MEMORANDUM November 5, Phillip Fielder, P.E., Permits and Engineering Group Manager Air Quality Division

Transcription

1 OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY AIR QUALITY DIVISION MEMORANDUM November 5, 2008 TO: THROUGH: THROUGH: THROUGH: FROM: SUBJECT: Phillip Fielder, P.E., Permits and Engineering Group Manager Air Quality Division Kendal Stegmann, Senior Environmental Manager Compliance and Enforcement Phil Martin, P.E., Engineering Section Peer Review Mark Chen, P.E., New Source Permits Section Evaluation of Permit Application No O (M-4) Superior Pipeline Company, L.L.C. Cashion Gas Plant Latitude N , Longitude W NW¼ Section 29, Township 15N, Range 4W Logan County, Oklahoma. Directions: From Cashion, the intersection of Highway 74F and County Line Road, go 3 miles south on County Line Road, then turn east onto Simpson Road and travel for 1 mile, then turn south onto Council Road. Travel ½ mile south on Council Road and turn east into the plant. SECTION I. INTRODUCTION Superior Pipeline Company, L.L.C. (SPC) has requested an operating permit to modify their Cashion Gas Plant (SIC 1321). AQD received the modification application on April 15, 2008, which was designated as Permit No O (M-4). The Cashion Gas Plant was originally constructed in August 2004, and is currently operated under Operating Permit No O (M-2), which was issued on December 22, 2006, and Construction Permit No C (M- 4), which was issued on January 29, The facility has a pending operating permit in AQD, Permit Application No O (M-3). The issuance of Permit No O (M-3) became obsolete and unnecessary when the Permit No C (M-4) was issued. In Permit No C (M-4), permitted emission sources include six compressor engines (C-1, C-2, C-5, C-6, C- 7, and C-8), two glycol dehydration units (SC-1 and SC-2), two refrigeration units (also named Cryogenic Plant #1 and Cryogenic Plant #3), and four condensate storage tanks (T-1, T-4, T-5, and T-8). The facility also includes two pressurized storage tanks (T-2 and T-3) and water storage tanks (T-6 and T-7), which have negligible emissions. On September 30, 2008, AQD received a permit modification for a construction permit from SPC to install six additional compressor engines (from C-9 to C-14), which will make the facility a major source. This application was designated as Permit No C (M-5). Due to an Enforcement Case No and a Consent Order (CO) No , which was closed on July 30, 2007, the facility was required to submit a Title V operating permit to AQD. On April 25, 2007, AQD received a Title V operating permit

2 PERMIT MEMORANDUM O (M-4) 2 application from SPC for the Cashion Gas Plant, which was designated as Permit No O (M-3). Since the Permit No O (M-3) will not be issued and this permit No O (M-4) will be issued instead, then, this operating permit application is subject to Tier II of Title V permitting procedure to satisfy the requirement of the CO No The construction Permit No C (M-5) will be concurrently issued with this operating permit. After the modification, the facility remains a synthetic minor source in this No O (M-4). SECTION II. FACILITY DESCRIPTION Natural gas is transported to the facility via a pipeline gathering system. The gas streams from near-by wells enter the facility through an inlet separator, where free liquids (condensate and water) are removed from the inlet stream. The condensate and water are transferred to the condensate tanks from the bottom of the separator. Leaving from the top of the separator, the natural gas stream then enters one of the three compressors (C-1, C-5, and C-8) at approximately psig, and leaves the compressors at gas pressure of psig. Ethylene glycol is injected into the compressed gas stream ahead of the refrigeration unit to prevent the formation of hydrates. The compressed gas then enters the refrigeration unit to drop the temperature to - 40 o F to condense the moisture and natural gas liquids (NGLs). The ethylene glycol in the gas stream also extracts and absorbs the condensed water. The water removal from the gas pipeline is to prevent formation of hydrate on the pipe wall and corrosion of the pipeline. Then, the gas, the wet glycol, and NGLs enter a three-way separator. The dried and purified natural gas exits from the top of the three-way separator and enters a boost compressor (C-2 and C-6) to boost its pressure to 800 psig to be transported off-site for sales. The wet glycol exits from the bottom of the three-way separator and returns to the dehydrator for glycol regeneration. The NGLs also exit from the bottom of the three-way separator and are transferred to the NGL storage tanks. Wastewater and condensate are transported off-site for disposal. Compressor C-7 provides the service for the refrigerant (propane) circulation to the refrigerant units. SECTION III. EQUIPMENT Table 1 Internal Combustion Engine Source Name/Model Serial No. Installation Date C-1 1,340-hp Caterpillar G-3516 LE 4-stroke & lean-burn with O.C.** 4EK04330 July 2005 C hp Caterpillar G-399-TA 4-stroke & rich-burn with C.C.* 49C762 August 2006 C-5 1,340-hp Caterpillar G-3516 LE 4-stroke & lean-burn with O.C.** 4EK04561 July 2006 C hp Caterpillar G-399-TA 4-stroke & rich-burn with C.C.* 49C1032 June 2007 C hp Waukesha 3524 GSI 4-stroke & rich-burn with C.C.* C-16267/1 June 2007 C-8 1,340-hp Caterpillar G-3516 LE 4-stroke & lean-burn with O.C.** 4EK05093 March 2008 *C.C. = Catalytic Converter, **O.C. =Oxidation Catalyst

3 PERMIT MEMORANDUM O (M-4) 3 Table 2 VOL Storage Tanks Source Contents Capacity Installation Barrels Gallons Date T-1 Condensate/Slop Oil ,800 January 2008 T-2 Natural Gas Liquid (NGL) ,000 August 2004 T-3 Natural Gas Liquid (NGL) ,000 August 2004 T-4 Condensate/Slop Oil 210 8,820 March 2006 T-5 Condensate/Slop Oil 210 8,820 March 2006 T-6 Wastewater 210 8,820 March 2006 T-7 Wastewater 210 8,820 June 2007 T-8 Condensate/Slop Oil ,800 July 2007 Table 3 Glycol Dehydrator Heaters/Still Columns Source Make/Model MMBTUH Installation Date SC-1 EG Dehydrator Still Column August 2004 H-1 EG Dehydrator Heater MMBTUH August 2004 SC-2 TEG Dehydrator Still Column January 2006 H-2 TEG Dehydrator Heater MMBTUH January 2006 H-4 Gas Regeneration Heater MMBTUH December 2006 Table 4 Fugitive VOC Emission Sources of Plant #1 Source Emission Unit Number Gas-line Service FUG-1 Compressor Seals 0 Pump Seals* 15* Valves 250 Connectors 450 Relief Valves 35 * For Light Liquid Table 5 Fugitive VOC Emission Sources of Plant #3 Source Emission Unit Number Gas-line Service FUG-3 Compressor Seals 6 Pump Seals* 22* Valves 260 Connectors 480 Relief Valves 40 * For Light Liquid SECTION IV. AIR EMISSIONS Based on manufacturer s data (including a safety factor for operational flexibility), the emission factors for compressor engines before and after modification are presented in Table 6. The criteria pollutant emissions are estimated from the compressor engines based on 8,760 hours per

4 PERMIT MEMORANDUM O (M-4) 4 year operation and 1,000 BTU/SCF average heating value. Table 7 lists the engine specifications and stack parameters. Table 6 Engine Emission Factors Source Qty NOx(g/hp-hr) CO(g/hp-hr) VOC(g/hp-hr) C-1, C-5, & C-8, 1,340-hp Caterpillar G-3516 LE with O.C C-2 & C-6, 930-hp Caterpillar G-399-TA, with C.C C-7, 840-hp Waukesha 3524 GSI with C.C Table 7 Engine Specifications and Stack Parameters Parameter C-1, C-5, & C-8 C-2 & C-6 C-7 Manufacturer Caterpillar Caterpillar Waukesha Model G-3516 LE G-399 TA 3524 GSI Control Oxid. Cata. Cat. Conv. Cat. Conv. Input Parameter Horsepower (max) 1, Fuel Consumption (BTU/hp-hr) 8,496 8,333 8,334 Fuel Usage (SCFH) 11,385 7,750 7,000 Stack Diameter (Inches) Height above Grade (Feet) Exhaust Flow (ACFM) 8,002 4,650 4,469 Exhaust Temperature ( o F) 877 1,100 1,200 Calculated Parameter Moisture Content (%) Fugitive emissions estimation are based on Table 2-4 of 1995 Protocol for Equipment Leak Emission Estimates (EPA 453/R ), Oil and Gas Production Operations Average Emission Factors. VOC content in the vapor lines is averaged at 9.1% by weight. Condensate tank emissions were calculated using the TANKS 4.09 computer software using a maximum annual throughput of 1,533,000 gallons total (230,000 gallons per tank per year for T-1, T-4, and T-5, and 843,000 gallons per year for T-8), a molecular weight of 62, and an average vapor pressure of 5.0 psia. VOC flash emissions due to the condensate transfer from the natural gas inlet separator (30 psig) to the atmospheric condensate tank are estimated based on a process modeling program, PROMAX. The PROMAX modeling program is a Window Version of PROSIM developed by Bryan Research & Engineering, Inc., and uses site operation conditions and a representative wellhead gas sample. As a result of this PROMAX modeling program, the calculated flashing emission factor for this site is 3.94 pounds per barrel (lb/bbl) of condensate collected in the tanks. VOC emissions for the condensate truck loadout operation are estimated using AP-42 (1/95), Equation (1) in Section 5.2, Transportation and Marketing of Petroleum Liquids, and Tables and VOC emissions from the wastewater tank, T-3, two NGL storage tanks, T-4 and T-5, lube oil tanks, antifreeze tanks, and methanol storage tanks are considered negligible.

5 PERMIT MEMORANDUM O (M-4) 5 Table 8 lists operational parameters for the two dehydration units. Emissions from the two glycol dehydration units still columns are based upon GRI-GLYCALC Version 4.0 along with an extended gas analysis, and their operational parameters for each dehydration unit. Each dehydration unit is equipped with its own gas-fired burners to provide heat to distill water and volatile organic compounds out of its rich glycol stream. The glycol dehydrators are each equipped with a vent stream condenser and a flash tank on the rich glycol stream. Overheads from the flash tank are routed back either to the station inlet or to the burner s firebox. Vapors from the still vent of SC-1 are vented to the air after condenser. Vapors from the still vent of SC-2 are routed to the burner s firebox for complete VOC destruction. The pollutants emissions from the burners are estimated based on AP-42 (7/98), Tables and 1.4-2, Section 1.4, Natural Gas Combustion. Dehydration units using glycol desiccants emit benzene, toluene, ethyl benzene, xylene (BTEX), and n-hexane from the dehydrator still vent stack. These compounds are regulated as hazardous air pollutant (HAP). HAP emissions from the dehydration units are shown below in Table 9. Table 8 Dehydration Unit Operation Parameters Dehydration Unit Gas Process Rate MMSCFD Glycol Circulation Rate GPM SC SC Table 9 Dehydration Units HAP Emissions Pollutant SC-1 SC-2 Totals lb/hr TPY lb/hr TPY lb/hr TPY n-hexane <0.01 < Benzene <0.01 < Toluene <0.01 < Ethyl Benzene ND ND ND ND ND ND Xylene ND ND ND ND ND ND Total HAP <0.03 < Total VOC <0.03 < ND = Not Detected The primary hazardous air pollutant (HAP) emission from the engines is formaldehyde. Formaldehyde emissions from the Caterpillar G-3516 LE lean-burn engines (C-1, C-5, and C-8) are estimated based on manufacturer s data of 0.29 g/hp-hr with a 70% reduction for oxidation catalyst, which results in emission factor of g/hp-hr. The emission factor of g/hp-hr is equal to lb/mmbtu. AP-42 (7/00), Section 3.2, Table presents the emission factor for uncontrolled 4-cycle rich-burn natural gas-fired stationary engines as lb/mmbtu. The installation of catalytic converters reduces the formaldehyde emissions by 75%, to lb/mmbtu (C-2, C-6, and C-7). In the next page, Table 10 shows total facility-wide formaldehyde emissions from engines. The facility-wide formaldehyde emissions do not exceed the major source threshold, 10 TPY. Emissions of all HAPs are less than 25 TPY. The facility is, therefore, an area source of HAPs. Tables 11 list the total facility-wide emissions. The facility remains a synthetic minor source.

6 PERMIT MEMORANDUM O (M-4) 6 Table 10 Engine Formaldehyde Emissions Sources Heat Input Emission Factor, Formaldehyde MMBTUH lb/mmbtu lb/hr TPY C-1, 1,340-HP Caterpillar G-3516LE w/oc C-2, 930-HP Caterpillar G-399TA w/cc C-5, 1,340-HP Caterpillar G-3516LE w/oc C-6, 930-HP Caterpillar G-399TA w/cc C-7, 840-HP Waukesha 3524 GSI w/cc C-8, 1,340-HP Caterpillar G-3516LE w/oc Totals Table 11 Total Facility-Wide Emissions Sources Nox CO VOC lb/hr TPY lb/hr TPY lb/hr TPY C-1, 1,340-HP Caterpillar G-3516LE w/oc* C-2, 930-HP Caterpillar G-399TA w/cc** C-5, 1,340-HP Caterpillar G-3516LE w/oc* C-6, 930-HP Caterpillar G-399TA w/cc** C-7, 840-HP Waukesha 3524 GSI w/cc** C-8, 1,340-HP Caterpillar G-3516LE w/oc* H-1, MMBTUH Heater H-2, 0.37 MMBTUH Heater H-4, 0.35 MMBTUH Heater SC-1, Glycol Dehydration Unit SC-2, Glycol Dehydration Unit T-1 & T-8, 400-bbl Condensate Tanks T-4 & T-5, 210-bbl Condensate Tanks # FUG-1 & FUG-3, Total Fugitive VOC LOAD, Condensate Loading Total Emissions # Combined emissions from working and breathing losses and flash emissions. *w/oc = with Oxidation Catalyst **w/cc = with Catalytic Converter SECTION V. OKLAHOMA AIR POLLUTION CONTROL RULES OAC 252:100-1 (General Provisions) Subchapter 1 includes definitions but there are no regulatory requirements. [Applicable] OAC 252:100-2 (Incorporation by Reference) [Applicable] This Subchapter incorporates by reference applicable provisions of Title 40 of the Code of Federal Regulations. These requirements are addressed in the Federal Regulations section. OAC 252:100-5 (Registration, Emissions Inventory and Annual Operating Fees) [Applicable] Subchapter 5 requires sources of air contaminants to register with Air Quality, file emission inventories annually, and pay annual operating fees based upon total annual emissions of regulated pollutants. Emission inventories have been submitted and fees paid for the past years.

7 PERMIT MEMORANDUM O (M-4) 7 OAC 252:100-7 (Permits for Minor Facilities) [Applicable] This facility (with controls listed in this permit) will qualify as a synthetic minor source after issuance of this permit, because total controlled emissions of each criteria pollutant do not exceed 100 TPY, and Hazardous Air Pollutants (HAP) emissions do not exceed the 10 TPY for any one HAP or 25 TPY for any aggregate of HAP. OAC 252:100-9 (Excess Emission Reporting Requirements) [Applicable] In the event of any release which results in excess emissions, the owner or operator of such facility shall notify the Air Quality Division as soon as the owner or operator of the facility has knowledge of such emissions, but no later than 4:30 p.m. the next working day. Within ten (10) working days after the immediate notice is given, the owner operator shall submit a written report describing the extent of the excess emissions and response actions taken by the facility. In addition, if the owner or operator wishes to be considered for the exemption established in 252: , a Demonstration of Cause must be submitted within 30 calendar days after the occurrence has ended. OAC 252: (Open Burning) [Applicable] Open burning of refuse and other combustible material is prohibited except as authorized in the specific examples and under the conditions listed in this subchapter. OAC 252: (Particulate Matter) [Applicable] This subchapter specifies a particulate matter (PM) emissions limitation of 0.51 lb/mmbtu from fuel-burning equipment with a rated heat input of 20 MMBTUH or less. For 4-cycle leanburn engines, AP-42 (7/00), Table lists the total PM emissions for natural gas to be 0.01 lbs/mmbtu. For 4-cycle rich-burn engines, AP-42 (7/00), Table lists the total PM emissions for natural gas to be 0.02 lbs/mmbtu. AP-42 (7/98), Table lists total PM emissions for natural gas combustion from heaters, boilers, etc., to be 0.01 lbs/mmbtu. The permit requires the use of natural gas for all fuel-burning units to ensure compliance with Subchapter 19. This subchapter also limits emissions of PM from industrial processes. Per AP-42 factors, there are no significant PM emissions from any other industrial activities at this facility. OAC 252: (Visible Emissions and Particulates) [Applicable] No discharge of greater than 20% opacity is allowed except for short-term occurrences that consist of not more than one six-minute period in any consecutive 60 minutes, not to exceed three such periods in any consecutive 24 hours. In no case shall the average of any six-minute period exceed 60% opacity. When burning natural gas there is little possibility of exceeding the opacity standards. OAC 252: (Fugitive Dust) [Applicable] No person shall cause or permit the discharge of any visible fugitive dust emissions beyond the property line on which the emissions originated in such a manner as to damage or to interfere with the use of adjacent properties, or cause air quality standards to be exceeded, or to interfere with the maintenance of air quality standards. Under normal operating conditions, this facility has negligible potential to violate this requirement; therefore it is not necessary to require specific precautions to be taken.

8 PERMIT MEMORANDUM O (M-4) 8 OAC 252: (Sulfur Compounds) [Applicable] Part 5 limits sulfur dioxide emissions from new petroleum or natural gas process equipment (constructed after July 1, 1972). For gaseous fuels the limit is 0.2 lb/mmbtu heat input averaged over 3 hours. For fuel gas having a gross calorific value of 1,000 BTU/SCF, this limit corresponds to fuel sulfur content of 1,203 ppmv. Thus, a limitation of 343 ppmv sulfur in a field gas supply will be in compliance. The permit requires the use of pipeline-grade natural gas or field gas with a maximum sulfur content of 343 ppmv for all fuel-burning equipment to ensure compliance with Subchapter 31. OAC 252: (Nitrogen Oxides) [Not Applicable] This subchapter limits NOx emissions from new fuel-burning equipment with rated heat input greater than or equal to 50 MMBTUH to emissions of 0.2 lb of NOx per MMBTU. There are no equipment items that exceed the 50 MMBTUH threshold. OAC 252: (Carbon Monoxide) [Not Applicable] None of the following affected processes are located at this facility: gray iron cupola, blast furnace, basic oxygen furnace, petroleum catalytic cracking unit, or petroleum catalytic reforming unit. OAC 252: (Volatile Organic Compounds) [Applicable] Part 3 requires storage tanks constructed after December 28, 1974, with a capacity of 400 gallons or more and storing a VOC with a vapor pressure greater than 1.5 psia at maximum storage temperature to be equipped with a permanent submerged fill pipe or with an organic vapor recovery system. This applies to the condensate tanks, T-1, T-4, T-5, and T-8. Part 3 requires VOC loading facilities with a throughput equal to or less than 40,000 gallons per day to be equipped with a system for submerged filling of tank trucks or trailers if the capacity of the vehicle is greater than 200 gallons. This facility does not have the physical equipment (loading arm and pump) to conduct this type of loading and is not subject to this requirement. Part 5 limits the VOC content of coatings from any coating line or other coating operation. This facility does not normally conduct coating or painting operations except for routine maintenance of the facility and equipment. No coating operation is located at this facility. Part 7 requires fuel-burning and refuse-burning equipment to be operated to minimize emissions of VOC. The equipment at this location is subject to this requirement. Part 7 requires all effluent water separator openings which receive water containing more than 200 gallons per day of any VOC, to be sealed or the separator to be equipped with an external floating roof or a fixed roof with an internal floating roof or a vapor recovery system. No effluent water separators are located at this facility. Part 7 also requires all reciprocating pumps and compressors handling VOCs to be equipped with packing glands and rotating pumps and compressors handling VOCs to be equipped with mechanical seals. All of the pumps and compressors at this facility are subject to these requirements. Equipment subject to NSPS Subpart KKK is exempt. OAC 252: (Toxic Air Contaminants (TAC)) [Applicable] This Subchapter regulates toxic air contaminants (TAC) that are emitted into the ambient air in areas of concern (AOC). Any work practice, material substitution, or control equipment required by the Department prior to June 11, 2004, to control a TAC, shall be retained, unless a

9 PERMIT MEMORANDUM O (M-4) 9 modification is approved by the Director. Since no AOC has been designated there are no specific requirements for this facility at this time. OAC 252: (Testing, Monitoring, and Recordkeeping) [Applicable] This subchapter provides general requirements for testing, monitoring and recordkeeping and applies to any testing, monitoring or recordkeeping activity conducted at any stationary source. To determine compliance with emissions limitations or standards, the Air Quality Director may require the owner or operator of any source in the state of Oklahoma to install, maintain and operate monitoring equipment or to conduct tests, including stack tests, of the air contaminant source. All required testing must be conducted by methods approved by the Air Quality Director and under the direction of qualified personnel. A notice-of-intent to test and a testing protocol shall be submitted to Air Quality at least 30 days prior to any EPA Reference Method stack tests. Emissions and other data required to demonstrate compliance with any federal or state emission limit or standard, or any requirement set forth in a valid permit shall be recorded, maintained, and submitted as required by this subchapter, an applicable rule, or permit requirement. Data from any required testing or monitoring not conducted in accordance with the provisions of this subchapter shall be considered invalid. Nothing shall preclude the use, including the exclusive use, of any credible evidence or information relevant to whether a source would have been in compliance with applicable requirements if the appropriate performance or compliance test or procedure had been performed. SECTION VI. FEDERAL REGULATIONS PSD, 40 CFR Part 52 [Not Applicable] Final total emissions are less than the major source threshold of 250 TPY of any single regulated pollutant and the facility is not one of the 26 specific industries with a threshold of 100 TPY. NSPS, 40 CFR Part 60 [Subpart KKK Is Applicable] Subparts K, Ka, Kb, VOL Storage Vessels. Subpart Kb regulates hydrocarbon storage tanks larger than 19,813 gallons capacity and built after July 23, The condensate tanks T-1, T-4, T-5, and T-8 have capacities less than the threshold, 19,813 gallons. The two NGL storage tanks, T-2 and T-3, are pressure tanks and not subject to this subpart. This subpart is not applicable. Subpart GG, Stationary Gas Turbines. There are no turbines at this facility. The compressors here are powered by reciprocating engines. Subpart VV, Equipment Leaks of VOC in the Synthetic Organic Chemicals Manufacturing Industry. This facility is not a SOCMI plant. Subpart LLL, Onshore Natural Gas Processing: SO 2 Emissions. There is no natural gas sweetening operation at this site at this time. Therefore, this facility is not subject to Subpart LLL. Subpart KKK, Equipment Leaks of VOC from Onshore Natural Gas Processing Plants. This subpart applies to natural gas processing plants that commence construction, reconstruction, or modification after January 20, 1984, and include the following facilities located at on-shore natural gas processing plants: a compressor station, dehydration unit, underground storage tank, field gas gathering system, or liquefied natural gas unit located at an on-shore natural gas processing plant. "Natural gas processing plant" is defined as any site engaged in the extraction of natural gas liquids from field gas, fractionation of natural gas liquids, or both; "Natural gas liquids" are further defined as hydrocarbons such as ethane, propane, butane, and pentane. The

10 PERMIT MEMORANDUM O (M-4) 10 compressors, C-2 and C-6, are in residue gas (with VOC removed) service and is subject only to the record-keeping requirements of 40 CFR (j). The refrigeration units (Cryogenic Plants #1 and #3) and the compressor of Engines C-1, C-5, C-7, and C-8 are subject to Subpart KKK. Subpart JJJJ, Standards of Performance for Stationary Spark Ignition Internal Combustion Engines (SI-ICE). This subpart was published in the Federal Register on January 18, It promulgates emission standards for new SI engines ordered after June 12, 2006, that are manufactured after certain dates, and for SI engines modified or reconstructed after June 12, The specific emission standards (either in g/hp-hr or as a concentration limit) vary based on engine class, engine power rating, lean-burn or rich-burn, fuel type, duty (emergency or nonemergency), and manufacture date. Engine manufacturers are required to certify certain engines to meet the emission standards and may voluntarily certify other engines. An initial notification is required only for owners and operators of engines greater than 500 HP that are non-certified. Emergency engines will be required to be equipped with a non-resettable hour meter and are limited to 100 hours per year of operation excluding use in an emergency (the length of operation and the reason the engine was in operation must be recorded). All engines, from C-1 to C-8, in this permit were manufactured prior to June 12, 2006, and therefore, all six engines are not subject to this subpart. NESHAP, 40 CFR Part 61 [Not Applicable] There are no emissions of any of the regulated pollutants: arsenic, asbestos, beryllium, benzene, coke oven emissions, mercury, radionuclides or vinyl chloride except for trace amounts of benzene. Subpart J, Equipment Leaks of Benzene, only applies to process streams which contain more than 10% benzene by weight. Analysis of Oklahoma natural gas indicates a maximum benzene content of less than 1%. NESHAP, 40 CFR Part 63 [HH Applicable] Subpart HH, Oil and Natural Gas Production Facilities. This subpart applies to affected emission points that are located at facilities which are major sources of HAPs and either process, upgrade, or store hydrocarbons prior to the point of custody transfer or prior to which the natural gas enters the natural gas transmission and storage source category. For purposes of this subpart natural gas enters the natural gas transmission and storage source category after the natural gas processing plant. If no natural gas plant is present, natural gas enters the natural gas transmission and storage source category after the point of custody transfer. The EPA promulgated the final rule for Subpart HH at area oil and gas production facilities, effective January 3, The only affected units at an area source are triethylene glycol (TEG) dehydration units. In the facility, only the Unit SC-2 is affected. Unit SC-1 uses Ethylene Glycol (EG), and is not affected. Even though the TEG dehydration unit at this facility is considered an affected area source it is exempt from the requirements of (d)(2) since the actual average emissions of benzene from the glycol dehydration unit process vent to the atmosphere are less than 1 TPY, as determined by the procedures specified in (b)(2). However, the facility must maintain records of the de minimis determination as required in (d)(1). All applicable requirements have been incorporated into the permit. Subpart HHH, affects Natural Gas Transmission and Storage Facilities. Since this facility is a production facility, this subpart does not apply. Subpart ZZZZ, Reciprocating Internal Combustion Engines (RICE). This subpart previously affected only RICE with a site-rating greater than 500 brake horsepower that are located at a major source of HAP emissions. On January 18, 2008, the EPA published a final rule that

11 PERMIT MEMORANDUM O (M-4) 11 promulgates standards for new and reconstructed engines (after June 12, 2006) with a site rating less than or equal to 500 HP located at major sources, and for new and reconstructed engines (after June 12, 2006) located at area sources. Owners and operators of new engines and reconstructed engines at area sources and of new or reconstructed engines with a site rating equal to or less than 500 HP located at a major source (except new or reconstructed 4-stroke lean-burn engines with a site rating greater than or equal to 250 HP and less than or equal to 500 HP located at a major source) meet the requirements of Subpart ZZZZ by complying with either 40 CFR Part 60 Subpart IIII (for CI engines) or 40 CFR Part 60 Subpart JJJJ (for SI engines). Owners and operators of new or reconstructed 4SLB engines with a site rating greater than or equal to 250 HP and less than or equal to 500 HP located at a major source are subject to the same MACT standards previously established for 4SLB engines above 500 HP at a major source, and must also meet the requirements of 40 CFR Part 60 Subpart JJJJ, except for the emissions standards for CO. All engines, from C-1 to C-8, in this permit were manufactured prior to June 12, 2006, and therefore, all six engines are not subject to this subpart. Subpart DDDDD, National Emission Standards for Hazardous Air Pollutants for Industrial, Commercial and Institutional Boilers and Process Heaters. In March, 2007, the EPA filed a motion to vacate and remand this rule back to the agency. The rule was vacated by court order, subject to appeal, on June 8, No appeals were made and the rule was vacated on July 30, Existing and new small gaseous fuel boilers and process heaters (less than 10 MMBtu/hr heat rating) were not subject to any standards, recordkeeping, or notifications under Subpart DDDDD. EPA is planning on issuing guidance (or a rule) on what actions applicants and permitting authorities should take regarding MACT determinations under either Section112(g) or Section 112(j) for sources that were affected sources under Subpart DDDDD and other vacated MACTs. It is expected that the guidance (or rule) will establish a new timeline for submission of section 112(j) applications for vacated MACT standards. At this time, AQD has determined that a 112(j) determination is not needed for sources potentially subject to a vacated MACT, including Subpart DDDDD. This permit may be reopened to address Section 112(j) when necessary. Chemical Accident Prevention Provisions, 40 CFR Part 68 [Not Applicable] The definition of a stationary source does not apply to transportation, including storage incident to transportation, of any regulated substance or any other extremely hazardous substance under the provisions of this part. The definition of a stationary source also does not include naturally occurring hydrocarbon reservoirs. Naturally occurring hydrocarbon mixtures, prior to entry into a natural gas processing plant or a petroleum refining process unit, including: condensate, crude oil, field gas, and produced water, are exempt for the purpose of determining whether more than a threshold quantity of a regulated substance is present at the stationary source. This facility does not process or store more than the threshold quantity of any regulated substance (Section 112r of the Clean Air Act 1990 Amendments). More information on this federal program is available on the web page: Stratospheric Ozone Protection, 40 CFR Part 82 [Subpart A and F Applicable] These standards require phase out of Class I & II substances, reductions of emissions of Class I & II substances to the lowest achievable level in all use sectors, and banning use of nonessential products containing ozone-depleting substances (Subparts A & C); control servicing of motor

12 PERMIT MEMORANDUM O (M-4) 12 vehicle air conditioners (Subpart B); require Federal agencies to adopt procurement regulations which meet phase out requirements and which maximize the substitution of safe alternatives to Class I and Class II substances (Subpart D); require warning labels on products made with or containing Class I or II substances (Subpart E); maximize the use of recycling and recovery upon disposal (Subpart F); require producers to identify substitutes for ozone-depleting compounds under the Significant New Alternatives Program (Subpart G); and reduce the emissions of halons (Subpart H). Subpart A identifies ozone-depleting substances and divides them into two classes. Class I controlled substances are divided into seven groups; the chemicals typically used by the manufacturing industry include carbon tetrachloride (Class I, Group IV) and methyl chloroform (Class I, Group V). A complete phase-out of production of Class I substances is required by January 1, 2000 (January 1, 2002, for methyl chloroform). Class II chemicals, which are hydrochlorofluorocarbons (HCFCs), are generally seen as interim substitutes for Class I CFCs. Class II substances consist of 33 HCFCs. A complete phase-out of Class II substances, scheduled in phases starting by 2002, is required by January 1, This facility does not utilize any Class I & II substances. SECTION VII. COMPLIANCE Tier Classification and Public Review This application was initially classified as Tier I per OAC 252: based on the fact that this is a request for an operating permit modification for a synthetic minor facility. However, after the cancellation of Permit No O (M-3), this application has been determined to be a Tier II based on the requirement in the Consent Order (CO) No , which was closed on July 30, Information on all permit actions is available for review by the public in the Air Quality Section of the DEQ web page: The permittee has submitted an affidavit that they are not seeking a permit for land use or for any operation upon land owned by others without their knowledge. The affidavit certifies that the applicant owns the land, which will be used to accomplish the permitted purpose. The applicant published the Notice of Filing a Tier II Application in The Guthrie News Leader, a tri-weekly newspaper printed and published in the City of Guthrie, Logan County, on May 16, The notice stated that the application was available for public review at the Guthrie Public Library, 201 North Division Street, Guthrie, Oklahoma or at the Air Quality Division s Main Office in Oklahoma City, Oklahoma. This facility is not located within 50 miles of the Oklahoma border. A draft of this permit will also be made available for public review for a period of 30 days as stated in another newspaper announcement and will be available on the AQD Section of the DEQ Web site. Information on all permit actions is available for review by the public in the Air Quality Section of the DEQ Web Page: Inspection An initial compliance inspection was conducted for the Permit No O (M-3) on May 21, Present for the inspection were, Mr. Bill Allread, ES&H Coordinator of SPC, Mr.

13 PERMIT MEMORANDUM O (M-4) 13 Merle Cooper, Cashion Plant Manager of SPC, and Mark Chen of Air Quality Division. An initial compliance inspection was conducted for the Permit No O (M-4) on October 23, Present for the inspection were, Mr. Jerry Farmer, Senior Environmental Specialist of SPC, and Mark Chen of Air Quality Division. The facility was constructed (Engine C-8) and is operating as described in the permit application of No O (M-4). The natural gas throughput was at 18.0 MMSCFD with all six compressors running when the facility was inspected around 11:00 AM. It was also confirmed that the condensate storage tanks are operated with submerged fill pipe. Identification plates with the make, model, and serial number were attached to the engine. Periodic engine testing records and other required records are maintained at the plant office on-site. Testing The engine emission testing was conducted in March and July All results are presented below and show compliance with the applicable permit conditions. EU Source Testing Permit Limitations Test Results NOx CO NOx CO Date lb/hr lb/hr lb/hr lb/hr C-1 1,340-HP Caterpillar G-3516LE w/oc* 7/14/ C HP Caterpillar G-399TA w/cc** 7/17/ C-5 1,340-HP Caterpillar G-3516LE w/oc* 7/14/ C HP Caterpillar G-399TA w/cc** 7/17/ C HP Waukesha 3524 GSI w/cc** 7/14/ C-8 1,340-HP Caterpillar G-3516LE w/oc* 3/25/ *w/oc = with Oxidation Catalyst **w/cc = with Catalytic Converter Fees Paid SPC submitted $2,000 application fee for the Permit No O (M-3), and $500 application fee for the Permit No O (M-4). AQD received the total application fee of $2,500. The Permit No O (M-3) is equivalent to an initial Part 70 source operating permit, the application fee is $2,000. The Permit No O (M-4) is a minor modification of a synthetic minor source, the application fee is $200. The total required application fee is $2,200. Therefore, $300 will be refunded upon issuance of this permit, No O (M-4). SECTION VIII. SUMMARY The facility was constructed and is operating as described in the permit application. Ambient air quality standards are not threatened at this site. There are no other active Air Quality compliance and enforcement issues concerning this facility. Issuance of the operating permit is recommended, contingent on EPA and public review.

14 PERMIT TO OPERATE AIR POLLUTION CONTROL FACILITY SPECIFIC CONDITIONS Superior Pipeline Company Cashion Gas Plant Permit No O (M-4) The permittee is authorized to operate in conformity with the specifications submitted to the Air Quality Division on April 15, 2008, and additional information received on October 27, The Evaluation Memorandum dated November 5, 2008, explains the derivation of applicable permit requirements and estimates of emissions; however, it does not contain operating limitations or permit requirements. Continuing operations under this permit constitutes acceptance of, and consent to, the conditions contained herein: 1. Points of emissions and emissions limitations for each point: Sources Nox CO VOC lb/hr TPY lb/hr TPY lb/hr TPY C-1, 1,340-HP Caterpillar G-3516LE w/oc* C-2, 930-HP Caterpillar G-399TA w/cc** C-5, 1,340-HP Caterpillar G-3516LE w/oc* C-6, 930-HP Caterpillar G-399TA w/cc** C-7, 840-HP Waukesha 3524 GSI w/cc** C-8, 1,340-HP Caterpillar G-3516LE w/oc* H-1, MMBTUH Heater H-2, 0.37 MMBTUH Heater H-4, 0.35 MMBTUH Heater SC-1, Glycol Dehydration Unit SC-2, Glycol Dehydration Unit T-1 & T-8, 400-bbl Condensate Tanks T-4 & T-5, 210-bbl Condensate Tanks # FUG-1 & FUG-3, Total Fugitive VOC LOAD, Condensate Loading # Combined emissions from working and breathing losses and flash emissions. *w/oc = with Oxidation Catalyst **w/cc = with Catalytic Converter 2. The fuel-burning equipment shall be fired with pipeline grade natural gas or other gaseous fuel with a sulfur content less than 343 ppmv. Compliance can be shown by the following methods: for pipeline grade natural gas, a current gas company bill; for other gaseous fuel, a current lab analysis, stain-tube analysis, gas contract, tariff sheet, or other approved methods. Compliance shall be demonstrated at least once annually. 3. The permittee shall be authorized to operate this facility continuously (24 hours per day, every day of the year). 4. Each engine at the facility shall have a legible and accessible permanent identification plate attached, which shows the make, model number, and serial number.

15 SPECIFIC CONDITIONS O (M-4) 2 5. At least once per calendar quarter, the permittee shall conduct tests of NOx and CO emissions in exhaust gases from the engines in Specific Condition No.1 and each replacement engine when operating under representative conditions for that period. Testing is required for any engine or replacement engine, which runs for more than 220 hours during that calendar quarter. Engines shall be tested no sooner than 20 days after the last test. Testing shall be conducted using a portable engine analyzer in accordance with a protocol meeting the requirements of the AQD Portable Analyzer Guidance document or an equivalent method approved by Air Quality. When four consecutive quarterly tests show an engine to be in compliance with the emissions limitations shown in the permit, then the testing frequency may be reduced to semi-annual testing. A semi-annual test may be conducted no sooner than 60 calendar days nor later than 180 calendar days after the most recent test. Likewise, when the following two consecutive semi-annual tests show compliance, the testing frequency may be reduced to annual testing. An annual test may be conducted no sooner than 120 calendar days nor later than 365 calendar days after the most recent test. Upon any showing of non-compliance with emissions limitations or testing that indicate that emissions are within 10% of the emission limitation, the testing frequency shall revert to quarterly. Reduced engine testing does not apply to engines with catalytic converters. 6. The rich-burn compressor engines, C-2, C-6, and C-7, shall each be set to operate with exhaust gases passing through a properly functioning catalytic converter. The lean-burn compressor engines, C-1, C-5, and C-8, shall each be set to operate with exhaust gases passing through a properly functioning oxidation catalyst. 7. Facility throughput for VOC storage tanks, T-1, T-4, T-5, and T-8, shall not exceed the combined throughput limit in any 12-month period: VOC Source Type T-1 and T-8, 400-bbl Condensate Tanks T-4 and T-5, 210-bbl Condensate Tanks Throughput Limit Barrels/year Gallons/year 36,500 1,533, All condensate tanks, T-1, T-4, T-5, and T-8 shall each be equipped with submerged fill pipe. 9. When periodic compliance testing shows engine exhaust emissions in excess of the lb/hr limits in Specific Condition Number 1, the permittee shall comply with the provisions of OAC 252: Requirements of OAC 252:100-9 include immediate notification and written notification of Air Quality and demonstrations that the excess emissions meet the criteria specified in OAC 252: Replacement (including temporary periods of up to six months for maintenance, etc.) of internal combustion engines shown in this permit with engines of lesser or equal emissions of each pollutant is authorized under the following conditions: a. The permittee shall notify AQD in writing within 10 days of start-up of the replacement engine(s)/turbine(s). Said notice shall identify the old engine/turbine and shall include the new engine/turbine make and model, serial number, horsepower rating, fuel

16 SPECIFIC CONDITIONS O (M-4) 3 usage, stack flow (ACFM), stack temperature ( F), stack height (feet), stack diameter (inches), and pollutant emission rates (g/hp-hr, lb/hr, and TPY) at maximum horsepower for the altitude/location. b. Quarterly emissions tests for the replacement engine(s)/turbine(s) shall be conducted to confirm continued compliance with NOx and CO emissions limitations. A copy of the first quarter testing shall be provided to AQD within 60 days of start-up of each replacement engine/turbine. The test report shall include the engine/turbine fuel usage, stack flow (ACFM), stack temperature ( o F), stack height (feet), stack diameter (inches), and pollutant emission rates (g/hp-hr, lbs/hr, and TPY) at maximum rated horsepower for the altitude/location. c. Replacement equipment and emissions are limited to equipment and emissions which do not subject the engine/turbine to an applicable requirement not already included in this permit. 11. The glycol dehydration units shall be installed and operated as follows: a. The lean glycol recirculation rate and the monthly-average daily processing rate shall not exceed the following limits. Dehydration Unit Gas Process Rate MMSCFD SC SC Glycol Circulation Rate GPM b. Each glycol dehydration unit shall be equipped with a condenser with the off-gases from both still vents being vented through the condenser when the dehydration unit is operating. The uncondensed vapors from the SC-2 condenser shall be routed back to the heater/reboiler firebox. c. Each glycol dehydration unit shall be equipped with a flash tank. The off-gases from the flash tank shall be routed back either to the heater/reboiler firebox, or to the station inlet gas stream (suction side of compressors). 12. By January 5, 2009, the permittee shall comply with all applicable requirements of the National Emission Standards for Hazardous Air Pollutants (NESHAP) for Oil and Natural Gas Production, Subpart HH, for the dehydration unit, SC-2, including but not limited to the following: [40 CFR through ] a. An owner or operator of a glycol dehydration unit that meets the exemption criteria in (e)(1) shall maintain the records specified in (d)(1), for that glycol dehydration unit. 13. The permittee shall comply with the Standards of Performance for Equipment Leaks of VOC from Onshore Natural Gas Processing Plants, NSPS Subpart KKK, for each of the affected facilities (C-2, -6, & -7) regarding the record-keeping requirements. [40 CFR to ]

17 SPECIFIC CONDITIONS O (M-4) 4 a. Information and data used to demonstrate that a reciprocating compressor is in wet gas service to apply for the exemption in (f) shall be recorded in a log that is kept in a readily accessible location as per (c). b. Information and data used to demonstrate that a reciprocating compressor is not in VOC service shall be recorded in a log that is kept in a readily accessible location as per (j). 14. The permittee shall comply with the Standards of Performance for Equipment Leaks of VOC from Onshore Natural Gas Processing Plants NSPS Subpart KKK, for each of the affected facilities including but not limited the equipment associated with the refrigeration units, the dehydration units, C-1, C-5, and C-8. [40 CFR to ] a. The owner operator shall comply with the requirements of (a), (b), and (d) and through except as provided in [ (a)] 1) The operator shall demonstrate compliance with to for all affected equipment within 180 days of initial startup which shall be determined by review of records, reports, performance test results, and inspection using methods and procedures specified in unless the equipment is in vacuum service and is identified as required by (e)(5). 2) The owner operator shall comply with the monitoring, inspection, and repair requirements, for pumps in light liquid service, of (a), (b), and (c) except as provided in (d), (e), and (f). 3) Each compressor shall be equipped with a seal system that includes a barrier fluid system and that prevents leakage of VOC to the atmosphere, except as provided in (c), (f), (c), (h), and (i). i) Each compressor seal system shall comply with the requirements of (b). ii) Each barrier fluid system shall be equipped with a sensor as required by (d) that is monitored or equipped with an alarm as required by (e) and repaired as required by (f) and (g). 4) Any existing reciprocating compressor in a process unit which becomes an affected facility under provisions of or is exempt from (a), (b), (c), (d), (e), and (h), provided the owner or operator demonstrates that recasting the distance piece or replacing the compressor are the only options available to bring the compressor into compliance with the provisions of (a) through (e) and (h). 5) The owner operator shall comply with the operation and monitoring requirements, for pressure relief devices in gas/vapor service, of (a) and (b) except as provided in (c) and (b). 6) Sampling and connection systems are exempt from the requirements of ) Each open-ended valve or line shall be equipped with a cap, blind flange, plug, or a second valve, except as provided in (c). The cap, blind flange, plug, or second valve shall seal the open end at all times except during operations requiring process fluid flow through the open-ended valve or line. Each open-ended valve or line equipped with a second valve shall be operated in a manner such that the valve on the process fluid end is closed before the second valve is closed. When a double block-and-bleed system is being used, the bleed valve or line may remain open