Pennsylvania Oil and Gas Air Quality Regulatory Update

Posted on January 4, 2012 by Kristian Macoskey, QEP

2011 was a busy year for those attempting to stay abreast of air quality issues affecting the oil and gas industry in Pennsylvania.  In recent presentations to the PA Chamber of Business and Industry and the Marcellus Shale Coalition, Joyce Epps, PADEP’s Director of Air Quality, discussed PADEP’s intent to require natural gas facility owner/operators to submit an atmospheric emission inventory data by March 1, 2012. This is just the latest in a series of state and federal air quality compliance issues that have been pertinent to the oil and gas industry.  As 2012 gets underway, expect to hear more about emission inventories, general permits, plan approval exemptions, source aggregation, NSPS/NESHAPS, and greenhouse gas reporting. If your head is spinning, here is an update on some key air topics:

1)    PADEP Atmospheric Emission Inventories

PADEP is rolling out its first emissions inventory program for the natural gas industry.  Initial indications are that it will be modeled after the Wyoming Department of Environmental Quality approach.  PADEP sent initial notification letters to 99 operators on 12/6/11 with the intent that 2011 inventories be submitted by 3/1/12.  Criteria pollutants (e.g., carbon monoxide and nitrogen dioxide) and hazardous air pollutants (e.g., benzene and formaldehyde) from point sources (e.g., dehydrators and heaters), fugitive or area sources (e.g., leaking components and impoundments), and mobile sources (e.g., on- and off-road engines) are expected to be included.  An Excel-based Shale Air Emissions Data Management System is being developed and the publicly-available Oil and Gas Reporting Electronic (OGRE) System will be modified to accommodate the reporting of this information.  Training is expected to be offered by PADEP in February 2012.  Additional materials can be found on PADEP’s website here.  Industry representatives are hopeful that an extension will be granted for delivery of the first reports.

2)    General Permit GP-5 – Natural Gas Production Facilities

Use of GP-5 expedites the permitting of certain natural gas activities.  The permit was last updated on 3/17/11 although no changes were made to the applicability of the permit or the associated emission limits.  The main change to the permit was a new condition that allows the applicant to limit the maximum emissions (i.e., potential to emit) of a source.  The biggest changes though were to the application itself which expanded from two pages to nine.  The new application requires significantly more detail including serial numbers for equipment, design parameters for control devices, and compliance demonstration methods.  With the development of EPA’s new NSPS and NESHAPS (see Item 6 below), PADEP plans to issue more substantive changes to GP-5 in early 2012.  Watch for the opportunity to submit comments during another 45-day window when proposed modifications are published.

3)    General Permit GP-11 – Nonroad Engines

Proposed changes to GP-11 were published in the PA Bulletin on 10/30/10.  PADEP included a provision to operate engines at temporary locations provided written notification is made to the municipality and PADEP five days prior to the change in location.  PADEP also proposed to require that an operations report be submitted within 30 days of completing work at each temporary location.  PADEP received comments from 1,122 parties prior to the comment period that closed on 5/26/11 and PADEP is still in the process of developing a comment and response document.  Possible changes to GP-11 are closely tied to proposed revisions to Exemption #38 on the PADEP Plan Approval Exemption List.

4)    Plan Approval Exemption #38

Certain oil and gas exploration and production facilities were exempt from Plan Approval requirements under Exemption #38 of the 7/26/03 list of Plan Approval exemptions.  A draft revision to that list was published on 4/16/10 which included the addition of several caveats to Exemption #38 that make it more difficult to obtain the exemption.  The public comment period closed on 5/26/11 by which time the agency had received comments on Exemption #38 from 1,225 parties.  Industry advocates are hopeful that the exemption will be tailored to enable nonroad engines that would otherwise be subject to GP-11 to be exempt from permitting requirements altogether.  PADEP is considering its response to these comments in combination with its work on GP-11.

5)    Source Aggregation Guidance

PADEP published its final Guidance for Performing Single Stationary Source Determinations for Oil and Gas Industries on 10/22/11 (41 Pa.B. 5719).  The comment period for that guidance closed on 11/21/11.  PADEP is in the process of responding to comments from 364 parties, perhaps most notable among them being Diana Esher, U.S. EPA Region III Air Protection Division Director.  Ms. Esher stated that, “We disagree with the policy pronouncements in the PADEP guidance which differ from established federal law and the Commonwealth’s own State Implementation Plan (SIP) and regulations by attempting to emphasize proximity and ‘common sense notion of a plant’ above other factors including conducting case-by-case analysis.”  Through six pages of detailed comments, EPA delineates multiple disagreements with PADEP’s guidance.  Ms. Esher states that PADEP indicates an intent “…to change the manner in which regulations that have been adopted as part of the…SIP and that are now federal law will be implemented.”  Ms. Esher states that “this is problematic,” in that the SIP becomes federal law once approved by EPA, not state law.  In concluding, Ms. Esher was clear that EPA will be paying close attention to PADEP’s source aggregation determinations.

6)    NSPS/NESHAPS

Proposed air emission standards for the oil and natural gas industry were published in the Federal Register on 8/23/11.  As drafted, these rules will apply to production and processing (drilling and well completions following hydraulic fracturing, producing wells, gathering lines, gathering and boosting compressors, gas processing plants) and transmission and storage (transmission compressor stations, transmission pipeline, underground storage).  Various industry groups including the American Petroleum Institute, the Gas Processors Association, and the Marcellus Shale Coalition submitted comments prior to the close of the comment period in late November 2011.  Final rules, expected by 2/28/12, will be automatically adopted in their entirety in the Pennsylvania Code.

7)    40 CFR 98, Subpart W Greenhouse Gas Reporting

Subpart W was published at the end of 2010 and obliged affected facilities to begin gathering data in 2011 for initial GHG reports due in 2012 (see CEC’s prior blog posting).  The Subpart has gone through several modifications since it was originally published, the most significant of which was an allowance for the use of best available monitoring methods (BAMM) for all of 2011.  Use of BAMM is currently permitted through June of 2012 providing the designated representative e-filed a Notice of Intent prior to 1/3/12.  Affected parties are encouraged to monitor changes in the rule for revisions to emission estimation methodologies and other technical revisions.  The current due date for the 2011 reports is 9/28/12.

CEC will be following these topics and will provide periodic updates as they develop.  In the meantime, if you are unclear as to how any of these issues may affect your operations, please contact CEC’s natural gas air quality expert Kris Macoskey at 800-365-2343 or by email at kmacoskey@cecinc.com.

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Cleanup of Chlorides in Soils at Natural Gas Well Sites

Posted on November 13, 2011 by Thomas L. Maher, Jr., P.G.
As described in our previous posting, CEC recently learned that the Pennsylvania Department of Environmental Protection (PADEP) will soon be issuing draft guidance that standardizes the regulatory requirements for reporting, remediating, and restoring areas impacted by spills or releases from oil and gas (O&G) well operations. That guidance specifies that the remediation of specific types of releases will be referred to the Bureau of Environmental Cleanup and Brownfields (BECB) for oversight of remedial activities which will be performed in accordance with the provisions of the Pennsylvania Land Recycling Program, commonly known as Act 2. Among the other provisions of Act 2, it requires that a site be remediated using one of three standards available in Act 2: Background Standard; Statewide Health Standard; or Site-Specific Standard. One parameter that must often be addressed after releases at natural gas well sites is chloride. Act 2 does not have a Media Specific Concentration (MSC) established for chlorides in soils for use in achieving the Statewide Health Standard, which could preclude the use of that cleanup standard. The lack of an established regulatory standard for chlorides in soil to guide remedial activities is also a potential concern in surrounding states.
The term “chloride” does not refer to any specific compound but is a category of substances that are either present in the deep groundwater encountered during well drilling to reach the Marcellus Shale, or are added to drilling muds or hydrofracturing fluids to facilitate development of a gas well.  The most common chlorides of interest include sodium chloride, calcium chloride, magnesium chloride, ammonium chloride, potassium chloride, and barium chloride. Act 2 established a MSC of 250 mg/l for chlorides in groundwater based on the Secondary Maximum Concentration Level (SMCL) promulgated by the United States Environmental Protection Agency (EPA). However, as stated earlier in this blog, Pennsylvania does not have a MSC for chlorides in soil. Both PADEP and industry personnel have requested guidance on how to address chlorides in soils.  As a result, PADEP is considering proposing the use of a Site-Specific Standard for chlorides in soil that would address both the potential soil-to-groundwater pathway and the ecological pathway that could impact species and habitats of concern.
The soil-to-groundwater pathway could be evaluated by submitting samples of impacted soil to a laboratory for analysis using the Synthetic Precipitation Leaching Procedure (SPLP).  Soils with a SPLP-leachable chloride concentration less than the groundwater MSC of 250 mg/l would be considered as having achieved attainment with the soil-to-groundwater MSC.  Additionally, potential surface water impacts to seeps/springs and stormwater runoff would be evaluated using the water quality standard (WQS) of 250 mg/l.  The potential for using soil to groundwater leachability calculations to derive cleanup standards for chlorides and other soluble constituents such as sulfate and bromide may also be considered since methods for performing these calculations have already been established under Act 2.
Under the existing Act 2 process, an evaluation of the ecological risk must be performed to address potential species and habitats of concern, but the evaluation does not have to consider impacts to common plant species.  PADEP is considering implementing additional requirements in an attempt to prevent the development of a Site-Specific Standard that would be considered to be protective of the species and habitats of concern specified in the Act 2 regulations while allowing residual chloride concentrations to remain in the soil that would negatively impact vegetation on the property.  These additional requirements would include an assessment of the chloride tolerance of the vegetation present at a site to develop a Site-Specific Standard.  This site-specific vegetation chloride tolerance approach could result in a large variation of chloride cleanup criteria from site to site.  For example, some agricultural crops can tolerate total chloride concentrations in soils of up to 1,500 mg/kg while more sensitive species cannot tolerate total chloride concentrations in soils at concentrations in the range of 500 to 800 mg/kg.  Proper selection and application of soil amendments can reduce the amount of chlorides and other ions (particularly sodium) in the soil that are potentially deleterious to plants, thereby reducing the potential toxicity due to residual chloride concentrations.
If you have questions on how the spill and release guidance might apply to your operations, please contact Bo Valli, P.G., (bvalli@cecinc.com) or Tom Maher, P.G., (tmaher@cecinc.com) at 800-365-2324.

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PADEP to Issue Draft Guidance for Response to Releases and Spills From Gas Sites

Posted on November 6, 2011 by Thomas L. Maher, Jr., P.G.

CEC recently learned that the Pennsylvania Department of Environmental Protection (PADEP) will soon be issuing draft guidance that standardizes the regulatory requirements for reporting, remediating, and restoring areas impacted by spills or releases from oil and gas (O&G) well operations. The guidance will be applicable to spills and releases from conventional well operations as well as unconventional shale gas exploration and production (E&P) operations involving the Marcellus and Utica Shales. The guidance is being developed to provide a consistent and uniform response program for releases and spills, and to establish a regulatory framework within which PADEP will exercise its administrative discretion when dealing with releases.

Until recently, responses to spills and releases from O&G operations were administered by the Office of Oil and Gas Management (OOGM), which was formerly referred to as the Bureau of Oil and Gas Management.   The various OOGM offices were free to exercise their discretion as to how to address each spill on a case-by-case basis. The incident reporting mechanism and overall responsibility for handling releases will remain with the OOGM, while the remediation of specific types of releases will be referred to the Bureau of Environmental Cleanup and Brownfields (BECB) for oversight of remedial activities. The practice of referring spills and releases to the BECB has already occurred with the issuance of several Notices of Violation that direct responsible parties to contact the BECB regarding procedures for conducting cleanups under the provisions of the Pennsylvania Land Recycling Program, commonly known as Act 2.  Specifically, environmental remediation standards established under Act 2 will be used whenever site remediation is required under the Clean Streams Law, the Air Pollution Control Act, the Solid Waste Management Act, the Hazardous Sites Cleanup Act, and the Storage Tank or the Spill Prevention Act.

The two types of releases specified in the guidance are based on their potential to cause environmental harm.  The first type is a release of regulated substances of less than 42 gallons that does not pose a danger of polluting waters of the Commonwealth and does not result in damage to the property. The guidance will specify that releases of that type will be cleaned up by removing visibly impacted soil.  For releases that exceed those criteria, performance of remediation of the impacted media will be required in accordance with the administrative and technical requirements of Act 2.  The cleanup standard used may be selected from three standards available in Act 2: Background Standard, Statewide Health Standard, or Site-Specific Standard. The Responsible Party would be required to follow the administrative process set forth in Act 2, including the submittal of a Notice of Intent to Remediate (NIR), publishing public notices and submitting a Final Report demonstrating attainment of the selected standard.  The submission of a NIR and public notifications can be waived under Act 2 if the final report is submitted within 90 days of the release.

Some potential concerns related to this guidance include:

  • The time needed to administratively complete the Act 2 process.  The Act 2 process will add to the administrative requirements and likely add to the time needed to obtain a release from PADEP. As indicated earlier in this posting, the administrative requirements could be reduced somewhat if a spill or release referred to the BECB is remediated to attainment of one of the remediation standards available under Act 2.
  • Potential for negative publicity: Increased negative publicity for the natural gas industry may result should the public notification portion of the Act 2 regulations be necessary.
  • Deed covenant requirement: Activities of natural gas operators are usually performed on leases and there is uncertainty about how landowners will react to the deed notification/environmental covenants required when utilizing site-specific cleanup standards under Act 2.  This would be the case for soils impacted by chlorides, a chemical of concern often associated with releases at natural gas sites.  There is no Statewide Health Standard for chloride in soil; and, as such, only the Site-Specific Standard and Background Standard are available for use under Act 2.

If you have questions on how the spill and release guidance might apply to your operations, please contact Bo Valli, P.G. (bvalli@cecinc.com) or Tom Maher, P.G. (tmaher@cecinc.com) at 800-365-2324.

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Reissued General Permit (PASPGP-4) Affects Linear Projects in Pennsylvania

Posted on July 19, 2011 by Paul A. Kanouff

On July 1, 2011 the U.S. Army Corps of Engineers (Corps) issued the Pennsylvania Special Programmatic General Permit-4 (PASPGP-4) which replaces the expired PASPGP-3.  The PASPGP is a federal Clean Water Act, Section 404 permit which can be authorized by the Pennsylvania Department of Environmental Protection (DEP) and county conservation districts for minor activities in wetlands, streams, rivers, and other waters without additional review by the Corps.  For the most part, the PASPGP-4 is a continuation of the PASPGP-3 but there are some key changes that will impact linear projects.  Although the changes were mainly aimed at the rapidly growing natural gas industry in Pennsylvania, they will affect all linear projects ranging from sewer and water pipelines to electrical, cable, and telephone lines.  The changes affecting linear projects are summarized in this posting.

One aspect of the PASPGP-4 which was the focus of a lot of debate was the definition of Single and Complete Projects.  The definition of a single and complete linear project still refers to each crossing of a separate water body.  However, the PASPGP-4 makes a distinction between the overall project and a single and complete project.  The overall project includes all regulated activities that are reasonably related and necessary to accomplish the project purpose.  Applicants must supply the locations for the start and end points along with the proposed crossings and the total cumulative impacts needed to accomplish the overall project.  Therefore, although a linear project may contain more than one single and complete project, the total cumulative impacts needed to accomplish the overall project must be disclosed.  The cumulative impacts (meaning the sum total of all of the crossings) for the overall project will then be used to determine the category of activity.  Therefore, if the cumulative impact for the overall project is greater than 1 acre of jurisdictional waters or 250 linear feet of streams, then the overall project will be a Category III activity and will be reviewed by the Corps.  However, the cumulative impacts are only used to determine the category level of the activity.  They are not used to determine whether the project is eligible for authorization under the PASPGP-4.  The project will still be eligible under a PASPGP-4 as long as the impacts for each single crossing are less than 1 acre of jurisdictional waters or 250 linear feet of streams.  Therefore, this process has not changed.

The PASPGP-4 includes clarification on the calculation of linear footage of stream impact.  The linear footage of stream impact is now to be measured from the top of bank to the top of the opposite bank and from the upstream to downstream limits of work.  The linear footage of stream impact will be the greater of these two measurements.  Therefore, the right-of-way (ROW) will typically be used to determine the linear footage of stream impacts for pipeline projects.

Through the PASPGP-4, the Corps has established two triggers which can automatically push a project into a Category III review.  The first trigger involves threatened and endangered species.  If the PNDI for a project identifies a conflict with a federally listed species or includes avoidance measures from the U.S. Fish and Wildlife Service (USFWS), the project will be considered a Category III activity and must be reviewed by the Corps.  The second trigger involves interstate projects.  Projects which will be located in Pennsylvania and another state will also be considered a Category III activity and must be reviewed by the Corps.

There was one major change to the PASPGP-4 that was included in the draft version of the general permit that was not included in the final version.  The Corps was expected to lower activities authorized as Waiver 2 (25 PA Code § 105.12(a)(2) Waiver 2) from a Category III activity to a Category 1 activity.  Waiver 2 is for water obstructions in a stream or floodway with a drainage area of 100 acres or less.  This waiver applies only to the DEP and not to the Corps.  Since these activities are still Category III, they must be reviewed by the Corps to obtain federal authorization for the project.

Lastly, projects which were authorized by the PASPGP-3 have been reauthorized by the PASPGP-4 provided the permit for the project had not expired by June 30, 2011.  For most projects, the new expiration date for the reauthorized PASPGP-3 will be tied to any applicable PADEP Chapter 105 applications such as a General Permit or Joint Permit.

If you have any questions regarding the requirements of the PASPGP-4 or any other aspects of the permitting requirements for linear projects in Pennsylvania, please contact Paul Kanouff at pkanouff@cecinc.com or 800-899-3610.

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