New Owner Clean Air Act Audit Program for Oil and Natural Gas Exploration and Production Facilities
June 13, 2018
June 13, 2018
In early May 2018, the federal EPA published a DRAFT document entitled “New Owner Clean Air Act Audit Program for Oil and Natural Gas Exploration and Production Facilities.” This voluntary audit program offers certain protections from Clean Air Act compliance penalties for newly acquired oil and gas (O&G) facilities provided the issues are resolved in a satisfactory manner. The agreement would only cover civil violations; there would be no protection from criminal liabilities.
This audit program is in addition to other EPA and State voluntary audit programs that are not focused on oil and gas operation.
Overview
Below is a brief highlight of the draft program agreement. You can review the document for more details by going to the link: New Owner Clean Air Act Audit Program for Oil and Natural Gas Exploration and Production Facilities.
The draft new owner audit program is a voluntary federal EPA program for the O&G exploration and production industry. The signed agreement between the EPA and the company would be a way for companies that are acquiring new O&G production facilities to obtain certain protections from penalties associated with compliance issues that the new owner was not responsible for. Only facilities identified in the agreement would get this benefit.
The draft agreement requires the company to conduct a self-audit of its newly acquired facilities for compliance with the federal Clean Air Act (CAA), CAA implementing regulations (e.g., 40 CFR) and federally approved and enforceable State Implementation Plans (SIP). The draft agreement would allow a company to enter into a parallel agreement with a State regulatory agency that has a State audit policy.
A key program component of the draft program is a requirement for companies to assess storage tank battery vapor control system design (e.g., VRUs, VCUs) as part of the audit process.
Agreement
The company corporate official and EPA representative would be required to sign the agreement.
The agreement and related documents submitted to the EPA would require certification by the company corporate official. The draft document includes some standard certification language.
Corrective Actions
Types of corrective actions include:
- Violations Unrelated to Engineering and/or Design Issues
- Violations Related to Engineering and/or Design Issues
- Immediate and Substantial Endangerment to Public Health or Welfare, or the Environment (i.e., Emergency Conditions)
NOTE: Violations that would be considered an Emergency Condition are required to reported as according to Federal/State emergencies reporting regulations to proper authorities (e.g., National Response Center, State Emergency Response Commissions (SERC) and Local Emergency Planning Committees (LEPC)) and to the EPA. Consult the draft agreement and your SERC and LEPC rules for emergency reporting requirements.
Vapor Control System Analysis, Field Survey and Corrective Actions
The draft agreement requires development of a plan for analysis, field surveys and corrective actions to include:
- Development of a Modeling Guideline – determine minimum and maximum instantaneous vapor flow rate for use in design and sizing vapor control system.
- Engineering Design Standards – implement proper system to control emissions.
- Vapor Control System Field Survey Standard Operating Procedure (SOP) – to establish procedure for field survey to demonstrate emission control system is adequately designed.
- Vapor Control System Field Survey and Engineering Evaluation – conduct field survey to demonstrate emission control system is adequately designed.
- Vapor Control System Modifications and Verification – used demonstrate how to bring into compliance vapor control systems that are not adequately designed and sized base on Engineering Evaluation (Item 4 above). Implement agreed to plan.
Reporting Requirements
Requires reporting the following to the EPA regarding the agreement
- Audit documents (audit protocols and checklists)
- Semiannual reports to EPA
- Final Report to detail compliance with each disclosed violation, as applicable.
Recordkeeping
The company must maintain records for at least 2 years after resolution of the Agreement with a Final Determination. Companies may assert a business confidentiality claim covering the records required to be submitted as specified in 40 CFR Part 2, Subpart B.
Other Voluntary Audit Programs
Other EPA and States environmental regulatory agencies have similar voluntary programs that cover all industries and multi-media environmental regulations (air, water, waste, etc.). See the HY-BON/EDI blog topic, “Voluntary Disclosure of Environmental Violations” for more details.
More links include:
- EPA's eDisclosure The eDisclosure online system uses EPA's Central Data Exchange (CDX) to so companies can promptly disclose violations and submit compliance certifications under EPA’s Audit Policy and Small Business Compliance Policy, which will be processed automatically by EPA.
- State Audit Privilege and Immunity Laws & Self-Disclosure Laws and Policies
HY-BON/EDI IQR Emissions Services (LDAR)
HY-BON/EDI can assist your company in routine compliance with State air regulations and NSPS OOOOa compliance. We have unrivaled experience and knowledge in Leak Detection (OGI) and measurement for the O&G Industry.
We employ professionally certified technicians each with over 10 years of technical experience. HY-BON/EDI offers a Leak Detection and Repair (LDAR) program that will keep your facility in compliance with the new regulations. A part of our IQR service for NSPS OOOOa compliance includes first attempt to repair the source of fugitive emissions which gives the operator more time to finalize repairs if needed.
