Oil & Gas Activities – Agencies are “Up-in-the-Air” on Air Regulations

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Most of the news regarding the oil and gas activity in Pennsylvania and West Virginia, and now tapping into Ohio shale plays, has focused on water concerns. But regulators also are eyeing air impacts. New or revised air regulations affecting the oil and gas industry are looming on the horizon, while the impact of other recent issuances is still being played out.

Coming Soon: New Source Performance Standards and Air Toxics Standards

By month’s end, U.S. EPA is scheduled to issue four air emission proposals impacting the oil and gas industry.

Specifically, EPA is reviewing two new source performance standards for onshore natural gas processing plants governing repairs, leaks of volatile organic compounds and sulfur dioxide emissions. EPA is considering changes that address well completion, compressors, storage vessels and pneumatic devices. Also under review are two air toxics standards. One rule applies to flash-emission tanks, leaks and glycol dehydrators at production operations. The other air toxics rule applies to dehydrators at major natural gas transmission and storage operations.

EPA has stated it is “taking a broad look” across the oil and gas sector “to identify sources of air pollution emissions, quantify those emissions, and consider how they could be reduced.” The extent to which this broad look will expand EPA’s regulatory reach of course is the big unknown; its proposal at the end of this month will shed light on just how aggressive EPA’s look is.

Aggregation and Source Determination

“Aggregation” involves grouping two or more pollutant-emitting activities together as a single emissions source. Smaller units that ordinarily would not trigger permitting could, if aggregated, constitute a “major” source subject to tougher requirements (although the Clean Air Act precludes aggregation of oil and gas wells or pipeline facilities for purposes of air toxics rules).

In September 2009, EPA’s top air official (Gina McCarthy) issued a memorandum stressing that – with respect to aggregation – EPA would now consider equally whether activities are under common control; are located on one or more contiguous or adjacent properties; and belong to the same industrial grouping. (Previously a proximity-laden approach had been in place.)

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Published In: Administrative Agency Updates, Energy & Utilities Updates, Environmental Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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