DAR File No. 42110

Environmental Quality, Air Quality

Rule R307-505

Oil and Gas Industry: Registration Requirements

Notice of Proposed Rule

(New Rule)

DAR File No.: 42110
Filed: 09/14/2017 04:58:39 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this new rule is to provide the Division of Air Quality (Division) with information necessary to understand what type of oil and gas emission sources and control equipment are currently in existence. As the rule is implemented, the registration of future oil and gas wells is necessary to support the implementation of permit-by-rule. Sources will no longer be obtaining an approval order and operating permit, the Division needs to know the source is operating in the state, the type of equipment it has, and a certification that the source will follow the air quality rules.

Summary of the rule or change:

The rule requires oil and gas sources to register with the Division. This rule covers both existing and new sources.

Statutory or constitutional authorization for this rule:

• Subsection 19-2-104(1)(a)

Anticipated cost or savings to:

the state budget:

This rule does not have a cost or savings to the state budget because this rule regulates oil and gas sources.

local governments:

This rule does not have a cost or savings to local governments because this rule regulates oil and gas sources.

small businesses:

The Division has identified 10 small businesses that may be impacted by this rule. This rule requires each company to register its new and existing operations with standard industrial classification codes in the major group 13. This includes industries involved in oil and natural gas exploration, production, and transmission operations; well production facilities; natural gas compressor stations; natural gas processing plants; and commercial oil and gas disposal wells and evaporation ponds. This rule will result in a fiscal impact on small businesses because it requires them to register with the director.

persons other than small businesses, businesses, or local governmental entities:

No--This rule does not have a cost or savings to "other persons" because the rule impacts owners or operators of oil and gas wells. The owners and operators of these wells are all businesses.

Compliance costs for affected persons:

The compliance cost is about $100 per registration, which is a one-time cost. An ongoing cost of less than $100 will also be associated to update a registration when changes are made to the company name, the emission control device strategies are altered, or operations are terminated. Larger companies will ultimately pay more because they will be required to submit more registrations to account for their larger inventory. Details of the cost analysis and compliance costs are in the department head's comments below.

Comments by the department head on the fiscal impact the rule may have on businesses:

I. WHETHER A FISCAL IMPACT TO BUSINESS IS EXPECTED AS A RESULT OF THE PROPOSED RULE AND,IF SO, A DESCRIPTION OF WHY: The Division has identified 30 companies that may be impacted by this rule. This rule requires each company to register its new and existing operations with standard industrial classification codes in the major group 13. This includes industries involved in oil and natural gas exploration, production, and transmission operations; well production facilities; natural gas compressor stations; natural gas processing plants; and commercial oil and gas disposal wells and evaporation ponds. This rule will result in a fiscal impact on businesses because it requires them to register with the Director. II. AN ESTIMATE OF THE TOTAL NUMBER OF BUSINESS ESTABLISHMENTS IN UTAH EXPECTED TO BE IMPACTED: The Division has identified 30 companies that may be impacted by this rule. III. AN ESTIMATE OF THE SMALL BUSINESS ESTABLISHMENTS IN UTAH EXPECTED TO BE IMPACTED: Of the 30 companies that will be impacted, at least 10 are small businesses. IV. A DESCRIPTION OF THE SOURCES OF COST OR SAVINGS AS WELL AS THE EXPECTED NET SAVINGS OR COST TO BUSINESS ESTABLISHMENTS AND SMALL BUSINESS ESTABLISHMENTS AS A RESULT OF THE PROPOSED RULE OVER A ONE-YEAR PERIOD, IDENTIFYING ONETIME AND ONGOING COSTS: The source of the cost to companies as a result of this rule is the requirement to register its operations with the Division. Registration includes the following general information; company name, mailing address, source location, source manager or point of contact, process description, capacity and quantity of emitting equipment on-site, fuel type of combustion related equipment (i.e. diesel, natural gas, propane, or field gas), emissions control devices installed, emissions, and certification that the facility is in compliance with Rules R307-506 through R307-510. This data should not be difficult to retrieve, and there will be minimal costs associated with the registration requirement. The cost will be the amount the company pays an employee to register online using the Division's web-based tool and any potential fees associated with registration that the Utah Legislature might approve in the future. This should cost no more than $100 per registration. This is a one-time cost for existing sources, which must be completed before 07/01/2018. An ongoing cost of less than $100 will also be associated with the need to update a registration when changes are made to the company name, the emission control device strategies are altered, or operations are terminated. There will also be an ongoing cost of less than $100 per registration for future registrations. These costs will be the same for small and large businesses. Larger companies will ultimately pay more because they will be required to submit more registrations to account for their larger inventory. (EDITOR'S NOTE: The proposed new Rule R307-506 is under Filing No. 42111, the proposed new Rule R307-507 is under Filing No. 42112, the proposed new Rule R307-508 is under Filing No. 42113, the proposed new Rule R307-509 is under Filing No. 42114, and the proposed new Rule R307-510 is under Filing No. 42115 in this issue, October 1, 2017, of the Bulletin.)

Alan Matheson, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Environmental Quality
Air QualityRoom Fourth Floor
195 N 1950 W
SALT LAKE CITY, UT 84116-3085

Direct questions regarding this rule to:

• Mat Carlile at the above address, by phone at 801-536-4116, by FAX at 801-536-4136, or by Internet E-mail at mcarlile@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/15/2017

Interested persons may attend a public hearing regarding this rule:

• 10/19/2017 01:00 PM, Department of Environmental Quality, 195 N 1950 W, Board Room 1015, Salt Lake City, UT
• 10/25/2017 01:00 PM, TriCounty Health, 133 S 500 E, Vernal UT

This rule may become effective on:

01/04/2018

Authorized by:

Bryce Bird, Director

R307. Environmental Quality, Air Quality.

R307-505. Oil and Gas Industry: Registration Requirements.

R307-505-1. Purpose.

R307-505 establishes requirements for sources in the oil and gas industry to register with the Division.

 

R307-505-2. Applicability.

(1) R307-505 applies to new and existing operations at a source with Standard Industrial Classification codes in the major group 13, which includes but is not limited to industries involved in oil and natural gas exploration, production, and transmission operations; well production facilities; natural gas compressor stations; natural gas processing plants and commercial oil and gas disposal wells, and evaporation ponds.

(a) A source that is subject to an approval order in accordance with R307-401-8 is exempt from R307-505.

 

R307-505-3. Registration Requirements

(1) An owner or operator of a source identified in R307-505-2 that begins operations on or after January 1, 2018, shall register with the director 30 days prior to commencing operation.

(2) An owner or operator of a source identified in R307-505-2 that is in operation before January 1, 2018, shall register with the director by July 1, 2018 .

(3) An owner or operator shall update the registration information within 30 days of any of the following:

(a) changes to company name,

(b) removal or addition of control devices, or

(c) termination of operations.

(4) Registration shall be completed online in a format provided by the Division and shall include the following general information: company name, mailing address, source location, source manager or point of contact, process description, capacity and quantity of emitting equipment on-site, fuel type of combustion related equipment (i.e. diesel, natural gas, propane, or field gas), emissions control devices installed, emissions and certification that the facility is in compliance with R307-506 through R307-510.

 

KEY: air pollution, oil, gas

Date of Enactment or Last Substantive Amendment: 2017

Authorizing, and Implemented or Interpreted Law: 19-2-104(1)(a)