DEP unveils draft final-form VOC rulemaking

The following appears in the January 2022 issue of The PIOGA Press.

The Department of Environmental Protection on December 9 presented the agency’s Air Quality Technical Advisory Committee (AQTAC) with the draft final-form version of regulations intended to control volatile organic compound (VOC) emissions from existing oil and natural gas sources. A presentation at the meeting covered the significant changes made in response to public comments received on the proposed rulemaking in mid-2020.

As published in the May 23, 2020, Pennsylvania Bulletin, the proposed rule would have Pennsylvania adopt reasonably available control technology (RACT) requirements and RACT emission limitations for oil and natural gas sources of VOCs that were in existence on or before the effective date of the regulation. The proposed rule would apply to owners and operators of storage vessels, natural gas-driven pneumatic controllers, natural gas-driven diaphragm pumps, centrifugal compressors and reciprocating compressors, and fugitive emission components. The proposal is based on the U.S. Environmental Protection Agency’s October 2016 Control Techniques Guidelines (CTG) for the Oil and Natural Gas Industry, which provide RACT requirements for VOC emissions from existing oil and gas sources.

An article in the June 2020 PIOGA Press provides an in-depth summary of the provisions of the proposed rule. The proposal drew approximately 4,500 comments from 36,000 commentators.

In formal comments submitted in July 2020, PIOGA emphasized these points (PIOGA Press, August 2020):

• The rule must be revised to exclude owners and operators of conventional wells because it fails to comply with Act 52 of 2016, the law requiring separate rulemakings for conventional and unconventional oil and gas facilities.
• The underlying data supporting the proposal is outdated and insufficient.
• Neither EPA nor DEP have demonstrated the CTG oil and gas rule is necessary.
• The rule disproportionally impacts conventional sources.
• Conventional and unconventional wells are fundamentally different, and these differences are not accounted for by DEP.
• EPA did not collect any significant data in the 2016 CTGs to identify the emissions profile of low-production wells, and DEP relied on EPA data to support the proposed rule.
• DEP has not provided the basis for the population of conventional wells in Pennsylvania cited in the preamble to the rulemaking.
• There are significant differences associated with emissions from new storage vessels versus existing vessels, and there is no certainty that existing facilities will be capable of accepting the retrofits, if needed, to capture vapors.
• Storage vessels associated with conventional operations should not be regulated under the proposal due to low emissions levels.
• The economic viability of many conventional operators is at stake.

Changes in the draft final-form rule

At the December AQTAC meeting, DEP presented a list of changes made since the 2020 proposed rulemaking.

Most notable among these changes is that DEP added a requirement for annual leak inspections at what it estimates will be 38 sites where low-producing wells exist on muti-well pads. Also included was a uniform threshold for when operators must begin controlling emissions from tanks, bringing the standards for tanks at conventional well sites in line with newer shale gas sites.

DEP also removed a provision that would have allowed companies to perform less frequent leak searches if they could show that fewer than 2 percent of their components were leaking. DEP replaced it with a standard allowing operators to conduct fewer or no leak surveys at sites only when production drops to a low level.

Although the department broadly noted some of the types of comments received, it indicated the formal comment and response document is still being prepared. As a result, no rationale was provided for the changes between the proposed and the draft-final versions. The following changes were highlighted in DEP’s presentation slides:

129.121: General provisions and applicability

• Updated the applicability for natural gas-driven pneumatic controller to clarify the final-form rulemaking applies to natural gas-driven continuous bleed pneumatic controller.

129.122: Definitions, acronyms and EPA Methods

• Some unnecessary terms were removed, and minor edits made to other terms for clarification.

129.123. Storage vessels

• Applicability for 95 percent VOC control is reduced to 2.7 tons per year (TPY) threshold for all storage vessels.
• Maximum daily average throughput changed to monthly average throughput to calculate actual VOC emissions.

129.124. Natural gas-driven continuous bleed pneumatic controllers

• Changed the term natural gas-driven pneumatic controller to natural gas-driven continuous bleed pneumatic controller for clarity.

129.125. Natural gas-driven diaphragm pumps

• Minor edits for clarification, no significant changes were made.

129.126. Compressors

• Changed the applicability for reciprocating compressors to require rod packing changes for reciprocating compressors located at well sites.
• Allowed routing the VOC emissions from a reciprocating compressor to a control device in addition to a process.

129.127. Fugitive emissions components

• Well sites producing, on average, equal to or greater than 15 (barrels of oil equivalent) BOE per day, with at least one well producing, on average, equal to or greater than 15 BOE per day, must perform quarterly LDAR inspection.
• Well site producing, on average, equal to or greater than 15 BOE per day, and at least one well producing, on average, equal to or greater than 5 BOE per day but less than 15 BOE per day must perform annual LDAR inspections. Operators in this category can request an exemption from the annual instrument-based LDAR inspection on a case-by-case basis.
• Removed 2-percent leak step-down provision and replaced it with the following production-based provision:

―Well site production and individual well production must be calculated on an annual basis.

―If the result of the calculation would allow the well site to inspect at a lower frequency, the owner or operator may adopt the less frequent inspections after two consecutive calculations.

―If the result of the calculation would require the well site to inspect at a higher frequency, the owner or operator shall adopt the higher frequency of inspection immediately.

129.128. Covers and closed vent systems

• The requirements for initial AVO (audio, video or olfactory) inspections were changed from 30 days to 60 days after the effective date of the final-form rulemaking.

129.129. Control devices

• Minor clarifications are made to performance testing requirement.

129.130. Recordkeeping and reporting

• Minor edits were made to reflect the reduction to 2.7 TPY threshold for storage vessels and refer to natural gas continuous bleed pneumatic controllers.

The presentation made by DEP to AQTAC and the draft final-form rule itself (referred to as Annex A) can be found in the December 9, 2021, meeting material on the committee’s webpage.

What’s next

DEP plans to present the rulemaking to its Citizens Advisory Council and Small Business Compliance Advisory Committee this month before seeking final approval from the Environmental Quality Board in the first quarter of the year. DEP then hopes to promulgate the final rule in the second quarter of 2022.

DEP’s proposal is more stringent than the federal guidelines it is based on. However, EPA is proposing another set of rules to cut the oil and gas industry’s methane emissions further. If they are finalized, Pennsylvania facilities will have to comply with those stricter standards.