[Federal Register Volume 80, Number 181 (Friday, September 18, 2015)]
[Proposed Rules]
[Pages 56554-56576]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-21025]



[[Page 56553]]

Vol. 80

Friday,

No. 181

September 18, 2015

Part II





Environmental Protection Agency





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40 CFR Parts 49, 51, 52, et al.





Oil and Natural Gas; Proposed Rules and Notice

  Federal Register / Vol. 80, No. 181 / Friday, September 18, 2015 / 
Proposed Rules  

[[Page 56554]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 49

[EPA-HQ-OAR-2014-0606; FRL-9931-75-OAR]
RIN 2060-AS27


Review of New Sources and Modifications in Indian Country: 
Federal Implementation Plan for Managing Air Emissions from True Minor 
Sources Engaged in Oil and Natural Gas Production in Indian Country

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing a 
federal implementation plan (FIP) that would apply to new true minor 
sources and minor modifications at existing true minor sources in the 
production segment of the oil and natural gas sector that are locating 
or expanding in Indian reservations or in other areas of Indian country 
over which an Indian tribe, or the EPA, has demonstrated the tribe's 
jurisdiction. The FIP would satisfy the minor source permitting 
requirement under the ``Federal Minor New Source Review (NSR) Program 
in Indian Country'' (referred to as the ``Federal Indian Country Minor 
NSR rule''). The FIP proposes to require emission limitations and other 
requirements from certain federal emission standards as written at the 
time of construction or modification for compression ignition and spark 
ignition engines, compressors (reciprocating and centrifugal), fuel 
storage tanks, fugitive emissions from well sites and compressor 
stations, glycol dehydrators, hydraulically fractured oil and gas well 
completions, pneumatic controllers in production, pneumatic pumps, 
process heaters and storage vessels.
    The EPA is also proposing several amendments to the Federal Indian 
Country Minor NSR rule, including adding new text regarding the purpose 
of the program, revising the program overview provision, establishing a 
compliance deadline of October 3, 2016, revising certain provisions to 
incorporate compliance with the FIP, revising the applicability 
provision to establish that sources are required to comply with the FIP 
unless they opt to obtain a source-specific permit or are otherwise 
required to obtain a source-specific permit, and revising the source 
registration provision. Also, we are revising the definition of Indian 
country to comport with a court decision that addressed EPA's 
jurisdiction to implement the Federal Indian Country Minor NSR rule: 
Oklahoma Dept. of Environmental Quality v. EPA, 740 F.3d 185 (D.C. Cir. 
2014). This court decision also affects the definition of Indian 
country under the Federal Major New Source Review Program in Indian 
Country so we are changing the definition under the Federal Indian 
Country Major NSR rule as well.

DATES: Comments. Comments must be received on or before November 17, 
2015.
    Public Hearing. The EPA will hold a public hearing on this proposed 
action. Details will be announced in a separate notice.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2014-0606, to the Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting 
comments. Once submitted, comments cannot be edited or withdrawn. The 
EPA may publish any comment received to its public docket. Do not 
submit electronically any information you consider to be Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Multimedia submissions (audio, video, etc.) must 
be accompanied by a written comment. The written comment is considered 
the official comment and should include discussion of all points you 
wish to make. The EPA will generally not consider comments or comment 
contents located outside of the primary submission (i.e., on the web, 
cloud or other file sharing system). For additional submissions, and 
general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.
    Docket. All documents in the docket are listed in the 
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 either electronically 
in www.regulations.gov or in hard copy at the EPA Docket Center (EPA/
DC), Room 3334, EPA WJC West Building, 1301 Constitution Ave. NW., 
Washington, DC. 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 Docket is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Mr. Christopher Stoneman, Outreach and 
Information Division, Office of Air Quality Planning and Standards (C-
304-01), Environmental Protection Agency, Research Triangle Park, North 
Carolina, 27711, telephone number (919) 541-0823, facsimile number 
(919) 541-0072, email address: [email protected]. For questions 
about the oil and natural gas new source performance standards (NSPS) 
proposed action,\1\ please contact Mr. Bruce Moore, Sector Policies and 
Programs Division, Office of Air Quality Planning and Standards (E-143-
01), Environmental Protection Agency, Research Triangle Park, North 
Carolina, 27711, telephone number (919) 541-5460, facsimile number 
(919) 541-4312, email address: [email protected]. For questions about 
the proposed action on the oil and natural gas source determination,\2\ 
please contact Ms. Cheryl Vetter, Air Quality Policy Division, Office 
of Air Quality Planning and Standards (C504-03), Environmental 
Protection Agency, Research Triangle Park, North Carolina, 27711, 
telephone number (919) 541-4391, facsimile number (919) 541-541-4312, 
email address: [email protected]. For questions about the 
applicability of this action to a particular source, please contact the 
appropriate EPA region:
---------------------------------------------------------------------------

    \1\ ``Emission Standards for New and Modified Sources in the Oil 
and Natural Gas Sector,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
    \2\ ``Source Determination for Certain Emission Units in the Oil 
and Natural Gas Sector,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions/html.
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     EPA Region 5 (Illinois, Indiana, Michigan, Minnesota, 
Ohio, and Wisconsin)--Ms. Genevieve Damico, Air Permits Section, 
Environmental Protection Agency, Region 5, Chicago, Illinois 60604; 
telephone (312) 353-4761; fax (312) 385-5501; email address: 
[email protected].
     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;

[[Page 56555]]

telephone number (303) 312-6520; fax number (303) 312-6520; 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: The information presented in this preamble 
is organized as follows:

I. General Information
    A. What entities are potentially affected by this proposal?
    B. What should I consider as I prepare my comments to the EPA?
    C. Where can I get a copy of this document and other related 
information?
II. Purpose
    A. Proposed Oil and Natural Gas FIP
    B. Proposed Amendments to the Federal Indian Country Minor NSR 
Rule
III. Background
    A. Tribal Air Rule
    B. Federal Indian Country Minor NSR Rule
    C. General Permits and Permits by Rule for the Federal Minor New 
Source Review Program in Indian Country--Final Rules
    D. EPA Actions Affecting Oil and Natural Gas Minor Sources in 
areas covered by the Federal Indian Country Minor NSR Rule
    E. What is a FIP?
    F. Oil and Natural Gas Sector
IV. Summary of Proposed Oil and Natural Gas FIP
    A. Overview
    B. What are the proposed FIP requirements?
    C. Site-Specific Permits
V. Summary of Proposed Amendments to the Federal Indian Country 
Minor NSR Rule
VI. Implementation Issues
    A. Requirements Relating to Threatened or Endangered Species and 
Historic Properties
    B. What is the effect of this FIP on other Indian Country FIPs?
VII. Rationale for Proposed FIP
    A. Why are we choosing a FIP as an alternative to site-specific 
permits, general permits and permits by rule?
    B. How did we select which equipment to include in this proposed 
FIP?
    C. Why are we excluding existing sources from this proposed oil 
and natural gas FIP?
    D. Why is the EPA extending the permitting deadline for oil and 
natural gas true minor sources in areas covered by the Federal 
Indian Country Minor NSR rule?
VIII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act (PRA)
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination with 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children from 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions that Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act (NTTAA)
    J. Executive Order 12898: Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations

I. General Information

A. What entities are potentially affected by this proposal?

    Entities potentially affected by this proposal consist of owners 
and operators of facilities included in the following source categories 
that are located, or planning to locate, in an Indian reservation or in 
another area of Indian country (as defined in 18 U.S.C. 1151) over 
which an Indian tribe, or the EPA, has demonstrated that the tribe has 
jurisdiction where there is no EPA-approved program in place and that 
are subject to the requirements of the Federal Indian Country Minor NSR 
rule.

       Table 1--Source Categories Affected By This Proposed Action
------------------------------------------------------------------------
                                                   Examples of regulated
         Industry category            NAICS Code   entities/description
                                         \a\       of industry category
------------------------------------------------------------------------
Oil and Gas Production/Operations..        21111  Exploration for crude
                                                   petroleum and natural
                                                   gas; drilling,
                                                   completing, and
                                                   equipping wells;
                                                   operation of
                                                   separators, emulsion
                                                   breakers, desilting
                                                   equipment, and field
                                                   gathering lines for
                                                   crude petroleum and
                                                   natural gas; and all
                                                   other activities in
                                                   the preparation of
                                                   oil and gas up to the
                                                   point of shipment
                                                   from the producing
                                                   property.
                                                  Production of crude
                                                   petroleum, the mining
                                                   and extraction of oil
                                                   from oil shale and
                                                   oil sands, the
                                                   production of natural
                                                   gas, sulfur recovery
                                                   from natural gas, and
                                                   the recovery of
                                                   hydrocarbon liquids
                                                   from oil and gas
                                                   field gases.
Crude Petroleum and Natural Gas           211111  Exploration,
 Extraction.                                       development and/or
                                                   the production of
                                                   petroleum or natural
                                                   gas from wells in
                                                   which the
                                                   hydrocarbons will
                                                   initially flow or can
                                                   be produced using
                                                   normal pumping
                                                   techniques or
                                                   production of crude
                                                   petroleum from
                                                   surface shales or tar
                                                   sands or from
                                                   reservoirs in which
                                                   the hydrocarbons are
                                                   semisolids.
Natural Gas Liquid Extraction......       211112  Recovery of liquid
                                                   hydrocarbons from oil
                                                   and gas field gases;
                                                   and sulfur recovery
                                                   from natural gas.
Drilling Oil and Gas Wells.........       213111  Drilling oil and gas
                                                   wells for others on a
                                                   contract or fee
                                                   basis, including
                                                   spudding in, drilling
                                                   in, redrilling, and
                                                   directional drilling.

[[Page 56556]]

 
Support Activities for Oil and Gas        213112  Performing support
 Operations.                                       activities on a
                                                   contract or fee basis
                                                   for oil and gas
                                                   operations (except
                                                   site preparation and
                                                   related construction
                                                   activities) such as
                                                   exploration (except
                                                   geophysical surveying
                                                   and mapping);
                                                   excavating slush pits
                                                   and cellars, well
                                                   surveying; running,
                                                   cutting, and pulling
                                                   casings, tubes, and
                                                   rods; cementing
                                                   wells, shooting
                                                   wells; perforating
                                                   well casings;
                                                   acidizing and
                                                   chemically treating
                                                   wells; and cleaning
                                                   out, bailing, and
                                                   swabbing wells.
Engines (Spark Ignition and              2211 **  Provision of electric
 Compression Ignition) for Electric                power to support oil
 Power Generation.                                 and natural gas
                                                   production where
                                                   access to the
                                                   electric grid is
                                                   unavailable.
------------------------------------------------------------------------
\a\ North American Industry Classification System.

    This list is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be potentially affected 
by this action. To determine whether your facility could be affected by 
this action, you should examine the applicability criteria in the final 
Federal Minor NSR Program in Indian Country (40 Code of Federal 
Regulations (CFR) 49.153), as well as the proposed FIP applicability in 
40 CFR 49.101. If you have any questions regarding the applicability of 
this action to a particular entity, contact the appropriate person 
listed in the FOR FURTHER INFORMATION CONTACT section.

B. What should I consider as I prepare my comments to the EPA?

    Submitting CBI. Do not submit this information to the EPA through 
regulations.gov or email. Clearly mark the part or all of the 
information that you claim to be CBI. For CBI information in a disk or 
CD ROM that you mail to the EPA, mark the outside of the disk or CD ROM 
as CBI and then identify electronically within the disk or CD ROM the 
specific information that is claimed as CBI. In addition to one 
complete version of the comment that includes information claimed as 
CBI, a copy of the comment that does not contain the information 
claimed as CBI must be submitted for inclusion in the public docket. 
Information so marked will not be disclosed except in accordance with 
procedures set forth in 40 CFR part 2. Send or deliver information 
identified as CBI to only the following address: Ms. Tiffany Purifoy, 
c/o OAQPS Document Control Officer (Mail Code C404-02), U.S. EPA, 
Research Triangle Park, NC 27711, Attention Docket ID No. EPA-HQ-OAR-
2014-0606.
    Coordination of Comments on Four Actions Affecting Oil and Natural 
Gas Sector. The EPA is proposing three rules that affect sources in the 
oil and natural gas sector. One is today's proposed rule, the oil and 
natural gas FIP for new true minor sources and minor modifications at 
existing true minor sources for Indian country. The other two proposed 
rules are the 2015 proposed 40 CFR part 60, subpart OOOOa rulemaking, 
which updates the oil and natural gas NSPS, and the proposed rule 
addressing oil and natural gas source determinations for NSR 
purposes.\3\ In addition, the EPA is making available for public review 
and comment a draft Control Techniques Guidelines (CTG) for the Oil and 
Natural Gas Source Category document.\4\ We welcome comments on all 
four of these actions. To help us respond more efficiently to public 
comments on this proposal, we request that commenters submit comments 
addressing the oil and natural gas NSPS signed on August 18, 2015 to 
the docket for the oil and natural gas NSPS, Docket ID No. EPA-HQ-OAR-
2010-0505. Please do not send comments on the proposed oil and natural 
gas NSPS to the docket for this proposed FIP. Comments addressing the 
2015 proposed oil and natural gas NSPS would include comments, for 
example, about the level of proposed control for the oil and natural 
gas NSPS. For this proposal, we request comments on the concept of 
relying on the oil and natural gas NSPS (and other applicable EPA 
rules) for the oil and natural gas FIP for Indian country. We request 
that comments on this concept and other comments applicable to this 
proposed FIP be submitted to the docket (Docket ID No. EPA-HQ-OAR-2014-
0606). In addition, on September 18, 2015, the EPA proposed to amend 40 
CFR parts 51, 52, 70, and 71 to address major source determinations for 
oil and gas extraction facilities for NSR purposes.\5\ All comments 
related to source determinations for oil and gas extraction facilities 
should be addressed to Docket ID No. EPA-HQ-OAR-2013-0685. Finally, all 
comments on the draft oil and natural gas CTG document should be 
addressed to Docket ID No. EPA-HQ-OAR-2015-0216.
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    \3\ ``Oil and Natural Gas Sector: Emission Standards for New and 
Modified Sources,'' signed August 18, 2015, and ``Source 
Determination for Certain Emission Units in the Oil and Natural Gas 
Sector,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
    \4\ Draft Control Techniques Guidelines for the Oil and Natural 
Gas Source Category, signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
    \5\ ``Source Determination for Certain Emission Units in the Oil 
and Natural Gas Sector,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
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    We have incorporated by reference Docket ID No. EPA-HQ-OAR-2010-
0505 and Docket ID No. EPA-HQ-OAR-2013-0685 into DOCKET ID No. EPA-HQ-
OAR-2014-0606. Comments submitted to Docket ID No. EPA-HQ-OAR-2010-0505 
and Docket ID No. EPA-HQ-OAR-2013-0685 will be part of the official 
record for this oil and natural gas FIP proposed action.
    Docket. The docket number for this action is Docket ID No. EPA-HQ-
OAR-2014-0606.
    World Wide Web (WWW). In addition to being available in the docket, 
an electronic copy of this document will be posted on the WWW. 
Following signature, the EPA will post a copy of this document at: 
http://www.epa.gov/airquality/oilandgas/actions.html, http://www.epa.gov/nsr (regulations and standards section of the NSR home 
page), and at: http://www.epa.gov/air/tribal/tribalnsr.html (tribal NSR 
page).
    Preparing Comments. When submitting comments, remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Respond to specific questions and link comments to 
specific CFR references when appropriate.
     Explain why you agree or disagree and suggest 
alternatives. Include specific regulatory text that implements your 
requested changes.

[[Page 56557]]

     Explain technical information and/or data that you used to 
as the basis of your comment and provide references to the supporting 
information.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified.

C. 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 proposal will also be available on the WWW. Following signature by 
the EPA Administrator, a copy of this notice will be posted on the 
regulations and standards section of the NSR home page located at: 
http://www.epa.gov/nsr, on the tribal NSR page at: http://www.epa.gov/air/tribal/tribalnsr.html, and at the oil and natural gas air pollution 
standards page at http://www.epa.gov/airquality/oilandgas/actions.html.

II. Purpose

A. Proposed Oil and Natural Gas FIP

    We are proposing a FIP for new true minor sources and minor 
modifications at existing true minor sources in the production segment 
of the oil and natural gas sector that are locating or expanding in an 
Indian reservation or in another area of Indian country over which a 
tribe, or the EPA, has demonstrated that the tribe has jurisdiction. 
The FIP would apply to new and modified true minor sources that are 
located or expanding in the referenced areas of Indian country 
designated as unclassifiable, attainment, or attainment/unclassifiable. 
It would not apply to new and modified true minor sources that are 
located or expanding in referenced areas of Indian country designated 
nonattainment. (Requirements for such areas would be addressed through 
site-specific minor NSR permitting and/or separate, reservation-
specific FIPs.).
    This FIP would be used instead of site-specific permits to fulfill 
the EPA's obligation under the Federal Indian Country Minor NSR rule to 
issue minor NSR preconstruction permits. The FIP would provide a 
streamlined, alternative approach addressing the permitting 
requirement, while also ensuring air quality protection through 
requirements that are unambiguous and legally and practicably 
enforceable. The FIP would reduce burden for sources and the Reviewing 
Authority and prevent delays in new construction due to the minor NSR 
permitting obligation. True minor sources in the oil and natural gas 
sector would be required to comply with the FIP instead of being 
required to obtain a minor source permit, unless a source chooses to 
opt out of the FIP and to obtain a site-specific minor NSR permit 
instead. In addition, the Reviewing Authority could require a source to 
obtain a site-specific permit based on local or reservation-specific 
air quality concerns where the emissions from the source could cause or 
contribute to a National Ambient Air Quality Standards (NAAQS) or 
increment violation. To protect the NAAQS, the Reviewing Authority 
could regulate emissions from operations at the minor source not 
regulated by the proposed FIP or could require more stringent emission 
limitations for operations at the source regulated by the proposed FIP.
    In this FIP, we are proposing to require owners and operators of 
oil and natural gas production facilities to comply with six federal 
standards to reduce emissions of volatile organic compounds (VOC), 
nitrogen oxides (NOX), sulfur dioxide (SO2), 
particulate matter (PM, PM10, PM2.5), hydrogen 
sulfide (H2S), carbon monoxide (CO) and various sulfur 
compounds from: compression ignition and spark ignition engines, 
compressors (reciprocating and centrifugal), fuel storage tanks, 
fugitive emissions from well sites and compressor stations, glycol 
dehydrators, hydraulically fractured oil and gas well completions, 
pneumatic controllers in production, pneumatic pumps, process heaters 
and storage vessels. The proposed oil and natural gas FIP requires 
compliance with four NSPS and two national emission standards for 
hazardous air pollutants (NESHAP). These rules are listed in Table 2.
---------------------------------------------------------------------------

    \6\ Two of the six rules are NESHAPs. Our basis for requiring 
compliance with NESHAPs in this rule that is designed to fulfill 
requirements of the Federal Indian Country Minor NSR rule is 
primarily to address criteria pollutants. These two NESHAPs control 
VOC and/or NOX. VOC and NOX are NSR-regulated 
pollutants of concern in the Federal Indian Country Minor NSR rule.

 Table 2--Six Federal Rules Incorporated by Reference in the Proposed Oil and Natural Gas FIP for Indian Country
                                                       \6\
----------------------------------------------------------------------------------------------------------------
                                                                  Potentially affected
       40 CFR part and subpart             Title of subpart          sources in the              Location
                                                                   production segment
----------------------------------------------------------------------------------------------------------------
40 CFR part 63, subpart DDDDD........  National Emission        Process heaters........  http://www.ecfr.gov/cgi-
                                        Standards for                                     bin/text-
                                        Hazardous Air                                     idx?SID=9f31077f895e9c
                                        Pollutants for Major                              b417f5386519941a47&mc=
                                        Sources: Industrial,                              true&node=sp40.14.63.d
                                        Commercial, and                                   dddd&rgn=div6
                                        Institutional Boilers
                                        and Process Heaters.
40 CFR part 60, subpart Kb...........  Standards of             Fuel Storage Tanks.....  http://www.ecfr.gov/cgi-
                                        Performance for                                   bin/text-
                                        Volatile Organic                                  idx?SID=9f31077f895e9c
                                        Liquid Storage Vessels                            b417f5386519941a47&mc=
                                        (Including Petroleum                              true&node=sp40.7.60.k_
                                        Liquid Storage                                    0b&rgn=div6
                                        Vessels) for Which
                                        Construction,
                                        Reconstruction, or
                                        Modification Commenced
                                        After July 23, 1984.
40 CFR part 60, subpart IIII.........  Standards of             Compression Ignition     http://www.ecfr.gov/cgi-
                                        Performance for          Internal Combustion      bin/text-
                                        Stationary Compression   Engines.                 idx?SID=9f31077f895e9c
                                        Ignition Internal                                 b417f5386519941a47&mc=
                                        Combustion Engines.                               true&node=sp40.7.60.ii
                                                                                          ii&rgn=div6

[[Page 56558]]

 
40 CFR part 60, subpart JJJJ.........  Standards of             Spark Ignition Internal  http://www.ecfr.gov/cgi-
                                        Performance for          Combustion Engines.      bin/text-
                                        Stationary Spark                                  idx?SID=9f31077f895e9c
                                        Ignition Internal                                 b417f5386519941a47&mc=
                                        Combustion Engines.                               true&node=sp40.7.60.jj
                                                                                          jj&rgn=div6
40 CFR part 60, subpart OOOOa          Standards for New and    Storage Vessels,         http://www.epa.gov/
 (proposed).                            Modified Sources in      Pneumatic Controllers,   airquality/oilandgas/
                                        the Oil and Natural      Compressors              actions.html
                                        Gas Sector.              (Reciprocating and
                                                                 Centrifugal),
                                                                 Hydraulically
                                                                 Fractured Oil and Gas
                                                                 Well Completions,
                                                                 Pneumatic Pumps and
                                                                 Fugitive Emissions
                                                                 from Well Sites and
                                                                 Compressor Stations.
----------------------------------------------------------------------------------------------------------------
40 CFR part 63, subpart HH...........  National Emission        Glycol Dehydrators.....  http://www.ecfr.gov/cgi-
                                        Standards for                                     bin/text-
                                        Hazardous Air                                     idx?SID=9f31077f895e9c
                                        Pollutants from Oil                               b417f5386519941a47&mc=
                                        and Natural Gas                                   true&node=sp40.11.63.h
                                        Production Facilities.                            h&rgn=div6
----------------------------------------------------------------------------------------------------------------

    For purposes of this FIP, we are proposing that compliance with 
these rules would effectively satisfy the NSR requirements. Therefore, 
we are proposing that true minor oil and natural gas sources subject to 
these standards must comply with these standards as they currently 
exist and as they may be amended, except for those provisions that we 
specifically exclude. (This proposed FIP does not change the 
applicability of the specified standards, nor does it relieve sources 
subject to the standards from complying with them, independently of 
this FIP.)
    We are seeking comment on the concept of relying on these EPA 
standards as written at the time construction or modification of the 
source is begun for the requirements of the proposed oil and natural 
gas FIP. The purpose is to protect air quality in Indian reservations 
and in other areas of Indian country for which an Indian tribe, or the 
EPA, has demonstrated the tribe's jurisdiction and are designated as 
attainment, unclassifiable, or attainment/unclassifiable. It is our 
intent that oil and natural gas sources in areas covered by the Federal 
Indian Country Minor NSR rule using the proposed FIP would be subject, 
for purposes of the proposed FIP, to any amendments to an NSPS or 
NESHAP, including any amendments to the oil and natural gas NSPS that 
become part of the final oil and natural gas NSPS as a result of the 
2015 proposed oil and natural gas NSPS.\7\ Sources subject to this 
proposed FIP would be subject to any future changes made to these six 
underlying EPA standards only if they would otherwise be subject to 
those future changes. To help understand the requirements of this 
proposed oil and natural gas FIP, please see the 2015 proposed oil and 
natural gas NSPS and the provisions for each of the six federal rules 
(i.e., four NSPS and two NESHAP) identified above.
---------------------------------------------------------------------------

    \7\ ``Oil and Natural Gas Sector: Emission Standards for New and 
Modified Sources,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
---------------------------------------------------------------------------

B. Proposed Amendments to the Federal Indian Country Minor NSR Rule

    Today's action proposes several amendments to the Federal Indian 
Country Minor NSR rule. First, we are proposing to revise Sec.  
49.151(b)(1) to establish as one of the purposes of the Federal Minor 
NSR Program in Indian Country the incorporation of the FIP (Sec. Sec.  
49.101 through 105) for oil and natural gas production true minor 
sources located in an Indian reservation or in another area of Indian 
country over which an Indian tribe, or the EPA, has demonstrated that 
the tribe has jurisdiction. Also, to clarify the purpose of subpart C, 
we are proposing to revise the subpart heading.
    Second, we are proposing to revise Sec.  49.151(c)(1)(iii)(A) to 
conform the registration deadline to the proposed, extended permitting 
deadline in Sec.  49.151(c)(1)(iii)(B).
    Third, we are proposing to revise Sec.  49.151(c)(1)(iii)(B) to 
establish a deadline for when new and modified true minor sources in 
the production segment of the oil and natural gas sector that are 
located in an Indian reservation or in another area of Indian country 
over which an Indian tribe, or the EPA, has demonstrated that the tribe 
has jurisdiction or planning to locate in such areas must comply with 
the FIP in lieu of obtaining a minor NSR permit, unless the source opts 
for a site-specific minor NSR permit. If a source opts-out of the FIP, 
then we are proposing to extend the date for when the source must 
obtain a minor source permit. We are proposing to extend the deadline 
from March 2, 2016, to October 3, 2016.
    Fourth, we are proposing to revise Sec.  49.151(d)(1), (2) and (4) 
to incorporate compliance with the FIP.
    Fifth, we are proposing to revise Sec. Sec.  49.153(a)(1)(i)(B) and 
(ii)(B) to establish that oil and natural gas production true minor 
sources are required to comply with the FIP, unless a source opts out 
of the FIP pursuant to Sec.  49.101(b)(2) or is required by the EPA to 
obtain a source-specific minor source permit pursuant to Sec.  
49.101(b)(3).
    Sixth, we are proposing to revise Sec. Sec.  49.160(c)(1)(ii) and 
(iii), to add Sec.  49.160(c)(1)(iv) and to revise Sec.  49.160(c)(4). 
We are revising Sec.  49.160(c)(1)(ii) to conform the registration 
deadline to the extended permitting deadline in Sec.  
49.151(c)(1)(iii)(B). For Sec.  49.160(c)(1)(iii) and Sec.  
49.160(c)(1)(iv), we are establishing that sources subject to the FIP 
still have to register with the Reviewing Authority, and we describe 
how to do that. For Sec.  49.160(c)(4), we are proposing to clarify 
that submitting a registration form does not relieve a source of the 
requirement to comply with the FIP if the source (or any physical or 
operational change at the source) would be subject to any minor NSR 
rule.
    Finally, we are revising the definition of Indian country in Sec.  
49.152(d) to comport with a court decision that

[[Page 56559]]

addressed EPA's jurisdiction to implement the Federal Indian Country 
Minor NSR rule: Oklahoma Dept. of Environmental Quality v. EPA, 740 
F.3d 185 (D.C. Cir. 2014). This court decision also affects the 
definition of Indian country under the Federal Major New Source Review 
Program in Indian Country so we are changing the definition under the 
Federal Indian Country Major NSR rule in Sec.  49.167.

III. Background

A. Tribal Authority Rule

    Section 301(d) of the Clean Air Act (CAA) authorizes the EPA to 
treat Indian tribes in the same manner as states and directs the EPA to 
promulgate regulations specifying those provisions of the CAA for which 
such treatment is appropriate. (42 U.S.C.Sec.  7601(d)(1) and (2)). It 
also authorizes the EPA, in circumstances in which the EPA determines 
that the treatment of Indian tribes as identical to states is 
inappropriate or administratively infeasible, to provide by regulation 
other means by which the EPA will directly administer the CAA. (42 
U.S.C. Sec.  7601(d)(4)) Acting principally pursuant to that authority, 
on February 12, 1998,\8\ the EPA promulgated what we refer to as the 
Tribal Authority Rule (TAR). (40 CFR 49.1-49.11). In the TAR, we 
determined that it was appropriate to treat tribes in the same manner 
as states for all CAA and regulatory purposes except a list of 
specified CAA provisions and implementing regulations thereunder. (40 
CFR 49.4) Among those provisions of the CAA for which we determined 
that tribes will not be treated in the same manner as states are 
specific plan submittal and implementation deadlines for NAAQS-related 
requirements, including the requirement under section 110(a)(2)(c) to 
submit a program, including a permit program as required in parts C and 
D of the CAA, to regulate the modification and construction of any 
stationary source as necessary to assure that the NAAQS are achieved. 
In the TAR, we also determined that we would not treat tribes in the 
same manner as states with respect to CAA section 110(a)(1) (State 
Implementation Plan (SIP) submittal) and CAA section 110(c)(1) 
(directing the EPA to promulgate a FIP ``within 2 years'' after we find 
that a state has failed to submit a required plan, or has submitted an 
incomplete plan, or within 2 years after we disapproved all or a 
portion of a plan), among other provisions.\9\
---------------------------------------------------------------------------

    \8\ ``Indian Tribes: Air Quality Planning and Management,'' U.S. 
Environmental Protection Agency, 63 FR 7254, February 12, 1998, 
http://www.gpo.gov/fdsys/pkg/FR-1998-02-12/pdf/98-3451.pdf.
    \9\ See 40 CFR 49.4(a) and (d) and 63 FR at 7262-66, February 
12, 1998.
---------------------------------------------------------------------------

    The TAR preamble clarified that by including CAA section 110(c)(1) 
on the Sec.  49.4 list, ``EPA is not relieved of its general obligation 
under the CAA to ensure the protection of air quality throughout the 
nation, including throughout Indian country. The preamble confirmed 
that the ``EPA will continue to be subject to the basic requirement to 
issue a FIP for affected tribal areas within some reasonable 
time.''\10\ In the TAR, we thus exercised our discretionary authority 
under CAA Sec. Sec.  301(a) and 301(d)(4) to establish a regulation 
providing that we would promulgate without unreasonable delay such FIP 
provisions as are necessary or appropriate to protect air quality (40 
CFR 40.11(a)). Section 49.11(a) provides that the EPA will promulgate a 
FIP as necessary or appropriate to protect tribal air quality within a 
reasonable time if tribal efforts do not result in adoption and 
approval of tribal plans or programs.\11\
---------------------------------------------------------------------------

    \10\ See CAA section 301(a) and 63 FR at 7265, February 12, 
1998.
    \11\ Section 49.11(a) states that the EPA, ``[s]hall promulgate 
without unreasonable delay such federal implementation plan 
provisions as are necessary or appropriate to protect air quality, 
consistent with the provisions of sections 301(a) and 301(d)(4), if 
a tribe does not submit a tribal implementation plan meeting the 
completeness criteria of 40 CFR part 51, Appendix V, or does not 
receive EPA approval of a submitted tribal implementation plan'' 
(see 40 CFR 49.11(a)).
---------------------------------------------------------------------------

    On August 21, 2006, acting pursuant to that authority, we proposed 
the regulation: ``Review of New Sources and Modifications in Indian 
Country'' (i.e., Indian Country NSR rule).\12\ Within this regulation, 
the EPA proposed to protect air quality in areas covered by the Federal 
Indian Country Minor NSR rule by establishing a FIP program to regulate 
the modification and construction of stationary sources consistent with 
the requirements of section 110(a)(2)(c) of the CAA. We call this part 
of the Indian Country NSR rule the Federal Indian Country Minor NSR 
rule. Under the Federal Indian Country Minor NSR rule, we proposed to 
provide a mechanism for issuing preconstruction permits for the 
construction of new minor sources and certain modifications of major 
and minor sources in areas covered by the Federal Indian Country Minor 
NSR rule. In developing the rule, the EPA conducted extensive outreach 
and consultation along with a 7-month public comment period that ended 
on March 20, 2007. The comments provided detailed information specific 
to Indian country and the final Federal Indian Country Minor NSR rule 
incorporated many of the suggestions we received. We promulgated final 
rules on July 1, 2011,\13\ and the FIP became effective on August 30, 
2011.
---------------------------------------------------------------------------

    \12\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 71 FR 48696, August 
21, 2006, http://www.gpo.gov/fdsys/pkg/FR-2006-08-21/html/06-6926.htm.
    \13\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 76 FR 38748, July 
1, 2011, https://www.federalregister.gov/articles/2011/07/01/2011-14981/review-of-new-sources-and-modifications-in-indian-country.
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B. Federal Indian Country Minor NSR Rule

1. What is the Federal Indian Country Minor NSR Rule?
    The Federal Indian Country Minor NSR rule applies to new and 
modified minor stationary sources and to minor modifications at 
existing major stationary sources located in Indian country\14\ where 
there is no EPA-approved program in place. Tribes can elect to develop 
and implement their own EPA-approved program under the Tribal Authority 
Rule (TAR),\15\ but they are not required to do so.\16\ In the absence 
of an EPA-approved tribal program, the EPA implements the program. 
Alternatively, tribes can take administrative delegation of the federal 
program from the EPA and become the Reviewing Authority.
---------------------------------------------------------------------------

    \14\ The Federal Indian Country Minor NSR rule defines ``Indian 
country'' to include three categories of lands consistent with 18 
U.S.C. 1151, i.e., Indian reservations, dependent Indian 
communities, and Indian allotments. The U.S. Court of Appeals for 
the District of Columbia Circuit vacated the rule with respect to 
non-reservation areas of Indian country (i.e., dependent Indian 
communities and Indian allotments) (Oklahoma Dept. of Environmental 
Quality v. EPA, 740 F.3d 185 (D.C. Cir. 2014)). The court held that 
the state, not tribes or the EPA, has initial primary responsibility 
for implementation plans under CAA section 110 in non-reservation 
areas of Indian country in the absence of a demonstration of tribal 
jurisdiction by the EPA or a tribe. The rule, therefore, does not 
apply in non-reservation areas of Indian country unless a tribe or 
the EPA has demonstrated that a tribe has jurisdiction in a 
particular non-reservation area of Indian country.
    \15\ To be eligible to develop and implement an EPA-approved 
program, under the Tribal Authority Rule a tribe must meet four 
requirements: (1) Be a federally-recognized tribe; (2) have a 
functioning government carrying out substantial duties and powers; 
(3) propose to carry out functions pertaining to air resources of 
the reservation or other areas within the tribe's jurisdiction; and 
(4) be reasonably expected to be capable of carrying out the 
program. For more information go to: ``Indian Tribes: Air Quality 
Planning and Management,'' U.S. Environmental Protection Agency, 63 
FR 7254, February 12, 1998, http://www.gpo.gov/fdsys/pkg/FR-1998-02-12/pdf/98-3451.pdf.
    \16\ Tribes can also establish permit fees under a tribal 
permitting program, as do most states.

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[[Page 56560]]

    Beginning September 2, 2014,\17\ any new stationary source that 
will emit, or will have the potential to emit (PTE), a regulated NSR 
pollutant in amounts that will be: (a) Equal to or greater than the 
minor NSR thresholds, established in the Federal Indian Country Minor 
NSR rule; and (b) less than the amount that would qualify the source as 
a major source or a major modification for purposes of the Prevention 
of Significant Deterioration (PSD) or nonattainment major NSR programs, 
must apply for and obtain a minor NSR permit before beginning 
construction of the new source. Likewise, any existing stationary 
source (minor or major) must apply for and obtain a minor NSR permit 
before beginning construction of a physical or operational change that 
will increase the allowable emissions of the stationary source by more 
than the specified threshold amounts, if the change does not otherwise 
trigger the permitting requirements of the PSD or nonattainment major 
NSR program(s).\18\
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    \17\ For oil and natural gas true minor sources, this date was 
extended to March 2, 2016. This notice proposes to extend it to 
October 3, 2016. For more information, see: ``Review of New Sources 
and Modifications in Indian Country Amendments to the Registration 
and Permitting Deadlines for True Minor Sources,'' 79 FR 34231, June 
16, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-06-16/pdf/2014-14030.pdf.
    \18\ A source may, however, be subject to certain monitoring, 
recordkeeping and reporting (MRR) requirements under the major NSR 
programs, if the change has a reasonable possibility of resulting in 
a major modification. A source may be subject to both the Federal 
Indian Country Minor NSR rule and the reasonable possibility MRR 
requirements of the major NSR program(s).
---------------------------------------------------------------------------

    In addition, among other things, the Federal Indian Country Minor 
NSR rule created a framework for the EPA to streamline the issuance of 
preconstruction permits to true minor sources by using general permits.
2. What are the minor NSR thresholds?
    The ``minor NSR thresholds'' establish cutoff levels for each 
regulated NSR pollutant. If a source has a PTE in amounts lower than 
the thresholds, then it is exempt from the Federal Indian Country Minor 
NSR rule (see Table 3 and 40 CFR 49.153) for that pollutant. New or 
modified sources that have a PTE in amounts that are: (1) Equal to or 
greater than the minor NSR thresholds; and (2) less than the major NSR 
thresholds (generally 100 or 250 tons per year (tpy)) are ``minor 
sources'' of emissions and subject to the Federal Indian Country Minor 
NSR rule requirements at 40 CFR 49.151 through 161.

    TABLE 3--Minor NSR Thresholds for Sources in Indian Country \19\
------------------------------------------------------------------------
                                                Minor NSR     Minor NSR
                                                thresholds    thresholds
           Regulated NSR pollutant                 for           for
                                              nonattainment   attainment
                                               areas  (tpy)  areas (tpy)
------------------------------------------------------------------------
CO..........................................           5            10
NOX.........................................      \20\ 5            10
SO2.........................................           5            10
VOC.........................................      \21\ 2             5
PM..........................................           5            10
PM10........................................           1             5
PM2.5.......................................           0.6           3
Lead........................................           0.1           0.1
Fluorides...................................          NA             1
Sulfuric acid mist..........................          NA             2
H2S.........................................          NA             2
Total reduced sulfur (including H2S)........          NA             2
Reduced sulfur compounds (including H2S)....          NA             2
Municipal waste combustor emissions.........          NA             2
Municipal solid waste landfill emissions              NA            10
 (measured as nonmethane organic compounds).
------------------------------------------------------------------------

     
---------------------------------------------------------------------------

    \19\ If part of a tribe's area of Indian country is designated 
as attainment and another part as nonattainment, the applicable 
threshold for a proposed source or modification is determined based 
on the designation where the source would be located. If the source 
straddles the two areas, the more stringent thresholds apply.
    \20\ In extreme ozone nonattainment areas, section 182(e)(2) of 
the CAA requires any change at a major source that results in any 
increase in emissions to be subject to major NSR permitting. In 
other words, any changes to existing major sources in extreme ozone 
nonattainment areas are subject to a ``0'' tpy threshold, but that 
threshold does not apply to minor sources.
    \21\ Id.
---------------------------------------------------------------------------

    There may be sources that have emissions that are above the 
emission thresholds defined for a true minor source but which fall 
below the applicability levels for specific requirements referenced in 
the FIP. For example, the oil and natural gas sector NSPS, subpart 
OOOOa, includes a VOC threshold of 6 tpy for storage vessel 
applicability. In cases where a facility may have VOC emissions above 5 
tpy but below 6 tpy, owners or operators would not be subject to the 
storage vessel provisions but would still be required under the 
proposed FIP to register with their appropriate regional office.
3. What is a true minor source?
    ``True minor source,'' under the Federal Indian Country Minor NSR 
rule, means a source that emits, or has the potential to emit, 
regulated NSR pollutants in amounts that are less than the major source 
thresholds under either the PSD Program at 40 CFR 52.21, or the Federal 
Major NSR Program for Nonattainment Areas in Indian Country at 40 CFR 
49.166-49.173, but equal to or greater than the minor NSR thresholds in 
40 CFR 49.153, without the need to take an enforceable restriction to 
reduce its PTE to such levels. A source's PTE includes fugitive 
emissions, to the extent that they are quantifiable, only if the source 
belongs to one of the 28 source categories listed in part 51, Appendix 
S, paragraph II.A.4(iii) or 40 CFR 52.21(b)(1)(iii), as applicable.
4. What is a general permit?
    The Federal Indian Country Minor NSR rule specified the process and 
requirements for using general permits to authorize construction and 
modifications at true minor sources as a

[[Page 56561]]

streamlined permitting approach. A general permit, for purposes of this 
action, is a permit document that contains standardized requirements 
that multiple stationary sources can use. The EPA may issue a general 
permit for categories of emission units or stationary sources that are 
similar in nature, have substantially similar emissions, and would be 
subject to the same or substantially similar permit requirements.\22\ 
``Similar in nature'' refers to size, processes, and operating 
conditions. The purpose of a general permit is to provide for 
protection of air quality, while simplifying the permitting process for 
similar minor sources. General permits offer a cost-effective means of 
issuing permits and provide a quicker and simpler mechanism for 
permitting minor sources than the site-specific permitting process.
---------------------------------------------------------------------------

    \22\ ``Review of New Sources and Modifications in Indian 
Country,'' U.S. Environmental Protection Agency, 76 FR 38770, July 
1, 2011, https://www.federalregister.gov/articles/2011/07/01/2011-14981/review-of-new-sources-and-modifications-in-indian-country.
---------------------------------------------------------------------------

5. What is a permit by rule?
    Like a general permit, a permit by rule is a standard set of 
requirements that can apply to multiple stationary sources with similar 
emissions characteristics. For purposes of this action, a permit by 
rule would differ from a general permit in that the EPA would codify a 
permit by rule directly into the Federal Indian Country Minor NSR rule. 
The process for a source to obtain coverage under a permit by rule is 
more streamlined compared to a standard general permit, or a site-
specific permit.

C. General Permits and Permits by Rule for the Federal Minor New Source 
Review Program in Indian Country--Final Rules

    On May 1, 2015, the EPA published a final rule, ``General Permits 
and Permits by Rule for the Federal Minor NSR Program in Indian Country 
for Five Source Categories,'' to simplify the CAA permitting process 
for certain smaller sources of air pollution commonly found in Indian 
country.\23\ In the action, the EPA finalized general permits for use 
in areas covered by the Federal Indian Country Minor NSR rule for new 
or modified minor sources in the following two source categories: Hot 
mix asphalt plants and stone quarrying, crushing and screening 
facilities. The EPA also finalized permits by rule for use in areas 
covered by the Federal Indian Country Minor NSR rule for new or 
modified minor sources in three source categories: Auto body repair and 
miscellaneous surface coating operations; gasoline dispensing 
facilities; and petroleum dry cleaning facilities. The EPA also took 
final action authorizing the use of general permits established under 
the program to create synthetic minor sources.
---------------------------------------------------------------------------

    \23\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country for Five Source 
Categories,'' U.S. Environmental Protection Agency, 80 FR 25068, May 
1, 2015, http://www.gpo.gov/fdsys/pkg/FR-2015-05-01/pdf/FR-2015-05-01-FrontMatter.pdf.
---------------------------------------------------------------------------

    On July 17, 2014, the EPA published a proposed rule, ``General 
Permits and Permits by Rule for the Federal Minor NSR Program in Indian 
Country,'' to simplify the CAA permitting process for certain other 
smaller sources of air pollution commonly found in Indian country.\24\ 
In the action, the EPA made available draft general permits for use in 
areas covered by the Federal Indian Country Minor NSR rule for new or 
modified minor sources in the following five source categories: 
Concrete batch plants; boilers; stationary spark ignition engines; 
stationary compression ignition engines; and sawmill facilities. The 
EPA also proposed a permit by rule for use in areas covered by the 
Federal Indian Country Minor NSR rule for new or modified minor sources 
in the graphic arts and printing operations source category.
---------------------------------------------------------------------------

    \24\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country,'' 79 FR 41846, July 17, 
2014, http://www.gpo.gov/fdsys/pkg/FR-2014-07-17/pdf/2014-16814.pdf.
---------------------------------------------------------------------------

D. EPA Actions Affecting Oil and Natural Gas Minor Sources in Areas 
Covered by the Federal Indian Country Minor NSR Rule

    On January 14, 2014, the EPA published a proposed rule, ``General 
Permits and Permits by Rule for the Federal Minor New Source Review 
Program in Indian Country,'' \25\ that included two proposed amendments 
that affected true minor sources in the production segment of the oil 
and natural gas sector. The proposed amendments were: (1) The extension 
of the deadline by which new true minor sources and minor modifications 
of existing true minor sources in the production segment of the oil and 
natural gas sector must receive minor NSR permits prior to commencing 
construction, from September 2, 2014, to March 2, 2016; and (2) an 
adjustment to the deadline by which existing true minor sources in the 
production segment of the oil and natural gas sector must register, 
from September 2, 2014, to March 2, 2016. On June 16, 2014, the EPA 
finalized those amendments as proposed.\26\
---------------------------------------------------------------------------

    \25\ 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 Federal 
Indian Country Minor NSR rule are on pages 79 FR 2570-2572. 
Electronic copies are available in the docket and in the regulations 
and standards section of our NSR home page located at http://www.epa.gov/nsr.
    \26\ For more information, see: ``Review of New Sources and 
Modifications in Indian Country Amendments to the Registration and 
Permitting Deadlines for True Minor Sources,'' 79 FR 34231, June 16, 
2014, http://www.gpo.gov/fdsys/pkg/FR-2014-06-16/pdf/2014-14030.pdf.
---------------------------------------------------------------------------

    On June 5, 2014, the EPA published an advance notice of proposed 
rulemaking (ANPR).\27\ The purpose of the ANPR was to solicit broad 
feedback on the most effective and efficient means of implementing the 
Federal Minor NSR Program in Indian Country for sources in the 
production segment of the oil and natural gas sector. In it we 
discussed alternatives to site-specific permits for new and modified 
minor sources engaged in oil and natural gas production activities. The 
EPA requested comments on the alternative approaches and other aspects 
of managing air emissions from oil and natural gas sources in areas 
covered by the Federal Indian Country Minor NSR rule. The ANPR asked 
for public comment on: (1) The inclusion of existing minor source 
emissions in a FIP; (2) the advantages and disadvantages of available 
approaches (i.e., FIP, permit by rule, or general permit) to manage 
emission impacts from the sources in the production segment of the oil 
and natural gas sector in areas covered by the Federal Indian Country 
Minor NSR rule; (3) the activities and pollutants that warrant 
regulation; (4) the coordination of compliance between any approach 
selected and the Federal Minor NSR Program in Indian Country; and (5) 
the appropriate emission control requirements.
---------------------------------------------------------------------------

    \27\ For more information, see: ``Managing Emissions from Oil 
and Natural Gas Production in Indian Country,'' 79 FR 32502, June 5, 
2014, http://www.gpo.gov/fdsys/pkg/FR-2014-06-05/pdf/2014-12951.pdf.
---------------------------------------------------------------------------

    We received 20 comments on the issues raised in the ANPR. Three 
comments were from tribes; one comment was from a federal government 
agency; three comments were from environmental groups; ten comments 
were from oil and natural gas companies or industry trade associations; 
and three comments were from anonymous commenters. The comments are 
summarized in a document entitled: ``Summary of Public Comments for 
Managing Emissions: Oil and Natural Gas Production in Indian Country'' 
and can be found in Docket ID

[[Page 56562]]

No. EPA-HQ-OAR-2011-0151, which has been incorporated by reference into 
the docket for this action, Docket ID No. EPA-HQ-OAR-2014-0606.
    We reviewed and carefully considered all the comments we received 
on the ANPR in developing this proposed FIP. Although not presented in 
a comment and response format, our consideration of the comments is 
evident throughout the discussions in this preamble. Commenters who 
wish their comments on the ANPR to also be considered in the 
development of the final FIP must resubmit those comments to the docket 
during the open public comment period for this proposed action.
    On September 18, 2015, the EPA proposed updates to the NSPS for the 
oil and natural gas sector.\28\ This proposed FIP adopts the standards 
from six federal rules, including the oil and natural gas NSPS (see 
Table 2). Future changes to these rules could affect requirements in 
the FIP because the proposed FIP adopts all or parts of these six 
federal emission standards, including future amendments. In addition, 
on September 18, 2015, the EPA proposed an oil and natural gas source 
determination rule.\29\ This action is also connected to this FIP as it 
would affect how oil and natural gas sources are defined for the 
purpose of major/minor source determinations.
---------------------------------------------------------------------------

    \28\ ``Oil and Natural Gas Sector: Emission Standards for New 
and Modified Sources,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
    \29\ ``Source Determination for Certain Emission Units in the 
Oil and Natural Gas Sector,'' signed August 18, 2015, http://www.epa.gov/airquality/oilandgas/actions.html.
---------------------------------------------------------------------------

E. What is a FIP?

    Under section 302(y) of the CAA, the term ``Federal implementation 
plan'' means ``. . . a plan (or portion thereof) promulgated by the 
Administrator to fill all or a portion of a gap or otherwise correct 
all or a portion of an inadequacy in a SIP, and which includes 
enforceable emission limitations or other control measures, means or 
techniques (including economic incentives, such as marketable permits 
or auctions of emission allowances), and provides for attainment of the 
relevant national ambient air quality standard.''
    We interpret the reference to a ``gap'' in a SIP as including 
circumstances where a SIP does not apply (i.e., on most Indian 
reservations and other areas of Indian country over which an Indian 
tribe, or the EPA, has demonstrated that the tribe has jurisdiction) 
and the relevant tribe has not implemented an EPA-approved plan. SIPs 
do not apply in these areas. In these circumstances, CAA Sec. Sec.  
301(a) and 301(d)(4) and 40 CFR 49.11(a) authorize the EPA to 
promulgate FIPs as are necessary or appropriate to protect air quality.
    The Federal Indian Country Minor NSR rule is an example of a FIP. 
In that rule, we identified a regulatory gap that could have the effect 
of adversely impacting air quality due to the lack of approved minor 
NSR permit programs to regulate construction of new and modified minor 
sources and minor modifications of major sources in areas covered by 
the Federal Indian Country Minor NSR rule. The EPA promulgated the FIP 
to ensure that air resources in areas covered by the Federal Indian 
Country Minor NSR rule are protected by establishing a preconstruction 
permitting program to regulate emission increases resulting from 
construction and modification activities that are not already regulated 
by the major NSR permitting programs.
    Because there are also no currently approved TIPs specifically 
applying to the issuance of general permits with respect to the 
reduction of emissions related to oil and natural gas production 
facilities, we believe a FIP is needed to protect air quality in areas 
covered by the Federal Indian Country Minor NSR rule. This proposed FIP 
would adopt legally and practicably enforceable requirements to control 
and reduce air emissions from oil and natural gas production. 
Therefore, in this rule, we propose to determine that it is necessary 
or appropriate to exercise our discretionary authority under sections 
301(a) and 301(d)(4) of the CAA and 40 CFR 49.11(a) to promulgate a FIP 
to remedy an existing regulatory gap under the CAA with respect to oil 
and natural gas production operations in areas covered by the Federal 
Indian Country Minor NSR rule where there is no EPA-approved plan in 
place.

F. Oil and Natural Gas Sector

    The oil and natural gas sector includes operations involved in the 
extraction and production of oil and natural gas, as well as the 
processing, transmission and distribution of natural gas.\30\ 
Specifically for oil, the sector includes all operations from the well 
to the point of custody transfer to an oil transmission pipeline or 
other means of transportation to 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.
---------------------------------------------------------------------------

    \30\ For a more detailed discussion about the oil and natural 
gas sector, see the preamble to the ANPR at 79 FR 32505-32508, June 
5, 2014.
---------------------------------------------------------------------------

    The proposed oil and natural gas FIP focuses on the first segment, 
oil and natural gas production, because we believe the oil and natural 
gas production segment includes the majority of the true minor sources 
in the sector that would need to obtain a minor source permit in areas 
covered by the Federal Indian Country Minor NSR rule. 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 natural gas 
dehydrators. Production operations also include the well drilling, 
completion and workover processes and include all the portable non-
self-propelled apparatuses associated with those operations. Production 
sites include not only the sites where the wells themselves are 
located, but also include centralized gas and/or liquid gathering 
facilities 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.
    The natural gas production segment ends where the natural gas 
enters a natural gas 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 the point of custody transfer to an oil 
pipeline or for transport of the crude oil to a petroleum refinery via 
trucks or railcars. The petroleum refinery is not considered part of 
the oil and natural gas sector. Thus, with respect to crude oil, the 
oil and natural gas sector ends at point of custody transfer where 
crude oil enters an oil transmission pipeline or other means of 
transportation to a petroleum refinery.
    Pollutants emitted from these activities that would be regulated 
through the proposed Federal Minor

[[Page 56563]]

NSR Program in Indian Country (regulated NSR pollutants) include: VOC, 
NOX, SO2, PM, PM10, PM2.5, 
H2S, CO and various sulfur compounds. Hydrogen sulfide and 
SO2 are emitted from production and processing operations 
that handle and treat sour gas.\31\
---------------------------------------------------------------------------

    \31\ Sour gas is natural gas with more than 5.7 milligrams of 
H2S per normal cubic meters (0.25 grains/100 standard 
cubic feet), see AP-42 Compilation of Air Pollutant Emission 
Factors, Chapter 5.0 Introduction to Petroleum Industry, Section 5.3 
Natural Gas Processing, available at: http://www.epa.gov/ttnchie1/ap42/ch05/final/c05s03.pdf.
---------------------------------------------------------------------------

IV. Summary of Proposed Oil and Natural Gas FIP

A. Overview

    This proposed oil and natural gas FIP would require owners and 
operators of new and modified existing minor sources in the oil and 
natural gas production segment that are located in areas covered by the 
Federal Indian Country Minor NSR rule to comply with six federal rules. 
One of the rules this FIP proposes to adopt is certain requirements of 
the proposed 40 CFR part 60, subpart OOOOa requirements.\32\ 
Requirements under proposed NSPS, subpart OOOOa that have been proposed 
include those requirements that involve oil and natural gas 
production.\33\
---------------------------------------------------------------------------

    \32\ Proposed 40 CFR part 60, subpart OOOOa covers the emission 
sources covered under existing 40 CFR part 60, subpart OOOO, as well 
as adding coverage of new and modified emission sources beyond those 
covered in existing 40 CFR part 60, subpart OOOO. These additional 
sources are hydraulically fractured oil well completions, pneumatic 
pumps and fugitive emissions from well sites and compressor 
stations.
    \33\ This list includes centrifugal compressors, reciprocating 
compressors, pneumatic controllers, pneumatic pumps, fugitive 
emissions from compressor stations, storage vessels. It excludes 
sources located in the transmission and storage segment because they 
are not part of this FIP proposal, which focusses on production.
---------------------------------------------------------------------------

    These six rules are listed in Table 2 and provide requirements for:
     Storage vessels;
     Pneumatic controllers in production;
     Compressors (reciprocating and centrifugal);
     Hydraulically fractured oil and gas well completions;
     Pneumatic pumps;
     Fugitive emissions from well sites and compressor 
stations;
     Glycol dehydrators;
     Compression ignition and spark ignition engines;
     Fuel storage tanks; and
     Process heaters
    The six rules and the provisions of each that the proposed oil and 
natural gas FIP would reference are discussed in more detail in this 
section. The proposed FIP requirements cover emission limitations and 
standards, monitoring, and testing and recordkeeping and reporting. For 
purposes of this FIP, we are proposing that true minor sources subject 
to these adopted standards must comply with these standards, as they 
currently exist or as amended in the future, except for those 
provisions that we specifically exclude under the FIP (unless the 
source opts-out of the FIP and obtains a source-specific permit). The 
excluded provisions are listed below. (This FIP does not change the 
applicability of the specified standards, nor does it relieve sources 
subject to the standards from complying with them, independently of 
this FIP.)
    Also discussed in this section are proposed features of the FIP and 
proposed amendments to the Federal Indian Country Minor NSR rule.

B. What are the proposed FIP requirements?

    We are proposing for purposes of this FIP, that owners and 
operators who determine that their new true minor source, or the 
modification of their existing true minor source, meets the 
applicability criteria of the proposed FIP must comply with all of the 
applicable and relevant requirements of the six federal rules listed in 
Table 2 above as written at the time construction or reconstruction of 
the source is begun, unless we exclude certain provisions as proposed 
below. In general, for this proposed FIP, we are proposing to exclude 
specific provisions of the rules because they are not relevant they 
would not apply to oil and natural gas production operations (e.g., 
emission points at natural gas processing plants) or they apply only to 
manufacturers and not owner/operators.
    For purposes of this FIP, we are proposing that true minor sources 
that are subject to 40 CFR part 63, subpart DDDDD (National Emission 
Standards for Hazardous Air Pollutants for Major Sources: Industrial, 
Commercial, and Institutional Boilers and Process Heaters), must comply 
with all of the applicable provisions of the standard as written at the 
time construction or reconstruction of the source is begun.
    For purposes of this FIP, we are proposing that true minor sources 
that are subject to part 60, subpart IIII--Standards of Performance for 
Stationary Compression Ignition Internal Combustion Engines, must 
comply with all of the applicable provisions of the standard as written 
at the time construction or reconstruction of the source is begun, 
except for the following:
     Sec.  60.4200(a)(1)--Am I subject to this subpart? 
(applies to manufacturers);
     Sec.  60.4200(b)--Not applicable to stationary ignition 
internal combustion engine being tested at an engine test cell/stand;
     Sec.  60.4200(c)--Am I subject to this subpart? (area 
sources and exemptions from Title V permits);
     Sec.  60.4201--What emission standards must I meet for 
non-emergency engines if I am a stationary compression ignition 
internal combustion engine manufacturer?;
     Sec.  60.4202--What emission standards must I meet for 
emergency engines if I am a stationary compression ignition internal 
combustion engine manufacturer?;
     Sec.  60.4203--How long must my engines meet the emission 
standards if I am a manufacturer of stationary compression ignition 
internal combustion engines?;
     Sec.  60.4210--What are my compliance requirements if I am 
a stationary compression ignition internal combustion engine 
manufacturer?; and
     Sec.  60.4215--What requirements must I meet for engines 
used in Guam, American Samoa, or the Commonwealth of the Northern 
Mariana Islands?
    For purposes of this FIP, we are proposing that true minor sources 
that are subject to part 60, subpart JJJJ--Standards of Performance for 
Stationary Spark Ignition Internal Combustion Engines, must comply with 
all of the applicable provisions of the standard as written at the time 
construction or reconstruction of the source is begun, except for the 
following:
     Sec.  60.4230(b)--Not applicable to stationary spark 
ignition internal combustion engines being tested at an engine test 
cell/stand;
     Sec.  60.4230(c)--Exemption for obtaining a Title V permit 
if owner or operator of an area source subject to this part;
     Sec.  60.4231 and Sec.  60.4232--Emission standards for 
manufacturers;
     Sec.  60.4238 through Sec.  60.4242--Compliance 
Requirements for Manufacturers; and
     Sec.  60.4247--Mobile source provisions that apply to 
manufacturers of stationary spark ignition internal combustion engines 
or equipment containing such engines.
    For purposes of this FIP, we are proposing that true minor sources 
that are subject to part 60, subpart Kb--Standards of Performance for 
Volatile Organic Liquid Storage Vessels, must comply with all of the 
provisions of the standard as written at the time

[[Page 56564]]

construction or reconstruction of the source is begun, except for the 
following:
     Sec.  60.112b(c)--Site-specific standard for Merck & Co., 
Inc.'s Stonewall Plant in Elkton, Virginia; and
     Sec.  60.117b(a) and (b)--Delegation of authority.
    For purposes of this FIP, we are proposing that true minor sources 
that are subject to proposed part 60, subpart OOOOa--Standards for New 
and Modified Sources in the Oil and Natural Gas Sector, must comply 
with all of the applicable provisions of the standard as written at the 
time construction or reconstruction of the source is begun, except for 
the following:
     Sec.  60.5365a(f)(3)--Equipment exemption at processing 
plant;
     Sec.  60.5365a(h)(4)--Existing sources constructed after 
August 23, 2011;
     Sec.  60.5370a(c)--Permit exemption;
     Sec.  60.5413a(a)(5)--Exemptions from performance 
testing--hazardous waste incinerator;
     Sec.  60.5420a(a)(2)(i)--Advance notification requirements 
for well completions; and
     Sec.  60.5420a(a)(2)(ii)--Advance notification 
requirements of well completions when subject to state regulation that 
requires advance notification.
    For purposes of this FIP, we are proposing that true minor sources 
that are subject to 40 CFR part 63, subpart HH--NESHAP from Oil and 
Natural Gas Production Facilities, must comply with all of the 
applicable provisions of the standard as written at the time 
construction or reconstruction of the source is begun, except for the 
following:
     Sec.  63.760(a)(2)--Facilities that process, upgrade or 
store hydrocarbon liquids;
     Sec.  63.760(b)(1)(ii)--Each storage vessel with the 
potential for flash emissions;
     Sec.  63.760(b)(1)(iii)--Equipment located at natural gas 
processing plants;
     Sec.  63.760(g)--Recordkeeping for major sources that 
overlap with other regulations for equipment leaks;
     Sec.  63.764(c)(2)-(3)--Requirements for compliance with 
standards for storage vessels and equipment at natural gas processing 
plants, respectively;
     Sec.  63.766--Storage vessel standards; and
     Sec.  63.769--Equipment leak standards.
    Additionally, we are proposing that prior to beginning 
construction, under proposed Sec.  49.104, true minor sources are 
required to address procedures for assessing threatened and endangered 
species and historic properties. The proposed section provides two 
options: (1) A site-specific National Environmental Policy Act (NEPA) 
process has been completed for the specific oil and natural gas 
activity, and the owner/operator also meets all air quality-related 
requirements as specified by the decision document (Record of Decision 
or Finding of No Significant Impact) for its NEPA analysis (these 
requirements are typically implemented and enforced as conditions of an 
approved Surface Use Plan of Operations and/or Application for Permit 
to Drill); or (2) submittal of documentation to the EPA Regional Office 
(and to the tribe where the source is located/locating) demonstrating 
that the source has completed the screening processes specified for 
consideration of threatened and endangered species and historic 
properties and received a determination from the EPA stating that it 
has satisfactorily completed these processes. (The processes are 
contained in the following document: ``Procedures to Address Threatened 
and Endangered Species and Historic Properties for New or Modified True 
Minor Oil and Natural Gas Production Sources in Indian Country 
Complying with the Oil and Natural Gas Minor Source Federal 
Implementation Plan,'' http://www.epa.gov/air/tribal/tribalnsr.html.)

C. Site-Specific Permits

    We are proposing that owners and operators of new and modified true 
minor oil and natural gas sources that meet all of the following 
criteria must comply with the requirements contained in Sec. Sec.  
49.101 through 49.105 of this proposed FIP, unless the owner or 
operator opts-out of the FIP and instead obtains a site-specific permit 
per proposed Sec. Sec.  49.101(b)(2) and (3):
     The facility is an oil and natural gas production facility 
as defined in proposed Sec.  49.102;
     The oil and natural gas production facility is located in 
areas covered by the Federal Indian Country Minor NSR rule as defined 
in Sec.  49.152(d) as proposed to be amended in this action;
     The oil and natural gas production facility is a new true 
minor source or a minor modification of an existing true minor source 
as determined under Sec.  49.153;
     The oil and natural gas production facility begins 
construction or modification on or after October 3, 2016, the proposed 
extended permitting deadline date; and
     The oil and natural gas production facility is not located 
in a designated nonattainment area (the proposed FIP would only apply 
to minor sources in the oil and natural gas sector locating or 
expanding in areas designated as unclassifiable, attainment, or 
attainment/unclassifiable).

Sources covered by the Federal Indian Country Minor NSR rule that do 
not meet all of the criteria are, thus, not eligible to use the FIP and 
must, therefore, obtain a site-specific permit prior to beginning 
construction, on or after October 3, 2016.

    If a source owner/operator does not want to comply with the FIP, 
they have the option to apply for a site-specific permit instead to 
meet the obligation under 40 CFR 49.151(c)(1)(iii)(B) of the Federal 
Indian Country Minor NSR rule to obtain a permit prior to commencing 
construction of a new true minor source or modification of an existing 
true minor source. As part of the FIP, we are proposing specific rule 
language in Sec.  49.101(b)(2) to allow true minor sources proposing to 
construct on or after the proposed, extended deadline date of October 
3, 2016, to opt-out of the default FIP if preferred by the owner or 
operator. We are proposing that an owner/operator of a source otherwise 
subject to the proposed FIP can opt out and seek a true minor source 
site-specific permit under 40 CFR 49.151(c)(1)(iii).
    We are also proposing that the EPA, or other Reviewing Authority, 
may require owners or operators to obtain a site-specific permit in 
lieu of complying with the proposed FIP to ensure protection of the 
NAAQS. Under Sec.  49.101(b)(3), we are proposing to specify that the 
Reviewing Authority may require an owner or operator of a source, in 
certain areas of Indian country proposing to construct on or after 
October 3, 2016, to apply for a site-specific permit for a new true 
minor source or minor modification of an existing true minor source. In 
particular, the Reviewing Authority may determine that the source is 
not sufficiently controlled under the proposed FIP to protect the NAAQS 
in the area of the proposed project (e.g., if the measured design value 
for the area is close to or above the level of the NAAQS). In that 
circumstance, the Reviewing Authority can require the minor source to 
obtain a site-specific permit. The agency recommends at the time of 
registration, the owner/operator of all new sources or all sources 
scheduled for modification contact the Reviewing Authority for a review 
of the air quality status of that area, and the possibility of a 
requirement for a site specific permit.

[[Page 56565]]

V. Summary of Proposed Amendments to the Federal Indian Country Minor 
NSR Rule

    Today's action proposes several amendments to the Federal Indian 
Country Minor NSR rule. First, we are proposing to revise Sec.  
49.151(b)(1) to add new text regarding the purpose of the Federal Minor 
NSR Program in Indian Country. The revised text indicates that the 
program satisfies the requirements of section 110(a)(2)(C) of the CAA 
by establishing a preconstruction permitting program for all new and 
modified minor sources (minor sources) and minor modifications at major 
sources located in Indian reservations and other areas of Indian 
country over which an Indian tribe, or the EPA, has demonstrated that 
the tribe has jurisdiction and where there is no EPA-approved plan in 
place and by establishing a FIP (Sec. Sec.  49.101 to 49.105) for oil 
and natural gas production true minor sources located in such areas of 
Indian country.
    Second, we are proposing to revise Sec.  49.151(c)(1)(iii)(A) to 
conform the registration deadline to the proposed extended permitting 
deadline in Sec.  49.151(c)(1)(iii)(B).
    Third, we are proposing to revise Sec.  49.151(c)(1)(iii)(B) to 
establish a deadline by which new and modified true minor sources in 
the oil and natural gas sector that are located in or plan to locate in 
Indian reservations or other areas of Indian country over which an 
Indian tribe, or the EPA, has demonstrated that the tribe has 
jurisdiction must comply with the FIP in lieu of obtaining a minor NSR 
permit (or obtain a minor source permit if the source opts out of the 
FIP). We are proposing to extend the permitting deadline from March 2, 
2016, to October 3, 2016.
    Fourth, we are proposing to revise Sec.  49.151(d)(1), (2) and (4) 
to incorporate compliance with the FIP. We are proposing to revise 
Sec.  49.151(d)(1) to indicate that if the owner/operator of a source 
begins construction of a new source or modification that is subject to 
this program after the applicable date (September 2, 2014, for all true 
minor sources, except oil and natural gas sources, and October 3, 2016, 
for oil and natural gas true minor sources) without applying for and 
receiving a permit pursuant to this program or complying with the FIP 
for oil and natural gas production, the owner/operator of the source 
will be subject to appropriate enforcement action. We are proposing to 
revise Sec.  49.151(d)(2) to indicate that if you do not construct or 
operate your source or modification in accordance with the terms of 
your minor NSR permit or the FIP for oil and natural gas production, 
you source will be subject to appropriate enforcement action. We are 
proposing to revise Sec.  49.151(d)(4) to indicate that issuance of a 
permit or compliance with the FIP for oil and natural gas production 
does not relieve the owner/operator of a source of the responsibility 
to comply fully with applicable provisions of any EPA-approved 
implementation plan or FIP or any other requirements under applicable 
law.
    Fifth, we are proposing to revise Sec. Sec.  49.153(a)(1)(i)(B) and 
(ii)(B) to establish that oil and natural gas true minor sources are 
required to comply with the FIP, unless the owner/operator of a source 
opts-out or is otherwise required by the EPA to obtain a minor source 
permit. Existing Sec.  49.153(a)(1)(i)(B) requires the owner/operator 
of a new source to determine whether the source's PTE is equal to or 
greater than the corresponding minor NSR threshold. If it is, then the 
source is subject to the preconstruction requirements of the Federal 
Indian Country Minor NSR Permit rule for that pollutant. The proposed 
amendment adds a clause to the end of the paragraph stating that for 
oil and natural gas production sources, if the PTE for oil and natural 
gas production sources is equal to or greater than the corresponding 
minor NSR threshold, such sources shall instead comply with the 
requirements of proposed Sec. Sec.  49.101 to 49.105, unless the owner/
operator of the source opts-out of the FIP pursuant to proposed Sec.  
49.101(b)(2) or is required by the EPA to obtain a source-specific 
minor source permit pursuant to proposed Sec.  49.101(b)(3).
    Existing Sec.  49.153(a)(1)(ii)(B) requires the owner/operator of 
modified sources to determine whether the increase in allowable 
emissions resulting from the modification would be equal to or greater 
than the minor NSR threshold for the pollutant being evaluated. If it 
is, the source is subject to the preconstruction requirements of the 
Federal Indian Country Minor NSR rule for that pollutant. The proposed 
amendment adds a clause to the end of the paragraph stating that, for 
oil and natural gas production sources, if the PTE for oil and natural 
gas production sources is equal to or greater than the corresponding 
minor NSR threshold, such sources shall instead comply with the 
requirements of proposed Sec. Sec.  49.101 to 49.105, unless the owner/
operator of the source opts-out of the proposed FIP pursuant to 
proposed Sec.  49.101(b)(2) or is required by the EPA to obtain a minor 
source permit pursuant to proposed Sec.  49.101(b)(3).
    Sixth, we are proposing to revise Sec. Sec.  49.160(c)(1)(ii) and 
(iii), to add Sec.  49.160(c)(1)(iv) and to revise Sec.  49.160(c)(4). 
For Sec.  49.160(c)(1)(ii), we are proposing to conform the 
registration deadline to the proposed extended permitting deadline in 
Sec.  49.151(c)(1)(iii)(B). For Sec.  49.160(c)(1)(iii), we are 
proposing language to indicate that if your true minor source is an oil 
and natural gas source, and you commence construction or modification 
of your source on or after October 3, 2016, you must report your 
source's actual emissions (if available) as part of your permit 
application or registration of oil and natural gas production sources 
using a form provided by the EPA (``Registration for New Oil and 
Natural Gas Minor Sources and Minor Modifications at Existing True 
Minor Oil and Natural Gas Sources,'' http://www.epa.gov/air/tribal/tribalnsr.html). Your permit application or registration form for oil 
and natural gas production sources will be used to fulfill the 
registration requirements described in Sec.  49.160(c)(2). This 
registration should occur each time an existing true minor source that 
would be subject to the proposed FIP undergoes a modification. For 
Sec.  49.160(c)(1)(iv), we are proposing to add a paragraph indicating 
that sources subject to the proposed FIP must still satisfy the 
requirement to register under the Federal Indian Country Minor NSR rule 
by using the registration form provided by the EPA that is tailored to 
the oil and natural gas sector rather than a permit application. The 
registration form contains the information required in Sec.  
49.160(c)(2). After being reviewed by the permitting authority, 
completed registration forms will be available online on the EPA 
Regional Office Web sites. For Sec.  49.160(c)(4), we are proposing to 
add language indicating that submitting a registration form does not 
relieve a source of the requirement to comply with the FIP for oil and 
natural gas production if the source or any physical or operational 
change at the source would be subject to any minor NSR rule.
    Finally, we are proposing to revise the definition of Indian 
country in Sec.  49.152 to comport with a court decision that addressed 
the EPA's authority to implement the Federal Indian Country Minor NSR 
rule in areas covered by the Federal Indian Country Minor NSR rule: 
Oklahoma Dept. of Environmental Quality v. EPA, 740 F.3d 185 (D.C. Cir. 
2014). This court decision also affects the definition of Indian 
country under the Federal Major NSR Program in

[[Page 56566]]

Indian Country so we are changing the definition under the Federal 
Indian Country Major NSR rule Sec.  49.167.
    The Federal Indian Country Minor NSR rule and Federal Indian 
Country Major NSR rule currently define ``Indian country'' to include 
three categories of lands consistent with 18 U.S.C. 1151, i.e., Indian 
reservations, dependent Indian communities, and Indian allotments. The 
U.S. Court of Appeals for the District of Columbia Circuit vacated the 
rule with respect to non-reservation areas of Indian country (i.e., 
dependent Indian communities and Indian allotments) (Oklahoma Dept. of 
Environmental Quality v. EPA, 740 F.3d 185 (D.C. Cir. 2014)). The court 
held that the states, not tribes or the EPA, have initial primary 
responsibility for implementation plans under CAA section 110 in non-
reservation areas of Indian country in the absence of a demonstration 
of tribal jurisdiction by the EPA or a tribe. We are proposing to 
revise the definition of Indian country in Sec. Sec.  49.152(d) and 
49.167 to add a clause indicating that, for purposes of the Federal 
Indian Country Minor NSR rule and the Federal Indian Country Major NSR 
rule, references to Indian country include all Indian reservation lands 
where no EPA-approved program is in place and all other areas of Indian 
country where no EPA-approved program is in place and over which an 
Indian tribe, or the EPA, has demonstrated that a tribe has 
jurisdiction.
    These proposed changes will address the minor NSR permitting 
requirements for the affected sources, while reducing the permitting 
burden through a more efficient and effective means of implementing the 
requirements.

VI. Implementation Issues

A. Requirements Relating to Threatened or Endangered Species and 
Historic Properties

1. Overview
    The Endangered Species Act (ESA) requires federal agencies to 
ensure, in consultation with the U.S. Fish and Wildlife Service and/or 
the National Marine Fisheries Service (the Services), that any action 
they authorize, fund, or carry out will not likely jeopardize the 
continued existence of any listed threatened or endangered species, or 
destroy or adversely modify the designated critical habitat of such 
species.
    The National Historic Preservation Act (NHPA) requires federal 
agencies to take into account the effects of their undertakings on 
historic properties--i.e., properties that are either listed on, or 
eligible for listing on, the National Register of Historic Places--and 
to provide the Advisory Council on Historic Preservation (the Council) 
a reasonable opportunity to comment on such undertakings.
    In developing the proposed FIP, EPA has considered issues regarding 
listed species and historic properties and has included provisions 
designed to ensure appropriate review of potential impacts on the 
protected resources. Although the individual coverage of each source 
that would operate under the FIP would not constitute a separate 
triggering action for ESA or NHPA purposes, we believe that the 
proposed FIP's procedures relating to listed threatened or endangered 
species and historic properties provide an appropriate site-specific 
means of addressing issues regarding potential impacts on those 
resources in connection with sources that could be covered under the 
FIP. We have provided two options, as described below, for sources to 
meet the proposed FIP's requirements regarding these resources.
a. Sources for Which a Prior ESA and/or NHPA Assessment Has Been 
Completed
    In most of Indian country, oil and natural gas production 
activities cannot begin before an owner/operator has obtained an 
approved application for permit to drill (APD). This authorization will 
include a National Environmental Policy Act Review (NEPA) \34\ review 
that is typically provided by certain agencies within the U.S. 
Department of the Interior--the Bureau of Land Management (BLM) and the 
Bureau of Indian Affairs (BIA), (herein after referred to as ``Federal 
Land Managers (FLMs)'' for simplicity).\35\ Under this review process, 
BLM is typically responsible for authorizing the mineral rights (i.e., 
permission to produce oil and/or natural gas) and BIA for authorizing 
surface activities (i.e., preparing the site for well-drilling 
activities and operating equipment for the production of oil and/or 
natural gas). (There are also cases where only one of these agencies 
will be involved or where another federal agency is involved as well.) 
Such APD authorizations are considered general triggering actions under 
the ESA and NHPA, and the FLMs will typically conduct review procedures 
to ensure that the requirements of these statutes are met. Frequently, 
these reviews occur in connection with an analysis performed by the 
appropriate FLM.\36\
---------------------------------------------------------------------------

    \34\ The NEPA regulatory requirements can be found at 40 CFR 
parts 1500-1508.
    \35\ The NEPA review process produces a decision document that 
is either a Record of Decision or a Finding of No Significant 
Impact.
    \36\ NEPA regulatory requirements can be found at 40 CFR parts 
1500-1508.
---------------------------------------------------------------------------

    Since an oil and gas exploration/production site involves surface 
activities and accessing the mineral resource below, thereby 
potentially requiring an approval from both BLM and BIA, these agencies 
often enter into agreements where one agency takes the lead in the 
overall NEPA (and associated ESA and NHPA) review process (i.e., 
evaluations of the potential impacts regarding mineral rights and 
surface rights are combined). The lead agency may vary depending on the 
particular Indian reservation at issue. We believe that a majority of 
oil and gas activity in areas covered by the Federal Indian Country 
Minor NSR rule occurs on land within the jurisdiction of these 
agencies. This means that before an oil and natural gas owner/operator 
can begin construction under the FIP, the APD must be approved by the 
FLMs. As part of the NEPA review process, the following steps are 
generally performed:
     For the ESA, impacts to threatened and endangered species 
and critical habitats are assessed through interaction with local U.S. 
Fish and Wildlife Service field offices, with appropriate measures put 
in place to protect those resources. These conditions are incorporated 
in the FLMs' authorization.
     For the NHPA, impacts to historic properties are evaluated 
by interaction with State and/or Tribal Historic Preservation Offices. 
Approval of an action will address any appropriate measures needed to 
protect a historic property (e.g., production equipment must be located 
a specified distance from a designated structure/road/etc.).
    The assessment(s) conducted by the FLMs will likely consider a 
facility's air emissions with respect to well drilling, completion, 
well-pad construction activities and future operations and may require 
measures to reduce air emissions. In addition to any air pollution 
measures implemented through the FLM's NEPA (and associated ESA and 
NHPA) review, our proposed FIP would require each source to comply with 
the six federal rules listed in Table 2 above in order to protect 
ambient air quality. The measures employed under the proposed FIP would 
require compliance with specific requirements from the NSPS and NESHAP 
control requirements for the following emission points: compression 
ignition and spark ignition engines, compressors (reciprocating and 
centrifugal), fuel storage tanks, fugitive

[[Page 56567]]

emissions from well sites and compressor stations, glycol dehydrators, 
hydraulically fractured oil and gas well completions, pneumatic 
controllers in production, pneumatic pumps, process heaters and storage 
vessels. We believe the reductions achieved through the required 
emission controls, by virtue of being protective of ambient air 
quality, are also protective of threatened and endangered species, 
their habitats and historic properties.
    Where the FLM(s) have concluded ESA and/or NHPA compliance as part 
of the APD process in connection with a particular source--whether as 
part of the FLM's NEPA review or otherwise--the source would be able to 
rely on that prior review for compliance with the proposed FIP's listed 
species (if prior ESA compliance has occurred) and historic properties 
(if prior NHPA compliance has occurred) requirements. No further 
assessment of impacts on these resources would be required by the 
proposed FIP as any such assessment would be duplicative of the prior 
work conducted by the FLM(s). We would require that documentation of 
completion of the APD process be provided before the owner/operator 
begins construction under the FIP.
b. Sources for Which No Prior ESA and/or NHPA Assessment Has Been 
Completed
    For oil and natural gas production activities that do not undergo 
ESA and/or NHPA review as part of an authorization from the FLM(s), we 
propose that those facilities first complete screening procedures 
relevant to the particular resource that has not previously been 
reviewed before the owner/operator can begin construction under the 
proposed FIP. These screening procedures are similar to those currently 
in place for existing general permits and permits by rule in areas 
covered by the Federal Indian Country Minor NSR rule before the owner/
operator can begin construction under the proposed FIP. Similar to our 
procedure for general permits and permits by rule, for the proposed 
FIP, once an owner/operator completes the screening procedures,\37\ 
they would submit documentation to the EPA Regional Office and receive 
written verification of completion before beginning construction. As we 
explained in the development of both the general permits and permits by 
rule for the ``General Permits and Permits by Rule for the Federal 
Minor New Source Review Program in Indian Country,'' \38\ to ensure 
listed species and critical habitats and historic properties are 
protected, we developed a framework for those permitting mechanisms 
requiring the source owner/operator to identify and assess potential 
effects to protected resources before obtaining coverage. Requiring 
this assessment aids in identifying any concerns related to potential 
impacts on listed species/critical habitat or historic properties early 
in the process when the greatest opportunities to mitigate or avoid any 
impacts--including changes to the facility's location or footprint--are 
available. The EPA believes that requiring a similar process in the air 
quality permit by rule, the general air quality permit, this proposed 
FIP and the general stormwater permits, will streamline the process for 
all concerned: the applicants, the EPA, the tribes, and the Services.
---------------------------------------------------------------------------

    \37\ These procedures are available for sources potentially 
subject to this proposed FIP in a document entitled: ``Procedures to 
Address Threatened and Endangered Species and Historic Properties 
for New or Modified True Minor Oil and Natural Gas Production 
Sources in Indian Country Complying with the Oil and Natural Gas 
Minor Source Federal Implementation Plan,'' http://www.epa.gov/air/tribal/tribalnsr.html.
    \38\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country,'' 79 FR 2546, January 
14, 2014, http://www.gpo.gov/fdsys/pkg/FR-2014-01-14/pdf/2013-30345.pdf.
---------------------------------------------------------------------------

B. What is the effect of this proposed FIP on other Indian Country 
FIPs?

    The objectives of this proposed FIP are to fulfill the requirements 
of the Federal Indian Country Minor NSR rule to address the air quality 
impacts of new and modified true minor sources and to impose 
appropriate air pollution control requirements that protect the NAAQS, 
while providing an alternative to obtaining preconstruction approval 
through the NSR preconstruction permitting process. This proposed FIP 
does not replace any other FIPs promulgated under the CAA for oil and 
natural gas sector sources in areas covered by the Federal Indian 
Country Minor NSR rule. An oil and natural gas source in areas covered 
by the Federal Indian Country Minor NSR rule that is subject to another 
CAA FIP must also comply with this proposed FIP. Generally, in cases 
where emission sources are already subject to a CAA FIP with more 
stringent requirements than those established for equivalent emission 
sources under this proposed FIP, the more stringent requirements 
supersede the requirements in this proposed FIP. Conversely, if 
requirements for certain emission sources in this proposed FIP are more 
stringent than requirements for equivalent emission sources in another 
applicable CAA FIP, then the requirements in this proposed FIP 
supersede the requirements for equivalent emission sources in the other 
FIP. In some cases, other applicable CAA FIPs defer to less stringent 
requirements in other federal CAA rules to avoid duplicative 
requirements. Those cases would provide an exception to this general 
concept.
    In the case of the FIP for Oil and Natural Gas Well Production 
Facilities on the Fort Berthold Indian Reservation (FBIR FIP) at 40 CFR 
49.4161-4168 (78 FR 17836), we stated in the preamble to that 
rulemaking that the FBIR FIP is not a permitting program and does not 
exempt facilities from any federal CAA permitting requirements, which 
would include compliance with this proposed FIP, and PSD 
preconstruction permitting requirements at 40 CFR 52.21, Federal Indian 
Country NSR permitting requirements for minor sources at 40 CFR 49.151, 
or federal Title V operating permit requirements at 40 CFR part 71. The 
FBIR FIP does provide legal and practical enforceability for the use of 
VOC emission controls, and compliant emission reductions achieved can 
be taken into account in calculating potential VOC emissions when 
determining the applicability of CAA permitting requirements. However, 
facilities subject to the FBIR FIP may emit VOCs from emission sources 
not regulated under the FBIR FIP, and/or may emit other NSR-regulated 
pollutants not regulated by the FBIR FIP at levels above the minor 
source thresholds in the Federal Indian Country Minor NSR rule or the 
major source PSD thresholds at 40 CFR 52.21, thus triggering NSR 
permitting requirements.
    This proposed oil and natural gas FIP does not exempt facilities 
from complying with the FBIR FIP. The EPA recognizes that the VOC 
emission control requirements under the FBIR FIP are in some instances 
more stringent than the VOC emission reduction requirements of this 
proposed oil and natural gas FIP. For instance, the FBIR FIP requires 
up to 98 percent reduction of VOC emissions from storage tanks, while 
this proposed FIP, which relies on applicability under the 2015 
proposed NSPS, subpart OOOOa, proposes to require 95 percent reduction 
of VOC emissions from storage vessels. To avoid duplicative 
requirements, the FBIR FIP specifies that facilities operating emission 
sources regulated under the FBIR FIP that are also subject to the 
storage vessel requirements under the 2015 proposed NSPS, subpart 
OOOOa, must comply with the applicable

[[Page 56568]]

requirements of the 2015 proposed NSPS, subpart OOOOa for those 
emission sources, rather than the requirements for produced oil and 
water storage tanks in the FBIR FIP. The FBIR FIP also regulates VOC 
emissions from oil and natural gas well completions, well casing heads, 
and heater treaters at oil and natural gas production facilities, which 
are not currently regulated by NSPS subpart OOOO, and, thus, are not 
part of this proposed FIP. Hydraulically fractured oil well completions 
were proposed for regulation in the 2015 proposed NSPS, subpart OOOOa 
signed on August 18, 2015. Therefore, a new or modified oil and natural 
gas well production facility that is subject to the FBIR FIP that would 
also be subject to this proposed FIP once final to meet the 
requirements of the Federal Indian Country Minor NSR rule would also 
need to comply with the FBIR FIP for casing head natural gas emissions 
and heater treater produced natural gas emissions.

VII. Rationale for Proposed FIP

A. Why are we choosing a FIP as an alternative to site-specific 
permits, general permits and permits by rule?

    In the ANPR, we asked for comment on three alternatives to site-
specific permits: general permits, permits by rule, and FIPs. Although 
commenters on the ANPR differed in their opinions on the best approach, 
the alternative approach garnering the most support was a FIP. 
Commenters supported using a FIP because it would streamline the 
permitting approach, eliminate the need for preconstruction approval 
from the permitting authority and apply requirements directly to 
sources. Commenters also supported a FIP because appropriate control 
measures would be in place and would provide the EPA and tribes 
assurances that construction and modification activities would be 
adequately and appropriately regulated. Some commenters supported a FIP 
because it could apply to existing sources. One commenter argued 
against a FIP approach because a FIP does not afford the same level of 
opportunity for a regulatory authority or the public to review, provide 
input on, or object to sources' coverage under a FIP as compared to a 
general permit.
    We committed to developing an alternative to site-specific permits 
primarily to avoid delays in new construction due to our inability to 
process hundreds of true minor source permits in an acceptable 
timeframe. A FIP provides a regulatory tool that protects air quality, 
streamlines implementation and compliance assurance, and meets the 
EPA's obligation to permit minor NSR sources. The alternatives--site-
specific permits, general permits and permits by rule--do not satisfy 
all of these concerns.
    Both a general permit and a permit by rule provide a more 
streamlined approach for authorizing construction and modification of a 
source compared to site-specific permitting. A FIP, however, has the 
advantage of not requiring a source to initiate advance review and 
obtain approval of coverage from the Reviewing Authority before 
beginning construction (as would a general permit), and it would reduce 
the resource burden on reviewing authorities associated with processing 
the potentially large volume of requests from true minor sources in the 
oil and natural gas production segment for coverage under a general 
permit. So, from those standpoints a FIP is preferable to a general 
permit.
    In comparison to a general permit, a FIP would provide less upfront 
scrutiny of an individual new construction or modification project and 
a citizen would not have the ability to object to a specific source 
gaining coverage. While we recognize these concerns, we believe that 
the proposed oil and natural gas FIP contains a robust set of emission 
control requirements and compliance monitoring and reporting provisions 
that will help ensure that a new or modified true minor source would 
not cause or contribute to a NAAQS or PSD increment violation.\39\ In 
addition, any citizen could enforce the provisions of a FIP, as that 
person can with respect to requirements of any other implementation 
plan or CAA requirement, by commencing a civil action in the district 
court in the judicial district in which the source is located. Citizens 
retain the right under CAA section 304(a)(1) to commence a civil action 
``against any person . . . who is alleged to have violated . . . or to 
be in violation of (A) an emission standard or limitation under this 
[Act] . . . .'' The Administrator also would retain the ability to 
enforce the requirements of a FIP under section 113(a)(1) of the CAA.
---------------------------------------------------------------------------

    \39\ True minor sources in Indian country in the oil and natural 
gas sector are also required to register under 40 CFR 14.160 and 
provide certain information about their new or modified operations.
---------------------------------------------------------------------------

    Another streamlined method, the permit by rule approach, also lacks 
the upfront scrutiny found with a general permit. In the first set of 
permits by rule that the EPA has issued for use in areas covered by the 
Federal Indian Country Minor NSR rule, we established the process for 
individual sources to obtain coverage under the EPA's permits by rule. 
It is a source notification process in which individual sources, unlike 
the general permit process, are not required to obtain the EPA's review 
and approval of a permit application prior to beginning 
construction.\40\ In a manner similar to a FIP, a permit by rule 
establishes a set of requirements to which a source becomes subject 
when it obtains coverage under that permit by submitting a Notification 
of Coverage Form to the EPA, which the EPA then posts online. (For the 
sources subject to this proposed FIP, the EPA intends to post the 
registration forms that the EPA receives (see 40 CFR 49.160(c)). Thus, 
on the issue of public scrutiny, the FIP and the permit by rule 
approaches are essentially the same. The EPA prefers the FIP because it 
provides more certainty for affected sources than the permit by rule 
approach and, as discussed below, does not have any significant 
disadvantages as compared to the permit by rule approach.
---------------------------------------------------------------------------

    \40\ ``General Permits and Permits by Rule for the Federal Minor 
New Source Review Program in Indian Country for Five Source 
Categories,'' U.S. Environmental Protection Agency, 80 FR 25068, May 
1, 2015, http://www.gpo.gov/fdsys/pkg/FR-2015-05-01/pdf/FR-2015-05-01-FrontMatter.pdf.
---------------------------------------------------------------------------

    Unlike NSR general permits and permits by rule, which cannot be 
used to address existing sources, a FIP could extend to existing 
sources; this is a key distinction between general permits and permits 
by rule versus a FIP. However, this proposal does not contain 
requirements for existing sources. The EPA's plan is to address 
existing sources, to the extent necessary, in the context of area- or 
reservation-specific FIPs designed to address areas or reservations 
with air quality issues (including nonattainment areas), as they arise, 
that are associated with oil and natural gas activities. Such FIP(s) 
will need to address, as necessary, requirements for existing sources, 
as well as additional requirements beyond those in this proposal for 
new and modified sources.

B. How did we select which equipment to include in this proposed FIP?

    In determining which equipment to include in the proposed oil and 
natural gas FIP, we reviewed the EPA regulations that apply to emission 
units within the oil and natural gas production segment. We have relied 
substantially on analyses performed in support of the 2015 proposed 
NSPS, subpart OOOOa to help determine which emission units the EPA 
should consider regulating in the oil and natural gas sector in areas 
covered by the Federal Indian Country Minor NSR

[[Page 56569]]

rule as part of this proposed FIP.\41\ In addition to the production 
segment sources proposed to be covered under NSPS, subpart OOOOa, in 
today's FIP, we are proposing requirements from existing EPA standards 
for three emission sources not covered by the NSPS, subpart OOOOa 
because they are present at oil and natural gas production sites and 
emit NOX and/or VOC: engines, process heaters and glycol 
dehydration units. Three of the six federal rules listed in Table 2 
above regulate these sources of pollution, among others. Therefore, we 
determined that a combination of existing federal regulations and the 
2015 proposed NSPS, subpart OOOOa provides a comprehensive and 
consistent regulatory approach for addressing true minor oil and 
natural gas production sources in areas covered by the Federal Indian 
Country Minor NSR rule.
---------------------------------------------------------------------------

    \41\ ``Background Technical Support Document for the Proposed 
New Source Performance Standards, 40 CFR part 60, subpart OOOOa,'' 
http://www.epa.gov/airquality/oilandgas/actions.html.
---------------------------------------------------------------------------

    We have concluded that these federal regulations employ emission 
limitations that are technically and economically feasible, and cost 
effective because we have vetted the existing regulations via the 
public comment process and sources are currently complying with these 
federal standards, including new and modified sources in the oil and 
natural gas sector located in areas covered by the Federal Indian 
Country Minor NSR rule. The referenced NSPS are all promulgated 
pursuant to the EPA's authority under CAA section 111. Under CAA 
section 111(a), the emission limitations for all the affected sources, 
except process heaters and glycol dehydrators, ``reflect the degree of 
emission limitation achievable through the application of the best 
system of emission reduction which (taking into account the cost of 
achieving such reduction and any non-air quality health and 
environmental impact and energy requirements) the Administrator 
determines have been adequately demonstrated.'' We refer to this level 
of control as the Best System of Emission Reduction (BSER). In 
determining BSER, we typically conduct a technology review that 
identifies what emission reduction systems exist and how much they 
reduce air pollution in practice. For each control system identified, 
we also evaluate its costs and other impacts.
    The NESHAP for process heaters and glycol dehydrators are 
promulgated pursuant to the EPA's authority under CAA section 112. 
Under CAA section 112(d)(3), the emission limitations for glycol 
dehydrators and process heaters at major sources of hazardous air 
pollutants (HAPs) reflect MACT. The MACT emission limitation for new 
sources cannot be less stringent than the emission control achieved in 
practice by the best-controlled similar source, without considering 
costs. In addition, under CAA section 112(d)(5), the emission reduction 
requirements for triethylene glycol dehydrators at area sources reflect 
``generally available control technology'' (GACT). For GACT there is no 
statutory minimum level of emissions reduction for new or existing 
sources and costs can be considered. We are proposing that the oil and 
natural gas FIP require sources to comply with the applicable MACT (for 
glycol dehydrators and process heaters located at major sources of HAP) 
or GACT (for glycol dehydrators located at area sources of HAP) 
emission limitations. Because the individual HAP pollutants regulated 
from glycol dehydrators by the NESHAP (and to some degree from process 
heaters, as well) for oil and gas production sources are also VOC, 
which are regulated NSR pollutants, the proposed FIP would create 
enforceable VOC reduction requirements for glycol dehydrators and 
process heaters. HAPs would serve as a surrogate for VOC with respect 
to emission limitations, monitoring, testing and compliance. In 
addition, compliance with 40 CFR part 63, subpart DDDDD MACT also 
provides beneficial reductions of non-targeted NSR pollutants, i.e., 
NOX.
    The rationale supporting the applicability, emission limitations, 
monitoring, recordkeeping, reporting, and other provisions for each of 
the six federal rules is found in the preambles and background 
documents for those rulemakings. The six federal rules are available on 
the Electronic Code of Federal Regulations at: http://www.ecfr.gov/cgi-bin/ECFR?page=browse.

C. Why are we excluding existing sources from this proposed oil and 
natural gas FIP?

    This section provides a brief overview of some of the significant 
comments on the inclusion of existing sources in a FIP, followed by a 
discussion of the EPA's rationale for why requirements for existing 
sources are not included in this proposed action. A complete summary of 
the comments on this and other issues we raised in the June 5, 2014, 
ANPR, can be found in Docket ID No. EPA-HQ-OAR-2011-0151, which has 
been incorporated by reference into the docket for this action, Docket 
ID No. EPA-HQ-OAR-2014-0606.
1. Comments in Favor of Regulation of Existing Sources
    In response to the ANPR the EPA issued on June 5, 2014 (79 FR 
32502), several commenters expressed support for the regulation of 
existing sources under a minor source permitting program (i.e., a FIP) 
for oil and natural gas sources. Two commenters agreed with the ANPR 
that the cumulative impacts from existing sources could exceed that of 
large, new major sources. Some commenters voiced concerns about the 
impact of unregulated existing sources on the health and welfare of 
tribal members. One commenter asserted that there is substantial 
evidence demonstrating that existing oil and gas sources are 
responsible for considerable air pollution emissions within Indian 
country, noting that in response to the Federal Indian Country Minor 
NSR rule, Region 8 received approximately 6,300 registrations from 
existing minor sources in the oil and natural gas sector. The commenter 
asserted that regions like the Uintah Basin are already exceeding the 
ozone NAAQS, and even in regions where there are not yet NAAQS 
violations, emissions from oil and natural gas sources contribute to 
elevated ozone levels and HAP emissions. The commenter stated that the 
EPA's approach must reduce emissions from existing sources in order for 
the EPA to meet its duty to protect public health and welfare, in 
addition to improving visibility impairment and nitrogen deposition in 
national parks and wilderness areas. Another commenter indicated that 
they could provide modeling and monitoring data to the EPA 
demonstrating air quality impacts to the National Park System. One 
commenter also argued that requiring existing source controls would 
reduce methane emissions and subsequent climate impacts.
    One commenter argued that the EPA must regulate existing sources to 
fulfill goals directed by the Obama administration, including 
recommendations from the Secretary of Energy's Advisory Board that 
``measures should be taken to reduce emissions of air pollutants, ozone 
precursors, and methane as quickly as practicable.'' One commenter 
asserted that the EPA has the statutory authority to implement 
regulations for existing oil and natural gas sources. One commenter 
expressed support for regulating existing sources, but stated that not 
all existing minor sources should be regulated in the same manner. 
Other commenters indicated that cost-effective controls are available

[[Page 56570]]

and should be applied to existing sources.
2. Comments in Opposition of Regulation of Existing Sources
    In response to the ANPR the EPA issued on June 5, 2014 (79 FR 
32502), many commenters objected to the regulation of existing sources. 
Commenters urged the EPA to prioritize development of a streamlined 
permitting process implementing the Federal Minor NSR Program in Indian 
Country and to not include existing sources. Several commenters 
provided legal arguments challenging the EPA's authority to impose 
requirements on existing sources. Two commenters stated that the EPA 
has not demonstrated that there is a need to regulate existing sources 
on a national basis. The commenter further argued that the EPA must 
make a much more definitive showing of adverse air quality impacts to 
justify existing source FIP requirements, taking into account the air 
quality, mix of emissions, and characteristics of each area in which it 
seeks to impose existing source controls.
    Two commenters urged the EPA to develop an emissions inventory 
using emissions monitoring data prior to implementing a FIP. Five 
commenters asserted that the EPA must establish an attainment plan 
prior to regulating existing sources. The commenters urged that to 
regulate existing sources, the EPA must make a determination that 
regulation is needed to attain the NAAQS and develop an attainment plan 
for the nonattainment areas in which the sources are located, and only 
for the relevant nonattainment pollutants. Other commenters stated that 
the EPA must evaluate the need for any regulation of existing minor 
sources in each tribal area on a case-by-case basis.
3. The EPA's Approach in This Proposed Action on Existing Oil and 
Natural Gas Minor Sources in Indian Country
    While the focus of the minor source permitting program is on new 
and modified oil and natural gas sources, the EPA believes that 
managing emissions from existing oil and natural gas sources in some 
areas of Indian country also may be important. This is because of the 
significant existing activity associated with the oil and natural gas 
sector in some areas of Indian country and the resultant need to 
protect public health and the environment from those emissions. 
Addressing existing sources through a FIP could be especially useful in 
areas of Indian country for which surrounding state requirements apply 
to existing oil and natural gas sources located on lands that are 
within a state's jurisdiction. In doing so, EPA would consider tribes' 
views and interests, including any interest in promoting economic 
development.
    While EPA believes that it has the necessary authority to 
promulgate a FIP regulating existing sources, in this action, we are 
proposing a FIP that only applies to new and modified true minor 
sources in the production segment of the oil and natural gas sector. 
This proposed FIP for new and modified true minor sources in the oil 
and natural gas production segment locating or located in Indian 
reservations (and other areas of Indian country over which an Indian 
tribe, or the EPA, has demonstrated that the tribe has jurisdiction) 
would apply to all such areas designated attainment, unclassifiable, or 
attainment/unclassifiable. It would not apply to any areas designated 
nonattainment. The Federal Indian Country Minor NSR rule allows us to 
manage minor source emission increases in Indian country and to ensure 
that new emissions do not cause or contribute to a NAAQS or PSD 
increment violation. We are concerned that the rapid growth of the oil 
and natural gas production segment in combination with existing 
exploration and production activities, could result, or in some cases 
already has resulted, in adverse air quality impacts, especially in 
light of the approximately 6,300 existing true minor source 
registrations received in the EPA Region 8 Office for facilities in the 
oil and natural gas sector.\42\ However, we believe that the most 
appropriate means for addressing impacts from existing sources is 
through area- or reservation-specific FIPs and not through this 
proposed, national FIP. If we determine that it is ``necessary or 
appropriate'' to exercise our discretionary authority under sections 
301(a) and 301(d)(4) of the CAA and 40 CFR 49.11(a) of our implementing 
regulations, we will publish a proposed area- or reservation-specific 
FIP that provides an opportunity for full public review and comment. At 
a minimum, the EPA or tribes will need to develop area-specific plans 
if and when areas of Indian country become nonattainment for ozone or 
other NAAQS pollutants. At that time, any such area that has oil and 
natural gas minor source activity may require additional controls on 
existing (and new and modified) sources in order to achieve attainment 
of the NAAQS. One source of information for control options will be the 
EPA's CTGs for oil and natural gas activity that the EPA has made 
available for comment and will finalize in 2016.\43\
---------------------------------------------------------------------------

    \42\ In the Federal Indian Country Minor NSR rule, EPA 
established a registration program that required owners and 
operators of existing true minor sources to file a one-time 
registration with the appropriate Reviewing Authority by March 1, 
2013. The EPA's Region 8 Office has received about 6,300 
registrations from true minor sources in the oil and natural gas 
sector. This far exceeded the amount received from sources in any 
other category.
    \43\ For more information, go to: http://www.epa.gov/airquality/oilandgas/actions.html.
---------------------------------------------------------------------------

    We believe that existing sources are best addressed through 
tailored, federal or tribal air quality plans because each basin 
producing oil and/or natural gas possesses different geological and 
meteorological characteristics and, thus, what primary fossil fuel 
resource is extracted can be very different in quality and type and the 
impacts from emissions associated with extraction activities can vary 
widely. For example, the predominant resource extracted from the Bakken 
Pool \44\ is a light, volatile oil, while the primary resource 
extracted from the Uintah Basin is a heavy, thick oil. Each of these 
types, in many cases, call for different sets of control requirements 
that are best addressed through tailored plans versus a national FIP.
---------------------------------------------------------------------------

    \44\ Bakken Pool means oil produced from the Bakken, Three 
Forks, and Sanish formations.
---------------------------------------------------------------------------

    We believe that through tailored plans a number of cost-effective 
emission reduction measures could be applied to existing emission units 
to balance new growth by mitigating the potential for adverse air 
quality impacts from overall increases in emissions. A number of state 
air pollution control agencies already regulate some existing emissions 
from this segment.\45\ For example, in February 2014, Colorado adopted 
additional regulations for oil and natural gas production operations 
that include such requirements as expanding nonattainment area 
pneumatic controller requirements statewide and reducing venting and 
flaring of gas streams at well sites, among other control 
strategies.\46\ In addition, these regulations determined leak 
detection and repair monitoring to be cost effective at oil and natural 
gas production facilities. Some technologies may even provide the 
industry with cost savings due to recovered product. For example, the 
EPA's Natural Gas Star

[[Page 56571]]

program estimates that adding a vapor recovery unit to a storage tank 
could pay for itself in 3 to 37 months, and thereafter result in cost 
savings.\47\
---------------------------------------------------------------------------

    \45\ See, e.g., L. Gribovicz, WRAP, ``Analysis of States' and 
EPA Oil and Gas Air Emissions Control Requirements for Oil and Gas 
Emissions Control Requirements for Selected Basins in the Western 
United States (2013 Update),'' Nov. 8, 2013, available at http://www.wrapair2.org/pdf/2013-11x_O&G%20Analysis%20(master%20w%20State%20Changes%2011-08).pdf.
    \46\ See Colorado Dept. of Public Health and Environment, Air 
Quality Control Commission Web site at http://www.colorado.gov/cs/Satellite/CDPHE-AQCC/CBON/1251647985820.
    \47\ See ``Lessons Learned from Natural Gas STAR Partners; 
Installing Vapor Recovery Units on Storage Tanks,'' available at 
http://epa.gov/gasstar/documents/ll_final_vap.pdf on the EPA's 
Natural Gas Star Web site: http://epa.gov/gasstar/index.html.
---------------------------------------------------------------------------

D. Why is the EPA extending the permitting deadline for oil and natural 
gas true minor sources in areas covered by the Federal Indian Country 
Minor NSR rule?

    The EPA is proposing to extend the deadline to allow us sufficient 
time to develop an approach for permitting new and modified true minor 
oil and natural gas production sources in areas covered by the Federal 
Indian Country Minor NSR rule that is consistent and coordinated with 
the EPA's overall approach to addressing emissions from this sector. 
Specifically, we have needed additional time to coordinate with the 
larger EPA effort to regulate methane and VOCs from the oil and natural 
gas sector. On January 14, 2015, as part of the Obama administration's 
methane strategy, the EPA outlined a series of steps it plans to take 
to address methane and smog-forming VOC emissions from the oil and gas 
industry, in order to ensure continued, safe and responsible growth in 
U.S. oil and natural gas production.\48\ This commonsense strategy will 
reduce methane pollution from new sources in this rapidly growing 
industry, reduce ozone-forming pollutants from existing sources in 
areas that do not meet federal ozone health standards, and build on 
work that states and industry are doing to address emissions from 
existing sources elsewhere.
---------------------------------------------------------------------------

    \48\ For more information, go to: http://www.epa.gov/airquality/oilandgas/pdfs/20150114fs.pdf.
---------------------------------------------------------------------------

    We intend to ensure the approach that we use to permit true minor 
oil and natural gas sources in areas covered by the Federal Indian 
Country Minor NSR rule reflects the EPA technical expertise gained 
through the work that has and will be done to understand feasible 
control opportunities in the oil and natural gas sector. In particular, 
we are drawing on the knowledge gained through the development of the 
technical white papers released on April 15, 2014, that address 
emerging data on VOCs and methane emissions from certain sources in the 
oil and natural gas sector, as well as techniques for mitigating those 
emissions.\49\ The white papers, and the comments we received on them, 
are helping us better understand the sector, including sources located 
in Indian country. We are also considering in this action the comments 
provided in response to the ANPR (79 FR 32502, June 5, 2014) in which 
we sought feedback on the most effective and efficient means of 
implementing the Federal Minor NSR Program in Indian Country for 
sources in the oil and natural gas production segment of the oil and 
natural gas sector.
---------------------------------------------------------------------------

    \49\ The white papers can be found at: http://www.epa.gov/airquality/oilandgas.
---------------------------------------------------------------------------

VIII. Statutory and Executive Order Reviews

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

    This proposed action is not a significant regulatory action and 
was, therefore, not submitted to the Office of Management and Budget 
for review.

B. Paperwork Reduction Act (PRA)

    This action does not impose any new information collection burden 
under the PRA. OMB has previously approved the information collection 
activities contained in the existing regulations and has assigned OMB 
control number 2060-0003. This action merely proposes to establish a 
FIP which serves as a mechanism for true minor sources in the 
production segment of the oil and natural gas sector locating or 
located in areas covered by the Federal Indian Country Minor NSR rule 
to satisfy the requirements of the Federal Indian Country Minor NSR 
rule in lieu of obtaining a site-specific minor source permit. Because 
it is intended as a substitute for a site-specific permit which would 
contain information collection activities in the Information Collection 
Request for Federal Indian Country Minor NSR rule issued in July 2011, 
it would not impose any new obligations or enforceable duties on any 
state, local or tribal government or the private sector. In addition, 
the information collection activities contained in the 6 rules proposed 
to be part of the proposed FIP have also been previously approved by 
OMB.\50\
---------------------------------------------------------------------------

    \50\ 40 CFR part 60, subpart Kb: Standards of Performance for 
Volatile Organic Liquid Storage Vessels (Including Petroleum Liquid 
Storage Vessels) for Which Construction, Reconstruction, or 
Modification Commenced After July 23, 1984 (OMB Control No. 2060-
0074); 40 CFR part 60, subpart IIII: Standards of Performance for 
Stationary Compression Ignition Internal Combustion Engines (OMB 
Control No. 2060-0590); 40 CFR part 60, subpart JJJJ: Standards of 
Performance for Stationary Spark Ignition Internal Combustion 
Engines (OMB Control No. 2060-0610); 40 CFR part 60, subpart OOOO: 
Standards of Performance for Crude Oil and Natural Gas Production, 
Transmission and Distribution (OMB Control No. 2060-0673); 40 CFR 
part 63, subpart DDDDD: National Emission Standards for Hazardous 
Air Pollutants for Major Sources: Industrial, Commercial, and 
Institutional Boilers and Process Heaters (OMB Control No. 2060-
0616) and 40 CFR part 63, subpart HH: National Emission Standards 
for Hazardous Air Pollutants from Oil and Natural Gas Production 
Facilities (OMB Control No. 2060-0417).
---------------------------------------------------------------------------

C. Regulatory Flexibility Act (RFA)

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. In 
making this determination, the impact of concern is any significant 
adverse economic impact on small entities. 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, has no 
net burden or otherwise has a positive economic effect on the small 
entities subject to the rule. The EPA analyzed the impact of 
streamlined permitting on small entities in the Federal Indian Country 
Minor NSR rule (76 FR 38748, July 1, 2011). The EPA determined that 
that action would not have a significant economic impact on a 
substantial number of small entities. This proposed action merely 
implements a particular aspect of the Federal Indian Country Minor NSR 
rule. We have, therefore, concluded that this action will have no net 
regulatory burden for all directly regulated small entities.

D. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandate, as described in 
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect 
small governments. The action imposes no enforceable duty on any state, 
local or tribal governments or the private sector. It simply provides 
one option for sources to comply with the Federal Indian Country Minor 
NSR rule. The Federal Indian Country Minor NSR rule itself imposes the 
obligation that true minor sources in areas covered by the Federal 
Indian Country Minor NSR rule obtain a minor source NSR permit and not 
this proposed FIP. This proposed FIP merely provides a vehicle for 
meeting that obligation.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It would 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.

[[Page 56572]]

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

    This action has tribal implications. However, it will neither 
impose substantial direct compliance costs on federally recognized 
tribal governments, nor preempt tribal law. The EPA has conducted 
outreach on this rule via on-going monthly meetings with tribal 
environmental professionals in the development of this proposed action. 
This action reflects tribal comments on and priorities for developing 
an approach for permitting true minor sources in the production segment 
of the oil and natural gas sector in areas covered by the Federal 
Indian Country Minor NSR rule. The EPA offered consultation on the ANPR 
to elected tribal officials and the following tribes requested a 
consultation, which was held on July 18, 2014, with the tribes and/or 
their representatives: MHA (Mandan, Hidatsa and Arikara) Nations (Three 
Affiliated Tribes), Ute Tribe of the Uintah and Ouray Reservation, and 
Crow Nation.
    At the consultation, the tribes present expressed a number of 
concerns regarding federal regulation of oil and natural gas activity 
in Indian country. Three main themes were expressed. First, the tribes 
expressed the concern that many areas of Indian country are facing 
difficult economic circumstances and are in need of economic 
development to improve the quality of life of tribal members; revenue 
from oil and natural gas activity in many areas provides that economic 
development. Second, in Indian country they indicated that oil and 
natural gas activity is already regulated by the federal government and 
that the EPA does not need to add to the burden. They expressed a wish 
to be able to manage their own resources without undue interference 
from the federal government. Finally, the tribes also expressed a need 
for greater resources so that they can implement their own 
environmental programs as they determine in their own lands.
    We believe that the FIP is directly responsive to the first two 
issues in that, for attainment and related areas, we are proposing a 
FIP to fulfill our CAA responsibilities to protect air quality in 
Indian country in a manner that: (1) Does not create an uneven playing 
field with respect to federal requirements in adjacent states where oil 
and natural gas sources face the same EPA requirements; and (2) 
minimizes the processing burden on oil and natural gas sources. We will 
continue to provide outreach to tribal environmental professionals and 
offer to consult with tribal leadership on this proposed action.

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

    This action is not subject to Executive Order (EO) 13045 because it 
is not economically significant as defined in EO 12866, and because the 
EPA does not believe the environmental health or safety risks addressed 
by this action present a disproportionate risk to children.

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

    This action is not subject to Executive Order 13211, because it is 
not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act (NTTAA)

    This action does not involve technical standards.

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

    The EPA believes the human health or environmental risk addressed 
by this action will not have potential disproportionately high and 
adverse human health or environmental effects on minority, low-income 
or indigenous populations. This proposed rule implements certain 
aspects of the Federal Indian Country Minor NSR rule.
    Our primary goal in developing this program is to ensure that air 
resources in areas covered by the Federal Indian Country Minor NSR rule 
will be protected in the manner intended by the CAA. This action will 
help ensure air quality protection in areas covered by the Federal 
Indian Country Minor NSR rule, by including in a FIP a comprehensive 
set of control requirements for new and modified true minor source in 
the production segment of the oil and natural gas sector. In addition, 
through this proposed FIP, we seek to establish a mechanism that 
provides an effective and efficient method for implementing a 
preconstruction permitting program for true minor sources in areas 
covered by the Federal Indian Country Minor NSR rule that enables a 
streamlined process, which helps promote economic development by 
minimizing delays in new construction; and provides a process 
comparable to those programs operated outside of Indian county, which 
helps tribes compete for new oil and natural gas production in areas 
covered by the Federal Indian Country Minor NSR rule..

List of Subjects in 40 CFR Part 49

    Environmental protection, Administrative practices and procedures, 
Air pollution control, Incorporation by reference, Indians, Indians-
law, Indians-tribal government, Intergovernmental relations, Reporting 
and recordkeeping requirements.

    Dated: August 18, 2015.
Gina McCarthy,
Administrator.
    For the reasons set forth in the preamble, EPA proposes to amend 40 
CFR part 49 as follows:

PART 49--INDIAN COUNTRY: AIR QUALITY PLANNING AND MANAGEMENT

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

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

0
2. Subpart C of part 49 is amended by adding a new undesignated center 
heading and Sec. Sec.  49.101 to 49.105 to read as follows:

Federal Implementation Plans for Tribes

Sec.
49.101 Introduction.
49.102 Definitions.
49.103 Delegation of authority of administration to Indian tribes.
49.104 Requirements regarding threatened or endangered species and 
historic properties.
49.105 Requirements.

Federal Implementation Plans for Tribes


Sec.  49.101  Introduction.

    What is the purpose of Sec. Sec.  49.101 through 49.105? (a) 
Sections 49.101 through 49.105 adopt legally and practicably 
enforceable requirements to control and reduce emissions of volatile 
organic compounds, nitrogen oxides, sulfur dioxide, particulate matter 
(PM, PM10, PM2.5), hydrogen sulfide, carbon 
monoxide and various sulfur compounds from oil and natural gas 
production segment operations.
    (b) Am I subject to Sec. Sec.  49.101 through 49.105? You are 
subject to the requirement if you meet the following criteria:
    (1) Owners and operators of new true minor oil and natural gas 
sources or minor modifications at existing true minor oil and natural 
gas sources as determined pursuant to 40 CFR 49.153(a) that meet the 
criteria specified in paragraphs (b)(1)(i) through (b)(1)(v)

[[Page 56573]]

of this section, shall comply with the requirements of Sec. Sec.  
49.104 and 49.105, unless the owner or operator obtains a site-specific 
permit as specified in paragraph (b)(2) or (b)(3) of this paragraph.
    (i) The facility is an oil and natural gas production facility as 
defined in Sec.  49.102;
    (ii) The oil and natural gas production facility is located in 
Indian country as defined in Sec.  49.102;
    (iii) The oil and natural gas production facility is a new true 
minor source or minor modification of an existing true minor source as 
determined under Sec.  49.153;
    (iv) The oil and natural gas production facility begins 
construction or modification on or after October 3, 2016; and
    (v) The oil and natural gas production facility is not located in a 
designated nonattainment area.
    (2) Owners and operators of facilities that meet the criteria 
specified in paragraphs (b)(1) of this section that choose to obtain a 
site-specific permit as specified in 40 CFR 49.155 before beginning 
construction are not required to comply with the requirements of 
Sec. Sec.  49.101 to 49.105.
    (3) Owners and operators of facilities that meet the criteria 
specified in paragraph (b)(1) of this section that the Reviewing 
Authority requires to obtain a site-specific permit to ensure 
protection of the NAAQS as specified in 40 CFR 49.155 before beginning 
construction are not required to comply with Sec. Sec.  49.101 to 
49.105.
    (c) When must I comply with Sec. Sec.  49.101 through 49.105? 
Compliance with Sec. Sec.  49.101 through 49.101 is required on or 
after October 3, 2016.


Sec.  49.102  Definitions.

    As used in Sec. Sec.  49.101 through 49.105, all terms not defined 
herein shall have the meaning given them in the Clean Air Act, in 
subpart A, and subpart OOOOa of 40 CFR part 60, in the Prevention of 
Significant Deterioration regulations at 40 CFR 52.21, or in the 
Federal Minor NSR Program in Indian Country at 40 CFR 49.152. The 
following terms shall have the specific meanings given them:
    Oil and natural gas production facility means a minor stationary 
source engaged in the extraction and production of oil and natural gas, 
as well as the processing, transmission and distribution of natural 
gas, including 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). Oil and natural gas production components may include, but 
are not limited to: wells and related casing head; tubing head and 
``Christmas tree'' piping; pumps; compressors; heater treaters; 
separators; storage vessels; pneumatic devices; natural gas 
dehydrators; well drilling, completion and workover processes and 
portable non-self-propelled apparatuses associated with those 
operations; and 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.
    Oil and natural gas well means a single well that extracts 
subsurface reservoir fluids containing a mixture of oil, natural gas, 
and water.
    Owner or operator means any person who owns, leases, operates, 
controls, or supervises an oil and natural gas production facility.
    Regional Administrator means the Regional Administrator of an EPA 
Region or an authorized representative of the Regional Administrator.


Sec.  49.103  Delegation of authority of administration to Indian 
tribes.

    (a) What is the purpose of this section? The purpose of this 
section is to establish the process by which a Regional Administrator 
may delegate to a federally-recognized tribe the authority to assist 
the EPA with administration of this Federal Implementation Plan 
(Sec. Sec.  49.101-49.105). This section provides for administrative 
delegation and does not affect the eligibility criteria under 40 CFR 
49.6 for treatment in the same manner as a state or a tribe's ability 
to obtain approval of a tribal implementation plan under 40 CFR 49.7.
    (b) How does a tribe request delegation? In order to be delegated 
authority to assist us with administration of this FIP, the authorized 
representative of a federally-recognized tribe must submit a request to 
a Regional
    Administrator that:
    (1) Identifies the specific provisions for which delegation is 
requested;
    (2) Identifies the Indian Reservation or other areas of Indian 
country for which delegation is requested;
    (3) Includes a statement by the applicant's legal counsel (or 
equivalent official) that includes the following information:
    (i) A statement that the applicant is a tribe recognized by the 
Secretary of the Interior;
    (ii) A descriptive statement that is consistent with the type of 
information described in Sec.  49.7(a)(2) demonstrating that the 
applicant is currently carrying out substantial governmental duties and 
powers over a defined area;
    (iii) A description of the laws of the tribe that provide adequate 
authority to administer the Federal rules and provisions for which 
delegation is requested; and
    (iv) A demonstration that the tribal agency has the technical 
capability and adequate resources to administer the FIP provisions for 
which the delegation is requested.
    (c) How is the delegation of administrative authority accomplished? 
(1) A Delegation of Authority Agreement will set forth the terms and 
conditions of the administrative delegation, will specify the rule and 
provisions that the tribe shall be authorized to implement on behalf of 
the EPA, and shall be entered into by the Regional Administrator and 
the tribe. The Agreement will become effective upon the date that both 
the Regional Administrator and the authorized representative of the 
tribe have signed the Agreement. Once the delegation becomes effective, 
the tribe will be responsible, to the extent specified in the 
Agreement, for assisting us with administration of this FIP and shall 
act as the Regional Administrator as that term is used in these 
regulations. Any Delegation of Authority Agreement will clarify the 
circumstances in which the term ``Regional Administrator'' found 
throughout this FIP is to refer only to the EPA Regional Administrator 
and when it is intended instead to refer to the EPA Regional 
Administrator or a federally-recognized tribe.
    (2) A Delegation of Authority Agreement may be modified, amended, 
or revoked, in part or in whole, by the Regional Administrator after 
consultation with a tribe.
    (d) How will any Delegation of Authority Agreement be publicized? 
The Regional Administrator shall publish a notice in the Federal 
Register informing the public of any Delegation of Authority Agreement 
with a tribe to assist us with administration of all or a portion of 
this FIP and will identify such delegation in the Code of Federal 
Regulations. The Regional Administrator shall also publish an 
announcement of the Delegation of Authority Agreement in local 
newspapers.


Sec.  49.104  Requirements regarding threatened or endangered species 
and historic properties.

    (a) What are sources required to do to address threatened or 
endangered species and historic properties? An owner/operator required 
to meet the

[[Page 56574]]

requirements contained in Sec. Sec.  49.101 through 49.105 to satisfy 
its obligation under Sec.  49.151(c)(1)(iii)(B) shall meet paragraph 
(a)(1) or (2) of this section.
    (1) The owner/operator shall submit to the EPA Regional Office (and 
to the tribe where the source is located/locating) documentation 
demonstrating that prior Endangered Species Act (ESA) and/or National 
Historic Preservation Act (NHPA) compliance has been completed by 
another federal agency in connection with the specific oil and natural 
gas activity operated under this FIP. The owner/operator must be in 
compliance with all measures required as part of that prior ESA and/or 
NHPA process.
    (2) The owner/operator shall submit to the EPA Regional Office (and 
to the tribe where the source is located/locating) documentation 
demonstrating that it has completed the screening procedures specified 
for consideration of threatened and endangered species and/or historic 
properties and receive written confirmation from the EPA stating that 
it has satisfactorily completed these procedures. The procedures 
document, ``Procedures to Address Threatened and Endangered Species and 
Historic Properties for New or Modified True Minor Oil and Natural Gas 
Production Sources in Indian Country Complying with the Oil and Natural 
Gas Minor Source Federal Implementation Plan,'' August 13, 2015, 
Version 1.0, is incorporated by reference into this section with the 
approval of the Director of the Federal Register under 5 U.S.C. 552(a) 
and 1 CFR part 51. To view or download the document, go to http://www.epa.gov/air/tribal/pdfs/procedures_for_esa_and_nhpa_for_ong_sources_8-13-15.pdf.


Sec.  49.105  Requirements.

    (a) For true minor sources that are subject to 40 CFR part 63, 
subpart DDDDD (National Emission Standards for Hazardous Air Pollutants 
for Major Sources: Industrial, Commercial, and Institutional Boilers 
and Process Heaters), for purposes of this FIP, sources must comply 
with all of the applicable provisions of the standard as written at the 
time construction or reconstruction of the source is begun.
    (b) For true minor sources that are subject to 40 CFR part 60, 
subpart IIII--Standards of Performance for Stationary Compression 
Ignition Internal Combustion Engines, for purposes of this FIP, sources 
must comply with all of the applicable provisions of the standard as 
written at the time construction or reconstruction of the source is 
begun, except for the following:
    (1) Sec.  60.4200(a)(1)--Am I subject to this subpart? (applies to 
manufacturers);
    (2) Sec.  60.4200(b)--Not applicable to stationary spark ignition 
internal combustion engines being tested at an engine test cell/stand;
    (3) Sec.  60.4200(c)--Am I subject to this subpart? (area sources 
and exemptions from Title V permits);
    (4) Sec.  60.4201--What emission standards must I meet for non-
emergency engines if I am a stationary compression ignition internal 
combustion engine manufacturer?;
    (5) Sec.  60.4202--What emission standards must I meet for 
emergency engines if I am a stationary compression ignition internal 
combustion engine manufacturer?;
    (6) Sec.  60.4203--How long must my engines meet the emission 
standards if I am a manufacturer of stationary compression ignition 
internal combustion engines?;
    (7) Sec.  60.4210--What are my compliance requirements if I am a 
stationary compression ignition internal combustion engine 
manufacturer?; and
    (8) Sec.  60.4215--What requirements must I meet for engines used 
in Guam, American Samoa, or the Commonwealth of the Northern Mariana 
Islands?
    (c) For true minor sources that are subject to 40 CFR part 60, 
subpart JJJJ--Standards of Performance for Stationary Spark Ignition 
Internal Combustion Engines, for purposes of this FIP, sources must 
comply with all of the applicable provisions of the standard as written 
at the time construction or reconstruction of the source is begun, 
except for the following:
    (1) Sec.  60.4230(b)--Not applicable to stationary spark ignition 
internal combustion engines being tested at an engine test cell/stand;
    (2) Sec.  60.4230(c)--Exemption for obtaining a Title V permit if 
owner or operator of an area source subject to this part;
    (3) Sec.  60.4231 and Sec.  60.4232--Emission standards for 
manufacturers;
    (4) Sec.  60.4238 through Sec.  60.4242--Compliance Requirements 
for Manufacturers; and
    (5) Sec.  60.4247--Mobile source provisions that apply to 
manufacturers of stationary spark ignition internal combustion engines 
or equipment containing such engines.
    (d) For true minor sources that are subject to 40 CFR part 60, 
subpart Kb--Standards of Performance for Volatile Organic Liquid 
Storage Vessels, for purposes of this FIP, sources must comply with all 
of the applicable provisions of the standard as written at the time 
construction or reconstruction of the source is begun, except for the 
following:
    (1) Sec.  60.112b(c)--Site-specific standard for Merck & Co., 
Inc.'s Stonewall Plant in Elkton, Virginia; and
    (2) Sec.  60.117b(a) and (b)--Delegation of authority.
    (e) For true minor sources that are subject to subpart OOOOa, 
Emission Standards for New and Modified Sources in the Oil and Natural 
Gas Sector, for purposes of this FIP, sources must comply with all of 
the provisions of the standard as written at the time construction or 
reconstruction of the source is begun, except for the following:
    (1) Sec.  60.5365a(f)(3)--Equipment exemption at processing plant;
    (2) Sec.  60.5365a(h)(4)--Existing sources constructed after August 
23, 2011;
    (3) Sec.  60.5370a(c)--Permit exemption;
    (4) Sec.  60.5413a(a)(5)--Exemptions from performance testing--
hazardous waste incinerator;
    (5) Sec.  60.5420a(a)(2)(i)--Advance notification requirements for 
well completions; and
    (6) Sec.  60.5420a(a)(2)(ii)--Advance notification requirements of 
well completions when subject to state regulation that requires advance 
notification.
    (f) For true minor sources that are subject to 40 CFR part 63, 
subpart HH--National Emission Standards for Hazardous Air Pollutants 
from Oil and Natural Gas Production Facilities, for purposes of this 
FIP, sources must comply with all of the applicable provisions of the 
standard as written at the time construction or reconstruction of the 
source is begun, except for the following:
    (1) Sec.  63.760(a)(2)--Facilities that process, upgrade or store 
hydrocarbon liquids;
    (2) Sec.  63.760(b)(1)(ii)--Each storage vessel with the potential 
for flash emissions;
    (3) Sec.  63.760(b)(1)(iii)--Equipment located at natural gas 
processing plants;
    (4) Sec.  63.760(g)--Recordkeeping for major sources that overlap 
with other regulations for equipment leaks;
    (5) Sec.  63.764(c)(2)--(3)--Requirements for compliance with 
standards for storage vessels and equipment at natural gas processing 
plants, respectively;
    (6) Sec.  63.766 Storage vessel standards; and
    (7) Sec.  63.769 Equipment leak standards.
0
3. Section 49.151 is amended by revising paragraphs (b)(1), 
(c)(1)(iii)(A) and (B), and (d)(1), (2) and (4) to read as follows:


Sec.  49.151  Program overview.

* * * * *

[[Page 56575]]

    (b) * * *
    (1) It satisfies the requirements of section110(a)(2)(C) of the Act 
by establishing a preconstruction permitting program for all new and 
modified minor sources (minor sources) and minor modifications at major 
sources located in Indian country and by establishing a Federal 
Implementation Plan (Sec. Sec.  49.101 to 49.105) for oil and natural 
gas production true minor sources located in Indian country.
* * * * *
    (c) * * *
    (1) * * *
    (iii) * * *
    (A) If you own or operate an existing true minor source in Indian 
country (as defined in Sec.  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, as defined in 
Sec.  49.102, 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, 
as defined in Sec.  49.102, and you commence construction after August 
30, 2011, and before October 3, 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, 
as defined in Sec.  49.102, and you wish to begin construction of a new 
true minor source or a minor 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/permit by 
rule pursuant to Sec.  49.156, if applicable). If your true minor 
source is an oil and natural gas source, as defined in Sec.  49.102, 
and you wish to begin construction of a new true minor source or a 
minor modification at an existing true minor source on or after October 
3, 2016, you must either comply with the Federal Implementation Plan 
for oil and natural gas production sources located in Indian country 
(Sec. Sec.  49.101 to 49.105) from the day you begin construction or 
opt out of those requirements pursuant to Sec.  49.101(b)(2) and obtain 
a minor source permit pursuant to Sec. Sec.  49.154 and 49.155 before 
beginning construction. Alternatively you may be required by the EPA, 
pursuant to Sec.  49.101(b)(3), to obtain a minor source permit 
pursuant to Sec. Sec.  49.154 and 49.155 before beginning construction. 
All proposed new sources or modifications are also subject to the 
registration requirements of Sec.  49.160, except for sources that are 
subject to Sec.  49.138.
* * * * *
    (d) * * *
    (1) If you begin construction of a new source or modification that 
is subject to this program after the applicable date specified in 
paragraph (c) of this section without applying for and receiving a 
permit pursuant to this program or complying with the Federal 
Implementation Plan at Sec. Sec.  49.101 to 49.105 for oil and natural 
gas production, you will be subject to appropriate enforcement action.
    (2) If you do not construct or operate your source or modification 
in accordance with the terms of your minor NSR permit or the Federal 
Implementation Plan for oil and natural gas production at Sec. Sec.  
49.101 to 49.105, you will be subject to appropriate enforcement 
action.
    (3) * * *
    (4) Issuance of a permit or compliance with the Federal 
Implementation Plan for oil and natural gas production at Sec. Sec.  
49.101 to 49.105 does not relieve you of the responsibility to comply 
fully with applicable provisions of any EPA-approved implementation 
plan or Federal Implementation Plan or any other requirements under 
applicable law.
* * * * *
0
4. Section 49.152 is amended by revising the introductory text of 
paragraph (d) and adding paragraph (4) to the definition of ``Indian 
country'' to read as follows:


Sec.  49.152  Definitions.

* * * * *
    (d) * * *
    Indian country, as defined in 18 U.S.C. 1151, means the following 
as applied to this program:
* * * * *
    (4) For purposes of this rule, references to Indian country include 
all Indian reservation lands where no EPA-approved program is in place 
and all other areas of Indian country where no EPA-approved program is 
in place and over which an Indian tribe, or the EPA, has demonstrated 
that a tribe has jurisdiction.
* * * * *
0
5. Section 49.153 is amended by revising paragraphs (a)(1)(i)(B) and 
(a)(1)(ii)(B) to read as follows:


Sec.  49.153  Applicability.

* * * * *
    (a)* * *
    (1) * * *
    (i) * * *
    (B) Step 2. Determine whether your proposed source's potential to 
emit for the pollutant that you are evaluating, (including fugitive 
emissions, to the extent they are quantifiable, only if the source 
belongs to one of the source categories listed pursuant to section 
302(j) of the Act), is equal to or greater than the corresponding minor 
NSR threshold in Table 1 of this section. If it is, you are subject to 
the preconstruction requirements of this program for that pollutant, 
except that oil and natural gas production sources shall instead comply 
with the requirements of the Federal Implementation Plan at Sec. Sec.  
49.101 to 49.105, unless you opt-out of the Federal Implementation Plan 
pursuant to Sec.  49.101(b)(2) in which case you are subject to the 
preconstruction requirements of this program for that pollutant or are 
required by the EPA to obtain a minor source permit pursuant to Sec.  
49.101(b)(3). If not, go to Step 3 (paragraph (a)(1)(ii)(C) of this 
section).
    (ii) * * *
    (B) Step 2. Determine whether the increase in allowable emissions 
from the proposed modification (calculated using the procedures of 
paragraph (b) of this section) would be equal to or greater than the 
minor NSR threshold in Table 1 of this section for the pollutant that 
you are evaluating. If it is, you are subject to the preconstruction 
requirements of this program for that pollutant, except oil and natural 
gas production sources shall instead comply with the requirements of 
the Federal Implementation Plan at Sec. Sec.  49.101 to 49.105, unless 
you opt-out of the Federal Implementation Plan pursuant to Sec.  
49.101(b)(2) in which case you are subject to the preconstruction 
requirements of this program for that pollutant or are required by the 
EPA to obtain a minor source permit pursuant to Sec.  49.101(b)(3). If 
not, go to Step 3 (paragraph (a)(1)(ii)(C) of this section).
* * * * *
0
6. Section 49.160 is amended by revising paragraphs (c)(1)(ii) and 
(iii), adding paragraph (c)(1)(iv) and revising paragraph (c)(4) to 
read as follows:


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

* * * * *
    (c) * * *
    (1) * * *
    (ii) If your true minor source is not an oil and natural gas 
source, as defined in Sec.  49.102, and you commence construction after 
August 30, 2011, and before September 2, 2014, you must

[[Page 56576]]

register your source with the Reviewing Authority within 90 days after 
the source begins operation. If your new true minor source or minor 
modification of an existing true minor source is an oil and natural gas 
source, as defined in Sec.  49.102, and you commence construction after 
August 30, 2011, and before October 3, 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, as defined in Sec.  49.102, 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, as defined in Sec.  49.102, and you 
commence construction or modification of your source on or after 
October 3, 2016, you must report your source's actual emissions (if 
available) as part of your permit application or registration of oil 
and natural gas production sources using a form provided by the EPA, 
``Registration for New True Minor Oil and Natural Gas Sources and Minor 
Modifications at Existing True Minor Oil and Natural Gas Sources'' 
(available at: http://www.epa.gov/air/tribal/tribalnsr.html or from EPA 
Regional Offices), and your permit application or registration for oil 
and natural gas production sources will be used to fulfill the 
registration requirements described in Sec.  49.160(c)(2).
    (iv) Minor sources complying with Sec. Sec.  49.101 to 49.105 for 
oil and natural gas production, as defined in Sec.  49.102, must submit 
a registration form 30 days prior to beginning construction that 
contains the information in Sec.  49.160(c)(2). The form titled 
``Registration for New True Minor Oil and Natural Gas Sources and Minor 
Modifications at Existing True Minor Oil and Natural Gas Sources'' is 
available at: http://www.epa.gov/air/tribal/tribalnsr.html or from EPA 
Regional Offices. This form is submitted instead of the application 
form required in Sec.  49.160(c)(1)(iii).
* * * * *
    (4) Duty to obtain a permit or comply with the Federal 
Implementation Plan for oil and natural gas production sources. 
Submitting a registration form does not relieve you of the requirement 
to obtain any required permit, including a preconstruction permit, or 
to comply with the Federal Implementation Plan for oil and natural gas 
production if your source or any physical or operational change at your 
source would be subject to any minor or major NSR rule.
* * * * *
0
7. Section 49.167 is amended by revising the introductory text of 
paragraph (d) and adding paragraph (d)(4) to read as follows:


Sec.  49.167  Definitions.

* * * * *
    (d) Indian country, as defined in 18 U.S.C. 1151, means the 
following as applied to this program:
* * * * *
    (4) For purposes of this rule, references to Indian country include 
all Indian reservation lands where no EPA-approved program is in place 
and all other areas of Indian country where no EPA-approved program is 
in place and over which an Indian tribe, or the EPA, has demonstrated 
that a tribe has jurisdiction.
* * * * *
[FR Doc. 2015-21025 Filed 9-17-15; 8:45 am]
 BILLING CODE 6560-50-P