To develop screening estimates of acute exposures, we developed estimates of maximum hourly emission rates by multiplying the average actual annual hourly emission rates by a factor to cover routinely variable emissions. We chose the factor based on process knowledge and engineering judgment and with awareness of a Texas study of short-term emissions variability, which showed that most peak emission events, in a heavily-industrialized 4-county area (Harris, Galveston, Chambers and Brazoria Counties, Texas) were less than twice the annual average hourly emission rate. The highest peak emission event was 74 times the annual average hourly emission rate, and the 99th percentile ratio of peak hourly emission rate to the annual average hourly emission rate was 9. This analysis is provided in Appendix 4 of the Draft Residual Risk Assessment for the Oil and Gas Production and Natural Gas Transmission and Storage Source Categories, which is available in the docket for this action. Considering this analysis, unless specific process knowledge or data are available to provide an alternate value, to account for more than 99 percent of the peak hourly emissions, we apply a conservative screening multiplication factor of 10 to the average annual hourly emission rate in these acute exposure screening assessments. The factor of 10 was used for both the Oil and Natural Gas Production and the Natural Gas Transmission and Storage source categories.
      In cases where acute HQ values from the screening step were less than or equal to 1, acute impacts were deemed negligible and no further analysis was performed. In cases where an acute HQ from the screening step was greater than 1, additional site-specific data were considered to develop a more refined estimate of the potential for acute impacts of concern. The data refinements employed for these source categories consisted of using the site-specific facility layout to distinguish facility property from an area where the public could be exposed. These refinements are discussed in the draft risk assessment document, which is available in the docket for each of these source categories. Ideally, we would prefer to have continuous measurements over time to see how the emissions vary by each hour over an entire year. Having a frequency distribution of hourly emission rates over a year would allow us to perform a probabilistic analysis to estimate potential threshold exceedances and their frequency of occurrence. Such an evaluation could include a more complete statistical treatment of the key parameters and elements adopted in this screening analysis. However, we recognize that having this level of data is rare, hence our use of the multiplier approach.
      To better characterize the potential health risks associated with estimated acute exposures to HAP, and in response to a key recommendation from the SAB's peer review
of the EPA's RTR risk assessment methodologies, we generally examine a wider range of available acute health metrics than we do for our chronic risk assessments. This is in response to the SAB's acknowledgement that there are generally more data gaps and inconsistencies in acute reference values than there are in chronic reference values. Comparisons of the estimated maximum off-site 1-hour exposure levels are not typically made to occupational levels for the purpose of characterizing public health risks in RTR assessments. This is because they are developed for working age adults and are not generally considered protective for the general public. We note that occupational ceiling values are, for most chemicals, set at levels higher than a 1-hour AEGL-1.
      As discussed in section VII.C.2 of this preamble, the maximum estimated worst-case 1-hour exposure to benzene outside the facility fence line for a facility in either source category is 12 mg/m[3]. This estimated exposure exceeds the 6-hour REL by a factor of 9 (HQREL = 9), but is significantly below the 1-hour AEGL-1 (HQAEGL-1 = 0.07). Although this worst-case exposure estimate does not exceed the AEGL-1, we note here that it slightly exceeds workplace ceiling level guidelines designed to protect the worker population for short duration (<15 minute) increases in exposure to benzene, as discussed below. The occupational short-term exposure limit (STEL) standard for benzene developed by the Occupational Safety and Health Administration is 16 mg/m[3], "as averaged over any 15-minute period." Occupational guideline STEL for exposures to benzene have also been developed by the American Conference of Governmental Industrial Hygienists (ACGIH) for less than 15 minutes (ACGIH threshold limit value (TLV)-STEL value of 8.0 mg/m[3]), and by the National Institute for Occupational Safety and Health (NIOSH) "for any 15 minute period in a work day" (NIOSH REL-STEL of 3.2 mg/m[3]). These shorter duration occupational values indicate potential concerns regarding health effects at exposure levels below the 1-hour AEGL-1 value. We solicit comment on the use of the occupational values described above in the interpretation of these worst-case acute screening exposure estimates.
d. Conducting Multi-Pathway Exposure and Risk Modeling
      The potential for significant human health risks due to exposures via routes other than inhalation (i.e., multi-pathway exposures) and the potential for adverse environmental impacts were evaluated in a three-step process. In the first step, we determined whether any facilities emitted any HAP known to be PB-HAP (HAP known to be persistent and bio-accumulative) in the environment. There are 14 PB-HAP compounds or compound classes identified for this screening in the EPA's Air Toxics Risk Assessment Library (available at http://www.epa.gov/ttn/fera/risk_atra_vol1.html). They are cadmium compounds, chlordane, chlorinated dibenzodioxins and furans, dichlorodiphenyldichloroethylene, heptachlor, hexachlorobenzene, hexachlorocyclohexane, lead compounds, mercury compounds, methoxychlor, polychlorinated biphenyls, POM, toxaphene and trifluralin.
      Since one or more of these PB-HAP are emitted by at least one facility in both source categories, we proceeded to the second step of the evaluation. In this step, we determined whether the facility-specific emission rates of each of the emitted PB - HAP were large enough to create the potential for significant non-inhalation human or environmental risks under reasonable worst-case conditions. To facilitate this step, we have developed emission rate thresholds for each PB - HAP using a hypothetical worst-case screening exposure scenario developed for use in conjunction with the EPA's TRIM.FaTE model. The hypothetical screening scenario was subjected to a sensitivity analysis to ensure that its key design parameters were established such that environmental media concentrations were not underestimated (i.e., to minimize the occurrence of false negatives or results that suggest that risks might be acceptable when, in fact, actual risks are high) and to also minimize the occurrence of false positives for human health endpoints. We call this application of the TRIM.FaTE model TRIM-Screen. The facility-specific emission rates of each of the PB - HAP in each source category were compared to the TRIM-Screen emission threshold values for each of the PB - HAP identified in the source category datasets to assess the potential for significant human health risks or environmental risks via non-inhalation pathways.
      There was only one facility in the Natural Gas Transmission and Storage source category with reported emissions of PB-HAP, and the emission rates were less than the emission threshold values. There were 29 facilities in the Oil and Natural Gas Production source category with reported emissions of PB-HAP, and one of these had emission rates greater than the emission threshold values. In this case, the emission threshold value for POM was exceeded by a factor of 6. For POM, dairy, vegetables and fruits were the three most dominant exposure pathways driving human exposures in the hypothetical screening exposure scenario. The single facility with emissions exceeding the emission threshold value for POM is located in a highly industrialized area. Therefore, since the exposure pathways which would drive high human exposure are not locally available, multi-pathway exposures and environmental risks were deemed negligible, and no further analysis was performed. For further information on the multi-pathway analysis approach, see the residual risk documentation.
e. Assessing Risks Considering Emissions Control Options
	In addition to assessing baseline inhalation risks and screening for potential multi-pathway risks, where appropriate, we also estimated risks considering the potential emission reductions that would be achieved by the particular control options under consideration. In these cases, the expected emissions reductions were applied to the specific HAP and emissions sources in the source category dataset to develop corresponding estimates of risk reductions.
f. Conducting Other Risk-Related Analyses: Facility-Wide Assessments
      To put the source category risks in context, we also examined the risks from the entire "facility," where the facility includes all HAP-emitting operations within a contiguous area and under common control. In other words, for each facility that includes one or more sources from one of the source categories under review, we examined the HAP emissions not only from the source category of interest, but also from all other emission sources at the facility. The emissions data for generating these "facility-wide" risks were also obtained from the 2005 NEI. For every facility included in the MACT database, we also retrieved emissions data and release characteristics for all other emission sources at the same facility. We estimated the risks due to the inhalation of HAP that are emitted "facility-wide" for the populations residing within 50 km of each facility, consistent with the methods used for the source category analysis described above. For these facility-wide risk analyses, the modeled source category risks were compared to the facility-wide risks to determine the portion of facility-wide risks that could be attributed to the source categories addressed in this proposal. We specifically examined the facilities associated with the highest estimates of risk and determined the percentage of that risk attributable to the source category of interest. The risk documentation available through the docket for this action provides the methodology and the results of the facility-wide analyses for each source category.
g. Conducting Other Analyses: Demographic Analysis
	To examine the potential for any environmental justice (EJ) issues that might be associated with each source category, we performed a demographic analysis of population risk. In this analysis, we evaluated the distributions of HAP-related cancer and noncancer risks across different social, demographic and economic groups within the populations living near the facilities where these source categories are located. The development of demographic analyses to inform the consideration of EJ issues in the EPA rulemakings is an evolving science. The EPA offers the demographic analyses in this rulemaking to inform the consideration of potential EJ issues and invites public comment on the approaches used and the interpretations made from the results, with the hope that this will support the refinement and improve the utility of such analyses for future rulemakings.
      For the demographic analyses, we focus on the populations within 50 km of any facility estimated to have exposures to HAP which result in cancer risks of 1-in-1 million or greater, or noncancer HI of 1 or greater (based on the emissions of the source category or the facility, respectively). We examine the distributions of those risks across various demographic groups, comparing the percentages of particular demographic groups to the total number of people in those demographic groups nationwide. The results, including other risk metrics, such as average risks for the exposed populations, are documented in source-category-specific technical reports in the docket for both source categories covered in this proposal.
      The basis for the risk values used in these analyses were the modeling results based on actual emissions levels obtained from the HEM-3 model described above. The risk values for each census block were linked to a database of information from the 2000 Decennial census that includes data on race and ethnicity, age distributions, poverty status, household incomes and education level. The Census Department Landview(R) database was the source of the data on race and ethnicity and the data on age distributions, poverty status, household incomes and education level were obtained from the 2000 Census of Population and Housing Summary File 3 Long Form. While race and ethnicity census data are available at the census block level, the age and income census data are only available at the census block group level (which includes an average of 26 blocks or an average of 1,350 people). Where census data are available at the block group level, but not the block level, we assumed that all census blocks within the block group have the same distribution of ages and incomes as the block group.
      For each source category, we focused on those census blocks where source category risk results show estimated lifetime inhalation cancer risks above 1-in-1 million or chronic noncancer indices above 1 and determined the relative percentage of different racial and ethnic groups, different age groups, adults with and without a high school diploma, people living in households below the national median income and for people living below the poverty line within those census blocks. The specific census population categories studied include:
::	Total population
::	White
::	African American (or Black)
::	Native Americans
::	Other races and multiracial
::	Hispanic or Latino
::	Children 18 years of age and under
::	Adults 19 to 64 years of age
::	Adults 65 years of age and over
::	Adults without a high school diploma
::	Households earning under the national median income
::	People living below the poverty line
      It should be noted that these categories overlap in some instances, resulting in some populations being counted in more than one category (e.g., other races and multiracial and Hispanic). In addition, while not a specific census population category, we also examined risks to "Minorities," a classification which is defined for these purposes as all race population categories except white.
      For further information about risks to the populations located near the facilities in these source categories, we also evaluated the estimated distribution of inhalation cancer and chronic noncancer risks associated with the HAP emissions from all the emissions sources at the facility (i.e., facility-wide). This analysis used the facility-wide RTR modeling results and the census data described above.
      The methodology and the results of the demographic analyses for each source category are included in a source-category-specific technical report for each of the categories, which are available in the docket for this action.
h. Considering Uncertainties in Risk Assessment
      Uncertainty and the potential for bias are inherent in all risk assessments, including those performed for the source categories addressed in this proposal. Although uncertainty exists, we believe that our approach, which used conservative tools and assumptions, ensures that our decisions are health-protective. A brief discussion of the uncertainties in the emissions datasets, dispersion modeling, inhalation exposure estimates and dose-response relationships follows below. A more thorough discussion of these uncertainties is included in the risk assessment documentation (referenced earlier) available in the docket for this action.
i. Uncertainties in the Emissions Datasets
	Although the development of the MACT dataset involved QA/quality control processes, the accuracy of emissions values will vary depending on the source of the data, the degree to which data are incomplete or missing, the degree to which assumptions made to complete the datasets are inaccurate, errors in estimating emissions values and other factors. The emission estimates considered in this analysis generally are annual totals for certain years that do not reflect short-term fluctuations during the course of a year or variations from year to year.
      The estimates of peak hourly emission rates for the acute effects screening assessment were based on a multiplication factor of 10 applied to the average annual hourly emission rate, which is intended to account for emission fluctuations due to normal facility operations. Additionally, although we believe that we have data for most facilities in these two source categories in our RTR dataset, our dataset may not include data for all existing facilities. Moreover, there are uncertainties with regard to the identification of sources as major or area in the NEI for these source categories.
ii. Uncertainties in Dispersion Modeling
	While the analysis employed the EPA's recommended regulatory dispersion model, AERMOD, we recognize that there is uncertainty in ambient concentration estimates associated with any model, including AERMOD. In circumstances where we had to choose between various model options, where possible, model options (e.g., rural/urban, plume depletion, chemistry) were selected to provide an overestimate of ambient air concentrations of the HAP rather than underestimates. However, because of practicality and data limitation reasons, some factors (e.g., meteorology, building downwash) have the potential in some situations to overestimate or underestimate ambient impacts. For example, meteorological data were taken from a single year (1991) and facility locations can be a significant distance from the site where these data were taken. Despite these uncertainties, we believe that at off-site locations and census block centroids, the approach considered in the dispersion modeling analysis should generally yield overestimates of ambient HAP concentrations.
iii.	Uncertainties in inhalation exposure
	The effects of human mobility on exposures were not included in the assessment. Specifically, short-term mobility and long-term mobility between census blocks in the modeling domain were not considered. The assumption of not considering short or long-term population mobility does not bias the estimate of the theoretical MIR, nor does it affect the estimate of cancer incidence since the total population number remains the same. It does, however, affect the shape of the distribution of individual risks across the affected population, shifting it toward higher estimated individual risks at the upper end and reducing the number of people estimated to be at lower risks, thereby increasing the estimated number of people at specific risk levels.
	In addition, the assessment predicted the chronic exposures at the centroid of each populated census block as surrogates for the exposure concentrations for all people living in that block. Using the census block centroid to predict chronic exposures tends to over-predict exposures for people in the census block who live further from the facility, and under-predict exposures for people in the census block who live closer to the facility. Thus, using the census block centroid to predict chronic exposures may lead to a potential understatement or overstatement of the true maximum impact, but is an unbiased estimate of average risk and incidence.
      The assessments evaluate the cancer inhalation risks associated with continuous pollutant exposures over a 70-year period, which is the assumed lifetime of an individual. In reality, both the length of time that modeled emissions sources at facilities actually operate (i.e., more or less than 70 years), and the domestic growth or decline of the modeled industry (i.e., the increase or decrease in the number or size of United States facilities), will influence the risks posed by a given source category. Depending on the characteristics of the industry, these factors will, in most cases, result in an overestimate both in individual risk levels and in the total estimated number of cancer cases. However, in rare cases, where a facility maintains or increases its emission levels beyond 70 years, residents live beyond 70 years at the same location, and the residents spend most of their days at that location, then the risks could potentially be underestimated. Annual cancer incidence estimates from exposures to emissions from these sources would not be affected by uncertainty in the length of time emissions sources operate.
      The exposure estimates used in these analyses assume chronic exposures to ambient levels of pollutants. Because most people spend the majority of their time indoors, actual exposures may not be as high, depending on the characteristics of the pollutants modeled. For many of the HAP, indoor levels are roughly equivalent to ambient levels, but for very reactive pollutants or larger particles, these levels are typically lower. This factor has the potential to result in an overstatement of 25 to 30 percent of exposures.
      In addition to the uncertainties highlighted above, there are several factors specific to the acute exposure assessment that should be highlighted. The accuracy of an acute inhalation exposure assessment depends on the simultaneous occurrence of independent factors that may vary greatly, such as hourly emissions rates, meteorology, and human activity patterns. In this assessment, we assume that individuals remain for 1 hour at the point of maximum ambient concentration as determined by the co-occurrence of peak emissions and worst-case meteorological conditions. These assumptions would tend to overestimate actual exposures since it is unlikely that a person would be located at the point of maximum exposure during the time of worst-case impact.
iv. Uncertainties in Dose-Response Relationships
	There are uncertainties inherent in the development of the dose-response values used in our risk assessments for cancer effects from chronic exposures and noncancer effects from both chronic and acute exposures. Some uncertainties may be considered quantitatively, and others generally are expressed in qualitative terms. We note as a preface to this discussion a point on dose-response uncertainty that is brought out in the EPA 2005 Cancer Guidelines; namely, that "the primary goal of the EPA actions is protection of human health; accordingly, as an Agency policy, risk assessment procedures, including default options that are used in the absence of scientific data to the contrary, should be health protective." (EPA 2005 Cancer Guidelines, pages 1 - 7.) This is the approach followed here as summarized in the next several paragraphs. A complete detailed discussion of uncertainties and variability in dose-response relationships is given in the residual risk documentation, which is available in the docket for this action.
      Cancer URE values used in our risk assessments are those that have been developed to generally provide an upper bound estimate of risk. That is, they represent a "plausible upper limit to the true value of a quantity" (although this is usually not a true statistical confidence limit). In some circumstances, the true risk could be as low as zero; however, in other circumstances, the risk could also be greater. When developing an upper bound estimate of risk and to provide risk values that do not underestimate risk, health-protective default approaches are generally used. To err on the side of ensuring adequate health-protection, the EPA typically uses the upper bound estimates rather than lower bound or central tendency estimates in our risk assessments, an approach that may have limitations for other uses (e.g., priority-setting or expected benefits analysis).
      Chronic noncancer reference (RfC and reference dose (RfD)) values represent chronic exposure levels that are intended to be health-protective levels. Specifically, these values provide an estimate (with uncertainty spanning perhaps an order of magnitude) of daily oral exposure (RfD) or of a continuous inhalation exposure (RfC) to the human population (including sensitive subgroups) that is likely to be without an appreciable risk of deleterious effects during a lifetime. To derive values that are intended to be "without appreciable risk," the methodology relies upon an uncertainty factor (UF) approach (U.S. EPA, 1993, 1994) which includes consideration of both uncertainty and variability. When there are gaps in the available information, UF are applied to derive reference values that are intended to protect against appreciable risk of deleterious effects. The UF are commonly default values, e.g., factors of 10 or 3, used in the absence of compound-specific data; where data are available, UF may also be developed using compound-specific information. When data are limited, more assumptions are needed and more UF are used. Thus, there may be a greater tendency to overestimate risk in the sense that further study might support development of reference values that are higher (i.e., less potent) because fewer default assumptions are needed. However, for some pollutants, it is possible that risks may be underestimated. While collectively termed "uncertainty factor," these factors account for a number of different quantitative considerations when using observed animal (usually rodent) or human toxicity data in the development of the RfC. The UF are intended to account for: (1) Variation in susceptibility among the members of the human population (i.e., inter-individual variability); (2) uncertainty in extrapolating from experimental animal data to humans (i.e., interspecies differences); (3) uncertainty in extrapolating from data obtained in a study with less-than-lifetime exposure (i.e., extrapolating from sub-chronic to chronic exposure); (4) uncertainty in extrapolating the observed data to obtain an estimate of the exposure associated with no adverse effects; and (5) uncertainty when the database is incomplete or there are problems with the applicability of available studies. Many of the UF used to account for variability and uncertainty in the development of acute reference values are quite similar to those developed for chronic durations, but they more often use individual UF values that may be less than 10. UF are applied based on chemical-specific or health effect-specific information (e.g., simple irritation effects do not vary appreciably between human individuals, hence a value of 3 is typically used), or based on the purpose for the reference value (see the following paragraph). The UF applied in acute reference value derivation include: (1) Heterogeneity among humans; (2) uncertainty in extrapolating from animals to humans; (3) uncertainty in lowest observed adverse effect (exposure) level to no observed adverse effect (exposure) level adjustments; and (4) uncertainty in accounting for an incomplete database on toxic effects of potential concern. Additional adjustments are often applied to account for uncertainty in extrapolation from observations at one exposure duration (e.g., 4 hours) to derive an acute reference value at another exposure duration (e.g., 1 hour).
      Not all acute reference values are developed for the same purpose and care must be taken when interpreting the results of an acute assessment of human health effects relative to the reference value or values being exceeded. Where relevant to the estimated exposures, the lack of short-term dose-response values at different levels of severity should be factored into the risk characterization as potential uncertainties.
      Although every effort is made to identify peer-reviewed reference values for cancer and noncancer effects for all pollutants emitted by the sources included in this assessment, some HAP continue to have no reference values for cancer or chronic noncancer or acute effects. Since exposures to these pollutants cannot be included in a quantitative risk estimate, an understatement of risk for these pollutants at environmental exposure levels is possible. For a group of compounds that are either unspeciated or do not have reference values for every individual compound (e.g., glycol ethers), we conservatively use the most protective reference value to estimate risk from individual compounds in the group of compounds.
      Additionally, chronic reference values for several of the compounds included in this assessment are currently under the EPA IRIS review and revised assessments may determine that these pollutants are more or less potent than the current value. We may re-evaluate residual risks for the final rulemaking if these reviews are completed prior to our taking final action for these source categories and a dose-response metric changes enough to indicate that the risk assessment supporting this notice may significantly understate human health risk.
v. Uncertainties in the Multi-Pathway and Environmental Effects Assessment
	We generally assume that when exposure levels are not anticipated to adversely affect human health, they also are not anticipated to adversely affect the environment. For each source category, we generally rely on the site-specific levels of PB-HAP emissions to determine whether a full assessment of the multi-pathway and environmental effects is necessary. As discussed above, we conclude that the potential for these types of impacts is low for these source categories.
vi. Uncertainties in the Facility-Wide Risk Assessment 	Given that the same general analytical approach and the same models were used to generate facility-wide risk results as were used to generate the source category risk results, the same types of uncertainties discussed above for our source category risk assessments apply to the facility-wide risk assessments. Additionally, the degree of uncertainty associated with facility-wide emissions and risks is likely greater because we generally have not conducted a thorough engineering review of emissions data for source categories not currently undergoing an RTR review.
vii.	Uncertainties in the Demographic Analysis
	Our analysis of the distribution of risks across various demographic groups is subject to the typical uncertainties associated with census data (e.g., errors in filling out and transcribing census forms), as well as the additional uncertainties associated with the extrapolation of census-block group data (e.g., income level and education level) down to the census block level.
2. What are the results and proposed decisions from the risk review for the Oil and Natural Gas Production source category?
a. Results of the Risk Assessments and Analyses
	We conducted an inhalation risk assessment for the Oil and Natural Gas Production source category. We also conducted an assessment of facility-wide risk. Details of the risk assessments and analyses can be found in the residual risk documentation, which is available in the docket for this action. For informational purposes and to examine the potential for any EJ issues that might be associated with each source category, we performed a demographic analysis of population risks.
i. Inhalation Risk Assessment Results
	Table 2 provides an overall summary of the results of the inhalation risk assessment.
  TABLE 2. OIL AND NATURAL GAS PRODUCTION INHALATION RISK ASSESSMENT RESULTS
                             Number of Facilities1
                                    Maximum
                                  Individual
                                  Cancer Risk
                                (in 1 million)2
                             Estimated Population
                          at Risk >= 1-in-1 Million
                               Estimated Annual
                                    Cancer
                          Incidence (cases per year)
                                    Maximum
                               Chronic Noncancer
                                    TOSHI4
                     Maximum Off-Site Acute Noncancer HQ5

                            Actual Emissions Level
                           Allowable Emissions Level

                            Actual Emissions Level
                           Allowable Emissions Level

                                      990
                                      40
                                  100 - 4003
                                   160,0003
                                 0.007 - 0.023
                                      0.1
                                      0.7
                              HQREL = 9 (benzene)
                           HQAEGL-1 = 0.07 (benzene)
1 Number of facilities evaluated in the risk analysis.
2 Estimated maximum individual excess lifetime cancer risk.
3 The EPA IRIS assessment for benzene provides a range of equally-plausible URE (2.2E-06 to 7.8E-06 per ug/m3), giving rise to ranges for the estimates of cancer MIR and cancer incidence. Estimated population values are not scalable with benzene URE range, but would be lower using the lower end of the URE range.
4 Maximum TOSHI. The target organ with the highest TOSHI for the Oil and Natural Gas Production source category is the respiratory system.
5 The maximum estimated acute exposure concentration was divided by available short-term dose-response values to develop an array of HQ values.

	As shown in Table 2, the results of the inhalation risk assessment performed using actual emissions data indicate the maximum lifetime individual cancer risk could be as high as 40-in-1 million, with POM driving the highest risk, and benzene driving risks overall. The total estimated cancer incidence from this source category is 0.02 excess cancer cases per year (0.007 excess cancer cases per year based on the lower end of the benzene URE range), or one case in every 50 years. Approximately 160,000 people are estimated to have cancer risks at or above 1-in-1 million as a result of the emissions from 89 facilities (use of the lower end of the benzene URE range would further reduce this population estimate). The maximum chronic non-cancer TOSHI value for the source category could be up to 0.1 from emissions of naphthalene, indicating no significant potential for chronic noncancer impacts.
	As explained above, our analysis of potential differences between actual emission levels and emissions allowable under the oil and natural gas production MACT standard indicate that MACT-allowable emission levels may be up to 50 times greater than actual emission levels. Considering this difference, the risk results from the inhalation risk assessment indicate the maximum lifetime individual cancer risk could be as high as 400-in-1 million (100-in-1 million based on the lower end of the benzene URE range) and the maximum chronic noncancer TOSHI value could be as high as 0.7 at the MACT-allowable emissions level.
ii. Facility-Wide Risk Assessment Results
	A facility-wide risk analysis was also conducted based on actual emissions levels. Table 3 displays the results of the facility-wide risk assessment. For detailed facility-specific results, see Table 2 of Appendix 6 of the risk document in the docket for this rulemaking.
 TABLE 3. OIL AND NATURAL GAS PRODUCTION FACILITY-WIDE RISK ASSESSMENT RESULTS
Number of facilities analyzed
                                      990
Cancer Risk
Estimated maximum facility-wide individual cancer risk (in 1 million)
                                      100

Number of facilities with estimated facility-wide individual cancer risk of 100-in-1 million or more
                                       1

Number of facilities at which the Oil and Natural Gas Production source category contributes 50 percent or more to the facility-wide individual cancer risks of 100-in-1 million or more
                                       0

Number of facilities with facility-wide individual cancer risk of 1-in-1 million or more
                                      140

Number of facilities at which the Oil and Natural Gas Production source category contributes 50 percent or more to the facility-wide individual cancer risk of 1-in-1 million or more
                                      85
Chronic Noncancer Risk
Maximum facility-wide chronic noncancer TOSHI
                                       9

Number of facilities with facility-wide maximum noncancer TOSHI greater than 1
                                      10

Number of facilities at which the Oil and Natural Gas Production source category contributes 50 percent or more to the facility-wide maximum noncancer TOSHI of 1 or more
                                       0

	The facility-wide MIR from all HAP emissions at a facility that contains sources subject to the oil and natural gas production MACT standards is estimated to be 100-in-1 million, based on actual emissions. Of the 990 facilities included in this analysis, only one has a facility-wide MIR of 100-in-1 million. At this facility, oil and natural gas production accounts for less than 2 percent of the total facility-wide risk. Nickel emissions from oil-fired boilers and formaldehyde emissions from reciprocating internal combustion engines (RICE) contribute essentially all the facility-wide risks at this facility, with over 80 percent of the risk attributed to the nickel emissions. There are 140 facilities with facility-wide MIR of 1-in-1 million or greater. Of these facilities, 85 have oil and natural gas production operations that contribute greater than 50 percent to the facility-wide risks. As discussed above, we are proposing MACT standards for BTEX emissions from small glycol dehydrators in this action. These standards would reduce the risk from benzene emissions at facilities with oil and gas production. Formaldehyde emissions will be assessed under future RTR for RICE.
	The facility-wide maximum individual chronic noncancer TOSHI is estimated to be 9 based on actual emissions. Of the 990 facilities included in this analysis, 10 have facility-wide maximum chronic noncancer TOSHI values greater than 1. Of these facilities, none had oil and natural gas production operations that contributed greater than 50 percent to these facility-wide risks. The chronic noncancer risks at these 10 facilities are primarily driven by acrolein emissions from RICE.
iii.	Demographic Risk Analysis Results
	The results of the demographic analyses performed to investigate the distribution of cancer risks at or above 1-in-1 million among the surrounding population are summarized in Table 4 below. These results, for various demographic groups, are based on actual emissions levels for the population living within 50 km of the facilities.
   TABLE 4. OIL AND NATURAL GAS PRODUCTION DEMOGRAPHIC RISK ANALYSIS RESULTS

                                  Nationwide
      Population with Cancer Risk at or Above 1-in-1 Million Due to....

                         Source Category HAP Emissions
                          Facility-Wide HAP Emissions
Total Population
                                  285,000,000
                                    160,000
                                    597,000
                                Race by Percent
White
                                      75
                                      62
                                      61
All Other Races
                                      25
                                      38
                                      39
                                Race by Percent
White
                                      75
                                      62
                                      61
African American
                                      12
                                      12
                                       8
Native American
                                      0.9
                                      0.7
                                      1.3
Other and Multiracial
                                      12
                                      25
                                      30
                             Ethnicity by Percent
Hispanic
                                      14
                                      22
                                      34
Non-Hispanic
                                      86
                                      78
                                      66
                               Income by Percent
Below Poverty Level
                                      13
                                      14
                                      19
Above Poverty Level
                                      87
                                      86
                                      81
                             Education by Percent
Over 25 and without High School Diploma
                                      13
                                      10
                                      16
Over 25 and with a High School Diploma
                                      87
                                      90
                                      84

	The results of the Oil and Natural Gas Production source category demographic analysis indicate that there are approximately 160,000 people exposed to a cancer risk at or above 1-in-1 million due to emissions from the source category, including an estimated 38 percent that are classified as minority (listed as "All Other Races" in the table above). Of the 160,000 people with estimated cancer risks at or above 1-in-1 million from the source category, 25 percent are in the "Other and Multiracial" demographic group, 22 percent are in the "Hispanic or Latino" demographic group, and 14 percent are in the "Below Poverty Level" demographic group, results which are 13, 8 and 1 percentage points higher, respectively, than the respective percentages for these demographic groups across the United States. The percentages for the other demographic groups are lower than their respective nationwide percentages. The table also shows that there are approximately 597,000 people exposed to an estimated cancer risk at or above 1-in-1 million due to facility-wide emissions, including 30 percent in the "Other and Multiracial" demographic group, 34 percent in the "Hispanic or Latino" demographic group, 1.3 percent in the "Native American" demographic group and 16 percent in the "Over 25 and without High School Diploma" demographic group, results which are 18, 2, 0.4 and 3 percentage points higher than the percentages for these demographic groups across the United States, respectively. The percentages for the other demographic groups are lower than their respective nationwide percentages.
b. What are the proposed risk decisions for the Oil and Natural Gas Production source category?
i. Risk Acceptability
	In the risk analysis we performed for this source category, pursuant to CAA section 112(f)(2), we considered the available health information--the MIR; the numbers of persons in various risk ranges; cancer incidence; the maximum noncancer HI; the maximum acute noncancer hazard; the extent of noncancer risks; the potential for adverse environmental effects; and distribution of risks in the exposed population; and risk estimation uncertainty (54 FR 38044, September 14, 1989).
      For the Oil and Natural Gas Production source category, the risk analysis we performed indicates that the cancer risks to the individual most exposed could be as high as 40-in-1 million due to actual emissions and as high as 400-in-1 million due to MACT-allowable emissions (100-in-1 million, based on the lower end of the benzene URE range). While the 40-in-1 million risk due to actual emissions is considerably less than 100-in-1 million, which is the presumptive limit of acceptability, the 400-in-1 million risk due to allowable emissions is considerably higher and is considered unacceptable. We do note, however, that the risk analysis shows low cancer incidence (1 case in every 50 years), low potential for adverse environmental effects or human health multi-pathway effects and that chronic noncancer health impacts are unlikely.
      We also conclude that acute noncancer health impacts are unlikely. As discussed above, screening estimates of acute exposures and risks were evaluated for each of the HAP at the point of highest off-site exposure for each facility (i.e., not just the census block centroids) assuming that a person is located at this spot at a time when both the peak emission rate and worst-case dispersion conditions occur. Under these worst-case conditions, we estimate benzene acute HQ values (based on the REL) could be as high as 9. Although the REL (which indicates the level below which adverse effects are not anticipated) is exceeded in this case, we believe the potential for acute effects is low for several reasons. First, the acute modeling scenario is worst-case because of the confluence of peak emission rates and worst-case dispersion conditions. Second, the benzene REL is based on a 6-hour exposure duration because a 1-hour exposure duration value was unavailable. An REL based on a 6-hour exposure duration is generally lower than an REL based on a 1-hour exposure duration and, consequently, easier to exceed. Also, although there are exceedances of the REL, the highest estimated 1-hour exposure is less than 10 percent of the AEGL-1 value, which is a level at which effects could be experienced. Finally, the generally sparse populations near these facilities make it less likely that a person would be near the plant to be exposed. For example, in the two cases where the acute HQ value is as high as 9, there are only 30 people associated with the census blocks within 2 miles of the two facilities.
      While our additional analysis of facility-wide risks showed that there is one facility with maximum facility-wide cancer risk of 100-in-1 million or greater and 10 facilities with a maximum chronic noncancer TOSHI greater than 1, it also showed that oil and natural gas production operations did not drive these risks.
      In determining whether risk is acceptable, we considered the available health information, as described above. In this case, although a number of factors we considered indicate relatively low risk concern, we are proposing to determine that the risks are unacceptable, in large part, because the MIR is 400-in-1 million due to MACT-allowable emissions, which greatly exceeds the "presumptive limit on maximum individual lifetime risk of approximately 1-in-10 thousand [100-in-1 million] recognized in the Benzene NESHAP (54 FR 38045)." The MIR, based on MACT-allowable emissions, is driven by the allowable emissions of 0.9 Mg/yr benzene under the MACT as a compliance option. We are, therefore, proposing to eliminate the alternative compliance option of 0.9 Mg/yr benzene from the existing glycol dehydrator MACT requirements. With this change, the source category MIR, based on MACT-allowable emissions, would be reduced to 40-in-1 million, which we find acceptable in light of all the other factors considered. Thus, we are proposing that the risks from the Oil and Natural Gas Production source category are acceptable, with the removal of the alternative compliance option of 0.9 Mg/yr benzene limit from the current glycol dehydrator MACT requirements.
      Pursuant to CAA section 112(f)(4), we are proposing that this change (i.e., removal of the 0.9 Mg/yr compliance alternative) apply 90 days after its effective date. We are requesting comment on whether or not this is sufficient time for the large dehydrators that have been relying on this compliance alternative to come into compliance with the 95-percent control requirement or if additional time is needed. See CAA section 112(f)(4)(A).
      We recognize that our proposal to remove the 0.9 Mg/yr compliance alternative for the 95-percent control glycol dehydrator MACT standard could have negative impacts on some sources that have come to rely on the flexibility this alternative provides. We solicit comment on any such impacts and whether such impacts warrant adding a different compliance alternative that would result in less risk than the 0.9 Mg/yr benzene limit compliance option. If a commenter suggests a different compliance alternative, the commenter should explain, in detail, what that alternative would be, how it would work and how it would reduce risk.
ii. Ample Margin of Safety
	We next considered whether this revised standard (existing MACT plus removal of 0.9 Mg/yr benzene compliance option) provides an ample margin of safety. In this analysis, we investigated available emissions control options that might reduce the risk associated with emissions from the source category and considered this information along with all of the health risks and other health information considered in the risk acceptability determination.
      For glycol dehydrators, we considered the addition of a second control device in the same manner that was discussed in the floor evaluation in section VII.B.1 above. The cost effectiveness associated with that option would be $167,200/Mg, which we believe is too high to require additional controls on glycol dehydrators.
      Similarly, we considered the addition of a second control device to the required MACT floor control device (cost effectiveness of $18,300/Mg). Similar to our discussion of beyond-the-MACT-floor controls for glycol dehydrators in section VII.B.1 of this preamble, the incremental cost to add a second control device for storage vessels would be approximately 20 times higher than the MACT floor cost effectiveness, or $366,000/Mg. We do not believe this cost effectiveness is reasonable.
      For leak detection, we considered implementation of LDAR programs that are more stringent than the current standards. An assessment performed for various LDAR options under the NSPS in section VI.B.4.b of this preamble yielded the lowest cost effectiveness of $5,170/Mg ($4,700/ton) for control of VOC for the options evaluated. A LDAR program to control HAP would involve similar costs for equipment, labor, etc., to those considered in the NSPS assessment, but since there is approximately 20 times less HAP than VOC present in material handled in regulated equipment, the cost effectiveness to control HAP would be approximately 20 times greater (i.e., $100,000/Mg) for HAP, which we believe is not reasonable.
      In accordance with the approach established in the Benzene NESHAP, the EPA weighed all health risk measures and information considered in the risk acceptability determination, along with the costs and economic impacts of emissions controls, technological feasibility, uncertainties and other relevant factors in making our ample margin of safety determination. Considering the health risk information and the high cost effectiveness of the options identified, we propose that the existing MACT standards, with the removal of the 1 tpy benzene limit compliance option from the glycol dehydrator standards, provide an ample margin of safety to protect public health.
      While we are proposing that the oil and natural gas production MACT standards (with the removal of the alternative compliance option of 1 tpy benzene limit) provide an ample margin of safety to protect public health, we are concerned about the estimated facility-wide risks identified through these screening analyses. As described previously, the highest estimated facility-wide cancer risks are mostly due to emissions from oil fired boilers and RICE. Both of these sources are regulated under other source categories and we anticipate that emission reductions from those sources will occur as standards for those source categories are implemented.
3. What are the results and proposed decisions from the risk review for the Natural Gas Transmission and Storage source category?
a. Results of the Risk Assessments and Analyses
	We conducted an inhalation risk assessment for the Natural Gas Transmission and Storage source category. We also conducted an assessment of facility-wide risk and performed a demographic analysis of population risks. Details of the risk assessments and analyses can be found in the residual risk documentation, which is available in the docket for this action.
i. Inhalation Risk Assessment Results
	Table 5 provides an overall summary of the results of the inhalation risk assessment. For informational purposes and to examine the potential for any EJ issues that might be associated with each source category, we performed a demographic analysis of population risks.
TABLE 5. NATURAL GAS TRANSMISSION AND STORAGE INHALATION RISK ASSESSMENT RESULTS
                             Number of Facilities1
                                    Maximum
                                  Individual
                                  Cancer Risk
                                (in 1 million)2
                             Estimated Population
                          at Risk >= 1-in-1 Million
                               Estimated Annual
                                    Cancer
                          Incidence (cases per year)
                                    Maximum
                               Chronic Noncancer
                                    TOSHI4
                     Maximum Off-Site Acute Noncancer HQ5

                            Actual Emissions Level
                           Allowable Emissions Level

                            Actual Emissions Level
                           Allowable Emissions Level

                                      321
                                   30 - 903
                                   30 - 903
                                    2,5003
                                0.0003 -0.0013
                                     0.4
                                      0.8
                              HQREL = 5 (benzene)
                        HQAEGL-1 = 0.2 (chlorobenzene)
1 Number of facilities evaluated in the risk analysis.
2 Estimated maximum individual excess lifetime cancer risk.
3 The EPA IRIS assessment for benzene provides a range of equally-plausible URE (2.2E-06 to 7.8E-06 per ug/m3), giving rise to ranges for the estimates of cancer MIR and cancer incidence. Estimated population values are not scalable with benzene URE range, but would be lower using the lower end of the URE range.
4 Maximum TOSHI. The target organ with the highest TOSHI for the Natural Gas Transmission and Storage source category is the immune system.
5 The maximum estimated acute exposure concentration was divided by available short-term dose-response values to develop an array of HQ values.

	As shown in Table 5 above, the results of the inhalation risk assessment performed using actual emissions data indicate the maximum lifetime individual cancer risk could be as high as 90-in-1 million, (30-in-1 million based on the lower end of the benzene URE range), with benzene as the major contributor to the risk. The total estimated cancer incidence from the source category is 0.001 excess cancer cases per year (0.0003 excess cancer cases per year based on the lower end of the benzene URE range), or one case in every polycyclic organic matter 1,000 years. Approximately 2,500 people are estimated to have cancer risks at or above 1-in-1 million as a result of the emissions from 15 facilities (use of the lower end of the benzene URE range would further reduce this population estimate). The maximum chronic noncancer TOSHI value for the source category could be up to 0.4 from emissions of benzene, indicating no significant potential for chronic noncancer impacts.
	As explained above in section VII.C.1.b, our analysis of potential differences between actual emission levels and emissions allowable under the natural gas transmission and storage MACT standard indicate that MACT-allowable emission levels may be up to 50 times greater than actual emission levels at some sources. However, because some sources are emitting at the level allowed under the current NESHAP, the risk results from the inhalation risk assessment indicate the maximum lifetime individual cancer risk would still be 90-in-1 million (30-in-1 million based on the lower end of the benzene URE range), based on both actual and allowable emission levels, and the maximum chronic noncancer TOSHI value could be as high as 0.8 at the MACT-allowable emissions level.
ii. Facility-Wide Risk Assessment Results
	A facility-wide risk analysis was also conducted based on actual emissions levels. Table 6 below displays the results of the facility-wide risk assessment. For detailed facility-specific results, see Table 2 of Appendix 6 of the risk document in the docket for this rulemaking.
TABLE 6. NATURAL GAS TRANSMISSION AND STORAGE FACILITY-WIDE RISK ASSESSMENT RESULTS
Number of Facilities Analyzed
                                      321
Cancer Risk
Estimated maximum facility-wide individual cancer risk (in 1 million)
                                    200[1]

Number of facilities with estimated facility-wide individual cancer risk of 100-in-1 million or more
                                       3

Number of facilities at which the Natural Gas Transmission and Storage source category contributes 50 percent or more to the facility-wide individual cancer risks of 100-in-1 million or more
                                       1

Number of facilities with facility-wide individual cancer risk of 1-in-1 million or more
                                      74

Number of facilities at which the Natural Gas Transmission and Storage source category contributes 50 percent or more to the facility-wide individual cancer risk of 1-in-1 million or more
                                      10
Chronic Noncancer Risk
Maximum facility-wide chronic noncancer TOSHI
                                      80

Number of facilities with facility-wide maximum noncancer TOSHI greater than 1
                                      30

Number of facilities at which the Natural Gas Transmission and Storage source category contributes 50 percent or more to the facility-wide maximum noncancer TOSHI of 1 or more
                                       0
1 We note that the MIR would be 100-in-1 million if the CIIT URE for formaldehyde were used instead of the IRIS URE.
	The facility-wide MIR from all HAP emissions at any facility that contains sources subject to the natural gas transmission and storage MACT standards is estimated to be 200-in-1 million, based on actual emissions. Of the 321 facilities included in this analysis, three have facility-wide MIR of 100-in-1 million or greater. The facility-wide MIR is 200-in-1 million at two of these facilities, driven by formaldehyde from RICE. Another facility has a facility-wide risk of 100-in-1 million, with 90 percent of the risk attributed to natural gas transmission and storage. There are 74 facilities with facility-wide MIR of 1-in-1 million or greater. Of these facilities, 10 have natural gas transmission and storage operations that contribute greater than 50 percent to the facility-wide risks. As discussed above, we are proposing MACT standards for benzene emissions from small glycol dehydrators in this action.  These standards would reduce the risk from benzene emissions at facilities with natural gas transmission and storage operations. The facility-wide cancer risks at the facilities with risks of 1-in-1 million or more are primarily driven by formaldehyde emissions from RICE, which will be assessed in a future RTR for that category.
	The facility-wide maximum individual chronic noncancer TOSHI is estimated to be 80, based on actual emissions. Of the 321 facilities included in this analysis, 30 have facility-wide maximum chronic noncancer TOSHI values greater than 1. Of these facilities, none had natural gas transmission and storage operations that contributed greater than 50 percent to these facility-wide risks. The chronic noncancer risks at these facilities are primarily driven by acrolein emissions from RICE.
iii.	Demographic Risk Analysis Results
	The results of the demographic analyses performed to investigate the distribution of cancer risks at or above 1-in-1 million among the surrounding population are summarized in Table 7 below. These results, for various demographic groups, are based on actual emissions levels for the population living within 50 km of the facilities.
TABLE 7. NATURAL GAS TRANSMISSION AND STORAGE DEMOGRAPHIC RISK ANALYSIS RESULTS

                                  Nationwide
      Population with Cancer Risk at or Above 1-in-1 Million Due to....

                         Source Category HAP Emissions
                          Facility-Wide HAP Emissions
Total Population
                                  285,000,000
                                     2,500
                                    99,000
                                Race by Percent
White
                                      75
                                      92
                                      58
All Other Races
                                      25
                                       8
                                      42
                                Race by Percent
White
                                      75
                                      92
                                      58
African American
                                      12
                                       6
                                      40
Native American
                                      0.9
                                      0.1
                                      0.2
Other and Multiracial
                                      12
                                       1
                                       2
                             Ethnicity by Percent
Hispanic
                                      14
                                       1
                                       2
Non-Hispanic
                                      86
                                      99
                                      98
                               Income by Percent
Below Poverty Level
                                      13
                                      17
                                      20
Above poverty level
                                      87
                                      83
                                      80
                             Education by Percent
Over 25 and without High School Diploma
                                      13
                                      20
                                      15
Over 25 and with a High School Diploma
                                      87
                                      80
                                      85

	The results of the Natural Gas Transmission and Storage source category demographic analysis indicate that there are approximately 2,500 people exposed to a cancer risk at or above 1-in-1 million due to emissions from the source category, including an estimated 8 percent that are classified as minority (listed as "All Other Races" in  Table 7 above). Of the 2,500 people with estimated cancer risks at or above 1-in-1 million from the source category, 17 percent are in the "Below Poverty Level" demographic group, and 20 percent are in the "Over 25 and without High School Diploma" demographic group, results which are 4 and 7 percentage points higher, respectively, than the percentages for these demographic groups across the United States. The percentages for the other demographic groups are lower than their respective nationwide percentages. The table also shows that there are approximately 99,000 people exposed to an estimated cancer risk at or above 1-in-1 million due to facility-wide emissions, including an estimated 42 percent that are classified as minority ("All Other Races" in Table 7 above). Of the 99,000 people with estimated cancer risk at or above 1-in-1 million from facility-wide emissions, 40 percent are in the "African American" demographic group, 20 percent are in the "Below Poverty Level" demographic group, and 15 percent are in the "Over 25 and without High School Diploma" demographic group, results which are 28, 7 and 2 percentage points higher, respectively, than the percentages for these demographic groups across the United States. The percentages for the other demographic groups are equal to or lower than their respective nationwide percentages.
b. What are the proposed risk decisions for the Natural Gas Transmission and Storage source category?
i. Risk Acceptability
	In the risk analysis we performed for this source category, pursuant to CAA section 112(f)(2), we considered the available health information--the MIR; the numbers of persons in various risk ranges; cancer incidence; the maximum noncancer HI; the maximum acute noncancer hazard; the extent of noncancer risks; the potential for adverse environmental effects; distribution of risks in the exposed population; and risk estimation uncertainty (54 FR 38044, September 14, 1989).
      For the Natural Gas Transmission and Storage source category, the risk analysis we performed indicates that the cancer risks to the individual most exposed could be as high as 90-in-1 million due to actual and allowable emissions (30-in-1 million, based on the lower end of the benzene URE range). These risks are near 100-in-1 million, which is the presumptive limit of acceptability. On the other hand, the risk analysis shows low cancer incidence (1 case in every 1,000 years), low potential for adverse environmental effects or human health multi-pathway effects and that chronic and acute noncancer health impacts are unlikely. We conclude that acute noncancer health impacts are unlikely for reasons similar to those described in section VII.C.2.b.i of this preamble.
      Our additional analysis of facility-wide risks showed that, among three facilities with maximum facility-wide cancer risk of 100-in-1 million or greater, one facility has a facility-wide cancer risk of 100-in-1 million, with 90 percent of the risk attributed to natural gas and transmission and storage. There are 30 facilities with a maximum chronic noncancer TOSHI greater than 1, but natural gas transmission and storage operations did not drive this risk.
      In determining whether risk is acceptable, we considered the available health information, as described above. In this case, because the MIR is approaching, but still less than 100-in-1 million risk, and because a number of other factors indicate relatively low risk concern (e.g., low cancer incidence, low potential for adverse environmental effects or human health multi-pathway effects, chronic and acute noncancer health impacts unlikely), we are proposing to determine that the risks are acceptable.
ii. Ample Margin of Safety
	We next considered whether the existing MACT standard provides an ample margin of safety. In this analysis, we investigated available emissions control options that might reduce the risk associated with emissions from the source category and considered this information, along with all of the health risks and other health information considered in the risk acceptability determination. The estimated MIR of 90-in-1 million discussed above is driven by the 0.9 Mg/year benzene limit compliance alternative for the glycol dehydrator MACT standard in the current NESHAP. Removal of this compliance alternative would lower the MIR for the source category to 20-in-1 million. We, therefore, considered removing this compliance alternative as an option for reducing risk and assessed the cost of such alternative. Without the compliance alternative, affected glycol dehydrators (i.e., those units with annual average benzene emissions of 0.9 Mg/yr or greater and an annual average natural gas throughput of 283,000 scmd or greater) must demonstrate compliance with the 95-percent control requirement, which we believe can be shown with their existing control devices in most cases, although, in some instances, installation of a different or an additional control may be necessary.
	In section VII.B.1 above, we discuss the costs for requiring controls on currently unregulated "small glycol dehydrators," which are similar, in operation and type of emission controls, to the dehydrators subject to the current MACT ("large dehydrators"). The HAP cost effectiveness determined for small dehydrators at the floor level of control was $1,650/Mg. Although control methodologies are similar for large and small dehydrators, we expect that the costs for controls on large units could be as much as twice as high as for small units because of the large gas flow being processed. However, we also expect that the amount of HAP emission reduction for the large dehydrators, in general, to be as much as, or more than, the amount achieved by small dehydrators. In light of the above, we do not expect the cost effectiveness of the control device needed to meet the 95-percent control requirement for large dehydrators to exceed $3,300/Mg (i.e., twice the cost effectiveness for small dehydrators), which we consider to be reasonable.
      In accordance with the approach established in the Benzene NESHAP, the EPA weighed all health risk measures and information considered in the risk acceptability determination, along with the costs and economic impacts of emissions controls, technological feasibility, uncertainties and other relevant factors in making our ample margin of safety determination. Considering the health risk information and the reasonable cost effectiveness of the option identified, we propose that the existing MACT standards, with the removal of the 0.9 Mg benzene limit compliance option from the glycol dehydrator standards, provide an ample margin of safety to protect public health.
      Pursuant to CAA section 112(f)(4), we are proposing that this change (i.e., removal of the 0.9 Mg/yr compliance alternative) apply 90 days after its effective date. We are requesting comment on whether or not there is sufficient time for the large dehydrators that have been relying on this compliance alternative to come into compliance with the 95-percent control requirement or if additional time is needed. See CAA section 112(f)(4)(A).
      We recognize that our proposal to remove the one-ton compliance alternative for the 95-percent control glycol dehydrator MACT standard could have negative impacts on some sources that have come to rely on the flexibility this alternative provides. We solicit comment on any such impacts and whether such impacts warrant adding a different compliance alternative that would result in less risk than the 0.9 Mg/yr benzene limit compliance option. If a commenter suggests a different compliance alternative, the commenter should explain, in detail, what that alternative would be, how it would work, and how it would reduce risk.
	As described above, we are proposing that the natural gas transmission and storage MACT standards (with the removal of the 0.9 Mg/yr benzene limit compliance option) provide an ample margin of safety to protect public health.  We recognize that one facility has a facility-wide cancer risk of 100-in-1 million, with 90 percent of the risk attributed to natural gas transmission and storage. This risk is driven by benzene emissions from glycol dehydrators and is being addressed by our proposed revision to the Natural Gas Transmission and Storage NESHAP (removal of the 0.9 Mg/yr benzene limit compliance option). As previously mentioned, two facilities have facility-wide MIR of 200-in-1 million, driven by formaldehyde from RICE. Emissions from RICE are regulated under another source category and will be assessed under a future RTR for that category.
D. How did we perform the technology review and what are the results and proposed decisions?
1. What was the methodology for the technology review?
	Our technology review is focused on the identification and evaluation of "developments in practices, processes, and control technologies" since the promulgation of the MACT standards for the two oil and gas source categories. If a review of available information identifies such developments, then we conduct an analysis of the technical feasibility of requiring the implementation of these developments, along with the impacts (costs, emission reductions, risk reductions, etc.). We then make a decision on whether it is necessary to amend the regulation to require these developments.
      Based on specific knowledge of each source category, we began by identifying known developments in practices, processes and control technologies. For the purpose of this exercise, we considered any of the following to be a "development":
::	Any add-on control technology or other equipment that was not identified and considered during MACT development;
::	Any improvements in add-on control technology or other equipment (that was identified and considered during MACT development) that could result in significant additional emission reduction;
::	Any work practice or operational procedure that was not identified and considered during MACT development; and
::	Any process change or pollution prevention alternative that could be broadly applied that was not identified and considered during MACT development.
      In addition to looking back at practices, processes or control technologies reviewed at the time we developed the MACT standards, we reviewed a variety of sources of data to aid in our evaluation of whether there were additional practices, processes or controls to consider. One of these sources of data was subsequent air toxics rules. Since the promulgation of the MACT standards for the source categories addressed in this proposal, the EPA has developed air toxics regulations for a number of additional source categories. We reviewed the regulatory requirements and/or technical analyses associated with these subsequent regulatory actions to identify any practices, processes and control technologies considered in these efforts that could possibly be applied to emission sources in the source categories under this current RTR review.
      We also consulted the EPA's RBLC. The terms "RACT," "BACT," and "LAER" are acronyms for different program requirements under the CAA provisions addressing the NAAQS. Control technologies classified as RACT, BACT or LAER apply to stationary sources depending on whether the source exists or is new and on the size, age and location of the facility. The BACT and LAER (and sometimes RACT) are determined on a case-by-case basis, usually by state or local permitting agencies. The EPA established the RBLC to provide a central database of air pollution technology information (including technologies required in source-specific permits) to promote the sharing of information among permitting agencies and to aid in identifying future possible control technology options that might apply broadly to numerous sources within a category or apply only on a source-by-source basis. The RBLC contains over 5,000 air pollution control permit determinations that can help identify appropriate technologies to mitigate many air pollutant emission streams. We searched this database to determine whether any practices, processes or control technologies are included for the types of processes used for emission sources (e.g., spray booths) in the source categories under consideration in this proposal.
	We also consulted information from the Natural Gas STAR program. The Natural Gas STAR program is a flexible, voluntary partnership that encourages oil and natural gas companies to adopt cost effective technologies and practices that improve operational efficiency and reduce pollutant emissions. The program provides the oil and gas industry with information on new techniques and developments to reduce pollutant emissions from the various processes.
2. What are the results and proposed decisions from the technology review?
	There are three types of emission sources covered by the two oil and gas NESHAP. These sources and the control technologies (including add-on control devices and process modifications) considered during the development of the MACT standards are: Glycol dehydrators (combustion devices, recovery devices, process modifications), storage vessels with the PFE (combustion devices, recovery devices) and equipment leaks (LDAR programs, specific equipment modifications). Dehydrators are addressed by both 40 CFR part 63, subpart HH and 40 CFR part 63, subpart HHH, while equipment leaks and storage vessels with the PFE are only covered by subpart HH.
	Since the promulgation of 40 CFR part 63, subpart HH, which established MACT standards to address HAP emissions from equipment leaks at gas processing plants, the EPA has developed LDAR programs that are more stringent than what is required in subpart HH. The most prevalent differences between these more stringent programs and subpart HH relate to the frequency of monitoring and the concentration which constitutes a "leak." We do consider these programs to represent a development in practices and evaluated whether to revise the MACT standards for equipment leaks at natural gas processing plants under subpart HH in light of this development.
	An analysis was performed above in section VI.B.1 to assess the VOC reduction, costs and other impacts associated with these more stringent LDAR program options at natural gas processing plants. One option considered was to require compliance with 40 CFR part 60, subpart VVa instead of 40 CFR part 60, subpart VV (the current NSPS requirement for equipment leaks of VOC at natural gas processing plants), which changes the leak definition (based on methane) from 10,000 ppm to 500 ppm and requires monitoring of connectors. Because the current leak definition under NESHAP 40 CFR part 63, subpart HH is the same as that in NSPS subpart VV, and the ratio of VOC to HAP is approximately 20 to 1, we expect that the HAP reduction would be 1/20th of the VOC reduction under subpart VVa. The estimated incremental cost for that option was determined to be $3,340 per ton of VOC. Based on the 20-to-1 ratio, we estimate the incremental cost to control HAP at the subpart VVa level would be approximately $66,800 per ton of HAP ($73,480/Mg). Other options considered in section VI.B.1 of this preamble (and the incremental cost of each option for reducing HAP) are as follows: The use of an optical gas imaging camera monthly with an annual EPA Method 21 check ($129,000 per ton of HAP/$143,600 per Mg, if purchasing the camera; $93,000 per ton of HAP/$103,300 per Mg, if renting the camera); monthly optical gas imagining alone; and annual optical gas imaging. In light of the above, we do not believe that the additional costs of these programs are justified.
	In addition to the plant-wide evaluations, a component analysis was also evaluated at gas processing plants for the 40 CFR part 60, subpart VVa-level of control (option 1

considered in section VI.B.1). That assessment shows that the subpart VVa-level of control for connectors has an incremental cost effectiveness of $4,360 per ton for VOC for connectors and $144 per ton for VOC for valves. This means the incremental cost to control HAP would be approximately $87,200 per ton ($96,900/Mg) for connectors and $2,880 per ton ($3,200/Mg) for valves. We do not believe the additional cost for the more stringent requirement for connectors is justified, but the additional cost for valves is justified. Therefore, we are proposing to revise the equipment leak requirements in 40 CFR part 63, subpart HH to lower the leak definition for valves to an instrument reading of at least 500 ppm as a result of our technology review.
	Some of the practices, processes or control technologies listed by the Natural Gas STAR program applicable to the emission sources in these categories were not identified and evaluated during the original MACT development. While the Natural Gas STAR program does contain information regarding new innovative techniques that are available to reduce HAP emissions, they are not considered to have emission reductions higher than what is set by the original MACT. One control technology identified in the Natural Gas STAR program that would result in no HAP emissions from glycol dehydration units would be the replacement of a glycol dehydration unit with a desiccant dehydrator. This technology cannot be used for natural gas operations with gas streams having high temperature, high volume, and low pressure. Due to the limitations posed by these conditions, we do not consider desiccant dehydrators as MACT.
      For storage vessels, the applicable technologies identified by the Gas STAR program, which are evaluated above for proposal under NSPS in section VI.B.4, are similar to the cover and control technologies currently required for storage vessels under the existing MACT. Therefore, these technologies would not result in any further emissions reductions than what is achieved by the original MACT.
      Our review of the RBLC did not identify any practices, processes and control technologies applicable to the emission sources in these categories that were not identified and evaluated during the original MACT development. In light of the above, we are not proposing any revisions to the existing MACT standards for storage vessels pursuant to section 112(d)(6) of the CAA.
E. What other actions are we proposing?
1. Combustion Control Device Testing
	As explained below in section VII.E.2, under our proposal, performance testing would be required initially and every 5 years for non-condenser control devices. However, for certain enclosed combustion control devices, we are proposing to allow, as an alternative to on-site testing, a performance test conducted by a control device manufacturer in accordance with the procedures provided in this proposal. We propose to allow a unit whose model meets the proposed performance criteria to claim a BTEX or HAP destruction efficiency of 98 percent at the facility. This value is lower than the 99.9-percent destruction efficiency required in the manufacturers' test due to variations between the test fuel specified and the gas streams combusted at the actual facility. A source subject to the small dehydrator BTEX limit would use the 98-percent destruction efficiency to calculate their dehydrator's BTEX emissions for the purpose of demonstrating compliance. For the 95-percent control MACT standard, a control device matching the tested model would be considered to meet that requirement. Once a device has been demonstrated to meet the proposed performance criteria (and, therefore, is assigned a 98-percent destruction efficiency), installation of a unit matching the tested model at a facility would require no further performance testing (i.e., periodic tests would not be required every 5 years).
	We are proposing this alternative to minimize issues associated with performance testing of certain combustion control devices. We believe that testing units that are not configured with a distinct combustion chamber present several technical issues that are more optimally addressed through manufacturer testing, and once these units are installed at a facility, through periodic inspection and maintenance in accordance with manufacturers' recommendations. One issue is that an extension above certain existing combustion control device enclosures will be necessary to get adequate clearance above the flame zone. Such extensions can more easily be configured by the manufacturer of the control device rather than having to modify an extension in the field to fit devices at every site. Issues related to transporting, installing and supporting the extension in the field are also eliminated through manufacturer testing. Another concern is that the pitot tube used to measure flow can be altered by radiant heat from the flame such that gas flow rates are not accurate. This issue is best overcome by having the manufacturer select and use the pitot tube best suited to their specific unit. For these reasons, we believe the manufacturers' test is appropriate for these control devices with ongoing performance ensured by periodic inspection and maintenance.
	This proposed alternative does not apply to flares, as defined in 40 CFR 63.761 and 40 CFR 63.1271, which must demonstrate compliance by meeting the design and operation requirements in 40 CFR 63.11(b), 40 CFR 63.772(e)(2) and 40 CFR 63.1282(d)(2). It also would not apply to thermal oxidizers having a combustion chamber/firebox where combustion temperature and residence time can be measured during an on-site performance test and are valid indicators of performance. These thermal oxidizers do not present the issues described above relative to on-site performance testing and, therefore, do not need an alternative testing option. The proposed alternative would, therefore, apply to enclosed combustion control devices except for these thermal oxidizers.
	In conjunction with the proposed manufacturer testing alternative, we are proposing to add a definition for flare to clarify that flares, as referenced in the NESHAP (and to which the proposed testing alternative does not apply), refers to a thermal oxidation system with an open flame (i.e., without enclosure). Accordingly, any thermal oxidation system that does not meet the proposed flare definition would be considered an enclosed combustion control device.
	We estimate that there are many existing facilities currently using enclosed combustion control devices that would be required to either conduct an on-site performance test or install and operate a control device tested by the manufacturer under our proposal. Given the estimated number of these combustion control devices in use, the time required for manufacturers to test and manufacture such units, we are proposing that existing sources have up to 3 years from the date of the final rules' publication date to comply with the initial performance testing requirements.
2. Monitoring, Recordkeeping and Reporting
	We are proposing to make changes to the monitoring requirements described below to address issues we have identified through a monitoring sufficiency review performed during the RTR process. First, we are including calibration procedures associated with parametric monitoring requirements in the existing NESHAP. The NESHAP require parametric monitoring of control device parameters (e.g., temperatures or flowrate monitoring), but did not include information on calibration or included inadequate information on calibration of monitoring devices. Therefore, we are specifying the calibration requirements for temperature and flow monitors that the NESHAP currently lacks.
	In addition, under the current NESHAP, a design analysis can be used in lieu of performance testing to demonstrate compliance and establish operating parameter limits. We are proposing to allow the use of the design evaluation alternative only when the control device being used is a condenser. The design evaluation option is appropriate for condensers because their emissions can be accurately predicted using readily available physical property information (e.g., vapor pressure data and condensation calculations). In those cases, one would not need to conduct emissions testing to determine actual emissions to demonstrate compliance with the MACT standard. For example, a requirement that "the temperature at the outlet of the condenser shall be maintained at 50[o] Fahrenheit below the condensation temperature calculated for the compound of interest using the reference equation" (e.g., National Institute of Standards and Technology Chemistry WebBook at http://webbook.nist.gov/chemistry/) is adequate to assure proper operation of the condenser and, therefore, compliance with the required emission standard.
	For other types of control technologies, such as carbon adsorption systems and enclosed combustion devices, the ability to predict emissions depends on data developed by the vendor and such data may not reliably result in an accurate prediction of emissions from a specific facility. There are variables (e.g., air to fuel ratios and waste constituents for combustion; varying organic concentrations, constituents and capacity issues, including break-through for carbon adsorption) that make theoretical predictions less reliable. The effects of these site-specific variables on emissions are not easily predictable and establishing monitoring conditions (e.g., combustion temperature, vacuum regeneration) based on vendor data will likely not account for those variables. Therefore, we propose to eliminate the design evaluation alternative for non-condenser controls.
	For non-condenser controls (and condensers not using the design analysis option), in addition to the initial compliance testing, we are proposing that performance tests be conducted at least once every 5 years and whenever sources desire to establish new operating limits. Under the current NESHAP, a performance test is only conducted in two instances: (1) As an alternative to a design analysis for their compliance demonstration and identification of operating parameter ranges and (2) as a requirement to resolve a disagreement between the EPA and the owner or operator regarding the design analysis. The current NESHAP do not require additional performance testing beyond these two cases (i.e., there is no periodic testing requirement). As mentioned above, we are proposing to remove the design evaluation option for non-condenser controls. For non-condenser controls (and condensers not using the design analysis option), the proposed periodic testing would ensure compliance with the emission standards by verifying that the control device is meeting the necessary HAP destruction efficiency determined in the initial performance test. As discussed above in section VII.E.1, we are proposing that combustion control devices tested under the manufacturers' procedure are not required to conduct periodic testing. In addition, we are also proposing that combustion control devices that can demonstrate a uniform combustion zone temperature meeting the required control efficiency during the initial performance test are exempt from periodic testing. The requirement for continuous monitoring of combustion zone temperature is an accurate indicator of control device performance and eliminates the need for future testing.
	The current NESHAP (40 CFR 63.771(d) and 40 CFR 63.1281(d)) require operating an enclosed combustion device at a minimum residence time of 0.5 seconds at a minimum temperature of 760 degrees Celsius. We are proposing to remove the residence time requirement. The residence time requirement is not needed because the compliance demonstration made during the performance test is sufficient to ensure that the combustion device has adequate residence time to ensure the needed destruction efficiency. Therefore, we are proposing to remove the residence time requirement.
	We are also clarifying at 40 CFR 63.773(d)(3)(i) and 40 CFR 63.1283(d)(3)(i) for thermal vapor incinerators, boilers and process heaters, that the temperature sensor shall be installed at a location representative of the combustion zone temperature. Currently, the regulation requires that the temperature sensor be installed at a location "downstream of the combustion zone" because we had thought that the temperature downstream would be representative of combustion zone temperature. We have now learned that may or may not be the case. We are, therefore, proposing to amend this provision to more accurately reflect the intended requirement.
	Next, consistent with revisions for SSM, we've revised 40 CFR 63.771(d)(4)(i) and 40 CFR 63.1281(d)(4)(i), except when maintenance or repair on a unit cannot be completed without a shutdown of the control device.
	Also, we've updated the criteria for prior performance test results that can be used to demonstrate compliance in lieu of conducting a performance test. These updates ensure that data for determining compliance are accurate, up-to-date, and truly representative of actual operating conditions.
	In addition, we are proposing to revise the temperature monitoring device minimum accuracy criteria in 40 CFR 63.773(d)(3)(i) to better reflect the level of performance that is required of the temperature monitoring devices. We believe that temperature monitoring devices currently used to meet the requirements of the NESHAP can meet the proposed revised criteria without modification.
	Also, we are proposing to revise the calibration gas concentration for the no detectable emissions procedure applicable to closed vent systems in 40 CFR 63.772(c)(4)(ii) from 10,000 ppmv to 500 ppmv methane to be consistent with the leak threshold of 500 ppmv in 40 CFR part 63, subpart HH. The current calibration level is inconsistent with achieving accurate readings at the level necessary to demonstrate there are no detectable emissions.
	Also, we are proposing recordkeeping and reporting requirements for carbon adsorption systems. The current NESHAP require the replacement of all carbon in the carbon adsorption system with fresh carbon on a regular, predetermined time interval that is no longer than the carbon service life established for the carbon system, but provide no recordkeeping or reporting requirement to document and assure compliance with this standard. We believe that maintaining some sort of log book is a reasonable alternative combined with a requirement to report instances when specified practices are not followed. Therefore, the proposed rule adds reporting and recordkeeping requirements for establishing a schedule and maintaining logs of carbon replacement.
	Finally, as noted above in section VII.B.1, we are proposing a BTEX emissions limit for small glycol dehydration unit process vents. For the compliance demonstration, we propose that parametric monitoring of the control device be performed. We believe that parametric monitoring is adequate for glycol dehydrators in these two source categories because temperature monitoring, whether it be to verify proper condenser or combustion device operation, is a reliable indicator of performance for reducing organic HAP emissions. We also considered the use of a continuous emissions monitoring system (CEMS) to monitor compliance. However, for glycol dehydrators in the oil and natural gas sector, the necessary electricity, weather-protective enclosures and daily staffing are not usually available. We, therefore, question the technical feasibility of operating a CEMS correctly in this sector. We request comment on the practicality of including provisions in the final rule for a CEMS to monitor BTEX emissions for small glycol dehydration units.
3. Startup, Shutdown, Malfunction
	The United States Court of Appeals for the District of Columbia Circuit vacated portions of two provisions in the EPA's CAA section 112 regulations governing the emissions of HAP during periods of SSM. Sierra Club v. EPA, 551 F.3d 1019 (D.C. Cir. 2008), cert. denied, 130 S. Ct. 1735 (U.S. 2010). Specifically, the Court vacated the SSM exemption contained in 40 CFR 63.6(f)(1) and 40 CFR 63.6(h)(1), that is part of a regulation, commonly referred to as the General Provisions Rule, that the EPA promulgated under section 112 of the CAA. When incorporated into CAA section 112(d) regulations for specific source categories, these two provisions exempt sources from the requirement to comply with the otherwise applicable CAA section 112(d) emission standard during periods of SSM.
      We are proposing the elimination of the SSM exemption in the two oil and gas NESHAP. Consistent with Sierra Club v. EPA, the EPA is proposing to apply the standards in these NESHAP at all times. In addition, we are proposing to revise 40 CFR 63.771(d)(4)(i) and 40 CFR 63.1281(d)(4)(i) to remove the provision allowing shutdown of the control device during maintenance or repair. We are also proposing several revisions to the General Provisions applicability table for the MACT standard. For example, we are proposing to eliminate the incorporation of the General Provisions' requirement that the source develop a SSM plan. We are also proposing to eliminate or revise certain recordkeeping and reporting requirements related to the SSM exemption. The EPA has attempted to ensure that we have not included in the proposed regulatory language any provisions that are inappropriate, unnecessary or redundant in the absence of the SSM exemption. We are specifically seeking comment on whether there are any such provisions that we have inadvertently incorporated or overlooked.
      In proposing the MACT standards in these rules, the EPA has taken into account startup and shutdown periods. We believe that operations and emissions do not differ from normal operations during these periods such that it warrants a separate standard. Therefore, we have not proposed different standards for these periods.
      Periods of startup, normal operations and shutdown are all predictable and routine aspects of a source's operations. However, by contrast, malfunction is defined as a "sudden, infrequent and not reasonably preventable failure of air pollution control and monitoring equipment, process equipment or a process to operate in a normal or usual manner * * * " (40 CFR 63.2). The EPA has determined that malfunctions should not be viewed as a distinct operating mode and, therefore, any emissions that occur at such times do not need to be factored into development of CAA section 112(d) standards, which, once promulgated, apply at all times. In Mossville Environmental Action Now v. EPA, 370 F.3d 1232, 1242 (D.C. Cir. 2004), the Court upheld as reasonable, standards that had factored in variability of emissions under all operating conditions. However, nothing in CAA section 112(d) or in case law requires that the EPA anticipate and account for the innumerable types of potential malfunction events in setting emission standards. See Weyerhaeuser v. Costle, 590 F.2d 1011, 1058 (D.C. Cir. 1978), ("In the nature of things, no general limit, individual permit, or even any upset provision can anticipate all upset situations. After a certain point, the transgression of regulatory limits caused by "uncontrollable acts of third parties," such as strikes, sabotage, operator intoxication or insanity, and a variety of other eventualities, must be a matter for the administrative exercise of case-by-case enforcement discretion, not for specification in advance by regulation.").
      Further, it is reasonable to interpret CAA section 112(d) as not requiring the EPA to account for malfunctions in setting emissions standards. For example, we note that CAA section 112 uses the concept of "best performing" sources in defining MACT, the level of stringency that major source standards must meet. Applying the concept of "best performing" to a source that is malfunctioning presents significant difficulties. The goal of best performing sources is to operate in such a way as to avoid malfunctions of their units.
      Moreover, even if malfunctions were considered a distinct operating mode, we believe it would be impracticable to take malfunctions into account in setting CAA section 112(d) standards for oil and natural gas production facility and natural gas transmission and storage operations. As noted above, by definition, malfunctions are sudden and unexpected events, and it would be difficult to set a standard that takes into account the myriad different types of malfunctions that can occur across all sources in each source category. Moreover, malfunctions can also vary in frequency, degree and duration, further complicating standard setting.
      In the event that a source fails to comply with the applicable CAA section 112(d) standards as a result of a malfunction event, the EPA would determine an appropriate response based on, among other things, the good faith efforts of the source to minimize emissions during malfunction periods, including preventative and corrective actions, as well as root cause analyses to ascertain and rectify excess emissions. The EPA would also consider whether the source's failure to comply with the CAA section 112(d) standard was, in fact, "sudden, infrequent, not reasonably preventable" and was not instead "caused in part by poor maintenance or careless operation." 40 CFR 63.2 (definition of malfunction).
      Finally, the EPA recognizes that even equipment that is properly designed and maintained can sometimes fail and that such failure can sometimes cause or contribute to an exceedance of the relevant emission standard. (See, e.g., State Implementation Plans: Policy Regarding Excessive Emissions During Malfunctions, Startup, and Shutdown (September 20, 1999); Policy on Excess Emissions During Startup, Shutdown, Maintenance, and Malfunctions (February 15, 1983)). The EPA is, therefore, proposing to add to the final rule an affirmative defense to civil penalties for exceedances of emission limits that are caused by malfunctions in both of the MACT standards addressed in this proposal. See 40 CFR 63.761 for sources subject to the oil and natural gas production MACT standards, or 40 CFR 63.1271 for sources subject to the natural gas transmission and storage MACT standards (defining "affirmative defense" to mean, in the context of an enforcement proceeding, a response or defense put forward by a defendant, regarding which the defendant has the burden of proof and the merits of which are independently and objectively evaluated in a judicial or administrative proceeding). We also are proposing other regulatory provisions to specify the elements that are necessary to establish this affirmative defense; a source subject to the oil and natural gas production facilities or natural gas transmission MACT standards must prove by a preponderance of the evidence that it has met all of the elements set forth in 40 CFR 63.762 and a source subject to the natural gas transmission and storage facilities MACT standards must prove by a preponderance of the evidence that it has met all of the elements set forth in 40 CFR 63.1272. (See 40 CFR 22.24.)  The criteria ensure that the affirmative defense is available only where the event that causes an exceedance of the emission limit meets the narrow definition of malfunction in 40 CFR 63.2 (sudden, infrequent, not reasonably preventable and not caused by poor maintenance and or careless operation). For example, to successfully assert the affirmative defense, the source must prove by a preponderance of evidence that excess emissions "[w]ere caused by a sudden, infrequent, and unavoidable failure of air pollution control and monitoring equipment, process equipment, or a process to operate in a normal or usual manner ...." The criteria also are designed to ensure that steps are taken to correct the malfunction, to minimize emissions in accordance with 40 CFR 63.762 for sources subject to the oil and natural gas production facilities MACT standards or 40 CFR 63.1272 for sources subject to the natural gas transmission and storage facilities MACT standards and to prevent future malfunctions. For example, the source must prove by a preponderance of evidence that "[r]epairs were made as expeditiously as possible when the applicable emission limitations were being exceeded..." and that "[a]ll possible steps were taken to minimize the impact of the excess emissions on ambient air quality, the environment and human health...." In any judicial or administrative proceeding, the Administrator may challenge the assertion of the affirmative defense and, if the respondent has not met its burden of proving all of the requirements in the affirmative defense, appropriate penalties may be assessed in accordance with section 113 of the CAA (see also 40 CFR 22.77).
4. Applicability and Compliance
a. Calculating Potential to Emit (PTE)
	We are proposing to amend section 40 CFR 63.760(a)(1)(iii) to clarify that sources must use a glycol circulation rate consistent with the definition of PTE in 40 CFR 63.2 in calculating emissions for purposes of determining PTE. Affected parties have misinterpreted the current language concerning measured values or annual average to apply to a broader range of parameters than was intended. Those qualifiers were meant to apply to gas characteristics that are measured, such as inlet gas composition, pressure and temperature rather than process equipment settings. That means that the circulation rate used in PTE determinations shall be the maximum under its physical and operational design.
	In addition to the proposed changes described above, we are seeking comment on several PTE related issues. According to the data available to the Administrator, when 40 CFR part 63, subpart HH was promulgated, the level of HAP emissions was predominantly driven by natural gas throughput (i.e., HAP emissions went up or down in concert with natural gas throughput). Since promulgation, we have learned that there is not always a direct correlation between HAP emissions and natural gas throughput. We have received information suggesting that, in some cases, HAP emissions can increase despite decreasing natural gas throughput due to changes in gas composition. We are asking for comment regarding the likelihood of this occurrence and data demonstrating the circumstances where it occurs. In light of the potential issue, we are asking for comment regarding the addition of provisions in the NESHAP to require area sources to recalculate their PTE to confirm that they are indeed area sources and whether that calculation should be performed on an annual or biannual basis to verify that changes in gas composition have not increased their emissions.
b. Definition of Facility and Applicability Criteria
      Subpart HH of 40 CFR part 63 (section 63.760(a)(2)) currently defines facilities as those where hydrocarbon liquids are processed, upgraded or stored prior to the point of custody transfer or where natural gas is processed, upgraded or stored prior to entering the Natural Gas Transmission and Storage source category. We are proposing to remove the references to "point of custody transfer" and "transmission and storage source categories" from the definition because the operations performed at a site sufficiently define a facility and the scope of the subpart is specified already under 40 CFR 63.760. In addition, we are removing the custody transfer reference from the applicability criteria in 40 CFR 63.760(a)(2). Since hydrocarbon liquids can pass through several custody transfer points between the well and the final destination, the custody transfer criteria is not clear enough. We are, therefore, proposing to replace the reference to "point of custody transfer" with a more specific description of the point up to which the subpart applies (i.e., the point where hydrocarbon liquids enter either the organic liquids distribution or petroleum refineries source categories) and exclude custody transfer from that criteria. We believe this change eliminates ambiguity and is consistent with the oil and natural gas production-specific provisions in the organic liquids distribution MACT.
5. Other Proposed Changes to Clarify These Rules
      The following lists additional changes to the NESHAP we are proposing. This list includes proposed rule changes that address editorial corrections and plain language revisions:
   * Revise 40 CFR 63.769(b) to clarify that the equipment leak provisions in 40 CFR part 63, subpart HH do not apply to a source if that source is required to control equipment leaks under either 40 CFR part 63, subpart H or 40 CFR part 60, subpart KKK. The current 40 CFR 63.769(b), which states that subpart HH does not apply if a source meets the requirements in either of the subparts mentioned above, does not clearly express our intent that such source must be implementing the LDAR provisions in the other 40 CFR part 60 or 40 CFR part 63 subparts to qualify for the exemption.
   * Revise 40 CFR 63.760(a)(1) to clarify that an existing area source that increases its emissions to major source levels has up to the first substantive compliance date to either reduce its emissions below major source levels by obtaining a practically enforceable permit or comply with the applicable major source provisions of 40 CFR part 63, subpart HH. We have revised the second to last sentence in 40 CFR 63.760(a)(1) by removing the parenthetical statement because it simply reiterates the last sentence of this section and is, therefore, unnecessary.
   * Revise 40 CFR 63.771(d)(1)(ii) and 40 CFR 63.1281(d)(1)(ii) to clarify that the vapor recovery device and "other control device" described in those provisions refer to non-destructive control devices only.
   * Revise the last sentence of 40 CFR 63.764(i) and 40 CFR 63.1274(g) to clarify the requirements following an unsuccessful attempt to repair a leak.
   * Updated the email and physical address for area source reporting in 40 CFR 63.775(c)(1).
VIII. What are the cost, environmental, energy and economic impacts of the proposed 40 CFR part 60, subpart OOOO and amendments to subparts HH and HHH of 40 CFR part 63?
	We are presenting a combined discussion of the estimates of the impacts for the proposed 40 CFR part 60, subpart OOOO and proposed amendments to 40 CFR part 63, subpart HH and 40 CFR part 63, subpart HHH. The cost, environmental and economic impacts presented in this section are expressed as incremental differences between the impacts of an oil and natural gas facility complying with the amendments to subparts HH and HHH and new standards under 40 CFR 60, subpart OOOO and the baseline, i.e., the standards before these amendments. The impacts are presented for the year 2015, which will be the year that all existing oil and natural gas facilities will have to be in compliance, and also the year that will represent approximately 5 years of construction of new oil and natural gas facilities subject to the NSPS emissions limits. The analyses and the documents referenced below can be found in Docket ID Numbers EPA-HQ-OAR-2007-0877 and EPA-HQ-OAR-2002-0051.
A. What are the affected sources?
	We expect that by 2015, the year when all existing sources will be required to come into compliance in the United States, there will be 97 oil and natural gas production facilities and 15 natural gas transmission and storage facilities with one or more existing glycol dehydration units. We also estimate that there will be an additional 329 (there are 47 facilities that already have an affected glycol dehydration unit) existing oil and natural gas production facilities with existing storage vessels that we expect to be affected by these final amendments. These facilities operate approximately 134 glycol dehydration units (115 in production and 19 in transmission and storage) and 1,970 storage vessels. Approximately 10 oil and natural gas production and two transmission and storage facilities would have new glycol dehydration units and 38 production facilities would have new dehydration units. We expect new production facilities would operate approximately 12 production glycol dehydration units and 197 storage vessels and new transmission and storage would operate approximately two glycol dehydration units.
	Based on data provided by the United States Energy Information Administration, we anticipate that by 2015 there will be approximately 21,800 gas wellhead facilities, 790 reciprocating compressors, 30 centrifugal compressors, 14,000 pneumatic devices and 300 storage vessels subject to the new NSPS for VOC. Some of these affected facilities will be built at existing facilities and some at new greenfield facilities. Based on data limitations, we assume impacts are equal regardless of location.
	There are about 21 glycol dehydration units with high enough HAP emissions that we believe cannot meet the emissions limit without using more than one control technique. In developing the cost impacts, we assume that they would require multiple controls. The controls for which we have detailed cost data are condensers and VRU, so we developed costs for both controls to develop what we consider to be a reasonable cost estimate for these facilities. This does not imply that we believe these facilities will specifically use a combination of a condenser and vapor recovery limit, but we do believe the combination of these control results is a reasonable estimate of cost.
B. How are the impacts for this proposal evaluated?
	For these proposed Oil and Natural Gas Production and Natural Gas Transmission and Storage NESHAP amendments and NSPS, the EPA used two models to evaluate the impacts of the regulation on the industry and the economy. Typically, in a regulatory analysis, the EPA determines the regulatory options suitable to meet statutory obligations under the CAA. Based on the stringency of those options, the EPA then determines the control technologies and monitoring requirements that sources might rationally select to comply with the regulation. This analysis is documented in an engineering analysis. The selected control technologies and monitoring requirements are then evaluated in a cost model to determine the total annualized control costs. The annualized control costs serve as inputs to an Economic Impact Analysis model that evaluates the impacts of those costs on the industry and society as a whole.
	The Economic Impact Analysis used the National Energy Modeling System (NEMS) to estimate the impacts of the proposed NSPS on the United States energy system. The NEMS is a publically-available model of the United States energy economy developed and maintained by the Energy Information Administration of the United States DOE and is used to produce the Annual Energy Outlook, a reference publication that provides detailed forecasts of the energy economy from the current year to 2035. The impacts we estimated included changes in drilling activity, price and quantity changes in the production and consumption of crude oil and natural gas and changes in international trade of crude oil and natural gas. We evaluated whether and to what extent the increased production costs imposed by the NSPS might alter the mix of fuels consumed at a national level. Additionally, we combined estimated emissions co-reductions of methane from the engineering analysis with NEMS analysis to estimate the net change in CO2e GHG from energy-related sources.
C. What are the air quality impacts?
	For the oil and natural gas sector NESHAP and NSPS, we estimated the emission reductions that will occur due to the implementation of the final emission limits. The EPA estimated emission reductions based on the control technologies selected by the engineering analysis. These emission reductions associated with the proposed amendments to 40 CFR part 63, subpart HH and 40 CFR part 63, subpart HHH are based on the estimated population in 2008. Under the proposed limits for glycol dehydration units and storage vessels, we have estimated that the HAP emissions reductions will be 1,400 tpy for existing units subject to the proposed emissions limits.
	For the NSPS, we estimated the emission reductions that will occur due to the implementation of the final emission limits. The EPA estimated emission reductions based on the control technologies selected by the engineering analysis. These emission reductions are based on the estimated population in 2015. Under the proposed NSPS, we have estimated that the emissions reductions will be 540,000 tpy VOC for affected facilities subject to the NSPS.
	The control strategies likely adopted to meet the proposed NESHAP amendments and the proposed NSPS will result in concurrent control of HAP, methane and VOC emissions. We estimate that direct reductions in HAP, methane and VOC for the proposed rules combined total about 38,000 tpy, 3.4 million tpy and 540,000 tpy, respectively.
	Under the final standards, new monitoring requirements are being added.
D. What are the water quality and solid waste impacts?
	We estimated minimal water quality impacts for the proposed amendments and proposed NSPS. For the proposed amendments to the NESHAP, we anticipate that the water impacts associated with the installation of a condenser system for the glycol dehydration unit process vent would be minimal. This is because the condensed water collected with the hydrocarbon condensate can be directed back into the system for reprocessing with the hydrocarbon condensate or, if separated, combined with produced water for disposal, usually by reinjection.
	Similarly, the water impacts associated with installation of a vapor control system either on a glycol dehydration unit or a storage vessel would be minimal. This is because the water vapor collected along with the hydrocarbon vapors in the vapor collection and redirect system can be directed back into the system for reprocessing with the hydrocarbon condensate or, if separated, combined with the produced water for disposal for reinjection.
	There would be no water impacts expected for facilities subject to the proposed NSPS. Further, we do not anticipate any adverse solid waste impacts from the implementation of the proposed NESHAP amendments and the proposed NSPS.
E. What are the secondary impacts?
	Indirect or secondary air quality impacts include impacts that will result from the increased electricity usage associated with the operation of control devices, as well as water quality and solid waste impacts (which were just discussed) that might occur as a result of these proposed actions. We estimate the proposed amendments to 40 CFR part 63, subpart HH and 40 CFR part 63, subpart HHH will increase emissions of criteria pollutants due to the potential use of flares for the control of storage vessels. We do not estimate an increased energy demand associated with the installation of condensers, VRU or flares. The increases in criteria pollutant emissions associated with the use of flares to control storage vessels subject to existing source standards are estimated to be 5,500 tpy of CO2, 16 tpy of carbon monoxide (CO), 3 tpy of NOx, less than 1 tpy of particulate matter (PM) and 6 tpy total hydrocarbons. For storage vessels subject to new source standards, increases in secondary air pollutants are estimated to be less than 900 tpy of CO2, 3 tpy of CO, 1 tpy of NOx, 1 tpy of PM and 1 tpy total hydrocarbons.
	In addition, we estimate that the secondary impacts associated with the pneumatic controller requirements to comply with the proposed NSPS would be about 22 tpy of CO2, 1 tpy of NOx and 3 tpy PM. For gas wellhead affected facilities, we estimate that the use of flares would result in increases in criteria pollutant emissions of about 990,000 tons of CO2, 2,800 tpy of CO, 500 tpy of NOx, 5 tpy of PM and 1,000 tpy total hydrocarbons.
F. What are the energy impacts?
	Energy impacts in this section are those energy requirements associated with the operation of emission control devices. Potential impacts on the national energy economy from the rule are discussed in the economic impacts section. There would be little national energy demand increase from the operation of any of the control options analyzed under the proposed NESHAP amendments and proposed NSPS.
	The proposed NESHAP amendments and proposed NSPS encourage the use of emission controls that recover hydrocarbon products, such as methane and condensate that can be used on-site as fuel or reprocessed within the production process for sale. We estimated that the proposed standards will result in a net cost savings due to the recovery of salable natural gas and condensate. Thus, the final standards have a positive impact associated with the recovery of non-renewable energy resources.
G. What are the cost impacts?
	The estimated total capital cost to comply with the proposed amendments to 40 CFR part 63, subpart HH for major sources in the Oil and Natural Gas Production source category is approximately $51.5 million. The total capital cost for the proposed amendments to 40 CFR part 63, subpart HHH for major sources in the Natural Gas Transmission and Storage source category is estimated to be approximately $370 thousand. All costs are in 2008 dollars.
	The total estimated net annual cost to industry to comply with the proposed amendments to 40 CFR part 63, subpart HH for major sources in the Oil and Natural Gas Production source category is approximately $16 million. The total net annual cost for proposed amendments to 40 CFR part 63, subpart HHH for major sources in the Natural Gas Transmission and Storage source category is estimated to be approximately $360,000. These estimated annual costs include: (1) The cost of capital, (2) operating and maintenance costs, (3) the cost of monitoring, inspection, recordkeeping and reporting (MIRR) and (4) any associated product recovery credits. All costs are in 2008 dollars.
	The estimated total capital cost to comply with the proposed NSPS is approximately $740 million in 2008 dollars. The total estimated net annual cost to industry to comply with the proposed NSPS is approximately $740 million in 2008 dollars. This annual cost estimate includes: (1) The cost of capital, (2) operating and maintenance costs and (3) the cost of MIRR. This estimated annual cost does not take into account any producer revenues associated with the recovery of salable natural gas and hydrocarbon condensates.
	When revenues from additional product recovery are considered, the proposed NSPS is estimated to result in a net annual engineering cost savings overall. When including the additional natural gas recovery in the engineering cost analysis, we assume that producers are paid $4 per thousand cubic feet (Mcf) for the recovered gas at the wellhead.  The engineering analysis cost analysis assumes the value of recovered condensate is $70 per barrel. Based on the engineering analysis, about 180,000,000 Mcf (180 billion cubic feet) of natural gas and 730,000 barrels of condensate are estimated to be recovered by control requirements in 2015. Using the price assumptions, the estimated revenues from natural gas product recovery are approximately $780 million in 2008 dollars. This savings is estimated at $45 million in 2008 dollars.
	Using the engineering cost estimates, estimated natural gas product recovery, and natural gas product price assumptions, the net annual engineering cost savings is estimated for the proposed NSPS at about $45 million in 2008 dollars. Totals may not sum due to independent rounding.
	As the price assumption is very influential on estimated annualized engineering costs, we performed a simple sensitivity analysis of the influence of the assumed wellhead price paid to natural gas producers on the overall engineering annualized costs estimate of the proposed NSPS.  At $4.22/Mcf, the price forecast reported in the 2011 Annual Energy Outlook in 2008 dollars, the annualized costs are estimated at about -$90 million, which would approximately double the estimate of net cost savings of the proposed NSPS. As indicated by this difference, EPA has chosen a relatively conservative assumption (leading to an estimate of few savings and higher net costs) for the engineering costs analysis. The natural gas price at which the proposed NSPS breaks-even from an estimated engineering costs perspective is around $3.77/Mcf. A $1/Mcf change in the wellhead natural gas price leads to about a $180 million change in the annualized engineering costs of the proposed NSPS. Consequently, annualized engineering costs estimates would increase to about $140 million under a $3/Mcf price or decrease to about -$230 million under a $5/Mcf price. For further details on this sensitivity analysis, please refer the regulatory impact analysis (RIA) for this rulemaking located in the docket.
H. What are the economic impacts?
	The NEMS analysis of energy system impacts for the proposed NSPS option estimates that domestic natural gas production is likely to increase slightly (about 20 billion cubic feet or 0.1 percent) and average natural gas prices to decrease slightly ($0.04 per Mcf in 2008 dollars or 0.9 percent at the wellhead for onshore producers in the lower 48 states) for 2015, the year of analysis. This increase in production and decrease in wellhead price is largely a result of the increased natural gas and condensate recovery as a result of complying with the NSPS. Domestic crude oil production is not expected to change, while average crude oil prices are estimated to decrease slightly ($0.02/barrel in 2008 dollars or less than 0.1 percent at the wellhead for onshore producers in the lower 48 states) in the year of analysis, 2015. The NEMS-based analysis estimates in the year of analysis, 2015, that net imports of natural gas and crude will not change significantly.
	Total CO2e emissions from energy-related sources are expected to increase about 2.0 million metric tons CO2e or 0.04 percent under the proposed NSPS, according to the NEMS analysis. This increase is attributable largely to natural gas consumption increases. This estimate does not include CO2e reductions from the implementation of the controls; these reductions are discussed in more detail in the benefits section that follows.
	We did not estimate the energy economy impacts of the proposed NESHAP amendments using NEMS, as the expected costs of the rule are not likely to have estimable impacts on the national energy economy.
I. What are the benefits?
	The proposed Oil and Natural Gas NSPS and NESHAP amendments are expected to result in significant reductions in existing emissions and prevent new emissions from expansions of the industry. These proposed rules combined are anticipated to reduce 38,000 tons of HAP, 540,000 tons of VOC and 3.4 million tons of methane. These pollutants are associated with substantial health effects, welfare effects and climate effects. With the data available, we are not able to provide credible health benefit estimates for the reduction in exposure to HAP, ozone and PM (2.5 microns and less) (PM2.5) for these rules, due to the differences in the locations of oil and natural gas emission points relative to existing information and the highly localized nature of air quality responses associated with HAP and VOC reductions.