Ohio EPA Issues Final General Air Permit for Shale Oil and Gas Production

Shale Energy Update

Date: February 16, 2012

Overview

The discovery of vast volumes of oil and natural gas deep within Ohio's Utica and Marcellus shale formations, combined with recent developments in horizontal drilling techniques - "hydraulic fracturing" - have produced significant interest in drilling well activity. Shale gas is considered by many to be a game changer for the nation's energy industry and markets. Many oil and gas companies have begun operations in Ohio. In anticipation of increased drilling activity and its resulting air emissions, Ohio EPA has issued a general air permit for shale oil and gas well-site production operations.

In response to concerns arising from the shale oil and gas boom, on February 1, 2012 Ohio EPA issued a final general permit for air emissions associated with shale oil and natural gas production. Eligible operations would not need to apply for the traditional, individual source-specific air permit to install and operate.

Ohio EPA determined that most of the activities associated with the drilling and completion phases of well development are generally exempt from air permitting requirements due to the temporary nature of these operations, their limited duration, their exemption by rule or their de minimis nature.

As for the oil and/or natural gas production phase, the general permit covers a variety of emission sources found at most shale gas production sites, including internal combustion engines, turbine-powered generators, dehydration systems, storage tanks, flares and unpaved roadways. The permit incorporates, where applicable, various NESHAP requirements for certain processes, as well as New Source Performance Standards (NSPSs) for certain processes. Of note, and in addition to incorporating applicable federal standards, the model general permit also imposes the following restrictions:

  • Glycol dehydration unit: Limits total organic compounds, less methane and ethane, to 5.0 tons per year (tpy) and provides the permittee the option of using a flare or BTEX elimination system to control emissions.
  • Spark ignition internal combustion engines: Limits particulate emissions (PE) to 19.6 tpy, nitrogen oxides (NOx) to 25.1 tpy, carbon monoxide (CO) to 50.2 tpy and volatile organic compounds (VOC) to 12.5 tpy, all on a rolling 12-month period, and limits visible emissions to 20 percent as a six-minute average. Also applies additional emission restrictions based on engine size and incorporates various NSPSs for engines.
  • Stationary diesel-fired compression ignition diesel internal combustion engines: Limits engines to Tier 3 compliant engines with not more than 250 horsepower; incorporates NSPSs for such engines; limits visible emissions to 20 percent as a six-minute average; limits emissions to 0.72 tpy particulate matter (PM), 6.3 tpy NOx, 9.0 tpy CO, 2.15 tpy VOC and 0.013 tpy SO2.
  • Vertical fixed roof flush vessel/storage tanks (no more than 252,000 gallon capacity total): Limits VOC emission to 51.3 tpy; does not permit any petroleum product in any tank, other than crude oil or condensate without controls including internal floating roofs.
  • Combustor/flare: Limits emissions to not more than 10 MM Btu/hr.; limits emissions of NOx to 3.0 tpy, SO2 to 1.8 tpy, VOC to 51.3 tpy and CO to 16.2 tpy.
  • Ancillary equipment (compressors, pumps, piping and gas-water/condensate/oil separators): Limits VOC emissions to 10.6 tpy per rolling 12-month period from fugitive emission leaks; requires leak detection and repair.

The general permit also has a qualifying criteria document that specifies the activities that are eligible or ineligible for the general permit.