At the February 28, 2013 Stakeholder Meeting, the Colorado Air Pollution Control Division (Division) revealed a suite of revisions it is considering to Air Quality Control Commission Regulation No. 7, in the form of significant new and expanded control options for Volatile Organic Compounds (VOCs), Greenhouse Gases (GHGs), and other hydrocarbon emissions from oil and gas facilities. The Division anticipates a formal rulemaking process to begin in November, 2013.

The options being considered could impose significant capital and operational costs on oil and gas operators statewide. The Division is requesting that comments on these potential revisions to Regulation No. 7 be submitted to the Division by March 21, 2013. Through this stakeholder process, the Division is providing oil and gas operators a significant opportunity to shape and tailor the Division's anticipated rulemaking proposal. The next Stakeholder Meeting is scheduled for March 28, 2013. More information can be found at the Division's website. Members of DGS' Air Quality Team have attended and monitored the first two stakeholder meetings, and have also been following the photochemical air modeling work of the Denver Regional Air Quality Council (RAQC) over the past year. This modeling will form the basis for any claimed benefits of the proposed regulations.

The Division is considering the following control strategies:

  • Expansion of control requirements for storage tanks;
  • Enhanced emissions capture at currently controlled storage tanks;
  • Expansion of auto-igniter requirements on flares for tanks statewide;
  • Expansion of leak detection and repair requirements to control fugitive emissions at compressor stations and wellsites;
  • Expansion of existing low-bleed pneumatic requirements statewide; and
  • Reducing venting and flaring at well sites.

Expansion of Storage Tank Requirements: The Division is primarily targeting storage tanks, as the Division considers these facilities to be the most significant emissions source. The Division is considering reducing the existing state-wide 20 tpy applicability threshold for condensate storage tanks to 6 tpy (actual uncontrolled VOCs). Consistent with the recently finalized federal rule (Quad O), this would require tanks with actual uncontrolled VOC emissions above 6 tpy to control VOC emissions by 95 percent. The Division estimates this potential requirement would affect approximately 521 condensate tanks statewide. Perhaps more significantly, the Division is considering making these control requirements applicable to both crude oil and produced water tanks.

Storage Tanks Emissions Capture: The Division is considering a "no detectable emissions" standard for thief hatches, pressure relief valves, and other tank access points (except during periods of malfunction). For this potential requirement, the Division identified the following, among others, as available options to increase capture efficiency: 2 or 3 phase gathering (liquids piped off site, rather than to an atmospheric tank); capture of gases from thief hatches, pressure relief valves, and other access points; and high-low pressure separators. DGS' Air Quality Team has openly reacted to this requirement as operationally infeasible and unachievable.

Expansion of Auto-igniter Requirements: All flare control devices statewide would require auto-igniters. The Division estimates that this potential requirement would affect approximately 198 dehydrators and 485 tank batteries.

Expansion of Leak Detection and Repair Requirements: Establishment of leak detection and repair requirements for compressor stations and requiring periodic IR camera inspection at well-head sites. This would appear to be aimed more at methane than VOC emissions, which raises a concern about the true purpose of, and bases for, these proposed ozone SIP implementation regulations.

Expansion of Low-bleed Pneumatic Requirements: Expansion of the current pneumatic low-bleed requirements for operations in the Denver Metro Non-attainment Area to all facilities employing gas-driven pneumatics statewide. This also would appear to be aimed at methane emission reductions, not VOCs.

Reduction of Gas Flaring/Venting: Separator gas must be routed to a gas gathering line or sent to a control device with 95 percent destruction efficiency during first 12 months of production of a new well or wells. The gas must be routed to a gas gathering line within 12 months.

Revisions to Regulation Nos. 3 and 6

The Division is also considering revisions to Regulation No. 3 and Regulation No. 6 as part of the anticipated rulemaking, including the following:

  • Adopt NSPS Subpart OOOO in full to include well completion and other requirements of the federal rule;
  • Remove the catch-all permitting and APEN requirement for sources subject to a NSPS, NESHAP, or MACT adopted in Colorado;
  • Simplify and streamline reporting and permitting requirements;
  • Increase APEN and permitting thresholds; and
  • Removing the crude oil tank permitting exemption.