83 FR 10478 - Notice of Proposed Withdrawal of the Control Techniques Guidelines for the Oil and Natural Gas Industry

ENVIRONMENTAL PROTECTION AGENCY

Federal Register Volume 83, Issue 47 (March 9, 2018)

The Environmental Protection Agency (EPA) is requesting public comment on a potential withdrawal of the Control Techniques Guidelines (CTG) for the Oil and Natural Gas Industry. The final CTG provided recommendations for reducing volatile organic compound (VOC) emissions from existing oil and natural gas industry emission sources in ozone nonattainment (NA) areas classified as Moderate or higher and states in the Ozone Transport Region (OTR). The CTG relied upon underlying data and conclusions made in the final rule titled ``Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources,'' published in the Federal Register on June 3, 2016 (2016 New Source Performance Standards (NSPS)). On June 5, 2017, the EPA granted reconsideration in regard to additional provisions of the 2016 NSPS. Pursuant to those actions, the EPA is currently looking broadly at the 2016 NSPS. In light of the fact that the EPA is reconsidering the 2016 NSPS and because the recommendations made in the CTG are fundamentally linked to the conclusions in the 2016 NSPS, the EPA believes it is prudent to withdraw the CTG in its entirety. The EPA also believes that the withdrawal will be more efficient for states in revising their state implementation plans (SIPs). The EPA is seeking comment on a potential withdrawal of the CTG.

[Federal Register Volume 83, Number 47 (Friday, March 9, 2018)]
[Notices]
[Pages 10478-10480]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-04703]


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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OAR-2015-0216; FRL-9975-31-OAR]
RIN 2060-AT76


Notice of Proposed Withdrawal of the Control Techniques 
Guidelines for the Oil and Natural Gas Industry

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of proposed withdrawal; request for comment.

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SUMMARY: The Environmental Protection Agency (EPA) is requesting public 
comment on a potential withdrawal of the Control Techniques Guidelines 
(CTG) for the Oil and Natural Gas Industry. The final CTG provided 
recommendations for reducing volatile organic compound (VOC) emissions 
from existing oil and natural gas industry emission sources in ozone 
nonattainment (NA) areas classified as Moderate or higher and states in 
the Ozone Transport Region (OTR). The CTG relied upon underlying data 
and conclusions made in the final rule titled ``Oil and Natural Gas 
Sector: Emission Standards for New, Reconstructed, and Modified 
Sources,'' published in the Federal Register on June 3, 2016 (2016 New 
Source Performance Standards (NSPS)). On June 5, 2017, the EPA granted 
reconsideration in regard to additional provisions of the 2016 NSPS. 
Pursuant to those actions, the EPA is currently looking broadly at the 
2016 NSPS. In light of the fact that the EPA is reconsidering the 2016 
NSPS and because the recommendations made in the CTG are fundamentally 
linked to the conclusions in the 2016 NSPS, the EPA believes it is 
prudent to withdraw the CTG in its entirety. The EPA also believes that 
the withdrawal will be more efficient for states in revising their 
state implementation plans (SIPs). The EPA is seeking comment on a 
potential withdrawal of the CTG.

DATES: Comments must be received on or before April 23, 2018.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2015-0216, at: http://www.regulations.gov. Follow the online 
instructions for submitting comments. Once submitted, comments cannot 
be edited or removed from Regulations.gov. The EPA may publish any 
comment received to its public docket. Do not submit electronically any 
information you consider to be Confidential Business Information (CBI) 
or other information whose disclosure is restricted by statute. 
Multimedia submissions (audio, video, etc.) must be accompanied by a 
written comment. The written comment is considered the official comment 
and should include discussion of all points you wish to make. The EPA 
will generally not consider comments or comment contents located 
outside of the primary submission (i.e., on the web, cloud, or other 
file sharing system). For additional submission methods, the full EPA 
public comment policy, information about CBI or multimedia submissions, 
and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Mr. Jonathan Witt, Sector Policies and 
Programs Division, Fuels and Incineration Group (E143-05), Office of 
Air Quality Planning and Standards, Environmental Protection Agency, 
Research Triangle Park, North Carolina 27711; telephone number: (919) 
541-5645; email address: [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    On October 27, 2016, the EPA published in the Federal Register the 
``Release of Final Control Techniques Guidelines for the Oil and 
Natural Gas Industry.'' 81 FR 74798. The CTG provided information to 
state, local, and tribal air agencies to assist them in determining 
reasonably available control technology (RACT) for VOC emissions from 
select oil and natural gas industry emission sources. Section 
182(b)(2)(A) of the Clean Air Act (CAA) requires that for ozone NA 
areas classified as Moderate, states must revise their SIPs to include 
provisions to implement RACT for each category of VOC sources covered 
by a CTG document issued between November 15, 1990, and the date of 
attainment. CAA section 182(c) through (e) extends this requirement to 
states with ozone NA areas classified as Serious, Severe, and Extreme. 
CAA section 184(b) further extends this requirement to states in the 
OTR.\1\
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    \1\ The states/areas in the OTR are: CT, DE, ME, MD, MA, NH, NJ, 
NY, PA, RI, VT and the Washington, DC consolidated metropolitan 
statistical area, which includes a portion of northern VA (see CAA 
section 184(a)).
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    Section 182(b)(2) of the CAA requires that a CTG document issued 
between November 15, 1990, and the date of attainment include the date 
by which states must submit their SIP revisions. In the final action 
issuing the CTG, the EPA established a SIP submission deadline of 
October 27, 2018, for addressing sources covered by the CTG. 81 FR 
74799. According to the CTG implementation memo issued on October 20, 
2016, ``[t]he emissions controls determined by the state to be RACT for 
sources covered by the Oil and Gas CTG must be implemented as soon as 
practicable, but in no case later than January 1, 2021.'' \2\ This 
implementation period includes the 2-year period between the 
publication of the CTG in the Federal Register \3\ document and the SIP 
submission date of October 27, 2018. Because the October 27, 2018, 
deadline is not imminent, no state has an impending RACT SIP deadline 
associated with the CTG.
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    \2\ Implementing Reasonably Available Control Technology 
Requirements for Sources Covered by the 2016 Control Techniques 
Guidelines for the Oil and Natural Gas Industry. Docket ID No. EPA-
HQ-OAR-2015-0216-0238.
    \3\ Id.
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    The CTG relied upon underlying data and conclusions from the 2016 
NSPS, as well as the final rule titled ``Oil and Natural Gas Sector: 
New Source Performance Standards and National Emission Standards for 
Hazardous Air Pollutants Reviews,'' published in the Federal Register 
on August 16, 2012 (2012 NSPS). 77 FR 49490. The RACT recommendations 
for VOC emission reductions contained in the final CTG were based on a 
review of the 2012 NSPS and the 2016 NSPS. 81 FR 74799. In the final 
CTG, the EPA states, ``[s]everal of the technical support documents 
(TSDs) prepared in support of the NSPS actions for the oil and natural 
gas industry include data and analyses considered in developing RACT 
recommendations in this CTG.'' \4\ RACT recommendations for storage 
vessels, compressors, pneumatic controllers, and equipment leaks from 
natural gas processing plants were based on the 2012 NSPS TSDs, and 
RACT recommendations for pneumatic pumps and fugitive emissions from 
well sites and compressor stations were based on the 2016 NSPS TSDs. It 
should be noted that facilities throughout the oil and natural gas 
sector (e.g., well sites,

[[Page 10479]]

compressor stations, and natural gas processing plants) may contain 
some sources subject to the 2012 NSPS and other sources subject to the 
2016 NSPS. On April 18, 2017, the EPA announced in a letter that it was 
convening a proceeding for reconsideration of certain core provisions 
of the 2016 NSPS, and on June 5, 2017, EPA granted reconsideration in 
regard to additional provisions of the 2016 NSPS. Pursuant to those 
actions, EPA is currently looking broadly at the 2016 NSPS. 82 FR 
25730.
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    \4\ Control Techniques Guidelines for the Oil and Natural Gas 
Industry. October 2016. Final. U.S. Environmental Protection Agency. 
Office of Air and Radiation. Office of Air Quality Planning and 
Standards. Sector Policies and Programs Division. EPA-453/B-16-001. 
Docket ID No. EPA-HQ-OAR-2015-0216-0236.
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II. Discussion

    The EPA is seeking comment on a proposed withdrawal of the CTG. If 
finalized, the withdrawal would remove the mandatory RACT review 
requirement for affected sources in ozone NA areas classified as 
Moderate or higher and states in the OTR. The withdrawal would not 
impact oil and natural gas industry sources otherwise covered by the 
major source thresholds for RACT review (100 tons per year (tpy) for 
Moderate areas, 50 tpy for Serious areas, 25 tpy for Severe areas, and 
10 tpy for Extreme areas).\5\ The EPA notes that unless and until EPA 
decides to withdraw the CTG, states remain obligated to revise their 
SIPs to address RACT requirements for oil and gas sources in ozone NA 
areas classified as Moderate or higher and the states in the OTR. 
Moreover, withdrawal of the CTG will not hinder states from 
establishing, where desired or otherwise required, emissions standards 
for sources in the oil and natural gas industry, including standards 
based on the recommendations contained in the withdrawn CTG. Having 
said that, the withdrawal of the CTG will relieve state, local, and 
tribal air agencies of the requirement to address RACT for non-major 
sources in this sector (and the associated need to consider the 
recommendations in the CTG for the time being).
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    \5\ The RACT requirements for major sources are independent of 
CTG-based RACT requirements, and are defined in CAA sections 
182(b)(2), 182(c), 182(d), 182(e), and 184(b)(2).
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    The EPA notes that after it issued the 2016 NSPS, it exercised its 
discretion to issue the CTG to inform air agencies of ``determinations 
as to what constitutes RACT for VOC for those oil and natural gas 
industry emission sources in their particular areas.'' 81 FR 74799. The 
EPA emphasized that the information contained in the CTG was ``provided 
only as guidance.'' Id. The guidance did not ``change, or substitute 
for, requirements specified in applicable sections of the CAA or the 
EPA's regulations; nor is it a regulation itself.'' Id. The RACT 
recommendations in the CTG posed no ``legally binding requirements on 
any entity.'' Id. It only provided ``recommendations for air agencies 
to consider in determining RACT.'' Id. The CTG noted that the 
recommendations were based on ``data and information currently 
available to the EPA.'' Id.
    In the final CTG, EPA provided an estimate of the costs potentially 
associated with the CTG. With this action, the EPA has adjusted the 
analysis of costs and emission reductions associated with the final CTG 
to reflect state rules that have been finalized since the CTG was 
released, to adjust compliance costs from 2012$ to 2016$, as well as to 
estimate present values (PV) and equivalent annualized values (EAV) of 
avoided costs. The EPA estimates these avoided costs under two 
analytical perspectives, one where all states fully adopt RACT under 
the CTG, but would avoid any controls in the absence of the CTG, and 
another that focuses on the net change across all industries and 
reflects the assumption that sources in Moderate or higher NA areas 
might need to incur costs to obtain emission reductions under SIPs.
    Under the analytical perspective that assumes all states fully 
adopt RACT under the CTG, but would avoid any controls in the absence 
of the CTG, the avoided costs of withdrawing the CTG are reflected in 
the total avoided costs of the updated analysis. Under this 
perspective, the PV of avoided costs over 2021 through 2035 is 
estimated to be $599 million assuming a 3-percent discount rate and 
$439 million assuming a 7-percent discount rate. The EAV from this 
perspective is approximately $49 million per year and $45 million per 
year assuming 3-percent and 7-percent discount rates, respectively. 
Under the analytic perspective that focuses on net changes across all 
industries, which reflects that sources in Moderate or higher NA areas 
might need to incur costs to obtain emission reductions under SIPs in 
the scenario the CTG is withdrawn, the avoided costs are reflected in 
the estimates of avoided costs in the OTR. Under this perspective, the 
PV of avoided costs over 2021 through 2035 is estimated to be $14 
million assuming a 3-percent discount rate and $16 million assuming a 
7-percent discount rate. The EAV from this perspective is approximately 
$1.2 million per year and $1.6 million per year assuming 3-percent and 
7-percent discount rates, respectively. Given the range of avoided 
costs between the two perspectives, we are soliciting comment on the 
uncertainty in the range of estimates. We are asking for any 
information related to state rules that would have supplanted the need 
for additional requirements under the final CTG, as well as on state 
actions with respect to sources that would be affected by the CTG in 
the absence of the CTG. This includes information on regulations in 
SIPs that would affect non-major oil and natural gas sources in the 
CTG, regardless of the status of the CTG. For more information on the 
estimates of avoided costs and forgone emissions reductions associated 
with the potential withdrawal of the CTG, see the memorandum, 
``Estimated Avoided Costs and Forgone Emission Reductions Associated 
with the Potential Withdrawal of the Control Techniques Guidelines for 
the Oil and Natural Gas Industry,'' located in the docket.
    In light of the fact that we are reconsidering the 2016 NSPS and 
because the 2016 NSPS and CTG share certain key pieces of data and 
information, the EPA believes it is prudent to withdraw the CTG in its 
entirety. This includes model rule language incorporating the 
recommended compliance elements that states may use as a starting point 
when developing their SIPs. The deadline for incorporating the CTG-
based RACT recommendations into SIPs has not yet passed, so states may 
wish to wait for the final outcome of any action related to the CTG and 
the EPA's reconsideration of the NSPS before finalizing any additional 
controls on oil and gas sources covered by the CTG, unless otherwise 
required by the CAA's ozone NA area and OTR provisions.\6\ During the 
time the EPA anticipates taking to complete the reconsideration of the 
2016 NSPS, states would not have had to fully implement any new CTG-
based RACT determinations for oil and gas sources. In addition, the EPA 
believes it is more efficient for states not to be required to revise 
their SIPs to comply with aspects pertaining to the 2012 NSPS and then 
potentially have to revise their SIPs again after reconsideration of 
the 2016 NSPS.
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    \6\ The RACT requirements for major sources are independent of 
CTG-based RACT requirements, and are defined in CAA sections 
182(b)(2), 182(c), 182(d), 182(e), and 184(b)(2).
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    Withdrawing the CTG in its entirety will allow a more holistic 
consideration of control options for these sources (e.g., shared 
control devices).
    For the reasons outlined above, the EPA believes it is prudent to 
withdraw the CTG in its entirety. The EPA is seeking comment on a 
potential withdrawal of the CTG.


[[Page 10480]]


    Dated: March 1, 2018.
E. Scott Pruitt,
Administrator.
[FR Doc. 2018-04703 Filed 3-8-18; 8:45 am]
BILLING CODE 6560-50-P