01-13413. Effluent Limitations Guidelines and New Source Performance Standards for the Oil and Gas Extraction Point Source Category; OMB Approval Under the Paperwork Reduction Act: Technical Amendment; Correction

AGENCY:

Environmental Protection Agency.

ACTION:

Final rule; correction.

SUMMARY:

EPA is correcting minor errors in the preamble and the effluent limitations guidelines and standards for the oil and gas extraction point source category, which was published as a final rule in the Federal Register on January 22, 2001 (66 FR 6850).

DATES:

These corrections shall become effective on June 8, 2001.

FOR FURTHER INFORMATION CONTACT:

Mr. Carey A. Johnston, Office of Water Engineering and Analysis Division (4303), U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue, NW, Washington, DC 20460, [phone], [e-mail].

SUPPLEMENTARY INFORMATION:

On January 22, 2001 (66 FR 6850), EPA published in the Federal Register final effluent limitations and standards for the oil and gas extraction point source category. The preamble and the final rule contained minor errors. These errors consisted of omission of several pages of the preamble text in the printed version of the preamble and minor typographical errors in the analytical methods contained in the rule. This action corrects those errors. The missing preamble pages were presented in the Development Document (EPA-821-B-00-013) or in the response to comments document supporting the rule but were inadvertently omitted in the Federal Register. The minor typographical errors in the analytical methods consist of two missing commas and one reversed inequality sign. The correction of the two missing commas clarifies two equations used in an analytical method for calculating base fluid retained on cuttings. The correction of the reversed inequality sign clarifies the quality control procedures for formulating positive controls in the crude oil contamination detection analytical method. EPA is not substantively altering the final rule or expanding the regulatory burden through correction of these minor errors.

Section 553(b)(B) of the Administrative Procedure Act, 5 U.S.C. 553(b)(B), provides that, when an agency for good cause finds that notice and public procedure are impracticable, unnecessary or contrary to the public interest, the agency may issue a rule without providing notice and an opportunity for public comment. EPA has determined that there is good cause for taking today's action without prior proposal and opportunity for comment because there is no substantive effect on the rule from this action; this action merely corrects errors in a portion of the preamble to the rule and in the analytical methods to the rule that already went through public notice and comment and do not increase the regulatory burden of the rule. All of the discussion inadvertently omitted from the printed preamble were contained in the record for the final rule as part of the final development document and response to comments document for the rule.

Correction of the reversed inequality sign makes the quality control criteria of the analytical method that is specified in appendix 6 to subpart A of part 435 consistent with the method's intended purpose as proposed and promulgated in the final rule. In the proposed rule and final rule, section 1.4 of appendix 6 states that the method was, “designed to show positive contamination for 5% of representative crude oils at a concentration of 0.1% in drilling fluid (vol/vol), 50% of representative crude oils at a concentration of 0.5%, and 95% of representative crude oils at a concentration of 1%.” In addition, in the proposed rule and final rule section 9.2 of appendix 6 specifies that a laboratory that properly practices the method must detect crude oil contamination in greater than 75% of control samples containing 1% crude oil. The proposal Development Document (EPA-821-B-98-021) also states, “For the proposed rule, the majority of formation oils would cause failure when present in SBFs at a concentration of about 0.5%.” Despite the proposal Development Document and sections 1.4 and 9.2 of the proposed and final rule, the Agency inadvertently reversed the inequality sign specifying the detection criteria for control samples containing 2% crude oil, which resulted in a quality control requirement that does not reflect the intent of sections 1.4 and 9.2 or the proposal Development Document. The Agency's intention was to specify that a laboratory that properly practices the method must detect crude oil contamination in greater than 90% of control samples containing 2% crude oil. This correction does not expand the regulatory burden because no change is made to the analytical procedures that laboratories must use for compliance monitoring. The correction changes only the criterion for interpreting quality control results for control samples containing 2% crude oil.

Thus, notice and public procedure are unnecessary. EPA finds that this constitutes good cause under 5 U.S.C. 553(b)(B). For the same reasons, EPA believes there is good cause under 5 U.S.C. 553(d)(3) to make this rule immediately effective.

Administrative Requirements

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and is therefore not subject to review by the Office of Management and Budget. Because, as described above, the agency has made a “good cause” finding that this action is not subject to notice-and-comment requirements under the Administrative Procedure Act or any other statute, it is not subject to the regulatory flexibility provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), or to sections 202 and 205 of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104-4). In addition, this action does not significantly or uniquely affect small governments or impose a significant intergovernmental mandate, as described in sections 203 and 204 of UMRA. This rule also does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 6, 2000). This rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This rule also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant.

This technical correction action does not involve technical standards; thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). EPA's compliance with the statutes and Executive Orders that were in effect when the underlying rule was developed is discussed in the January 22, 2001 Federal Register document.

The Congressional Review Act (5 U.S.C. 801 et seq.), as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. Section 808 allows the issuing agency to make a rule effective sooner than otherwise provided by the CRA if the agency makes a good cause finding that notice and public procedure is impracticable, unnecessary or contrary to the public interest. This determination must be supported by a brief statement. 5 U.S.C. 808(2). As stated previously, EPA has made such a good cause finding, including the reasons therefor, and established an effective date of June 8, 2001. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

List of Subjects in 40 CFR Part 435

• Environmental protection
• Oil and gas extraction
• Waste treatment and disposal
• Water pollution control

Dated: May 18, 2001.

Diane C. Regas,

Acting Assistant Administrator.

The following corrections are made in FRL-6929-8, Effluent Limitations Guidelines and New Source Performance Standards for the Oil and Gas Extraction Point Source Category; OMB Approval Under the Paperwork Reduction Act: Technical Amendment (FR Doc. 01-361), which were published in the Federal Register on January 22, 2001 (66 FR 6850).

Preamble Corrections

1. On page 6871, in column 1, line 25, insert the following text between the two phrases “In addition, because of the uncertainty about ester performance, operators may not be encouraged to switch from OBFs or WBFs to SBF” and “when properly installed and maintained.”:

If only vegetable ester- or low viscosity ester-based SBFs could be discharged. As previously stated, EPA is promoting the appropriate conversion from OBF-and WBF-drilling to SBF-drilling in order to reduce pollutant loadings and NWQI. Due to demonstrated or potential technical limitations of vegetable esters or low viscosity esters, EPA estimates that the pollutant loadings and NWQIs associated with establishing vegetable esters or low viscosity esters as the basis for stock limitations are similar to the pollutant loadings and NWQIs associated with the zero discharge option for all SBF-cuttings (see section V.F). EPA finds these increases in pollutant loadings and NWQIs as unacceptable.

d. Biodegradation Rate Technical Availability

EPA is today promulgating a biodegradation stock base fluid limitation that would only allow the discharge of SBF-cuttings using SBF base fluids that degrade as fast or greater than C₁₆-C₁₈ IOs. Alternatively, this limitation could be expressed in terms of a “biodegradation rate ratio” which is defined as the percent degradation of C₁₆-C₁₈ IOs divided by the percent degradation of stock base fluid being tested, both at 275 days. EPA is promulgating a biodegradation rate ratio of less than 1.0. As stated in the April 2000 NODA (65 FR 21550), EPA is promulgating the use of the marine anaerobic closed bottle biodegradation test (i.e., ISO 11734:1995) with modifications for compliance with this biodegradation BAT limitation. One of the modifications to this test is that natural marine or estuarine sediments be used in place of digested sludge as an inoculum. The revised method also requires that the volatile solids of the sediments must be no less than 2% and EPA recommends ASTM D2974 or its equivalent. To meet this limitation through product substitution, the base fluids currently available for use include vegetable esters, low viscosity esters, linear alpha olefin, and internal olefins.

EPA finds this limit to be technically available and economically achievable through product substitution because information in the rulemaking record supports the findings that vegetable esters, low viscosity esters, and internal olefins have performance characteristics enabling them to be used in the wide variety of drilling situations in offshore U.S. waters and meet today's promulgated limit. Marketing data given to EPA shows that internal olefin SBFs are the most popular SBFs used in the GOM.

The marine anaerobic closed bottle biodegradation test (i.e., ISO 11734:1995) is incorporated by reference into the effluent limitations guidelines and is available from the American National Standards Institute, 11 West 42nd Street, 13th Floor, New York, NY 10036. Additionally, EPA modified the marine anaerobic closed bottle biodegradation test to make the test more applicable to a marine environment. These modifications are listed in appendix 4 of subpart A of 40 CFR part 435 and include: (1) The laboratory shall use sea water in place of freshwater; (2) the laboratory shall use marine sediment in place of digested sludge as an inoculum; and (3) the laboratory shall run the test for 275 days.

EPA selected the closed bottle test because it models the ability of a drilling fluid to degrade anaerobically. Industry comments to the April 2000 NODA report the results of seabed surveys (Docket No. W-98-26, Record No. IV.A.a.13, Attachment Ester-52). These seabed surveys and the scientific literature indicate that the environments under cuttings piles are anaerobic and that the recovery of seabeds did not occur in acceptable periods of time when drilling fluids (e.g., diesel oils, mineral oils) cannot anaerobically degrade (i.e., the anaerobic biodegradation rates are zero or very low). The scientific literature also indicates that there is no known mechanism for initiation of anaerobic alkane biodegradation (Docket No. W-98-26, Record No.IV.A.a.13, Attachment BIODEG-62). The general anaerobic microbiology literature indicates that metabolic pathways are just beginning to be determined for anaerobic biodegradation of linear alkanes (i.e., linear paraffins). The anaerobic biodegradability of the SBF base fluid represents an essential prerequisite for the prevention of long-term persistence of SBFs and deleterious impacts on marine sediments (Docket No. W-98-26, Record No.I.D.b.26). Therefore, EPA considers the control of anaerobic degradation as the most environmentally relevant way to ensure the biodegradation of SBF under cuttings piles and other anaerobic environments for the recovery of benthic organisms and environments in an acceptable period.

EPA has selected the C₁₆-C₁₈ IO as the basis for the biodegradation rate ratio limitation instead of the vegetable ester or low viscosity ester for several reasons: (1) EPA does not believe that vegetable esters can be used in all drilling situations; and (2) EPA does not have sufficient field testing information that low viscosity esters can be used in all drilling situations (see section V.F.1.a). Operators may not be encouraged to switch from OBFs or WBFs to SBF if only vegetable ester- or low viscosity ester-based SBFs could be discharged. As previously stated, EPA is promoting the appropriate conversion from OBF- and WBF-drilling to SBF-drilling in order to reduce pollutant loadings and NWQI. Due to demonstrated or potential technical limitations of vegetable esters or low viscosity esters, EPA estimates that the pollutant loadings and NWQIs associated with establishing vegetable esters or low viscosity esters as the basis for stock limitation are similar to the pollutant loadings and NWQIs associated with the zero discharge option for all SBF-cuttings (see section V.F). EPA finds these increases in pollutant loadings and NWQIs as unacceptable. Nevertheless, due to EPA's information (primarily laboratory data) that indicates that esters provide better environmental performance in terms of sediment toxicity and biodegradation, EPA is promulgating a higher ROC limitation and standard where esters are used to encourage operators to use esters when possible.

EPA also selected C₁₆-C₁₈ IO as the basis for the biodegradation rate ratio limitation instead of other SBFs (e.g., paraffins, enhanced mineral oils, PAOs) as SBFs with biodegradation rate similar to or better than the C₁₆-C₁₈ IO (e.g., C₁₆-C₁₈ IO, esters) show acceptable levels of anaerobic biodegradation. As previously stated, controlling anaerobic degradation is the most environmentally relevant way to ensure the biodegradation of SBF under cuttings piles and other anaerobic environments for the recovery of benthic organisms and environments in an acceptable period. Industry marine anaerobic closed bottle testing data demonstrate that some SBFs show very little or no anaerobic biodegradation (e.g., paraffins, enhanced mineral oils, PAOs). EPA finds that the C₁₆-C₁₈ IO has greater anaerobic biodegradation than other SBFs (e.g., paraffins, enhanced mineral oils, PAOs) and, unlike esters, is currently the most popular SBF in the market.

e. Economic Achievability of Stock Base Fluid Controls

EPA finds that the promulgated stock base fluid controls are economically achievable. Industry representatives have told EPA that while the synthetic base fluids are more expensive than diesel and mineral oil base fluids, the savings in discharging the SBF-cuttings versus land disposal or re-injection of OBF-cuttings (as required under current regulations) more than offsets the increased cost of SBFs. Moreover, the reduced time to complete a well with SBF as compared with OBF- and WBF-drilling can be significant (i.e., days to weeks). This reduction in time translates into lower rig rental costs for operators. Thus, operator costs are lower even with the more expensive SBF provided the drill cuttings with adhering SBF can be discharged. The stock base fluid limitations outlined above and promulgated today are technically achievable through product substitution with the use of the currently widely used SBFs based on internal olefins ($160/bbl), vegetable esters ($250/bbl), and low viscosity esters ($300/bbl) (Docket No. W-98-26, Record No. IV.B.a.13). For comparison, diesel oil-based drilling fluid costs about $70/bbl, and mineral oil-based drilling fluid costs about $90/bbl. According to industry sources, currently in the Gulf of Mexico the most widely used and discharged SBFs are, in order of use, based on internal olefins, linear alpha olefins, and vegetable esters. Since the stock limitations allow the continued use of the IO- and ester-based SBFs, EPA attributes no additional cost due to the stock base fluid requirements other than monitoring (testing and certification) costs. EPA estimates that dischargers will satisfy: (1) The base fluid stock sediment toxicity and biodegradation limitations by having suppliers monitor once annually; and (2) the PAH and formation oil limitations by having suppliers monitor each batch of stock SBF.

EPA also considered NWQIs in selecting the controlled discharge option for SBF-cuttings (i.e., BAT/NSPS Option 2). See section VIII.

2. Discharge Limitations Technical Availability and Economic Achievability

a. Formation Oil Contamination of SBF-Cuttings. EPA is today promulgating a BAT limitation of zero discharge to control formation oil contamination on SBF-cuttings. EPA is also today promulgating a screening method (Reverse Phase Extraction (RPE) method presented in appendix 6 to subpart A of part 435) and a compliance assurance method (Gas Chromatograph/Mass Spectrometer (GC/MS) method presented in appendix 5 to subpart A of part 435) to demonstrate compliance with this zero discharge requirement.

Formation oil is an “indicator” pollutant for the many toxic and priority pollutant pollutants present in formation (crude) oil (e.g., aromatic and polynuclear aromatic hydrocarbons). The RPE method is a fluorescence test and is appropriately “weighted” to better detect crude oils. These crude oils contain more toxic aromatic and PAH pollutants and show brighter fluorescence (i.e., noncompliance) in the RPE method at lower levels of crude oil contamination. Under the final rule, approximately 5% of all (all meaning a large representative sampling) formation oils would fail (not comply) at 0.1% contamination of SBFs and 95% of all formation oils will fail at 1.0% contamination of SBFs. The majority of formation oils will fail at 0.5% contamination of SBFs. Since the RPE method is a relative brightness test, GC/MS is today promulgated as a confirmatory compliance assurance method when the results from the RPE compliance method are in doubt by either the operator or the enforcement authority. Results from the GC/MS method will supersede those of the RPE method. EPA is also requiring that dischargers verify and document that a SBF is free of formation oil contamination before initial use of the SBF. The GC/MS method will be used to verify and document the absence of formation oil contamination in SBFs.

EPA intends that the BAT limitation promulgated on formation (crude) oil contamination in SBF is no less stringent that the existing BAT limitation on WBF through the static sheen test (appendix 1 of subpart A of 40 CFR part 435). In most cases the static sheen test detects formation oil contamination in WBF down to 1% and in some cases down to 0.5%. Based on the available information, EPA believes that only a very minimal amount of SBF will be non-compliant with this limitation and therefore be required to be disposed of onshore or by injection. EPA thus finds that this limitation is technically available. EPA also finds this option to be economically achievable because there is no reason why formation oil contamination would occur more frequently under this rule than under the current rules which industry can economically afford. EPA has determined that essentially no costs are associated with this requirement other than monitoring and reporting costs, which are minimal costs for this industry, but are incorporated into the cost and economic analyses.

b. Retention of SBF on SBF-Cuttings. EPA is today promulgating BAT limitations controlling the amount of SBF discharged with SBF-cuttings for the Offshore subcategory where SBF-cuttings may be discharged. As previously stated, limiting the amount of SBF content in discharged cuttings controls: (1) The amount of toxic and non-conventional pollutants in SBF which are discharged to the ocean; (2) the biodegradation rate of discharged SBF; and (3) the potential for SBF-cuttings to develop cuttings piles and mats which are deleterious to the benthic environment. The BAT limitations promulgated today for controlling the amount of SBF discharged with SBF-cuttings are averaged by hole volume over the well sections drilled with SBF. Those portions of the SBF-cuttings wastestream that are retained for zero discharge (e.g., fines) are factored into the weighted well average with a retention value of zero.

EPA evaluated the costs, cost savings, and technical performance of several technologies to recover SBF from the SBF-cuttings discharge (see SBF Development Document and SBF Statistical Support Document). EPA also investigated the use of Best Management Practices (BMPs) to reduce the amount of SBF discharge on SBF-cuttings. Typical BMPs for SBF-cuttings include regulating the flow and dispersion across solid control equipment screens and properly maintaining these screens. EPA also considered NWQIs (e.g., land disposal requirements, fuel use, air emissions, safety, and other considerations) in setting the SBF retention on SBF-cuttings BAT limitation.

As previously stated in section II.C, the drilling fluid and drill cuttings undergo an extensive separation process by the solids control system to remove drilling fluid from the drill cuttings. The solids control system is necessary to maintain constant drilling fluid properties and/or change them as required by the drilling conditions. Drilling fluid recovered from the solids control equipment is recycled into the active mud system (e.g., mud pits, mud pumps) and back downhole. Drill cuttings discarded from the solids control equipment are a waste product. Drill cuttings are also cleaned out of the mud pits and from the solid separation equipment during displacement of the drilling fluid system (i.e., accumulated solids).

Most drilling operators use, at a minimum, a solids control system typically consisting of primary and secondary shale shakers in series with a “fines removal unit” (e.g., mud cleaner, decanting centrifuge). The primary and secondary shale shakers remove the larger and smaller cuttings respectively. The fines removal unit removes the “fines” (i.e., low gravity solids) down to about 5 microns (10^-6 meters). Solids less than 5 microns are labeled as “entrained” and are unable to be removed by solids control equipment. Because of their small size and large surface area per unit volume, the fines retain more drilling fluid than an equal amount of larger cuttings coming off the shale shakers. This solid control equipment configuration was labeled as “baseline” (i.e., representative of current industry practice) in the April 2000 NODA (65 FR 21559). EPA continues to use this solid control equipment configuration as baseline in the analyses supporting today's final rule.

EPA assessed the baseline performance using industry submitted ROC data received before and in response to the April 2000 NODA. EPA received sufficient additional cuttings retention data from GOM sources to re-evaluate the discharges of the baseline solids control equipment (e.g., primary shale shaker, secondary shale shaker, fines removal unit) to calculate a revised baseline long-term average retention value of 10.2% by weight of SBF on cuttings. Despite the revision of the retention data, the revised long-term average retention value is only slightly different than the 11% originally calculated for the February 1999 proposal and the 11.4% calculated for the April 2000 NODA. This relative convergence of the various calculated baseline performance averages provides further confidence in the accuracy of the baseline model and associated data.

Operators also recover additional drilling fluid from drill cuttings discarded from the shale shakers through the use of cuttings dryers (e.g., vertical or horizontal centrifuges, squeeze press mud recovery units, High-G linear shakers). Since the February 1999 proposal and April 2000 NODA, the GOM offshore drilling industry has increased its use of “add-on” cuttings drying equipment (i.e., “cuttings dryers”) to reduce the amount of SBF adhering to the SBF-cuttings prior to discharge. Specifically, in response to the April 2000 NODA, EPA received ROC data from approximately 45 GOM SBF well projects that used cuttings dryers (e.g., vertical or horizontal centrifuges, squeeze press mud recovery units, High-G linear shakers) to reduce the amount of SBF discharged (see SBF Statistical Support Document). These 45 GOM SBF well projects represent a broad representation of typical factors affecting solids control equipment performance which include: (1) GOM formation types (e.g., shale, sand, salt); (2) rig types (e.g., drill tension leg platform, semi-submersible); (3) drilling operation types (i.e., exploratory or development); (4) water depth (i.e., shallow or deep); and (5) rates of penetration (ROP). Current data available to EPA indicates that these cuttings dryers can operate consistently and efficiently.

2. On page 6874, in column 3, line 14, correct the sentence to read “c. Sediment Toxicity of SBF Discharged with Cuttings.”

PART 435—[CORRECTED]

Appendix 5 to Subpart A—[Corrected]

3. On page 6908, in column 2, in appendix 5 to subpart A of part 435 in 9.2. in line 15, correct the line to read “2% oil—Detected in >90% of samples”.

Appendix 7 to Subpart A—[Corrected]

4. On page 6912, in appendix 7 to subpart A of part 435, in 4. calculations, in the last paragraph of 7., correct equations 11 and 13 to read as follows:

Appendix 7 to Subpart A of Part 435—API Recommended Practice 13B-2

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4. Calculations

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7. * * *

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