Skip to main content

The Environmental Protection Agency (EPA) is proposing significant changes to the New Source Performance Standards that regulate Oil and Gas Operations. These proposed changes align with the Biden Administration’s priority, and the presidential executive order directing the EPA to amend the existing rules to regulate existing sources that are currently not subject to the rule, as well as regulating methane emissions from oil and gas operations). In addition, the proposed changes are in compliance with the most recent Congressional Review Act (CRA) requiring amendment of the rules.

The proposed rule makes changes to 40 CFR Part 60 subpart OOOOa and proposes new standards in 40 CFR Part 60, Subpart OOOOb and Subpart OOOOc. Some of the important requirements proposed are:

  • Fugitive emissions at well head facilities, and compressor stations: Facilities with fugitive emissions of 3 tpy or more will be required to monitor for leaks on a quarterly basis. If fugitive emissions are less than 3 tpy a one-time survey will be required. The first attempt to repair must be within 30 days of finding a leak and final repair must be completed within 30 days of first attempt.

The EPA is also soliciting comments to determine if semi-annual monitoring will be appropriate for facilities with emissions greater than or equal to 3 tpy and less than 8 tpy. Facilities with fugitive emissions greater than 8 tpy will still perform monitoring on a quarterly basis.

The EPA is also proposing Alternate Emissions Monitoring Methods (AEMM), using emerging technologies, with flexible schedules which are subject to EPA approval. EPA is currently considering approval of monitoring using fixed wing crafts, drones, and is also soliciting comments on deploying fence-line monitors. Additionally, the EPA is also seeking information on any other technologies that may be more suitable for identifying and quantifying leaks. The oil and gas industry has requested approval to use new technology in order to more efficiently identify/quantify leaks and, if done correctly, this will be a great step forward.

Fugitive emissions monitoring at gas processing plants will be performed, at a minimum, on a bi-monthly basis using Optical Gas Imaging (OGI). OGI is currently used to detect leaks at gas plants, however, surveys are currently only required quarterly.

The proposal solicits comments if EPA should require operators to conduct root cause analysis and corrective actions on the basis of excess emissions.

  • The proposal will expand the number of storage tanks which require controls by making this rule applicable to tank batteries that could emit more than 6 tpy from all tanks in a battery (current rule only requires controls if emissions from each tank are greater than 6 tpy), and for existing facilities if the emissions for each tank battery are greater than 20 tpy. Storage tank batteries that are subject to 40 CFR Part 60, Subparts OOOOa and OOOOb must control emissions by 95% for methane and VOC. EPA is also prescribing what approval, monitoring, recordkeeping and reporting will be needed to exempt a tank battery from control requirements through “legally and practically enforceable” state emissions permitting. Several old tank batteries will now require controls and complying with these provisions could be challenging given current supply chain issues.
  • Only zero bleed pneumatic controllers will be allowed unless a given facility is located in Alaska without power supply. Pneumatic pump emissions must be controlled to reduce emissions by 95%. EPA assumes that the industry will utilize compressed air at the majority of the locations to operate pneumatic controllers.
  • For well liquids unloading – EPA is requiring zero methane/VOC emissions unless not feasible for technical or safety reasons. If not feasible, Best Management Practices (BMP) must be implemented to minimize emissions. Complying with this provision may not be economical for old wells but the rule does not supersede this provision based on economic consideration.
  • Wet seal compressor emissions must be reduced by 95%. Rod packings for reciprocating compressors must be monitored on an annual basis or emissions must be routed to the process.
  • A combination of Reduced Emission Completion and the use of a combustion device should be deployed to complete non-wildcat and non-delineation wells. A combustion device can be used to control emissions from exploratory and low-pressure wells.
  • Associated gas flaring will be prohibited unless the operator demonstrates that a gas sales line is not accessible.
  • Sweetening units have a stipulation of minimum SO2 emission reduction efficiencies.
  • The proposal requests public comments/suggestiongs regulating abandoned wells, pigging operations, and tank truck loading operations.
  • Finally, the EPA proposed rule changes require operators to e-file periodic reports that could be easily accessible by all stakeholders.

The information summarized above is based on the rule preamble only. Unlike in the past, EPA has not provided the proposed rule texts but has promised a supplement proposal. It appears that EPA is soliciting comments on the preamble to develop a proposed rule. It is assumed that the EPA will solicit comments on the supplemental proposal to finalize the rule in 2022. The final NSPS OOOOa and NSPS OOOOb rules will become effective immediately once finalized. The Emission Guidelines for NSPS OOOOc would be adopted by the state with an effective date in 2026. All stakeholders will have 60 days to comment on this proposal.

The rule, as proposed, will have an impact on voluntary emission reduction projects and their ability to have creditable emissions. Finally, the proposed rule requirements will also change what is reported by the operators as voluntary emission reduction actions in their sustainability reports.

Author Profile
Jagadeesan Sethuraman
Director, ESG Analysis and Reporting

Jagadeesan Sethuraman has a Ph.D. in Chemical Engineering from Auburn University and an Executive MBA from the University of Denver. He has been working in the Environmental multi-media permitting and compliance field for the last 27 years. He most recently was the Chief of Staff for the Regional Administrator for the Environmental Protection Agency Region 8. He has extensive experience serving upstream, midstream, and downstream oil and gas sectors, Chemicals Manufacturing Sector, Power Generation, Manufacturing Sectors, and Pulp and Paper Mills. ESG, Rule interpretation, Program Development, Agency Negotiations, Auditing, Due Diligence, Stakeholder Engagement, Strategy Development, Technology Evaluation, and Process Improvement are some of his areas of specialties. Jagadeesan served as member and leader of many subcommittees of oil and gas trade associations.