance required to meet the 
standards of 40 CFR part 110 that formed the basis for the PE's 
certification are maintained.''
    (d) Notwithstanding compliance with paragraphs (a) and (c) of this 
section, complete a review and evaluation of the SPCC Plan at least 
once every five years from the date your facility becomes subject to 
this part; or, if your facility was in operation on or before August 
16, 2002, five years from the date your last review was required under 
this part. As a result of this review and evaluation, you must amend 
your SPCC Plan within six months of the review to include more 
effective prevention and control technology if the technology has been 
field-proven at the time of the review and will significantly reduce 
the likelihood of a discharge as described in Sec.  112.1(b) from the 
facility. You must implement any amendment as soon as possible, but not 
later than six months following preparation of any amendment. You must 
document your

[[Page 74302]]

completion of the review and evaluation, and must sign a statement as 
to whether you will amend the Plan, either at the beginning or end of 
the Plan or in a log or an appendix to the Plan. The following words 
will suffice, ``I have completed review and evaluation of the SPCC Plan 
for (name of facility) on (date), and will (will not) amend the Plan as 
a result.''
* * * * *

0
6. Revise Sec.  112.6 to read as follows:

Sec.  112.6  Qualified Facilities Plan Requirements.

    Qualified facilities meeting the Tier I applicability criteria in 
Sec.  112.3(g)(1) are subject to the requirements in paragraph (a) of 
this section. Qualified facilities meeting the Tier II applicability 
criteria in Sec.  112.3(g)(2) are subject to the requirements in 
paragraph (b) of this section.
    (a) Tier I Qualified Facilities.
    (1) Preparation and Self-Certification of the Plan. If you are an 
owner or operator of a facility that meets the Tier I qualified 
facility criteria in Sec.  112.3(g)(1), you must either: comply with 
the requirements of paragraph (a)(3) of this section; or prepare and 
implement a Plan meeting requirements of paragraph (b) of this section; 
or prepare and implement a Plan meeting the general Plan requirements 
in Sec.  112.7 and applicable requirements in subparts B and C, 
including having the Plan certified by a Professional Engineer as 
required under Sec.  112.3(d). If you do not follow the Appendix G 
template, you must prepare an equivalent Plan that meets all of the 
applicable requirements listed in this part, and you must supplement it 
with a section cross-referencing the location of requirements listed in 
this part and the equivalent requirements in the other prevention plan. 
To complete the template in Appendix G, you must certify that:
    (i) You are familiar with the applicable requirements of 40 CFR 
part 112;
    (ii) You have visited and examined the facility;
    (iii) You prepared the Plan in accordance with accepted and sound 
industry practices and standards;
    (iv) You have established procedures for required inspections and 
testing in accordance with industry inspection and testing standards or 
recommended practices;
    (v) You will fully implement the Plan;
    (vi) The facility meets the qualification criteria in Sec.  
112.3(g)(1);
    (vii) The Plan does not deviate from any requirement of this part 
as allowed by Sec.  112.7(a)(2) and 112.7(d) or include an exemption/
measures pursuant to Sec.  112.9(c)(6) for produced water containers 
and any associated piping and appurtenances downstream from the 
container; and
    (viii) The Plan and individual(s) responsible for implementing this 
Plan have the approval of management, and the facility owner or 
operator has committed the necessary resources to fully implement this 
Plan.
    (2) Technical Amendments. You must certify any technical amendments 
to your Plan in accordance with paragraph (a)(1) of this section when 
there is a change in the facility design, construction, operation, or 
maintenance that affects its potential for a discharge as described in 
Sec.  112.1(b). If the facility change results in the facility no 
longer meeting the Tier I qualifying criteria in Sec.  112.3(g)(1) 
because an individual oil storage container capacity exceeds 5,000 U.S. 
gallons or the facility capacity exceeds 10,000 U.S. gallons in 
aggregate aboveground storage capacity, within six months following 
preparation of the amendment, you must either:
    (i) Prepare and implement a Plan in accordance with Sec.  112.6(b) 
if you meet the Tier II qualified facility criteria in Sec.  
112.3(g)(2); or
    (ii) Prepare and implement a Plan in accordance with the general 
Plan requirements in Sec.  112.7, and applicable requirements in 
subparts B and C, including having the Plan certified by a Professional 
Engineer as required under Sec.  112.3(d).
    (3) Plan Template and Applicable Requirements. Prepare and 
implement an SPCC Plan that meets the following requirements under 
Sec.  112.7 and in subparts B and C of this part: introductory 
paragraph of Sec. Sec.  112.7, 112.7(a)(3)(i), 112.7(a)(3)(iv), 
112.7(a)(3)(vi), 112.7(a)(4), 112.7(a)(5), 112.7(c), 112.7(e), 
112.7(f), 112.7(g), 112.7(k), 112.8(b)(1), 112.8(b)(2), 112.8(c)(1), 
112.8(c)(3), 112.8(c)(4), 112.8(c)(5), 112.8(c)(6), 112.8(c)(10), 
112.8(d)(4), 112.9(b), 112.9(c)(1), 112.9(c)(2), 112.9(c)(3), 
112.9(c)(4), 112.9(c)(5), 112.9(d)(1), 112.9(d)(3), 112.9(d)(4), 
112.10(b), 112.10(c), 112.10(d), 112.12(b)(1), 112.12(b)(2), 
112.12(c)(1), 112.12(c)(3), 112.12(c)(4), 112.12(c)(5), 112.12(c)(6), 
112.12(c)(10), and 112.12(d)(4). The template in Appendix G to this 
part has been developed to meet the requirements of 40 CFR part 112 
and, when completed and signed by the owner or operator, may be used as 
the SPCC Plan. Additionally, you must meet the following requirements:
    (i) Failure analysis, in lieu of the requirements in Sec.  
112.7(b). Where experience indicates a reasonable potential for 
equipment failure (such as loading or unloading equipment, tank 
overflow, rupture, or leakage, or any other equipment known to be a 
source of discharge), include in your Plan a prediction of the 
direction and total quantity of oil which could be discharged from the 
facility as a result of each type of major equipment failure.
    (ii) Bulk storage container secondary containment, in lieu of the 
requirements in Sec. Sec.  112.8(c)(2) and (c)(11) and 112.12(c)(2) and 
(c)(11). Construct all bulk storage container installations (except 
mobile refuelers and other non-transportation-related tank trucks), 
including mobile or portable oil storage containers, so that you 
provide a secondary means of containment for the entire capacity of the 
largest single container plus additional capacity to contain 
precipitation. Dikes, containment curbs, and pits are commonly employed 
for this purpose. You may also use an alternative system consisting of 
a drainage trench enclosure that must be arranged so that any discharge 
will terminate and be safely confined in a catchment basin or holding 
pond. Position or locate mobile or portable oil storage containers to 
prevent a discharge as described in Sec.  112.1(b).
    (iii) Overfill prevention, in lieu of the requirements in 
Sec. Sec.  112.8(c)(8) and 112.12(c)(8). Ensure that each container is 
provided with a system or documented procedure to prevent overfills of 
the container, describe the system or procedure in the SPCC Plan and 
regularly test to ensure proper operation or efficacy.
    (b) Tier II Qualified Facilities.
    (1) Preparation and Self-Certification of Plan. If you are the 
owner or operator of a facility that meets the Tier II qualified 
facility criteria in Sec.  112.3(g)(2), you may choose to self-certify 
your Plan. You must certify in the Plan that:
    (i) You are familiar with the requirements of this part;
    (ii) You have visited and examined the facility;
    (iii) The Plan has been prepared in accordance with accepted and 
sound industry practices and standards, and with the requirements of 
this part;
    (iv) Procedures for required inspections and testing have been 
established;
    (v) You will fully implement the Plan;
    (vi) The facility meets the qualification criteria set forth under 
Sec.  112.3(g)(2);
    (vii) The Plan does not deviate from any requirement of this part 
as allowed by Sec.  112.7(a)(2) and 112.7(d), or include an exemption/
measures pursuant to Sec.  112.9(c)(6) for produced water containers 
and any associated piping

[[Page 74303]]

and appurtenances downstream from the container, except as provided in 
paragraph (b)(3) of this section; and
    (viii) The Plan and individual(s) responsible for implementing the 
Plan have the full approval of management and the facility owner or 
operator has committed the necessary resources to fully implement the 
Plan.
    (2) Technical Amendments. If you self-certify your Plan pursuant to 
paragraph (b)(1) of this section, you must certify any technical 
amendments to your Plan in accordance with paragraph (b)(1) of this 
section when there is a change in the facility design, construction, 
operation, or maintenance that affects its potential for a discharge as 
described in Sec.  112.1(b), except:
    (i) If a Professional Engineer certified a portion of your Plan in 
accordance with paragraph (b)(4) of this section, and the technical 
amendment affects this portion of the Plan, you must have the amended 
provisions of your Plan certified by a Professional Engineer in 
accordance with paragraph (b)(4)(ii) of this section.
    (ii) If the change is such that the facility no longer meets the 
Tier II qualifying criteria in Sec.  112.3(g)(2) because it exceeds 
10,000 U.S. gallons in aggregate aboveground storage capacity you must, 
within six months following the change, prepare and implement a Plan in 
accordance with the general Plan requirements in Sec.  112.7 and the 
applicable requirements in subparts B and C of this part, including 
having the Plan certified by a Professional Engineer as required under 
Sec.  112.3(d).
    (3) Applicable Requirements. Except as provided in this paragraph, 
your self-certified SPCC Plan must comply with Sec.  112.7 and the 
applicable requirements in subparts B and C of this part:
    (i) Environmental Equivalence. Your Plan may not include alternate 
methods which provide environmental equivalence pursuant to Sec.  
112.7(a)(2), unless each alternate method has been reviewed and 
certified in writing by a Professional Engineer, as provided in 
paragraph (b)(4) of this section.
    (ii) Impracticability. Your Plan may not include any determinations 
that secondary containment is impracticable and provisions in lieu of 
secondary containment pursuant to Sec.  112.7(d), unless each such 
determination and alternate measure has been reviewed and certified in 
writing by a Professional Engineer, as provided in paragraph (b)(4) of 
this section.
    (iii) Produced Water Containers. Your Plan may not include any 
produced water container exemptions or alternative procedures for 
skimming in lieu of sized secondary containment pursuant to Sec.  
112.9(c)(6), unless they have been reviewed and certified in writing by 
a Professional Engineer, as provided in paragraph (b)(4) of this 
section.
    (4) Professional Engineer Certification of Portions of a Qualified 
Facility's Self-Certified Plan.
    (i) As described in paragraph (b)(3) of this section, the facility 
owner or operator may not self-certify alternative measures allowed 
under Sec.  112.7(a)(2) or (d), that are included in the facility's 
Plan. Such measures must be reviewed and certified, in writing, by a 
licensed Professional Engineer. For each alternative measure allowed 
under Sec.  112.7(a)(2), the Plan must be accompanied by a written 
statement by a Professional Engineer that states the reason for 
nonconformance and describes the alternative method and how it provides 
equivalent environmental protection in accordance with Sec.  
112.7(a)(2). For each determination of impracticability of secondary 
containment pursuant to Sec.  112.7(d), the Plan must clearly explain 
why secondary containment measures are not practicable at this facility 
and provide the alternative measures required in Sec.  112.7(d) in lieu 
of secondary containment. By certifying each measure allowed under 
Sec.  112.7(a)(2) and (d), the Professional Engineer attests:
    (A) That he is familiar with the requirements of this part;
    (B) That he or his agent has visited and examined the facility; and
    (C) That the alternative method of environmental equivalence in 
accordance with Sec.  112.7(a)(2) or the determination of 
impracticability and alternative measures in accordance with Sec.  
112.7(d) is consistent with good engineering practice, including 
consideration of applicable industry standards, and with the 
requirements of this part.
    (ii) As described in paragraph (b)(3) of this section, the facility 
owner or operator may not self-certify measures as described in Sec.  
112.9(c)(6) for produced water containers and any associated piping and 
appurtenances downstream from the container. Such measures must be 
reviewed and certified, in writing, by a licensed Professional 
Engineer, in accordance with Sec.  112.3(d)(1)(vi) or (vii), as 
applicable.
    (iii) The review and certification by the Professional Engineer 
under this paragraph is limited to the alternative method which 
achieves equivalent environmental protection pursuant to Sec.  
112.7(a)(2); to the impracticability determination and measures in lieu 
of secondary containment pursuant to Sec.  112.7(d); or the measures 
pursuant to Sec.  112.9(c)(6) for produced water containers and any 
associated piping and appurtenances downstream from the container.

0
7. Amend Sec.  112.7 as follows:
0
a. By revising the first sentence in paragraph (a)(2);
0
b. By revising paragraphs (a)(3) introductory text and (a)(3)(i);
0
c. By revising paragraphs (c) introductory text and (c)(1);
0
d. By revising paragraph (g); and
0
e. By revising the heading to paragraph (h), paragraphs (h)(1) and 
(h)(2).

Sec.  112.7  General requirements for Spill Prevention, Control, and 
Countermeasure Plans.

* * * * *
    (a) * * *
    (2) Comply with all applicable requirements listed in this part. 
Except as provided in Sec.  112.6, your Plan may deviate from the 
requirements in paragraphs (g), (h)(2) and (3), and (i) of this section 
and the requirements in subparts B and C of this part, except the 
secondary containment requirements in paragraphs (c) and (h)(1) of this 
section, and Sec. Sec.  112.8(c)(2), 112.8(c)(11), 112.9(c)(2), 
112.9(d)(3), 112.10(c), 112.12(c)(2), and 112.12(c)(11), where 
applicable to a specific facility, if you provide equivalent 
environmental protection by some other means of spill prevention, 
control, or countermeasure. * * *
* * * * *
    (3) Describe in your Plan the physical layout of the facility and 
include a facility diagram, which must mark the location and contents 
of each fixed oil storage container and the storage area where mobile 
or portable containers are located. The facility diagram must identify 
the location of and mark as ``exempt'' underground tanks that are 
otherwise exempted from the requirements of this part under Sec.  
112.1(d)(4), and produced water containers and any associated piping 
and appurtenances downstream from the container, that are otherwise 
exempted from the requirements of this part under Sec.  112.1(d)(12). 
The facility diagram must also include all transfer stations and 
connecting pipes, including intra-facility gathering lines that are 
otherwise exempted from the requirements of this part under Sec.  
112.1(d)(11). You must also address in your Plan:
    (i) The type of oil in each fixed container and its storage 
capacity. For mobile or portable containers, either

[[Page 74304]]

provide the type of oil and storage capacity for each container or 
provide an estimate of the potential number of mobile or portable 
containers, the types of oil, and anticipated storage capacities;
* * * * *
    (c) Provide appropriate containment and/or diversionary structures 
or equipment to prevent a discharge as described in Sec.  112.1(b), 
except as provided in paragraph (k) of this section for qualified oil-
filled operational equipment, and except as provided in Sec.  
112.9(d)(3) for flowlines and intra-facility gathering lines at an oil 
production facility. The entire containment system, including walls and 
floor, must be capable of containing oil and must be constructed so 
that any discharge from a primary containment system, such as a tank, 
will not escape the containment system before cleanup occurs. In 
determining the method, design, and capacity for secondary containment, 
you need only to address the typical failure mode, and the most likely 
quantity of oil that would be discharged. Secondary containment may be 
either active or passive in design. At a minimum, you must use one of 
the following prevention systems or its equivalent:
    (1) For onshore facilities:
    (i) Dikes, berms, or retaining walls sufficiently impervious to 
contain oil;
    (ii) Curbing or drip pans;
    (iii) Sumps and collection systems;
    (iv) Culverting, gutters, or other drainage systems;
    (v) Weirs, booms, or other barriers;
    (vi) Spill diversion ponds;
    (vii) Retention ponds; or
    (viii) Sorbent materials.
* * * * *
    (g) Security (excluding oil production facilities). Describe in 
your Plan how you secure and control access to the oil handling, 
processing and storage areas; secure master flow and drain valves; 
prevent unauthorized access to starter controls on oil pumps; secure 
out-of-service and loading/unloading connections of oil pipelines; and 
address the appropriateness of security lighting to both prevent acts 
of vandalism and assist in the discovery of oil discharges.
    (h) Facility tank car and tank truck loading/unloading rack 
(excluding offshore facilities, farms, and oil production facilities).
    (1) Where loading/unloading rack drainage does not flow into a 
catchment basin or treatment facility designed to handle discharges, 
use a quick drainage system for tank car or tank truck loading/
unloading racks. You must design any containment system to hold at 
least the maximum capacity of any single compartment of a tank car or 
tank truck loaded or unloaded at the facility.
    (2) Provide an interlocked warning light or physical barrier 
system, warning signs, wheel chocks or vehicle brake interlock system 
in the area adjacent to a loading/unloading rack, to prevent vehicles 
from departing before complete disconnection of flexible or fixed oil 
transfer lines.
* * * * *

Subpart B--[Amended]

0
8. Amend Sec.  112.8 by revising the first sentence in paragraph (c)(2) 
and revising paragraphs (c)(6) and (c)(11) to read as follows:

Sec.  112.8  Spill Prevention, Control, and Countermeasure Plan 
requirements for onshore facilities (excluding oil production 
facilities).

* * * * *
    (c) * * *
    (2) Construct all bulk storage tank installations (except mobile 
refuelers and other non-transportation-related tank trucks) so that you 
provide a secondary means of containment for the entire capacity of the 
largest single container and sufficient freeboard to contain 
precipitation.* * *
* * * * *
    (6) Test or inspect each aboveground container for integrity on a 
regular schedule and whenever you make material repairs. You must 
determine, in accordance with industry standards, the appropriate 
qualifications for personnel performing tests and inspections, the 
frequency and type of testing and inspections, which take into account 
container size, configuration, and design (such as containers that are: 
shop-built, field-erected, skid-mounted, elevated, equipped with a 
liner, double-walled, or partially buried). Examples of these integrity 
tests include, but are not limited to: visual inspection, hydrostatic 
testing, radiographic testing, ultrasonic testing, acoustic emissions 
testing, or other systems of non-destructive testing. You must keep 
comparison records and you must also inspect the container's supports 
and foundations. In addition, you must frequently inspect the outside 
of the container for signs of deterioration, discharges, or 
accumulation of oil inside diked areas. Records of inspections and 
tests kept under usual and customary business practices satisfy the 
recordkeeping requirements of this paragraph.
* * * * *
    (11) Position or locate mobile or portable oil storage containers 
to prevent a discharge as described in Sec.  112.1(b). Except for 
mobile refuelers and other non-transportation-related tank trucks, you 
must furnish a secondary means of containment, such as a dike or 
catchment basin, sufficient to contain the capacity of the largest 
single compartment or container with sufficient freeboard to contain 
precipitation.
* * * * *
0
9. Amend Sec.  112.9 as follows:
0
a. By revising the section heading;
0
b. By revising the introductory text;
0
c. By revising paragraphs (c)(2) and (c)(3);
0
d. By adding paragraphs (c)(5) and (c)(6);
0
e. By revising paragraph (d)(3); and
0
f. By adding paragraph (d)(4).

Sec.  112.9  Spill Prevention, Control, and Countermeasure Plan 
Requirements for onshore oil production facilities (excluding drilling 
and workover facilities).

    If you are the owner or operator of an onshore oil production 
facility (excluding a drilling or workover facility), you must:
* * * * *
    (c) * * *
    (2) Except as described in paragraph (c)(5) of this section for 
flow-through process vessels and paragraph (c)(6) of this section for 
produced water containers and any associated piping and appurtenances 
downstream from the container, construct all tank battery, separation, 
and treating facility installations, so that you provide a secondary 
means of containment for the entire capacity of the largest single 
container and sufficient freeboard to contain precipitation. You must 
safely confine drainage from undiked areas in a catchment basin or 
holding pond.
    (3) Except as described in paragraph (c)(5) of this section for 
flow-through process vessels and paragraph (c)(6) of this section for 
produced water containers and any associated piping and appurtenances 
downstream from the container, periodically and upon a regular schedule 
visually inspect each container of oil for deterioration and 
maintenance needs, including the foundation and support of each 
container that is on or above the surface of the ground.
* * * * *
    (5) Flow-through process vessels. The owner or operator of a 
facility with flow-through process vessels may choose to implement the 
alternate requirements as described below in lieu of sized secondary 
containment required in paragraphs (c)(2) and (c)(3) of this section.

[[Page 74305]]

    (i) Periodically and on a regular schedule visually inspect and/or 
test flow-through process vessels and associated components (such as 
dump valves) for leaks, corrosion, or other conditions that could lead 
to a discharge as described in Sec.  112.1(b).
    (ii) Take corrective action or make repairs to flow-through process 
vessels and any associated components as indicated by regularly 
scheduled visual inspections, tests, or evidence of an oil discharge.
    (iii) Promptly remove or initiate actions to stabilize and 
remediate any accumulations of oil discharges associated with flow-
through process vessels.
    (iv) If your facility discharges more than 1,000 U.S. gallons of 
oil in a single discharge as described in Sec.  112.1(b), or discharges 
more than 42 U.S. gallons of oil in each of two discharges as described 
in Sec.  112.1(b) within any twelve month period, from flow-through 
process vessels (excluding discharges that are the result of natural 
disasters, acts of war, or terrorism) then you must, within six months 
from the time the facility becomes subject to this paragraph, ensure 
that all flow-through process vessels subject to this subpart comply 
with Sec.  112.9(c)(2) and (c)(3).
    (6) Produced water containers.
    (i) A produced water container, and any associated piping and 
appurtenances downstream from the container, are exempt from the 
requirements of this part if a Professional Engineer certifies in 
accordance with Sec.  112.3(d)(1)(vi) that no discharge from the 
produced water container, including a complete loss of the capacity of 
the container, could cause a discharge in quantities that may be 
harmful, as described in part 110 of this chapter. This determination 
for the container must be made in accordance with Sec.  112.1(d)(1)(i).
    (A) The SPCC Plan must include a description of the produced water 
characteristics in the container, procedures, or maintenance required 
to meet the standards of Part 110 and the owner or operator's annual 
verifications prepared in accordance with Sec.  112.5.
    (B) If an exempt produced water container as described in paragraph 
(c)(6)(i) of this section experiences a discharge as described in Sec.  
112.1(b), then such container, piping, and appurtenances are ineligible 
for this exemption and you must comply with all provisions under this 
part applicable to the container, including Sec.  112.9(c)(2) and 
(c)(3) within six months of the date of the discharge.
    (ii) For each container not exempted as described in paragraph 
(c)(6)(i) of this section, comply with Sec.  112.9(c)(1) and (c)(4); 
and Sec.  112.9(c)(2) and (c)(3), or:
    (A) Implement, on a regular schedule, a procedure for each produced 
water container that is designed to separate the free-phase oil that 
accumulates on the surface of the produced water. Include in the Plan a 
description of the procedures, frequency, amount of free-phase oil 
expected to be maintained inside the container, and a Professional 
Engineer certification in accordance with Sec.  112.3(d)(1)(vii). 
Maintain records of such events in accordance with Sec.  112.7(e). 
Records kept under usual and customary business practices will suffice 
for purposes of this paragraph. If this procedure is not implemented as 
described in the Plan or no records are maintained, then you must 
comply with Sec.  112.9(c)(2) and (c)(3).
    (B) On a regular schedule, visually inspect and/or test the 
produced water container and associated piping for leaks, corrosion, or 
other conditions that could lead to a discharge as described in Sec.  
112.1(b) in accordance with good engineering practice.
    (C) Take corrective action or make repairs to the produced water 
container and any associated piping as indicated by regularly scheduled 
visual inspections, tests, or evidence of an oil discharge.
    (D) Promptly remove or initiate actions to stabilize and remediate 
any accumulations of oil discharges associated with the produced water 
container.
    (E) If your facility discharges more than 1,000 U.S. gallons of oil 
in a single discharge as described in Sec.  112.1(b), or discharges 
more than 42 U.S. gallons of oil in each of two discharges as described 
in Sec.  112.1(b) within any twelve month period from a produced water 
container subject to this subpart (excluding discharges that are the 
result of natural disasters, acts of war, or terrorism) then you must, 
within six months from the time the facility becomes subject to this 
paragraph, ensure that all produced water containers subject to this 
subpart comply with Sec.  112.9(c)(2) and (c)(3).
    (d) * * *
    (3) For flowlines and intra-facility gathering lines that are not 
provided with secondary containment in accordance with Sec.  112.7(c), 
unless you have submitted a response plan under Sec.  112.20, provide 
in your Plan the following:
    (i) An oil spill contingency plan following the provisions of part 
109 of this chapter.
    (ii) A written commitment of manpower, equipment, and materials 
required to expeditiously control and remove any quantity of oil 
discharged that might be harmful.
    (4) Prepare and implement a written program of flowline/intra-
facility gathering line maintenance. The maintenance program must 
address your procedures to:
    (i) Ensure that flowlines and intra-facility gathering lines and 
associated valves and equipment are compatible with the type of 
production fluids, their potential corrosivity, volume, and pressure, 
and other conditions expected in the operational environment.
    (ii) Visually inspect and/or test flowlines and intra-facility 
gathering lines and associated appurtenances on a periodic and regular 
schedule for leaks, oil discharges, corrosion, or other conditions that 
could lead to a discharge as described in Sec.  112.1(b). For flowlines 
and intra-facility gathering lines that are not provided with secondary 
containment in accordance with Sec.  112.7(c), the frequency and type 
of testing must allow for the implementation of a contingency plan as 
described under part 109 of this chapter.
    (iii) Take corrective action or make repairs to any flowlines and 
intra-facility gathering lines and associated appurtenances as 
indicated by regularly scheduled visual inspections, tests, or evidence 
of a discharge.
    (iv) Promptly remove or initiate actions to stabilize and remediate 
any accumulations of oil discharges associated with flowlines, intra-
facility gathering lines, and associated appurtenances.

Subpart C--[Amended]

0
11. Amend Sec.  112.12 as follows:
0
a. By revising the introductory text;
0
b. By revising the first sentence in paragraph (c)(2); and
0
c. By revising paragraphs (c)(6) and (c)(11).

Sec.  112.12  Spill Prevention, Control, and Countermeasure Plan 
Requirements.

    If you are the owner or operator of an onshore facility, you must:
* * * * *
    (c) * * *
    (2) Construct all bulk storage tank installations (except mobile 
refuelers and other non-transportation-related tank trucks) so that you 
provide a secondary means of containment for the entire capacity of the 
largest single container and sufficient freeboard to contain 
precipitation. * * *
* * * * *
    (6) Bulk storage container inspections.
    (i) Except for containers that meet the criteria provided in 
paragraph (c)(6)(ii)

[[Page 74306]]

of this section, test or inspect each aboveground container for 
integrity on a regular schedule and whenever you make material repairs. 
You must determine, in accordance with industry standards, the 
appropriate qualifications for personnel performing tests and 
inspections, the frequency and type of testing and inspections, which 
take into account container size, configuration, and design (such as 
containers that are: shop-built, field-erected, skid-mounted, elevated, 
equipped with a liner, double-walled, or partially buried). Examples of 
these integrity tests include, but are not limited to: Visual 
inspection, hydrostatic testing, radiographic testing, ultrasonic 
testing, acoustic emissions testing, or other systems of non-
destructive testing. You must keep comparison records and you must also 
inspect the container's supports and foundations. In addition, you must 
frequently inspect the outside of the container for signs of 
deterioration, discharges, or accumulation of oil inside diked areas. 
Records of inspections and tests kept under usual and customary 
business practices satisfy the recordkeeping requirements of this 
paragraph.
    (ii) For bulk storage containers that are subject to 21 CFR part 
110, are elevated, constructed of austenitic stainless steel, have no 
external insulation, and are shop-fabricated, conduct formal visual 
inspection on a regular schedule. In addition, you must frequently 
inspect the outside of the container for signs of deterioration, 
discharges, or accumulation of oil inside diked areas. You must 
determine and document in the Plan the appropriate qualifications for 
personnel performing tests and inspections. Records of inspections and 
tests kept under usual and customary business practices satisfy the 
recordkeeping requirements of this paragraph (c)(6).
* * * * *
    (11) Position or locate mobile or portable oil storage containers 
to prevent a discharge as described in Sec.  112.1(b). Except for 
mobile refuelers and other non-transportation-related tank trucks, you 
must furnish a secondary means of containment, such as a dike or 
catchment basin, sufficient to contain the capacity of the largest 
single compartment or container with sufficient freeboard to contain 
precipitation.
* * * * *

0
12. Add Appendix G to read as follows:

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[FR Doc. E8-28159 Filed 12-4-08; 8:45 am]

BILLING CODE 6560-50-C