PA PROPOSES NEW OIL AND GAS AIR PERMIT (GP-5A) THAT EXCEEDS FEDERAL REQUIREMENTS

On February 4, 2017, the Pennsylvania Department of Environmental Protection (“PADEP”) formally proposed a new air general permit (GP-5A) to regulate air emissions from new or modified unconventional natural gas well site operations.  This new proposed permit is a part of PADEP’s and Governor Wolf’s methane reduction initiatives that were previously announced in January 2016 and would control emissions from unconventional gas well sites more stringently than required under applicable federal regulations.  Additionally, the proposed GP-5A will impose emissions control requirements and/or best management practices to reduce emissions on remote pigging operations, tanker truck load-out operations, and wellbore liquids unloading operations that have traditionally not been regulated by PADEP.  The proposed GP-5A also covers more emissions sources and is more stringent than PADEP’s plan approval Exemption No. 38 that currently exempts unconventional gas well sites from air permitting in Pennsylvania provided that certain limited requirements were met.  Accordingly, in proposing the new GP-5A, PADEP also proposes to revise the current plan approval Exemption No. 38 by eliminating the exemption’s applicability to unconventional well sites.  Thus, if and when the new GP-5A is finalized, owners or operators of new unconventional gas well sites or modified sources at existing unconventional well sites must obtain authorization to use the GP-5A or submit an application to PADEP for a site-specific Plan Approval/Operating Permit prior to construction of the facility.  Existing unconventional gas well sites would still be permitted to operate under the current plan approval Exemption No. 38, however, these existing well sites would be required to obtain authorization under the new GP-5A if the facility undergoes a modification, which would include refracturing or the addition of a new piece of equipment according to PADEP’s proposal.  Neither major source Title V facilities nor facilities that produce or process sour gas are eligible for the proposed GP-5A, and instead must continue to obtain their own individual source permits.  Conventional oil and gas wells will still be permitted to operate under the plan approval Exemption No. 38. 

PADEP also proposed revisions to its existing general permit (GP-5), which covers natural gas compressor stations and processing plants, to incorporate the more stringent requirements proposed as part of the GP-5A into a revised GP-5. In addition, PADEP proposes to revise the existing GP-5 to impose more stringent requirements on certain stationary natural gas-fired combustion turbines and centrifugal compressors and to expand applicability to transmission facilities.  Both the revised GP-5 and the new GP-5A also propose arguably burdensome recordkeeping, notification, and reporting requirements, including, for example, a requirement to notify PADEP at least 24 hours before any scheduled blowdown or venting and within 24 hours after any unscheduled blowdown, venting, or emergency shutdown.      

The emissions control requirements and emissions limitations that PADEP proposes as part of the new GP-5A and the revised GP-5 are based on PADEP’s assessment of “best available technology” (“BAT”), which is defined at 25 Pa. Code § 121.1 as equipment, devices, methods, or techniques as determined by PADEP “which will prevent, reduce, or control emissions of air contaminants to the maximum degree possible and which are or may be available.”  In general, BAT determinations allow for the consideration of economic impacts in addition to energy and environmental impacts.  BAT is required for all sources in Pennsylvania, including minor sources, that are required to obtain a plan approval.  In conducting the BAT analysis for the proposed new GP-5A and the revised GP-5, PADEP stated in the accompanying draft Technical Support Document that it considered the applicable federal New Source Performance Standards (“NSPS”) and National Emissions Standards for Hazardous Air Pollutants (“NESHAPs”) as a baseline for determining BAT.  PADEP stated that it also evaluated vendors’ guaranteed emission limits, available stack data, permits recently issued by other states, and documents related to U.S. EPA’s Natural Gas Star program, among other sources, to determine BAT.  As noted in the draft Technical Support Document, PADEP has proposed BAT on a pollutant-by-pollutant basis for each source in the proposed new GP-5A and revised GP-5 and, notably, PADEP has required BAT control measures to reduce methane emissions from certain sources (glycol dehydrators, storage vessels, and pigging operations) that have uncontrolled methane emissions at a rate of 200 tpy or greater.   

As noted above, PADEP’s proposed new GP-5A and revised GP-5 are a part of Governor Wolf’s and PADEP’s methane reduction initiatives that were previously announced in January 2016.  Written comments on these proposed permits and the revisions to Exemption No. 38 are due to PADEP by March 22, 2017.  In addition to the comments that will certainly be submitted by the various trade organizations, affected companies may want to consider submitting individual attributional or non-attributional comments regarding the technical, commercial, and economic feasibility of the BAT determinations made in the proposed new GP-5A and the revised GP-5.    

 

This Energy and Environmental Alert is intended to keep readers current on matters affecting energy and environmental issues and is not intended to be legal advice. For information or assistance regarding any of the information noted above, please contact Scott R. Dismukes at 412.566.1998 or sdismukes@eckertseamans.com, Richard S. Wiedman at 412.566.5967 or rwiedman@eckertseamans.com, David A. Rockman at 412.566.1999 or drockman@eckertseamans.com, or Jessica Sharrow Thompson at 412.566.5941 or jsharrow@eckertseamans.com or any other attorney with whom you have been working.