[Federal Register Volume 79, Number 115 (Monday, June 16, 2014)]
[Rules and Regulations]
[Pages 34231-34240]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-14030]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 49

[EPA-HQ-OAR-2011-0151; FRL-9911-46-OAR]
RIN 2060-AS24


Review of New Sources and Modifications in Indian Country 
Amendments to the Registration and Permitting Deadlines for True Minor 
Sources

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is issuing final amendments to the ``Federal Minor New 
Source Review Program in Indian Country'' (we refer to this new source 
review rule as the ``Indian Country Minor NSR Rule''). We are amending 
the Indian Country Minor NSR Rule in two ways. First, we are extending 
the NSR minor source permitting deadline for true minor sources in the 
oil and natural gas sector from September 2, 2014, to March 2, 2016. 
Second, we are changing the registration deadline for new true minor 
sources in the oil and natural gas sector to conform with the changes 
to the NSR minor source permitting deadline. We are also eliminating a 
requirement for all true minor sources that begin operation before 
September 2, 2014, to obtain a minor NSR permit 6 months after EPA 
publishes a general permit because the provision no longer affects any 
source.

DATES: The final rule is effective on July 16, 2014.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-HQ-OAR-2011-0151. All documents in the docket are listed in the 
http://www.regulations.gov index. Although listed in the index, some 
information is not publicly available e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available

[[Page 34232]]

either electronically in http://www.regulations.gov or in hard copy at 
the Air and Radiation Docket, EPA/DC, William Jefferson Clinton West 
Building, Room 3334, 1301 Constitution Avenue NW., Washington, DC 
20460. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., 
Monday through Friday, excluding legal holidays. The telephone number 
for the Public Reading Room is (202) 566-1744, and the telephone number 
for the Air and Radiation Docket is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: For general questions about this 
document, please contact Mr. Christopher Stoneman, Outreach and 
Information Division, Office of Air Quality Planning and Standards 
(C304-01), Environmental Protection Agency, Research Triangle Park, 
North Carolina 27711; telephone number (919) 541-0823; fax number (919) 
541-0072; email address: [email protected]. For questions about 
the applicability of this action to a particular source, please contact 
the appropriate EPA region contact for your state:
    EPA Region 6 (Arkansas, Louisiana, New Mexico, Oklahoma, and 
Texas)--Ms. Bonnie Braganza, Air Permits Section, Multimedia Permitting 
and Planning Division, Environmental Protection Agency Region 6, 
Dallas, Texas 75202; telephone number (214) 665-7340; fax number (214) 
665-6762; email address: [email protected].
    EPA Region 8 (Colorado, Montana, North Dakota, South Dakota, Utah, 
and Wyoming)--Ms. Claudia Smith, Air Program, Mail Code 8P-AR, 
Environmental Protection Agency Region 8, Denver, Colorado 80202; 
telephone number (303) 312-6520; fax number (303) 312-6649; email 
address: [email protected].
    EPA Region 9 (Arizona, California, Hawaii, Nevada, and Pacific 
Islands)--Ms. Lisa Beckham, Permits Office, Air Division, Air-3, 
Environmental Protection Agency Region 9, San Francisco, California 
94105; telephone number (415) 972-3811; fax number (415) 947-3579; 
email address: [email protected].
    All other EPA regions--The permit reviewer for minor sources in 
Indian country for your EPA region. You can find the list of the EPA 
permit reviewers at http://www.epa.gov/air/tribal/tribalnsr.html. 
Scroll down to the heading, ``Existing Source Registration,'' and click 
on ``Reviewing Authority'' to access ``Environmental Protection 
Agency's Reviewing Authorities for Permits.''

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    Entities potentially affected by this final rule include owners and 
operators of true minor emission sources in all industry groups 
planning to locate or already located in Indian country. Categories and 
entities potentially affected by this action are expected to include, 
but are not limited to, the following:

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                                                 Examples of regulated
             Category               NAICS \a\           entities
------------------------------------------------------------------------
Industry..........................      21111  Oil and gas production/
                                                operations.
                                       211111  Crude petroleum and
                                                natural gas extraction.
                                       211112  Natural gas liquid
                                                extraction.
                                       212321  Sand and gravel mining.
                                       213111  Drilling oil and gas
                                                wells.
                                       213112  Support activities for
                                                oil and gas operations.
                                        22111  Electric power
                                                generation.
                                       221210  Natural gas distribution.
                                        22132  Sewage treatment
                                                facilities.
                                        23899  Sand and shot blasting
                                                operations.
                                       311119  Animal food
                                                manufacturing.
                                         3116  Beef cattle complex,
                                                slaughter house and meat
                                                packing plant.
                                       321113  Sawmills.
                                       321212  Softwood veneer and
                                                plywood manufacturing.
                                        32191  Millwork (wood products
                                                manufacturing).
                                       323110  Printing operations
                                                (lithographic).
                                       324121  Asphalt hot mix.
                                         3251  Chemical preparation.
                                        32711  Clay and ceramics
                                                operations (kilns).
                                        32732  Concrete batching plant.
                                         3279  Fiber glass operations.
                                       331511  Casting foundry (iron).
                                         3323  Fabricated structural
                                                metal.
                                       332812  Surface coating
                                                operations.
                                         3329  Fabricated metal
                                                products.
                                        33311  Machinery manufacturing.
                                        33711  Wood kitchen cabinet
                                                manufacturing.
                                        42451  Grain elevator.
                                        42471  Gasoline bulk plant.
                                         4471  Gasoline station.
                                        54171  Professional, scientific,
                                                and technical services.
                                       562212  Solid waste landfill.
                                        72112  Casino hotels.
                                       811121  Auto body refinishing.
------------------------------------------------------------------------
\a\ North American Industry Classification System.

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be subject to the Indian 
Country Minor NSR Program, and, therefore, potentially affected by this 
action. To determine whether your facility is affected by this action, 
you should examine the applicability criteria in 40 CFR 49.151 through 
49.161 (i.e., the Indian Country Minor NSR Rule). If you have any 
questions regarding the applicability of

[[Page 34233]]

this action to a particular entity, contact the appropriate person 
listed under FOR FURTHER INFORMATION CONTACT.

B. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this final rule will also be available on the World Wide Web. Following 
signature by the EPA Administrator, a copy of this final rule will be 
posted in the regulations and standards section of our NSR home page 
located at http://www.epa.gov/nsr and on the tribal NSR page at http://www.epa.gov/air/tribal/tribalnsr.html.

II. Purpose

    In July 2011, EPA finalized a rule that includes a minor new source 
review NSR permitting program for sources in Indian country. We call 
the minor source permitting part of the rule: The ``Indian Country 
Minor NSR Rule.'' \1\ We call a permit issued under this program a 
minor NSR permit. Under the rule issued in 2011, new and modified minor 
sources and major sources that make minor modifications, located in 
Indian country, must obtain a permit prior to commencing construction 
(a pre-construction permit) beginning on September 2, 2014.
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    \1\ The Indian Country Minor NSR Rule is a component of ``Review 
of New Sources and Modifications in Indian Country, Final Rule'' 
July 1, 2011 (76 FR 38748) that applies to new and modified minor 
sources and minor modifications at major sources. It is codified at 
40 CFR 49.151-49.161.
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    The purpose of today's rulemaking is to finalize the following two 
amendments to the Indian Country Minor NSR Rule:
    (1) Extend the minor NSR permitting deadline for true minor sources 
in the oil and natural gas sector located, or planning to locate, in 
Indian country; and
    (2) Adjust the registration deadline to conform to the extended 
permitting deadline for true minor sources in the oil and natural gas 
sector; and
    (3) We are also eliminating a requirement for all true minor 
sources that begin operation before September 2, 2014, to obtain a 
minor NSR permit 6 months after EPA publishes a general permit. No 
general permits have been finalized to date, so the provision is now 
moot.

III. Background

A. Proposed Amendments to the Indian Country Minor NSR Rule

    On January 14, 2014, EPA published a proposed rule, ``General 
Permits and Permits by Rule for the Federal Minor New Source Review 
Program in Indian Country,'' \2\ that included proposed amendments to 
Sec.  49.151(c)(1)(iii)(B) and Sec.  49.160(c)(1)(ii) and (c)(1)(iii) 
of the Indian Country Minor NSR Rule. Two of the proposed amendments 
affect only true minor sources in the oil and natural gas sector: (1) 
The extension of the deadline by which true minor sources in the oil 
and natural gas sector must receive minor NSR permits prior to 
commencing construction; and (2) the deadline by which true minor 
sources in the oil and natural gas sector must register. The third 
proposed amendment would affect all true minor sources by eliminating 
the requirement to obtain a permit beginning 6 months after EPA 
publishes a general permit for a source category in the Federal 
Register, if that date is before September 2, 2014.
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    \2\ The ``General Permits and Permits by Rule for the Federal 
Minor New Source Review Program in Indian Country'' was proposed on 
January 14, 2014 (79 FR 2546). Proposed changes to the Indian 
Country Minor NSR rule are on pages 79 FR 2570-2572.
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    EPA proposed other changes to the Indian Country Minor NSR Rule in 
the ``General Permits and Permits by Rule for the Federal Minor New 
Source Review Program in Indian Country.'' These other proposed changes 
are not part of today's final rule and will be addressed in a separate 
final rulemaking.
    EPA also proposed amendments to the Indian Country Minor NSR Rule 
in the proposed rule, ``Review of New Sources and Modifications in 
Indian Country--Amendments to the Indian Country Minor New Source 
Review Rule,'' published in the Federal Register on June 4, 2013 (78 FR 
33266). These proposed amendments addressed the list of emissions units 
and activities that are exempt from the Indian Country Minor NSR 
Program and definitions of ``commence construction'' and ``begin 
construction.'' We finalized these amendments in a final rule published 
in the Federal Register on May 30, 2014 (79 FR 31035).

B. How might EPA streamline NSR permitting for true minor sources in 
the oil and natural gas sector?

    When we proposed the extension of the permit deadline for true 
minor sources in the oil and natural gas sector, we explained that an 
extension of the deadline was necessary, in part, because of the 
additional time required to appropriately address issues associated 
with this sector. To begin the process of addressing these issues, EPA 
published an Advance Notice of Proposed Rulemaking (ANPR) to solicit 
broad feedback on the most effective and efficient means of 
implementing the Indian Country Minor NSR Rule for new and modified 
true minor sources and minor modifications at major sources in the oil 
and natural gas sector located in Indian Country.\3\ In particular, the 
ANPR discusses various approaches, including a federal implementation 
plan (FIP), which would establish requirements for new and modified 
true minor sources and minor modifications at major sources (and 
possibly existing sources as well); and a general permit, which would 
establish a streamlined permitting approach for new and modified minor 
sources and minor modifications at major sources under the Indian 
Country Minor Source NSR Rule. EPA is also seeking feedback on other 
possible approaches such as a permit by rule.
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    \3\ See 79 FR 32502, published on June 5, 2014.
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    After considering feedback received in response to the ANPR,\4\ EPA 
intends to propose action on regulating new and modified true minor 
sources and minor modifications at major sources, and possibly also 
existing sources of oil and natural gas production operations in Indian 
country, in a way that: (1) Ensures the timely implementation of 
environmental protections; (2) maximizes the efficient use of 
resources; (3) minimizes preventable delays in economic development; 
and (4) proactively mitigates potential adverse air quality-related 
environmental and public health impacts that could result from the 
rapid growth in emissions from these sources.
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    \4\ Electronic copies of the ANPR are available in the docket 
and in the regulations and standards section of our NSR home page 
located at http://www.epa.gov/nsr.
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IV. What final action is EPA taking on amendments to the Indian Country 
Minor NSR Rule?

    Today's final rule promulgates three amendments to the Indian 
Country Minor NSR Rule. This section discusses those three amendments 
and our rationale for adopting them.
    This final rule amends Sec.  49.151(c)(1)(iii)(B) in two ways. 
First, we are eliminating the requirement to obtain a permit beginning 
6 months after the general permit for a source category is published in 
the Federal Register, if that date is before September 2, 2014. The 
purpose of this provision was to ensure that sources would obtain 
preconstruction permits as soon as practicable after a general permit 
had been issued rather than waiting until September 2, 2014. However, 
today's date is fewer than 6 months from September 2, 2014, making the 
provision unnecessary. Eliminating it

[[Page 34234]]

de-clutters and clarifies the regulatory text.
    Second, we are extending the permitting deadline for all true minor 
sources (both new and modified true minor sources and minor 
modifications at existing major sources) within the oil and natural gas 
sector located in Indian country.\5\ Today's final rule changes the 
deadline from September 2, 2014, to March 2, 2016, for true minor 
sources in the oil and natural gas sector that either begin new 
construction or modifications to an existing source on or after that 
date.
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    \5\ Typically, sources in the oil and natural gas sources sector 
will be assigned to one of the following NAICS codes: 21111 Oil and 
gas production/operations; 211111 Crude petroleum and natural gas 
extraction; 211112 Natural gas liquid extraction; 21311 Drilling oil 
and gas wells; 213112 Support activities for oil and gas operations; 
and 221210 Natural gas distribution.
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    This final rule also amends a provision in the Indian Country Minor 
NSR Rule governing existing minor source registration timeframes (Sec.  
49.151(c)(1)(iii)(A)) to conform to the changes to the registration 
date that we made to another provision in the Indian Country Minor NSR 
rule on the same topic (Sec.  49.160(c)(1)(ii) and (c)(1)(iii)) and to 
eliminate redundant text that addresses the effective date of the 
Indian Country Minor NSR Rule. We did not propose either change, but 
had intended to make the changes we proposed throughout the regulatory 
text to ensure consistency. The first change to Sec.  
49.151(c)(1)(iii)(A), which addresses the registration date for true 
minor sources in Indian Country, is necessary to ensure consistency 
with the changes we proposed in Sec.  49.160(c)(1)(ii) and (c)(1)(iii). 
Without the change in Sec.  49.151(c)(1)(iii)(A), the regulatory text 
would have conflicting requirements. The second change in Sec.  
49.151(c)(1)(iii)(A) eliminates ``you must register your source with 
your reviewing authority in your area within 18 months after the 
effective date of this program, that is.'' This change eliminates 
unnecessary existing regulatory text and does not change any 
requirements.
    Today's final rule also amends Sec.  49.160(c)(1)(ii) and 
(c)(1)(iii) to make registration deadlines consistent with the minor 
NSR permitting deadline for true minor sources in the oil and natural 
gas sector. The Indian Country Minor NSR Rule currently requires true 
minor sources that commence construction between August 30, 2011, and 
September 2, 2014, to register with the appropriate reviewing authority 
within 90 days after the source begins operation. If a source commences 
construction or modification on or after September 2, 2014, its permit 
application fulfills the registration requirement. Today's rule changes 
the September 2, 2014, date to March 2, 2016, for true minor sources in 
the oil and natural gas sector, thereby extending the period during 
which sources in the oil and natural gas sector must register.

V. Summary of Significant Comments and Responses

    We received comments from 28 commenters (twelve tribes or tribal 
entities, two state or local agencies, and fourteen industry entities) 
overall on the ``General Permits and Permits by Rule for the Federal 
Minor New Source Review Program in Indian Country'' proposed rule. The 
subsections that follow provide a summary of the comments, and our 
responses to those comments, that relate to the changes discussed in 
Unit IV. and that we are addressing in today's final rule. The 
remainder of the comments will be addressed as part of a separate final 
rule that relates to the general permits (or permits by rule) and other 
changes to the Indian Country Minor NSR Rule proposed in the ``General 
Permits and Permits by Rule for the Federal Minor New Source Review 
Program in Indian Country'' proposed rule.

A. Consultation With Tribal Governments

    Comment: One commenter stated that much of EPA's proposed rule 
violated Executive Order No. 13175 on Consultation and Coordination 
with Indian Tribal Governments and EPA's May 2011 Policy on 
Consultation and Coordination with Indian Tribes.
    Response: The EPA coordinated with tribal environmental 
professionals on the development of the ``General Permits and Permits 
by Rule for the Federal Minor New Source Review Program in Indian 
Country'' proposed rule, including the proposed amendments to extend 
the permitting and registration deadlines for true minor sources in the 
oil and natural gas sector located in Indian country. The coordination 
consisted of participating in monthly teleconferences. Specifically, on 
December 19, 2013, we presented an overview of the proposal and 
welcomed feedback and questions. On March 4, 2014, we met with 
representatives of the Ute Indian Tribe to hear their concerns 
regarding the proposed rule.
    On December 16, 2013, EPA mailed letters to over 600 tribal leaders 
to offer consultation. To assist tribes in deciding whether to accept 
our offer of consultation, we held a conference call on January 6, 
2014, during which EPA provided an overview of the proposed changes and 
answered questions. We did not receive any requests for consultation 
from tribal governments in response to our letters offering 
consultation. However, prior to mailing the consultation letters, EPA 
began consulting with two tribes. Senior EPA officials consulted with 
the elected Ute Indian Tribe tribal leader and other members of the Ute 
Indian Tribe, including business committee members, on August 27, 2013, 
September 12, 2013, and March 21, 2014. Senior EPA officials also 
consulted with the designated representatives of the elected leaders of 
the Ute Indian Tribe and the Three Affiliated Tribes on July 26, 2013.

B. Removing the Requirement To Obtain a Permit Beginning 6 Months After 
the Publication Date of a General Permit

    Comment: Two commenters supported eliminating the 6 month 
requirement, noting that the general permits have not been published, 
and cannot be finalized prior to 6 months before September 2, 2014. One 
commenter also noted that the change clarifies that September 2, 2014, 
is the applicable permitting deadline.
    Response: For the reasons explained in this document, this final 
rule eliminates the requirement.

C. Extending the True Minor Source Permitting Deadline of the Indian 
Country Minor NSR Rule for True Minor Sources in the Oil and Natural 
Gas Sector

1. Extension Date
    Comment: No commenters opposed extending the true minor source 
permitting deadline for the Indian Country Minor NSR Rule, although two 
commenters did express concerns about how the extension would affect 
air quality. Sixteen commenters supported an extension, citing the need 
for a streamlined approach to permitting minor sources in the oil and 
natural gas sector.
    One commenter noted that an extension of the deadline is 
reasonable, given the complexity of the oil and natural gas sector. 
Another commenter noted that without an extension, companies will have 
to get individual permits for every facility. One commenter stated that 
if oil and natural gas sources have to obtain site-specific permits 
before commencing construction, the delays could have ``profoundly 
negative effects on the Tribe's mineral estate, its economy and its 
ability to fund the tribal

[[Page 34235]]

government,'' which could affect the tribal government's ability to 
provide ``much needed social services to its tribal members.'' Other 
commenters stated that obtaining site-specific permits for true minor 
sources in the oil and natural gas sector would cause significant and 
harmful delays due to the resources required to prepare and submit 
permit applications and the inability of the EPA to review and issue 
permits in a timely manner. One commenter noted that ``EPA will be 
inundated with hundreds, maybe thousands, of permit applications'' and 
has ``insufficient staff to review and approve'' these permits. Another 
commenter noted that the number of applications for minor source 
permits would ``overwhelm EPA's limited resources and likely lead to 
unrealistic lead times and increased uncertainty for sources seeking 
permits.'' Another commenter stated that even if a general permit was 
proposed soon for the oil and natural gas sector, five-and-a-half 
months lead time is not enough for companies to make control decisions 
and equipment purchases, which often involve waiting lists or require 
testing to assure controls will work in specific locations.
    One commenter stated that EPA should not pick an arbitrary fixed 
future date for the permitting deadline. Several commenters asked EPA 
to set the deadline for permitting as a conditional date, i.e., a date 
12 months from the publication date or effective date of the general 
permit for a source category. Commenters were concerned about EPA's 
ability to issue a final general permit by March 2, 2016. One commenter 
stated that if a deadline of March 2, 2016, does not provide enough 
time for EPA to issue a general permit or permit by rule, we ``could 
end up in the same predicament we find ourselves in today,'' with no 
general permit or permit by rule in place and a fast-approaching 
deadline. One commenter noted that it makes no sense to have an 
effective date until a general permit or permit by rule is issued and 
effective for a sector.
    One commenter requested that EPA allow adequate lead time between 
the date a final oil and natural gas sector general permit, or permit 
by rule, is published and the permitting deadline. One commenter noted 
that 12 months would give oil and natural gas operators sufficient time 
to read and understand the general permit, or permit by rule, and to 
prepare hundreds of individual permit applications.
    Response: We are aware that EPA's ability to review and issue minor 
NSR permits for the oil and natural gas sector would be strained 
without a streamlined approach to permitting for true minor sources in 
the oil and natural gas sector. We are also aware that delays in 
issuing permits can be costly to industry and to tribes. To help 
address these concerns, we are developing a streamlined approach to 
permitting minor sources in the oil and natural gas sector. As 
discussed in Unit III.B., we published an ANPR that addresses various 
aspects of permitting oil and natural gas sources and requests comment 
from the public on how EPA might best apply federally enforceable 
limits that protect air quality in Indian country and minimize 
potentially costly delays.
    Following the ANPR, EPA will develop a notice of proposed 
rulemaking and a final rule. A permitting deadline prior to March 2, 
2016, does not allow sufficient time to propose and promulgate a 
general permit, FIP, or other possible approach (i.e., a permit by 
rule) for sources in the oil and natural gas sector. However, a 
deadline date of March 2, 2016, should provide sufficient time for us 
to complete the regulatory development process and to finalize a 
streamlined approach for addressing the potential impact of true minor 
sources in the oil and natural gas sector. Therefore, today's final 
rule is extending the permitting deadline for true minor sources in the 
oil and natural gas sector to March 2, 2016.
    We do not believe that an open-ended extension of the permit 
deadline is appropriate for a number of reasons. First, while we 
believe that an extension of the permitting deadline is necessary in 
practical terms for the successful implementation of the minor source 
permitting program for oil and natural gas sources, this means that a 
true minor source in the oil and natural gas sector that begins 
construction before March 2, 2016, will not be required to have an NSR 
permit. We recognize that the extended period of time true minor 
sources in the oil and natural gas sector will be able to construct 
without first obtaining an NSR permit could have a negative impact on 
air quality in Indian country. We believe that establishing a date of 
March 2, 2016, as the date by which true minor sources must obtain an 
NSR permit prior to commencing construction will help to minimize any 
such impacts. A nonspecific deadline conditional on the timing of 
publication in the Federal Register of a general permit could 
exacerbate any such impacts. Second, an open-ended extension would not 
provide the certainty that industry representatives have consistently 
said they need in order to make informed decisions regarding the 
purchase and locating of equipment. Third, one of the reasons 
commenters asked EPA for a conditional permitting deadline is the 
amount of lead time they said sources require to develop permit 
applications. When public comments were submitted, EPA had not 
published the ANPR, which discusses the possibility of issuing 
federally enforceable requirements using a FIP instead of a general 
permit for true minor sources in the oil and natural gas sector in 
Indian country. As discussed in the ANPR, an oil and natural gas 
production FIP would apply directly by regulation and would authorize 
construction or modification of sources complying with the requirement; 
sources would not need to submit a permit application or obtain 
coverage under a permit. This would mean that a source in compliance 
with the FIP could begin construction at any point after meeting 
notification requirements, potentially eliminating the need for 
significant lead time. If EPA issues a general permit or follows 
another approach instead of a FIP for minor sources in the oil and 
natural gas sector, then we will take into consideration the need for 
lead time.
2. Source Categories and Sources in the Oil and Natural Gas Sector 
Subject to the Permitting Deadline Extension
    Comment: Several commenters stated that the permitting deadline 
extension should apply to all true minor sources at oil and natural gas 
facilities. One commenter further specified that the permitting 
deadline extension should apply to glycol dehydrators, compressor 
stations, natural gas processing plants, and any other gas gathering 
facilities. Another commenter linked the equipment covered by a general 
permit to equipment covered by the extension deadline and stated that 
the general permit should be for storage tanks, dehydrators, and 
compressor stations. One commenter stated that the permitting deadline 
extension should include gas gathering activities and asked that the 
EPA clarify the NAICS code that includes oil and gas gathering 
activities. One commenter stated that a general permit for stationary 
engines would be especially relevant for facilities in the oil and gas 
industry. The commenter also stated that it ``makes no sense to make 
the program effective for the oil and gas industry until after a 
general permit or permit by rule has been issued and is effective for . 
. . all source types used in that sector.''
    Several commenters stated that EPA should provide a permitting 
extension to true minor sources in all source categories.

[[Page 34236]]

    Response: EPA agrees with the commenters that the permitting 
extension should apply to all affected emissions units that are located 
at a true minor source in the oil and natural gas sector.\6\ An 
affected emissions unit, such as a boiler or an internal combustion 
engine, does not have to be exclusive to the industry, but it must be 
necessary for, and used in conjunction with, the extraction, 
production, processing, storage, transmission or distribution of oil or 
natural gas to be part of the oil and natural gas sector. We decided to 
apply the extension to all affected emissions units at true minor 
sources in the oil and natural gas sector because we have yet to 
determine which affected emissions units will be covered by a general 
permit, FIP or other approach. Before we decide in a subsequent notice 
of proposed rulemaking which affected emission units we want to propose 
to be covered, we want to consider the public comments received on a 
host of issues outlined in the ANPR. We expect that most affected 
emissions units at true minor sources in the oil and natural gas sector 
will be covered by one of the approaches outlined in the ANPR or which 
come to light in comments received on the ANPR; however, we believe it 
best to extend the deadline for all affected emissions units at true 
minor sources in the oil and natural gas sector until we determine 
exactly which affected emissions units will be covered.
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    \6\ ``Affected emissions units'' is defined in the definitions 
section (Sec.  49.152) of the Indian Country Minor NSR Rule.
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    EPA is not extending the permitting deadline for all true minor 
sources because we do not believe an extension is warranted for other 
source categories. If general permits, or permits by rule, are not in 
place for other source categories by September 2, 2014, we would issue 
site-specific permits for the sources in those source categories that 
seek minor source permits during what we anticipate to be a short 
period of time between that date and the date when general permits or 
permits by rule are available.\7\ We believe that the time during which 
the issuance of site-specific permits may be necessary will be short 
because we have proposed general permits, or permits by rule, for five 
source categories in Indian country and expect to propose additional 
general permits, or permits by rule, later this year.
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    \7\ We are basing our sense of the number of potential sources 
in other source categories on information from two sources. First, 
it is based on the mix of existing minor sources that registered 
with EPA in response to the March 2013 deadline. The number of oil 
and natural gas sources that have registered far outweighs the 
number of sources that have registered in other source categories. 
Second, EPA's projections of minor source growth in Indian country 
also indicates far higher growth in oil and natural gas sources 
versus sources in other categories. A copy of the economic analysis 
can be found in the following docket: Docket ID No. EPA-HQ-OAR-2011-
0151.
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    For the purposes of the permitting and registration deadlines, as 
specified in Sec. Sec.  49.151(c)(1)(iii)(A) and (c)(1)(iii)(B), and 
49.160(c)(1)(i) through (c)(1)(iii), for true minor sources, an ``oil 
and natural gas source'' is part of the oil and natural gas sector. The 
oil and natural gas sector encompasses all operations in the extraction 
and production of oil and natural gas, as well as the processing, 
transmission and distribution of natural gas. Specifically for oil, the 
sector includes all operations from the well to the point of custody 
transfer at a petroleum refinery. For natural gas, the sector includes 
all operations from the well to the final end user. The oil and natural 
gas sector can generally be separated into four segments: (1) Oil and 
natural gas production; (2) natural gas processing; (3) natural gas 
transmission and storage; and (4) natural gas distribution.
    The oil and natural gas production segment includes the wells and 
all related processes used in the extraction, production, recovery, 
lifting, stabilization, and separation or treatment of oil and/or 
natural gas (including condensate). Production components may include, 
but are not limited to, wells and related casing head, tubing head and 
``Christmas tree'' piping, as well as pumps, compressors, heater 
treaters, separators, storage vessels, pneumatic devices and 
dehydrators. Production operations also include the well drilling, 
completion and workover processes and include all the portable non-
self-propelled apparatus associated with those operations. Production 
sites include not only the sites where the wells themselves are 
located, but also include stand-alone ``pads'' where oil, condensate, 
produced water, and natural gas from several wells may be separated, 
stored, and treated. The production segment also includes the low to 
medium pressure, smaller diameter, gathering pipelines and related 
components that collect and transport the oil, natural gas and other 
materials and wastes from the wells or well pads. We believe most true 
minor sources in the oil and natural gas sector that will need a minor 
NSR permit are in the oil and natural gas production segment.
    The natural gas production segment ends where the natural gas 
enters a processing plant. In situations where there is no processing 
plant, the natural gas production segment ends at the point where the 
natural gas enters the transmission segment for long-line transport. 
The crude oil production segment ends at the storage and load-out 
terminal which is used for transport of the crude oil to a petroleum 
refinery via trucks or railcars. The petroleum refinery is not 
considered a part of the oil and natural gas sector. Thus, with respect 
to crude oil, the oil and natural gas sector ends where crude oil 
enters the petroleum refinery.
    The second segment, natural gas processing, consists of separating 
certain hydrocarbons and fluids from the natural gas to produce 
``pipeline quality'' dry natural gas. Pipeline quality natural gas 
leaves the natural gas processing segment and enters the third segment, 
natural gas transmission and storage, which includes pipelines, 
reciprocating or centrifugal compressors, and underground storage 
facilities. The fourth segment is the natural gas distribution segment. 
Local distribution companies comprise the natural gas distribution 
segment and deliver natural gas to the final end user. As explained 
earlier in this comment response, we believe that most true minor 
sources that will need a minor NSR permit will be in the oil and 
natural gas production segment.
3. Protection of Air Quality in Indian Country During the Period of the 
Extension
    Comment: One commenter expressed concern that extending the 
permitting deadline may provide yet additional time for oil and natural 
gas sources to commence new operations or make modifications to 
existing sources without a permit. The commenter noted that the oil and 
gas sector is one of the most prolific sources in some areas of Indian 
country and it might not be beneficial to have so many unpermitted 
sources during the extension period. Another commenter asked how EPA 
will protect air quality in Indian country during the period of the 
extension.
    Response: EPA recognizes that extending the minor NSR permitting 
deadline for the oil and natural gas sector could have negative impacts 
on air quality in Indian country, because some sources will not have to 
install air pollution controls that might otherwise have been required. 
Such impacts should be minimized, because many new, modified and 
reconstructed sources in Indian country will have to meet the 
requirements of the Agency's oil and natural gas New Source

[[Page 34237]]

Performance Standard (NSPS).\8\ The NSPS covers most emission sources 
in the production segment of the oil and natural gas sector, including 
completions of hydraulically fractured gas wells, storage vessels, 
compressors, and pneumatic controllers. Sources constructed, modified 
or reconstructed after August 23, 2011, must comply with the 
requirements of the NSPS. The NSPS will be fully implemented in 2015. 
Thus, the NSPS will help protect air quality during the extension. 
Moreover, the permitting extension applies only to true minor sources; 
the requirement that major sources and synthetic minor sources obtain 
pre-construction permits in Indian country is not affected.
---------------------------------------------------------------------------

    \8\ See 40 CFR part 60, subpart OOOO, ``Standards of Performance 
for Crude Oil and Natural Gas Production, Transmission, and 
Distribution.''
---------------------------------------------------------------------------

    EPA does not have the necessary resources to deal with the 
anticipated number of site-specific permit applications that would be 
submitted between the current September 2, 2014, deadline and the date 
by which we are able to issue a FIP, general permit or other 
streamlined mechanism for the permitting of true minor sources in the 
oil and natural gas sector. This could result in significant delays in 
construction of oil and natural gas sources in Indian country. 
Commenters representing both tribes and industry expressed concerns 
about the negative impacts of delays in obtaining permits.
    The permitting extension also gives us an opportunity to coordinate 
among all of the ongoing efforts to better manage the regulatory 
challenges posed by this large, rapidly growing, complex sector. Three 
activities are highlighted here. First, as previously mentioned, we 
have promulgated an NSPS regulation for this source category \9\ that 
applies directly to new, modified, and reconstructed sources in the 
industry and requires emission controls for some sources. These 
requirements are independent of any NSR permit. Second, on April 15, 
2014, we released several technical white papers for peer review that 
address emerging data on volatile organic compounds and methane 
emissions from certain sources in the oil and natural gas sector, as 
well as techniques for mitigating those emissions.\10\ These white 
papers, and the comments they elicit, will help us solidify our 
understanding of the sector and will help inform future policy 
decisions as we consider potential voluntary and regulatory approaches. 
Third, we are working to improve our emissions inventory and emissions 
factors for the oil and natural gas sector. These improvements will 
allow us to better assess the potential impacts of increased 
production.
---------------------------------------------------------------------------

    \9\ See 40 CFR part 60, subpart OOOO, ``Standards of Performance 
for Crude Oil and Natural Gas Production, Transmission, and 
Distribution.''
    \10\ The white papers can be found at http://www.epa.gov/airquality/oilandgas.
---------------------------------------------------------------------------

    An extension to the permitting deadline also gives us time to 
evaluate public comments on the ANPR (discussed in Unit III.), 
including comments that address whether EPA should cover existing 
sources in an oil and natural gas FIP. Covering existing oil and 
natural gas sources in a FIP, if we decide to do so, could allow us to 
better manage emissions increases in those areas of Indian country that 
exceed, or are close to exceeding, the ozone National Ambient Air 
Quality Standards (NAAQS) because of emissions from the oil and natural 
gas sector. This could also ensure greater consistency with the 
requirements in minor NSR permits previously issued by surrounding 
states.

D. Registration

    Comment: Two commenters supported the proposed change to the 
registration date for true minor sources in the oil and natural gas 
sector. We did not receive any adverse comments on the proposed change.
    Response: We changed the registration date for true minor sources 
in the oil and natural gas sector to be consistent with the permitting 
deadline of March 2, 2016.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is not a ``significant regulatory action'' under the 
terms of Executive Order (E.O.) 12866 (58 FR 51735, October 4, 1993) 
and is therefore not subject to review under Executive Orders 12866 and 
13563 (76 FR 3821, January 21, 2011).

B. Paperwork Reduction Act

    This action does not impose any new information collection burden 
under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et 
seq. The action will not create any new requirements under the Indian 
Country Minor NSR Program, but rather extends permitting and 
registration deadlines for true minor sources in the oil and natural 
gas sector, potentially reducing burden. However, the Office of 
Management and Budget (OMB) has previously approved the information 
collection requirements contained in the existing regulations for the 
Indian Country Minor NSR Program (40 CFR 49.151 through 49.161) under 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., 
and has assigned OMB control number 2060-0003. The OMB control numbers 
for the EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act generally requires an agency to 
prepare a regulatory flexibility analysis of any rule subject to notice 
and comment rulemaking requirements under the Administrative Procedures 
Act or any other statute unless the agency certifies that the rule will 
not have a significant economic impact on a substantial number of small 
entities. Small entities include small businesses, small organizations 
and small governmental jurisdictions.
    For purposes of assessing the impacts of this final action on small 
entities, small entity is defined as: (1) A small business as defined 
in the U.S. Small Business Administration size standards at 13 CFR 
121.201; (2) a small governmental jurisdiction that is a government of 
a city, county, town, school district or special district with a 
population of less than 50,000; or (3) a small organization that is any 
not-for-profit enterprise that is independently owned and operated and 
is not dominant in its field.
    After considering the economic impacts of this final action on 
small entities, I certify that this final action will not have a 
significant economic impact on a substantial number of small entities. 
In determining whether a rule has a significant economic impact on a 
substantial number of small entities, the impact of concern is any 
significant adverse economic impact on small entities, since the 
primary purpose of the regulatory flexibility analysis is to identify 
and address regulatory alternatives ``which minimize any significant 
economic impact of the rule on small entities.'' 5 U.S.C. 603 and 604. 
Thus, an agency may certify that a rule will not have a significant 
economic impact on a substantial number of small entities if the rule 
relieves regulatory burden, or otherwise has a positive economic 
effect, on all of the small entities subject to the rule.
    This final action will not create any new requirements under the 
Indian Country Minor NSR Program. It merely extends the permit and 
registration deadlines for true minor sources in the oil and natural 
gas sector in Indian country. Therefore, it would not impose any 
additional burden on any sources

[[Page 34238]]

(including small entities). We have therefore concluded that this final 
rule will be neutral or relieve the regulatory burden for all affected 
small entities.

D. Unfunded Mandates Reform Act

    This action contains no federal mandate under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 
1531-1538 for state, local or tribal governments in the aggregate, or 
the private sector in any 1 year. This action will not create any new 
requirements under the Indian Country Minor NSR Program, but rather 
extends the permitting and registration deadlines for true minor 
sources in the oil and natural gas sector in Indian country. Therefore, 
this action is not subject to the requirements of sections 202 or 205 
of UMRA.
    This action is also not subject to the requirements of section 203 
of UMRA because it contains no regulatory requirements that might 
significantly or uniquely affect small governments. As noted 
previously, the effect of this final rule will be neutral or relieve 
regulatory burden.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It 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. This final rule will revise the 
Indian Country Minor NSR Program, which applies only in Indian country, 
and will not, therefore, affect the relationship between the national 
government and the states or the distribution of power and 
responsibilities among the various levels of government.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    Subject to the Executive Order 13175 (65 FR 67249, November 9, 
2000), EPA may not issue a regulation that has tribal implications, 
that imposes substantial direct compliance costs and that is not 
required by statute, unless the Federal government provides the funds 
necessary to pay the direct compliance costs incurred by tribal 
governments or EPA consults with tribal officials early in the process 
of developing the proposed regulation and develops a tribal summary 
impact statement.
    EPA has concluded that this final rule will have tribal 
implications. However, it will neither impose substantial direct 
compliance costs on tribal governments, nor preempt tribal law. This 
final rule will have tribal implications since it revises the Indian 
Country Minor NSR Program, which applies to both tribally-owned and 
privately-owned sources in Indian country. As with the existing rule, 
the revised rule will be implemented by EPA, or a delegate tribal 
agency assisting EPA with administration of the rules, until replaced 
by an EPA-approved tribal implementation plan. The effect of this final 
rule will be to extend the permitting and registration deadlines for 
true minor sources in the oil and natural gas sector.
    EPA coordinated with tribal environmental professionals on the 
development of the ``General Permits and Permits by Rule for the 
Federal Minor New Source Review Program in Indian Country'' proposed 
rule, including the proposed amendments to extend the permitting and 
registration deadlines for true minor sources in the oil and natural 
gas sector located in Indian country. The coordination consisted of 
participating in monthly teleconferences. Specifically, on December 19, 
2013, we presented an overview of the proposal and welcomed feedback 
and questions. On March 4, 2014, we met with representatives of the Ute 
Indian Tribe to hear their concerns regarding the proposed rule. On 
December 16, 2013, EPA mailed letters to over 600 tribal leaders to 
offer consultation. To assist tribes in deciding whether to accept our 
offer of consultation, we held a conference call on January 6, 2014, 
during which EPA provided an overview of the proposed changes and 
answered questions. We did not receive any requests for consultation 
from tribal governments in response to our letters offering 
consultation. However, prior to mailing the consultation letters, EPA 
began consulting with two tribes. Senior EPA officials consulted with 
the elected Ute Indian Tribe tribal leader and other members of the Ute 
Indian Tribe, including business committee members, on August 27, 2013, 
September 12, 2013, March 4, 2014, and March 21, 2014. Senior EPA 
officials also consulted with the designated representatives of the 
elected leaders of the Ute Indian Tribe and the Three Affiliated Tribes 
on July 26, 2013.

G. Executive Order 13045: Protection of Children From Environmental 
Health and Safety Risks

    EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) 
as applying only to those regulatory actions that concern health or 
safety risks, such that the analysis required under section 5-501 of 
the Executive Order has the potential to influence the regulation. This 
action is not subject to Executive Order 13045 because it does not 
establish an environmental standard intended to mitigate health or 
safety risks.

H. Executive Order 13211: Actions That Significantly Affect Energy 
Supply, Distribution or Use

    This action is not subject to Executive Order 13211 (66 FR 28355, 
May 22, 2001), because it is not a significant regulatory action under 
Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures and business practices) that are developed or adopted by 
voluntary consensus standards bodies. The NTTAA directs EPA to provide 
Congress, through the OMB, explanations when the Agency decides not to 
use available and applicable voluntary consensus standards.
    This rulemaking does not involve technical standards. Therefore, 
EPA has not considered the use of any voluntary consensus standards.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629, February 16, 1994) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies and activities on minority populations and low-income 
populations in the United States.
    EPA has determined that this final rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations. This final rule will 
extend the true minor source permit deadlines for oil and natural gas 
sources under the Indian Country Minor

[[Page 34239]]

NSR Program. EPA recognizes that this will result in some sources not 
installing air pollution controls that might otherwise have been 
required by a permit, but believes that any negative impacts on air 
quality associated with such activities will not be significant and 
that the practical need for the extension justifies any such impacts in 
the near term. Many new, modified and reconstructed sources in Indian 
country will have to meet the requirements of the Agency's oil and 
natural gas NSPS. The NSPS covers most emission sources in the 
production segment of the oil and natural gas sector, including 
completions of hydraulically fractured gas wells, storage vessels, 
compressors, and pneumatic controllers. Sources constructed, modified 
or reconstructed after August 23, 2011, must comply with the 
requirements of the NSPS. The NSPS will be fully implemented in 2015. 
Thus, the NSPS will help protect air quality during the extension. 
Moreover, the permitting extension applies only to true minor sources; 
the requirement that major sources and synthetic minor sources obtain 
pre-construction permits in Indian country is not affected.

K. Congressional Review Act

    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. 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. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective July 16, 2014.

L. Judicial Review

    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the District of Columbia Circuit by August 15, 2014. Any 
such judicial review is limited to only those objections that are 
raised with reasonable specificity in timely comments. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review, nor does it extend the time within which a petition for 
judicial review may be filed and shall not postpone the effectiveness 
of such rule or action. Under section 307(b)(2) of the Clean Air Act, 
the requirements of this final action may not be challenged later in 
civil or criminal proceedings brought by us to enforce these 
requirements.

VII. Statutory Authority

    The statutory authority for this action is provided by sections 
101, 110, 112, 114, 116 and 301 of the Clean Air Act as amended (42 
U.S.C. 7401, 7410, 7412, 7414, 7416 and 7601).

List of Subjects in 40 CFR Part 49

    Environmental protection, Administrative practices and procedures, 
Air pollution control, Indians, Intergovernmental relations, Reporting 
and recordkeeping requirements.

    Dated: May 22, 2014.
Gina McCarthy,
Administrator.

    Therefore, 40 CFR part 49 is amended as follows:

PART 49--[AMENDED]

0
1. The authority citation for part 49 continues to read as follows:

    Authority:  42 U.S.C. 7401, et seq.

0
2. In Sec.  49.151, revise paragraphs (c)(1)(iii)(A) and (c)(1)(iii)(B) 
to read as follows:


Sec.  49.151  Program overview.

* * * * *
    (c) * * *
    (1) * * *
    (iii) * * * (A) If you own or operate an existing true minor source 
in Indian country (as defined in 40 CFR 49.152(d)), you must register 
your source with the reviewing authority in your area by March 1, 2013. 
If your true minor source is not an oil and natural gas source, and you 
commence construction after August 30, 2011, and before September 2, 
2014, you must also register your source with the reviewing authority 
in your area within 90 days after the source begins operation. If your 
true minor source is an oil and natural gas source, and you commence 
construction after August 30, 2011, and before March 2, 2016, you must 
register your source with the reviewing authority in your area within 
90 days after the source begins operation. You are exempt from these 
registration requirements if your true minor source is subject to Sec.  
49.138.
    (B) If your true minor source is not an oil and natural gas source 
and you wish to begin construction of a new true minor source or a 
modification at an existing true minor source on or after September 2, 
2014, you must first obtain a permit pursuant to Sec. Sec.  49.154 and 
49.155 (or a general permit pursuant to Sec.  49.156, if applicable). 
If your true minor source is an oil and natural gas source and you wish 
to begin construction of a new true minor source or a modification at 
an existing true minor source on or after March 2, 2016, you must first 
obtain a permit pursuant to Sec. Sec.  49.154 and 49.155 (or a general 
permit pursuant to Sec.  49.156, if applicable). The proposed new 
source or modification will also be subject to the registration 
requirements of Sec.  49.160, except for sources that are subject to 
Sec.  49.138.
* * * * *

0
3. In Sec.  49.160, revise paragraphs (c)(1)(i), (c)(1)(ii), and 
(c)(1)(iii) to read as follows:


Sec.  49.160  Registration program for minor sources in Indian country.

* * * * *
    (c) * * *
    (1) * * *
    (i) If you own or operate an existing true minor source (as defined 
in 40 CFR 49.152(d)), you must register your source with the reviewing 
authority by March 1, 2013.
    (ii) If your true minor source is not an oil and natural gas source 
and you commence construction after August 30, 2011, and before 
September 2, 2014, you must register your source with the reviewing 
authority within 90 days after the source begins operation. If your 
true minor source is an oil and natural gas source, and you commence 
construction after August 30, 2011, and before March 2, 2016, you must 
register your source with the reviewing authority within 90 days after 
the source begins operation.
    (iii) If your true minor source is not an oil and natural gas 
source, and you commence construction or modification of your source on 
or after September 2, 2014, and your source is subject to this rule, 
you must report your source's actual emissions (if available) as part 
of your permit application and your permit application information will 
be used to fulfill the registration requirements described in Sec.  
49.160(c)(2). If your true minor source is an oil and natural gas 
source, and you commence construction or modification of your source on 
or after March 2, 2016, and your source is subject to this rule, you 
must report your source's actual emissions (if available) as part of 
your permit application and your permit application information will be 
used to fulfill the

[[Page 34240]]

registration requirements described in Sec.  49.160(c)(2).
* * * * *
[FR Doc. 2014-14030 Filed 6-13-14; 8:45 am]
BILLING CODE 6560-50-P