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Oil and Gas Operations, Including Hydraulic Fracturing, Subject to New Air Quality Regulation - EPA Issues Final Rules Under the New Source Performance Standards and National Emission Standards for Hazardous Air Pollutants Programs
04/20/2012
James D. Braddock, Jeff Civins, Mary Simmons Mendoza

In order to comply with a court-ordered schedule, EPA Administrator Lisa Jackson on April 17, signed final rules that subject additional oil and gas operations, including hydraulic fracturing, to air quality regulation under the New Source Performance Standards (NSPS) and National Emission Standards for Hazardous Air Pollutants (NESHAPs) programs, and impose new and amended requirements under both programs. These new rules affect new, and, in some cases, existing sources, significantly expanding the breadth and complexity of air quality requirements for the oil and natural gas industry. 

The final rules amend existing NSPS standards applicable to natural gas processing plants to address leaks of volatile organic compounds (VOC) and emissions of sulfur dioxide. Additionally, the rules modify NSPS to include all oil and gas operations (drilling, production, processing, transmission, storage and distribution), imposing requirements on those operations. 

The new NSPS standards include requirements for completions of hydraulically fractured gas wells, except wildcat, delineation and low-pressure wells. These standards, applicable to newly fractured and refractured wells, require the use of reduced emission completion (REC) techniques (a/k/a “green” completions), developed in EPA’s Natural Gas STAR Program. REC techniques entail capturing natural gas that currently escapes into the air from the flowback associated with preparation of a well for production.  Until January 1, 2015, subject facilities, in lieu of using REC techniques, may combust gas that would otherwise escape during completion activities. Controllers, storage vessels and compressors, and sweetening units are also regulated under the new NSPS requirements.

The NESHAPs standards include maximum achievable control technology (MACT) standards for certain small glycol dehydrators at major sources of hazardous air pollutants not currently subject to MACT standards.

All operators in the oil and gas industry should consider evaluating the potential impacts of the new rules in order to ensure compliance.

Please feel free to contact us if you have any questions regarding these matters.

James D. Braddock
512.867.8462
james.braddock@haynesboone.com

Jeff Civins
512.867.8477
jeff.civins@haynesboone.com

Mary Mendoza
512.867.8418
mary.mendoza@haynesboone.com